Satya Nadella became CEO in 2014 and turned Microsoft into a cloud company. The stock went up. Shareholders got rich. Retail traders who bought puts lost everything and now write angry posts on Reddit about how the market is rigged.
Now he has to do it again with AI. The same people who missed the cloud run are absolutely convinced they'll nail the AI trade. They won't.
Nadella's first trick was convincing everyone that renting software was better than owning it. Brilliant. His second trick is convincing everyone that a chatbot that hallucinates legal citations is worth billions in enterprise value. Also brilliant. The man could sell ice to Eskimos if Eskimos had a board of directors and a compliance department.
Microsoft is pouring money into OpenAI like a divorced dad trying to win back his kids with Xbox consoles. The strategy is simple. Integrate ChatGPT into every product. Make Clippy smart enough to actually help. Charge corporations a premium for the privilege of laying off their workforce.
Retail traders see the headlines and think this is their moment. They buy call options expiring in three days. They max out their margin. They tell their wives the Porsche is practically paid for. Then the stock trades sideways for six months because the actual revenue from AI products is approximately seven dollars and the whole thesis was priced in before they even opened their brokerage app.
Nadella will probably pull this off. He pulled off cloud when everyone thought Microsoft was dead. He'll pull off AI because he's good at his job and retail traders are bad at theirs.
The real question is what happens when he has to reinvent Microsoft a third time in 2030. My guess is holographic computing or some sh*t. Retail will buy that top too.
Photo by Marcus Urbenz on Unsplash
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