Microsoft reshuffles teams to bolster GitHub as AI coding and agent wars heat up

• Microsoft is reshuffling teams to bolster its GitHub software development platform.
• It's part of a plan to overhaul GitHub to compete with AI coding tools, recent meeting audio shows.
• GitHub faces new AI rivals such as Cursor and Claude Code as developer preferences shift.

Microsoft wants to overhaul GitHub to compete with AI coding rivals and embrace AI agents, and the company has started reshuffling teams to make that happen, according to people familiar with the changes.

GitHub is a leading software development platform that Microsoft acquired in 2018. GitHub had an early lead because of its popularity as a place to store code. Lately, though, GitHub has faced more competition from AI tools such as Cursor and Anthropic's Claude Code.

Microsoft in January 2025 formed a new group focused on building AI tools under ex-Facebook engineering boss Jay Parikh. The group, called CoreAI Platform and Tools, combined Microsoft's developer division, AI platform team, and GitHub.

Still, Microsoft and GitHub have remained somewhat separate, and the company has been moving people and resources around over the past few months to better coordinate efforts such as sales, one of the people said. The latest change, happening this week, is moving a small group of Microsoft engineers over to GitHub.

The goal, the people said, is to better compete with AI coding tools that rival GitHub Copilot, while getting in the race to build AI agents and fulfill Parikh's vision to build an "agent factory."

In an internal meeting late last year, Parikh spoke about needing to overhaul GitHub to compete with Cursor and Claude Code, according to audio reviewed by Business Insider.

"GitHub is just not the place anymore where developers are storing code," Parikh said at the time. "We want it to be the center of gravity for all of AI-powered software development."

Microsoft wants GitHub's AI tools to be available wherever developers work, not just inside one app, to wants to make GitHub a kind of dashboard for managing multiple AI agents.

The latest changes are also part of what Parikh said would be new investment in improving the basic parts of GitHub. In the meeting, Parikh said those include making improvements to its GitHub Actions tool that automates building, testing, and deploying code, analytics and insights tools so teams can see how their code is performing, security for keeping the code safe, and making sure the company can meet local data storage rules to offer GitHub in new countries.

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