Microsoft has unveiled a family of seven in-house AI models at its annual Build developer conference in San Francisco, in the clearest sign yet that the tech giant is moving to reduce its dependence on the AI companies it has poured billions into.
Mustafa Suleyman, Microsoft AI chief executive, said that after tuning its models for consulting firm McKinsey, the company outperformed OpenAI's GPT-5.5 on quality — with what it projects as ten times better cost efficiency, based on public pricing data scaled across model sizes.
"We believe the time has come for every company to move from consuming a frontier model to fully participating at the frontier," said chief executive Satya Nadella at the conference.
The headline release is MAI-Thinking-1, Microsoft's first reasoning model, trained from scratch on clean, commercially licensed data without distillation from third-party systems.
A mid-sized model with 35 billion active parameters and a 256,000-token context window, it is designed for complex multi-step instructions, long-context reasoning and code generation.
