Microsoft’s executive vice president Rajesh Jha has offered a reassuring perspective to investors worried that widespread adoption of artificial intelligence could shrink revenue for enterprise software firms through large-scale workforce reductions.
Speaking amid growing concerns over AI’s potential to disrupt traditional business models, Jha, who leads the company’s Experiences + Devices Group, argued that AI agents will themselves become paying users within software platforms. This shift, he suggested, could actually expand rather than diminish the number of software licences sold, even if companies reduce their human staff significantly.
Jha explained that future AI agents will operate as independent entities inside business systems. They will possess their own digital identities, including logins and inboxes, effectively functioning like additional users. “All of those embodied agents are seat opportunities,” he stated, referring to the industry term for paid software licences.
He illustrated the point with a practical example: A company currently employing 20 people and holding 20 Microsoft 365 licences might introduce five AI agents per employee to boost productivity. If this leads to a reduction in its human workforce to just 10 people, the firm could still require licences for 50 seats- the 10 remaining employees plus 40 AI agents.
According to Jha, this dynamic means that even if organisations lay off half their workforce due to productivity gains from AI, their overall spending on software could rise because each AI agent would need its own licensed position in the system.
The comments come at a time when many investors question whether AI poses a serious threat to the seat-based pricing model that has long driven profitability in the enterprise software sector. The prevailing fear has been that fewer human workers would translate directly into fewer software licences and declining revenue.
Jha countered that such concerns stem from a limited view of how AI will be integrated. Defining users solely as human employees overlooks the role that digital agents are expected to play as active participants in software ecosystems.
His remarks, reported by the TOI Tech Desk on April 12, 2026, aim to address anxiety across the industry about AI potentially undermining the core economics of software companies.
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