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Microsoft CEO Satya Nadella told "Axios on HBO" that he is not focused on cutting costs in the face of the coronavirus crisis, but instead aiming to meet "new demand" for Microsoft Teams and other Office applications as more employees work from home.

Why it matters: Tech companies like Microsoft are taking on central new roles in keeping government, business and education up and running as offices shut down to reduce the spread of the coronavirus.

What's happening: Microsoft warned in February that earnings would fall short of expectations due to the virus, but that related to the supply of PCs coming out of China, not the broader impact of the pandemic.

  • Asked if he was contemplating layoffs or slowing in investments in certain areas, Nadella said that's not where he is putting his energy.
  • "So for now, what I'm focused on is ... what I would call new demand," Nadella said. "I don't think, you know, one month ago I would have thought of 'work from home' as a complete new scenario with the type of spikes we have today. Overall activation of Microsoft 365 is increasing significantly." (That's a mix of new paid users and free trials, though.)

While the spike in demand has led to some challenges — Microsoft Teams had an outage in Europe last week — Nadella said that, overall, the shift from company-based servers to the cloud has prepared the economy to handle a large population of employees working from home.

"I think we are so much better equipped today," Nadella said. "But clearly the spikes we are seeing are pretty unprecedented, right? This was not a growth that we had looked at and planned in any spreadsheet or any model we had even a month ago."

Yes, but: It's not like a near shutdown of the economy isn't going to hurt other areas.

  • "When you have large swaths of our consumer economy quarantined, there will be an impact," Nadella said.
  • "We are clearly going to have some demand shock," Nadella said. "But Microsoft is a very diversified business, and that's been one of our strengths through the previous downturns. ... We have a good set of businesses with good business models."

The big picture: With a huge concentration of employees in Washington state — and a presence in China — Microsoft was hit early by the epidemic and acted early, encouraging its employees to work from home and promising to pay hourly workers even if their services were not needed as full-time employees telecommute.

Meanwhile: Nadella said he is still tapping Bill Gates' expertise, even as the Microsoft co-founder announced last week he would step down from the company's board.

  • "Bill has been very engaged in helping us understand even some of the core data and science and also the response side of it," Nadella said, adding, "Bill and his guidance will continue independent of his participation in our board. He will always be our founder, and he'll always be somebody that I'll count on his advice in times like this and beyond."

Go deeper

Scoop: Gina Haspel almost resigned over plan to install Kash Patel as CIA deputy

Photo: Win McNamee/Getty Images

CIA Director Gina Haspel almost resigned in early December after President Trump cooked up a hasty plan to install loyalist Kash Patel, a former aide to Rep. Devin Nunes (R-Calif.), as her deputy, according to three senior administration officials with direct knowledge of the matter.

Why it matters: The revelations stunned national security officials and almost blew up the leadership of the world's most powerful spy agency. Only a series of coincidences — and last minute interventions from Vice President Mike Pence and White House Counsel Pat Cipollone — stopped it.

Updated 2 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Health: Coronavirus deaths reach 4,000 per day as hospitals remain in crisis mode — CDC warns highly transmissible coronavirus variant could become dominant in U.S. in March.
  2. Politics: Biden says, "We will manage the hell out of" vaccine distribution — Biden taps ex-FDA chief to lead Operation Warp Speed amid rollout of COVID plan — Widow of GOP congressman-elect who died of COVID-19 will run to fill his seat.
  3. Vaccine: Battling Black mistrust of the vaccines"Pharmacy deserts" could become vaccine deserts — Instacart to give $25 to shoppers who get vaccine.
  4. Economy: Unemployment filings explode againFed chair: No interest rate hike coming any time soon —  Inflation rose more than expected in December.
  5. World: WHO team arrives in China to investigate pandemic origins.

NRA declares bankruptcy, says it will reincorporate in Texas

Wayne LaPierre of the National Rifle Association (NRA) speaks during CPAC in 2016. Photo: Saul Loeb/AFP via Getty Images

The National Rifle Association said Friday it has filed for Chapter 11 bankruptcy and will seek to reincorporate in Texas, calling New York, where it is currently registered, a "toxic political environment."

The big picture: The move comes just months after New York Attorney General Letitia James filed a lawsuit to dissolve the NRA, alleging the group committed fraud by diverting roughly $64 million in charitable donations over three years to support reckless spending by its executives.