Microsoft has been making its GitHub subsidiary more dependent on the company’s own Azure public cloud.
That lines up with Microsoft’s desire to increase the use of Azure, whose revenue was growing 40% in the second quarter, faster than any other major product category the company discloses every three months.
At the same time, it must be careful not to break commitments it made at the time of the $7.5 billion GitHub acquisition in 2018. Otherwise, some developers wary of Microsoft’s past behavior might not want to use GitHub to store their software code.
In the late 1990s, the U.S. Department of Justice argued that Microsoft had illegally required device makers to commit to including the Internet Explorer browser on every PC they shipped with the Windows 95 operating system. In the settlement of the landmark antitrust case, Microsoft agreed to a ban on pacts mandating exclusive support of its software, among other changes.
When GitHub was a standalone company, software developers saw it as a neutral ground where they could house their software projects and then run the code on the market-leading Amazon Web Services cloud or any other computing environment. Then Microsoft announced its plan to buy GitHub. Some developers objected, and over 1,900 people signed a petition to block the deal.
“Microsoft likely acquired GitHub so it could more closely integrate it with Microsoft Visual Studio Team Services (VSTS) and ultimately help drive compute usage for Azure,” Sid Sijbrandij, co-founder and CEO of GitHub competitor GitLab, was quoted as saying in a company blog post.
On the day Microsoft announced the GitHub deal, Microsoft published a blog post from its CEO, Satya Nadella, that communicated Microsoft’s intent.
“Going forward, GitHub will remain an open platform, which any developer can plug into and extend,” Nadella wrote. “Developers will continue to be able to use the programming languages, tools and operating systems of their choice for their projects — and will still be able to deploy their code on any cloud and any device.”
The company would also speed up the ability for developers at large companies to use Microsoft’s cloud infrastructure, Nadella wrote.
Some developers worried that Microsoft would adjust GitHub so that running code on Azure would be the easiest approach.
But Microsoft has employed more subtle tactics.
Instead of pushing developers to run their code on Azure, GitHub has simply introduced new products and features, many of which are built on Azure. So when developers use GitHub, Azure is increasingly the backbone.
For instance, GitHub Copilot, a tool that helps developers complete their coding projects line by line, uses Azure, said Scott Guthrie, Microsoft’s executive vice president for cloud and enterprise, in an interview with CNBC. The GitHub Actions service for building and deploying code and the Codespaces cloud-based development environment operate in Azure, too, Guthrie said.
“GitHub, historically, I could say, has run in their own data centers, not actually on a public cloud, and a lot of the new features of GitHub are using our public cloud,” Guthrie said.
That means the GitHub acquisition can increase Azure usage — even if customers don’t realize it — and Microsoft can say that GitHub continues to allow people to run their code on any server.
Under Nadella, Microsoft has transformed other companies it has bought into Azure users. In 2019 LinkedIn announced plans to move the business social network to Azure, and in 2020 Microsoft said Mojang Studios, publisher of the popular Minecraft video game, would stop using Amazon’s AWS.
“There is a lot of great stuff we’re doing, but at the same time, we’re being super careful, obviously, because you know, GitHub has a gestalt of its own, and so we’re making sure — and I think we’ve done a really good job of that — sort of being able to integrate all of those features in a very native way inside of GitHub,” Guthrie said.
In September Microsoft informed investors that its closely watched Azure and Other Cloud Services revenue growth number each quarter would expand to include “additional GitHub cloud revenue now delivered via our datacenter infrastructure.” Until now that revenue has fallen under the company’s Server Products category.
Alphabet can no longer be ignored. It is going back into our Bullpen list of stocks to watch after our unfortunate exit from the Google parent back in March. We got out of the name due to concerns that Google’s Gemini was not advancing quickly enough to compete with OpenAI’s ChatGPT, and because the Justice Department was seeking to force a spin-off of Google’s Chrome browser and prohibit Google from paying Club name Apple a hefty sum to be the default search engine in the iPhone maker’s Safari browser Since then, however, Google has launched Gemini 3 — which, in addition to instantly becoming the new standard for all other large language models to beat, was developed and runs entirely on custom silicon developed by Google, in partnership with Club holding Broadcom . The market also started to appreciate that the custom silicon used to run the model with extreme efficiency may very well represent a new revenue stream, with Google beginning to see more interest in the chips from other companies. Also, following our exit, the ruling from the courts came down in favor of Alphabet, stating that it did not need to spin off Chrome and that the long-time, mutually beneficial partnership between Google and Apple could continue. It was especially important given Apple’s clear intention to leverage third-party technology for its highly anticipated Siri AI upgrade, which goes beyond the option to have OpenAI’s ChatGPT answer complex queries to a full-blown conversational digital assistant. Jim Cramer has said that Google would likely be a better AI partner for Apple’s new Siri due to the search arrangement already in place. Plus, OpenAI is approaching a $1 trillion valuation, based on the numbers being discussed in its latest funding round. Jim has been cautious about OpenAI’s ability to pay for some $1.4 trillion worth of commitments to fund data centers and buy AI chips. Considering OpenAI’s massive spending promises and its extreme cash burn, Gemini, inside the cash machine that is Google, should be worth a lot more. Bottom line While it was clearly a mistake to get out of the name, hindsight is 20/20, and allowing that poor decision to keep us from potential gains in the future, when the facts have so drastically changed, would be a sin. It’s not about where stock is coming from but where it’s going. We can’t allow a regrettable sale cloud what needs to be an objective analysis of Alphabet’s future earnings potential. (Jim Cramer’s Charitable Trust is long AAPL, AVGO. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
Firefly’s CEO Jason Kim reacts during the company’s IPO at the Nasdaq MarketSite in New York City, U.S., August 7, 2025.
Jeenah Moon | Reuters
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Last week’s liftoff also coincided with President Donald Trump‘s “space superiority” executive order, signed on Friday, that aims to create a permanent U.S. base on the moon.
Investors have also gained more clarity on the future of NASA following a whirlwind drama since Trump won the election.
Google parent Alphabet on Monday announced it will acquire Intersect, a data center and energy infrastructure company, for $4.75 billion in cash in addition to the assumption of debt.
Alphabet said Intersect’s operations will remain independent, but that the acquisition will help bring more data center and generation capacity online faster.
In recent years, Google has been embroiled in a fierce competition with artificial intelligence rivals, namely OpenAI, which kick-started the generative AI boom with the launch of its ChatGPT chatbot in 2022. OpenAI has made more than $1.4 trillion of infrastructure commitments to build out the data centers it needs to meet growing demand for its technology.
With its acquisition of Intersect, Google is looking to keep up.
“Intersect will help us expand capacity, operate more nimbly in building new power generation in lockstep with new data center load, and reimagine energy solutions to drive US innovation and leadership,” Sundar Pichai, CEO of Google and Alphabet, said in a statement.
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Google already had a minority stake in Intersect from a funding round that was announced last December. In a release at the time, Intersect said its strategic partnership with Google and TPG Rise Climate aimed to develop gigawatts of data center capacity across the U.S., including a $20 billion investment in renewable power infrastructure by the end of the decade.
Alphabet said Monday that Intersect will work closely with Google’s technical infrastructure team, including on the companies’ co-located power site and data center in Haskell County, Texas. Google previously announced a $40 billion investment in Texas through 2027, which includes new data center campuses in the state’s Haskell and Armstrong counties.
Intersect’s operating and in-development assets in California and its existing operating assets in Texas are not part of the acquisition, Alphabet said. Intersect’s existing investors including TPG Rise Climate, Climate Adaptive Infrastructure and Greenbelt Capital Partners will support those assets, and they will continue to operate as an independent company.
Alphabet’s acquisition of Intersect is expected to close in the first half of 2026, but it is still subject to customary closing conditions.