Microsoft CEO Nadella establishes a new AI team to develop and manage customer-facing applications.

• On Monday, Microsoft CEO Satya Nadella announced that Jay Parikh, the former CEO of Lacework, will head a new group called CoreAI - Platform and Tools.
• Nadella wrote that the mission is to create the complete Copilot & AI stack for both first-party and third-party customers to develop and operate AI applications and agents.
• Nadella announced the launch of Copilot AI initiatives 10 months after hiring Mustafa Suleyman, DeepMind cofounder, to lead the project.

The company announced on Monday that it is establishing a new group aimed at creating AI applications and offering tools to third-party customers.

Microsoft CEO Satya Nadella announced in a memo to employees that a new group, led by Jay Parikh, will be formed to build the end-to-end Copilot & AI stack for both first-party and third-party customers to develop and run AI applications and agents.

Nadella appointed Mustafa Suleyman, co-founder of DeepMind, as an executive vice president to lead Copilot AI initiatives 10 months after his hire.

In Monday's post, Nadella announced that Parikh will collaborate with Suleyman and Guthrie, who heads cloud technology, as well as other top tech leaders at the company. Parikh joined Microsoft in October as an executive vice president and reports directly to the CEO.

Since the launch of ChatGPT by OpenAI in late 2022, artificial intelligence has emerged as the dominant theme in the tech industry, with Microsoft, as the primary investor in OpenAI, playing a pivotal role in the growth of the sector. Microsoft leverages OpenAI's large language models for its internal AI applications, such as content generation and code creation, and also serves as the startup's primary cloud partner.

Microsoft is developing products and tools that compete with some OpenAI services, and Nadella used the phrase "cooperation tension" while discussing the relationship with investors Brad Gerstner and Bill Gurley on a podcast released last month.

In his memo on Monday, Nadella emphasized that our internal organizational boundaries are irrelevant to both our customers and our competitors.

Nadella stated that the new group will unite individuals working on developer and AI platforms, as well as teams from the Office of the CTO.

The success of our next phase will depend on having the best AI platform, tools, and infrastructure, as stated in the written communication.

Microsoft hired Parikh from Lacework, a fast-growing and high-profile startup that reached a valuation of $8.3 billion in 2022, seven years after its founding. However, the company's fortunes changed when the market shifted away from risk, and Lacework had to drastically cut staff to try and turn profitable. In August, security software vendor closed its acquisition of Lacework for $149 million.

— CNBC's Jordan Novet contributed to this report

Microsoft intends to invest $80 billion in developing AI technology this year.