Microsoft has a problem: nobody wants to buy or use its shoddy AI products

Summary

If there's one thing that typifies Microsoft under CEO Satya Nadella's tenure: it's a general inability to connect with customers.Microsoft shut down its retail arm quietly over the past few years, closed up shop on mountains of consumer products, while drifting haphazardly from tech fad to tech fad. From blockchain to "metaverse" and now to artificial intelligence — Microsoft CEO Satya Nadella can't seem to prioritize effectively, and the cracks are starting to shine through.A recent report from The Information detailed how Microsoft's internal AI efforts are going awry, with cut forecasts and sales goals for its Azure AI products across the board. The Information said that Microsoft's sales people are "struggling" to meet goals, owing to a complete lack of demand. Microsoft denied the reports, but it can't deny market share growth trends — all of which point to Google Gemini surging ahead.Last week we wrote about how Microsoft Copilot's backend partner OpenAI issued a "code red" situation. ChatGPT has fallen behind Google Gemini in problem solving, and Nano Banana image generation has outpaced OpenAI's own DALLE by leaps and bounds.With OpenAI's business model under constant scrutiny and racking up genuinely dangerous levels of debt, it's become a cascading problem for Microsoft to have tied up layer upon layer of its business in what might end up being something of a lame duck.Swipe to scroll horizontallyFirstPageSage AI Chatbot Usage Chart (December 3, 2025)#Generative AI ChatbotAI Search Market ShareEstimated Quarterly User Growth1ChatGPT (excluding Copilot)61.30%7% ▲2Microsoft Copilot14.10%2% ▲3Google Gemini13.40%12% ▲4Perplexity6.40%4% ▲5Claude AI3.80%14% ▲6Grok0.60%6% ▲7Deepseek0.20%10% ▲There are reams of research that suggest agentic AI tools require human intervention at a frequency ratio that makes them cost ineffective, but Microsoft seems unbothered that its tools are poorly conceived.In any case, OpenAI is supposedly going to launch future models of C...