Microsoft to take $800 million hit from this sudden U-turn by General Motors

Microsoft will absorb an $800 million financial blow following General Motors' abrupt decision to terminate its Cruise autonomous vehicle program, the tech giant revealed in a regulatory filing Wednesday.

The impairment charge, unexpected and not previously included in the company's quarterly guidance, will reduce Microsoft's second-quarter earnings per share by approximately 9 cents.

Microsoft originally invested in Cruise during a $2 billion funding round in January 2021, joining GM, Honda, and other institutional investors in backing the ambitious robotaxi venture. At the time, the investment was part of a broader strategic partnership that included cloud computing and autonomous vehicle technology collaboration.

GM's sudden retreat from the robotaxi market marks a dramatic shift from its earlier projections. Just a year ago, CEO Mary Barra had optimistically suggested the Cruise unit could generate $50 billion in annual revenue by decade's end. Now, the company has decided to discontinue the robotaxi business and redirect autonomous vehicle technologies toward its core personal car operations.