• by Laurie Sullivan , Yesterday

Microsoft announced Thursday a shakeup in its Experience + Devices division that primarily targets engineering and internal efficiency -- and indirectly signals a shift in how Microsoft Advertising will operate within the company's AI-first strategy.

Executive vice president Rajesh Jha will retire mid-year while Jeff Teper is being promoted to executive vice president, and Sumit Chauhan and Kirk Koenigsbauer are being promoted to president. 

“We’re announcing these top-level changes today, and between now and June, my leadership team and I will work together to finalize the full cascade of details needed in this kind of transition,” Jha wrote in a blog post based on a letter to employees.

Jha wrote that it includes aligning “operating rhythms, decision ownership, and details on the future org structure, all so we’ll be fully aligned and ready to run at the start” of fiscal year 2027, starting July 1.

The intent is to minimize changes and not lose the momentum the company claims to have built.

Microsoft Advertising is a core group of the Experience + Devices engineering group. Other units include search, development of the Microsoft Edge browser and web-based services, search and technologies related to Bing and Copilot, and the Windows operating system. 

The priorities around Microsoft’s Secure Future Initiative that launched in November of 2023 will not change. The Secure Future Initiative is a commitment that advances the way its engineers design, build, test, and operate products and services. Copilot and Quality Excellence Initiative (QEI) related to accountability also will not change.

Microsoft CEO Satya Nadella also praised Jha as being a “constant” throughout his years at the company, expressing his gratitude for all he has done.

“From our earliest days working together, I have admired his unwavering commitment to his team, to our customers, to the products we build, and to the company,” he wrote. “I have always been struck by his operational rigor, his ability to make the hard strategic calls, lead through the grind, and emerge stronger on the other side. That, to me, is what true leadership looks like.”

While Jha's Experiences + Devices (E+D) division primarily focused on Windows and Office, his departure creates a flatter organizational structure for all the division's businesses.

The change is designed to accelerate AI and Copilot integration across all consumer and business platforms, the company said.

The reorganization is designed to flatten management layers and speed the deployment of Copilot and other AI agents across Windows and Office.

For advertisers, this suggests that future ad placements will increasingly integrated into AI-driven user experiences rather than traditional standalone placements. 

Microsoft AI CEO Mustafa Suleyman in February warned that AI could automate a large share of jobs within the next 12 to 18 months, as the company accelerates development of what he called “professional-grade AGI," in an interview  with the Financial Times.