Microsoft forms new AI engineering team under ex-Meta leader

Microsoft has created a new AI-focused engineering division called CoreAI – Platform and Tools, led by former Meta executive Jay Parikh, combining its developer division with AI platform teams to build comprehensive AI solutions.

Strategic reorganization; Microsoft CEO Satya Nadella is positioning the company for what he describes as a transformative AI platform shift in 2025 that will reshape all application categories.

• The new CoreAI division combines Microsoft’s Dev Div, AI platform teams, and select members from the Office of the CTO
• Parikh, who joined Microsoft in October, will serve as executive vice president of CoreAI – Platform and Tools, reporting directly to Nadella
• Several key executives now report to Parikh, including AI platform chief Eric Boyd, deputy CTO Jason Taylor, and developer division head Julia Liuson

Technical vision and infrastructure; Microsoft aims to establish Azure as the foundation for AI while building an integrated platform of developer tools across Azure AI Foundry, GitHub, and VS Code.

• The company is developing what Nadella calls an “AI-first app stack” to transform how developers build and utilize AI applications
• The platform will focus on creating agents that will impact every Software-as-a-Service (SaaS) application category
• This shift represents a fundamental change in how custom applications will be developed, moving toward a “service as software” model

Leadership structure and scope; The reorganization places Microsoft’s entire developer division under an AI-focused mandate, signaling a significant shift in the company’s technical priorities.

• The new division will be responsible for building the end-to-end Copilot and AI stack for both internal and external customers
• Notable focus is placed on Azure AI Foundry, GitHub, and VS Code, while traditional products like Visual Studio and .NET receive less emphasis
• The restructuring suggests Microsoft’s developer tools and platforms will be increasingly AI-centric

Market implications; Microsoft’s organizational changes reflect Nadella’s belief that thirty years of technological change will be compressed into just three years, highlighting the urgency behind this strategic shift.

• The creation of CoreAI indicates Microsoft’s commitment to maintaining its competitive edge in the rapidly evolving AI landscape
• The appointment of Parikh, with his extensive experience at Meta, brings valuable expertise in scaling engineering operations
• This restructuring positions Microsoft to better compete in the enterprise AI market while supporting both internal development and external customers

Looking ahead: The formation of CoreAI represents Microsoft’s most significant organizational shift toward AI-first development, though the success of this transformation will depend on how effectively the company can integrate its various developer tools and platforms while maintaining its existing customer base.