AI’s Power Problem: Satya Nadella Warns Tech World to Use Energy Wisely as Microsoft Plans More Layoffs

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New Delhi: Microsoft CEO Satya Nadella is urging the tech industry to think hard about how much energy artificial intelligence (AI) uses and whether it truly benefits people. Speaking at Y Combinator’s AI Startup School, Nadella said, “If you’re going to use a lot of energy, you need to have a good reason. We can’t just burn energy unless we are doing something useful with it.” He stressed that AI should make real improvements in daily life, like making healthcare, education, or paperwork easier and faster.

Nadella pointed out that Microsoft, one of the world’s biggest AI companies, used about 24 terawatt-hours of electricity in 2023—about as much as a small country. He said AI’s true test is whether it solves real problems, such as helping hospitals discharge patients faster, saving both time and money.

But while Microsoft is betting big on AI, it’s also cutting jobs. Over the past year, the company has laid off more than 6,000 employees as it reorganizes to focus on AI and cloud computing. More layoffs are expected soon, especially in the Xbox gaming division and sales teams, as Microsoft tries to boost profits after spending billions to buy Activision Blizzard.

Nadella’s message is clear: AI should not just be about new technology or profits—it must prove its worth by genuinely helping society, especially given its massive energy appetite. As Microsoft leads the AI race, it’s also facing tough choices about jobs and the true cost of innovation.