Microsoft plans to unveil several new AI models at its annual Build conference for developers in San Francisco next week, with one aimed specifically at enhancing the GitHub Copilot coding assistant, a person with direct knowledge of the plans told the Information, the report said. The company also intends to introduce models tailored to transcription, reasoning, speech and image processing, the source added. Microsoft declined to comment on the report.
Market reaction to the report was positive in the short term - Microsoft shares rose and were last reported up almost 3% on the news. The announcement fits within a broader company push to expand its in-house AI capabilities as it plans for a future less dependent on external partners that have supplied foundational models.
Until now, Microsoft has leaned on models developed by OpenAI, Anthropic and Google to power GitHub Copilot, the AI assistant used by software developers. While Copilot enjoyed early adoption gains, rival coding-focused products such as Anthropic's Claude Code have quickly grabbed top positions in AI-assisted coding rankings, according to the report.
In parallel with building internal models, Microsoft has been exploring acquisitions of AI startups, Reuters reported earlier this month. Those potential deals are intended to broaden the company's access to AI talent and help it meet its stated objective of producing a leading-edge AI model by next year, three sources told Reuters.
The company's pivot toward developing its own models and pursuing targeted acquisitions comes against a backdrop of heightened investor scrutiny. Market sentiment around Microsoft has cooled this year as some investors reassess whether the company can maintain an early advantage in AI while its partnership with OpenAI is being reshaped. At the same time, competitors including Google and Amazon have reported notable progress on their own AI initiatives, adding to the competitive pressure.
The specifics of the new models - including their architectures, training data, and rollout timelines beyond next week's announced unveiling - were not detailed in the report. Microsoft declined to comment when approached for confirmation.
Overview
Microsoft is set to present multiple internally built AI models at Build, including a coding model for GitHub Copilot, and other specialist models for transcription, reasoning, speech and images. The company is pursuing a strategy that mixes in-house model development with potential AI-focused acquisitions to secure talent and deliver an advanced model by next year.