After years of ignoring and maligning Windows, Microsoft has finally woken up and is making some happy noises. Last week, we discussed how Microsoft plans to improve the quality of Windows and that there are already many signs of that work in various security features and new OneDrive Folder Backup changes - plus those two new direct reports to Nadella. Then, Microsoft announced its Windows Baseline Security Mode and User Transparency and Consent initiatives with questions about the timing. And now, Microsoft just explained Windows 11 version 26H1, and it's not like 24H2 at all despite being tied to Snapdragon X2 silicon.

Something happened ... and that something is tied to 26H1

• 26H1: Only for Snapdragon X2, a "scoped release," based on a "different core" from 24H2 and 25H2
• You cannot upgrade 24H2 or 25H2 to 26H1
• You cannot upgrade 26H1 to 26H2 (!) - instead, those on 26H1 "will have a path to update in a future Windows release." - Is that future Windows release Windows 12? Probably
• 24H2, 25H2, and 26H1 will all have the same user-facing features, this has been the case with all support Windows (11) versions for 2+ years
• (Remember, this is not what happened with 24H2. Shipped early on Snapdragon X1, but was made available to all Windows 11 PCs later that year)
• So why is this happening now? Fortune 500/corporate customer pushback on AI is one guess
• This is GOOD news, however it all unfolds

More Windows 11

• Yesterday was Patch Tuesday, so get to work. Updates this month include: Agent in Settings (Copilot+ PCs only) improvements. Settings improvements, cross-device Resume improvements, Windows MIDI Services improvements, Narrator improvements, Smart App Control improvements, Windows Hello New ESS improvements, and File Explorer improvements
• Somewhat related to the quality/security push noted above, Microsoft is rolling out new Secure Boot certificates this year for older (pre-2024/25) PCs
• Microsoft announces a Store CLI that does (almost) nothing new compared to winget
• New Dev and Beta builds with minor changes: Emoji 16.0, camera improvements, various fixes

More earnings

• Amazon hits $213.4 billion in revenues, will spend $200 billion CAPEX/AI infrastructure this fiscal year, more than Google ($175/$185 billion) or Microsoft (estimated $150+ billion)
• Qualcomm $12.25 billion in revenues, up 5 percent
• Alphabet/Google - Up 18 percent (!) to $113.8 billion - 750 million MAUs on Gemini, 74 percent of revenues come from advertising
• Spotify - somehow has over 750 million MAUs now

AI and dev

• OpenAI and Anthropic release dueling agentic AI coding models that do more than agentic AI coding within minutes of each other
• Ads appear in ChatGPT Free and Go as threatened
• Duck.ai adds private, anonymous real-time AI voice chat
• NET 11 Preview 1 arrives, but there's nothing major here

Xbox & games

• Microsoft announces the 2025 Xbox Excellence Awards
• Celebrate 35 years of Id Software - Castle Wolfenstein 3D was a wake-up call for PC gaming, but DOOM was a miracle, and Quake was a real WTF moment
• Sony sold 8 million PlayStation 5s (down 16 percent YOY) in the holiday quarter, 92 million (!) overall
• Valve predictably delays the vaporware Steam Machine
• Epic Games is having a winter sale - for example, Silent Hill 2, GTA V Enhanced are 50 percentR

These show notes have been truncated due to length. For the full show notes, visit https://twit.tv/shows/windows-weekly/episodes/970

Hosts: Leo Laporte, Paul Thurrott, and Richard Campbell

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Microsoft is burning through billions on AI, but Wall Street is finally demanding to see where the payoff is. The earnings announcement triggered a $357 billion valuation wipe-out, the largest in Microsoft's history and the second-largest in history overall (Nvidia managed to lose $593 billion in value in the wake of DeepSeek in early 2025).

Windows

• Windows 11 has over one billion users - and, surprise, it got their faster than Windows 10 without any of the shenanigans
• Microsoft to address the quality issues in Windows 11 in 2026
• There is already evidence that Microsoft is trying to make Windows 11 suck less: Recent OneDrive changes that address a key ensh*ttification, and let's not forget all those security advances
• What did Microsoft really promise? Not much
• Microsoft has new EVPs for Security and Quality
• Microsoft belatedly delivered the January Week D update last Thursday, a preview of this month's Patch Tuesday
• Dev and Beta builds both deliver Mark Russinovich's sysmon tool

Microsoft earnings deep dive

• Microsoft reported a net income of $38.5 billion on revenues of $81.3 billion in the quarter ending December 31. Those figures represent gains of 60 percent and 17 percent, respectively, year-over-year
• Earnings analysis: All eyes are on AI and no one is happy
• Microsoft spent $37.5 billion on AI infrastructure (capex) in the quarter, up 66 percent YOY, and it's on track to spend $150+ billion in the fiscal year
• Every single question was about this and how it will ever recoup the costs
• There are now 15 million paid Microsoft 365 Copilot seats out of 450+ million Microsoft 365 seats
• OpenAI is Microsoft's biggest Azure customer, but it's unclear if there is any real money there because of accounting tricks
• Windows, Edge, and Bing all "gained share," PC maker revenues were up just 1 percent, the Windows 10 upgrade cycle was mostly a bust (it's likely that most of it was tied to RAM pricing fears, too)
• Xbox fell off a cliff with content and services revenues down 5 percent in a holiday quarter somehow and Xbox hardware revenue declined an astonishing 32 percent YOY
• Standalone Office 2025 suite was a surprise hit, Hood is curious if that continues
• Microsoft 365 "cost of business" up 10 percent YOY because of AI costs
• AMD revenues up 34 percent to $10.3 billion
• Apple delivers record revenues of $143.8 billion; iPhone made more revenues by itself than all of Microsoft

AI

• Microsoft is going to basically make an app store for content makers who wish to be paid for use by AI
• Anthropic advertises that Claude will be advertising-free, unlike ChatGPT
• The next Firefox will include the promised AI kill switch and Vivaldi "extends the middle fingerˮ to AI

Xbox and games

• AMD reveals next Xbox console in 2027
• We're getting a solid collection of Xbox Game Pass titles for the beginning of February
• Battlefield 6 was the best-selling shooter of 2025 and EA made $1.9 billion in Q4
• Epic Games has big plans for its PC launcher/store
• Nintendo has now sold 17 million Switch 2s as OG Switch hits 155 million units

Tips and picks

• Tip of the week: Make OneDrive Folder Backup work for you
• App pick of the week: Bitwarden (TWiT sponsor)
• RunAs Radio this week: Getting Started using Purview with Erica Toelle
• Brown liquor pick of the week: Glendronach Ode to

These show notes have been truncated due to length. For the full show notes, visit https://twit.tv/shows/windows-weekly/episodes/969

Hosts: Leo Laporte, Paul Thurrott, and Richard Campbell

Sponsor:

• zscaler.com/security

Microsoft's Patch Tuesday blunder triggers emergency fixes, surprise layoffs ripple through Amazon, and the crew debates whether rapid AI advances spell the end of traditional apps. Also, password managers do a lot more than manage passwords, so there's one thing everyone needs to get right.

Windows 11

• Dev splits from Beta, tests what will surely be 26H1 - After last week's show, Microsoft did issue that same Beta build in the Dev channel for some reason
• Dev and Beta get same fixes in different builds, but no new features
• 24H2 and 25H2 Release Preview update(s) are a peek at the next Patch Tuesday, lots of changes
• January Patch Tuesday update was so terrible it required two emergency fixes, the second of which went out late Sunday

Earnings/industry

• Intel falls flat in Q4, full year 2025 despite U.S. "investment"
• Amazon lays off 16,000 employees
• Microsoft, Apple, earnings this week, Alphabet, Amazon are next week

AI

• Microsoft announces Maia 200 AI datacenter processor
• Like Baldric in Black Adder, Apple has a cunning plan for an AI Siri
• With AI costs soaring, cheaper new AI plans appear somehow
• OpenAI was last week with big expansion of ChatGPT Go
• Google does the same this week with AI Plus plan
• OpenAI, Anthropic (this week), others are adding "apps" to their chatbots
• Microsoft is exposing app features as AI Actions in Windows 11
• Paul opined that this semantic/programmatic capability was the end of apps
• But we can now essentially vibe-code our own custom apps - this is vaguely reminiscent of the home computer/DIY era, but without the technical knowledge requirements
• The age of native apps is over, at least on desktop. Will mobile fall next?

Dev

• Microsoft introduces the Windows App Development (winapp) CLI. For some reason

Xbox and gaming

• Microsoft refreshes the Xbox Cloud Gaming web experience — bigger changes coming?
• Fable is coming to Xbox, PC, PS5 in late 2026

Tips and picks

• Tip of the week: Choose a single password manager, make your life easier
• App pick of the week: Proton Pass
• RunAs Radio this week: Business Process Automation in 2026 with Ian Cooper
• Brown liquor pick of the week: Tullibardine 18
  

Hosts: Leo Laporte, Paul Thurrott, and Richard Campbell

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