Stig Brodersen argues generative AI could undermine Microsoft's per-seat Office subscription model, which generates roughly $70 billion in profit

On the We Study Billionaires podcast, Brodersen laid out a bear case framing how AI reduces labor intensity: when users generate a first draft in 30 seconds and spend 20 minutes editing rather than two hours creating, the per-seat subscription assumption—one license for each human doing cognitive work—breaks down.

Microsoft has already begun shifting the business model from per-seat to per-user and usage pricing. Microsoft 365 Copilot paid seats crossed 20 million, up 250% year over year, and the AI business hit a $37 billion annual run rate, up 123%.

Q3 FY26 delivered $82.89 billion in revenue, up 18%, with commercial RPO at $627 billion, up 99% year over year, though the stock is down 14% year to date.