Microsoft is Fully Working on Agentic AI and Vibe Coding Now That It’s ‘Working’

During Microsoft’s latest earnings call on Wednesday, CEO Satya Nadella may have inadvertently summed up the current state of the company’s massive AI push.

“It didn’t kind of work until it started working, just because the model came out,” Nadella said, referring to Microsoft Excel’s proxy mode feature.

Agent mode, a feature that uses artificial intelligence to create and edit Excel workbooks alongside your actions, became the default for Microsoft 365 Copilot and Premium subscribers in Excel, Word, and PowerPoint as of last week. He said Microsoft’s investments in AI infrastructure gave the company the ability to use it to implement the successful model.

(Nadella used the term Agent Mode, but officially, Microsoft has retired that term, preferring the simpler term “Editing with Copilot.”)

This ability played a big role during the earnings call, as Microsoft shifted toward charging customers for how much they use the AI, not just for access licenses. “We have a structural position in knowledge, work, programming and security,” he said. “Then that is linked to the right business model…which is the user as well as the usage.”

Nearly 90% of Fortune 500 companies now have active agents built using “our low-code/no-code tools,” Nadella said, and the company sees its Copilot Credit consumption nearly double quarter-on-quarter as customers use custom agents tailored to their workflows.

There was also a significant milestone: Microsoft’s Bing search service, founded 17 years ago, reached 1 billion monthly active users for the first time, Nadella said.

Usage pricing is coming to GitHub

Nadella repeatedly mentioned GitHub, a software development platform Bought by Microsoft in 2018as another advantage. Starting June 1, GitHub Copilot will move to Usage-based pricing model.

He said the number of enterprise subscribers to the platform has nearly tripled from last year, with nearly 140,000 organizations now using GitHub Copilot.

Each GitHub Copilot plan will include a monthly allotment of GitHub AI credits. According to Github blog“Usage will be calculated based on token consumption, including input, output and cached tokens, using the API rates listed for each model.”

Microsoft reported revenue of $82.9 billion for the quarter, an increase of 18% from the third quarter of the previous year, during the January-March period. Capital expenditures are expected to rise to more than $40 billion to build more capabilities for artificial intelligence tools – including… Huge data centers.