Welcome everyone. I'm Brett Iversen, General Manager of Investor Relations. This is the sixth in our series of quarterly videos focusing on strategic areas that are top of mind for our investors. Today's discussion will cover the developer space, including GitHub and Visual Studio. We brought together two of our key leaders to answer your most frequently asked questions. We have Thomas Dohmke, CEO of GitHub, and Amanda Silver, CVP and Head of Product for the developer division, which includes Visual Studio, .NET, and our Azure Application Platform as a service. As always, please reach out to our investor relations team directly with any feedback you might have after you view the video. With that, let's kick things off. Thank you both for being here.
You know, Thomas, maybe to start, you know, what can you tell us about the developer landscape today and how you've seen it evolving?
Yeah. You know, I'm not only the CEO of GitHub, I'm a developer at heart and have been a developer for the last 30 years. If I look back over those 30 years, the world has changed so much. We are now so dependent on software, you know, whether it's in your car, whether it's obviously in your work life. Even my lawnmower has software running on it. You often pick services and companies you buy products from based on the software they offer to you. The way we are seeing this is that every company is becoming a software company, and so that means every company needs to employ software developers and work with them to create innovation for the market to grow.
If we look at those companies and what they need, we have realized that they need to modernize their software development workflows and ultimately move to the developer cloud. Old and new companies wanna adopt the same practices that than the companies that have been born in the cloud, and they wanna, you know, modernize their workflows to be more agile, more efficient, more productive, and ultimately more creative in their value generation workflow.
Yeah. I'm sure you've seen a ton of transformation.
Yeah.
I bet. Amanda, on the developer importance to Microsoft in general, like what, how would you help our audience think about that as well as the associated opportunity?
Well, I mean, you know, in a lot of ways Microsoft has always been a platform company.
Absolutely.
What I mean by that is that developers are always extending the applications and the services that we build, and they're also building their applications and their services out of building blocks that we deliver to them. You know, we're also, as a result, a dev company. That means that basically developers are the ones that are extending our platform, and they often use Visual Studio as the mechanism to do that. We have 31 million-
Wow.
developers that use a Visual Studio product every month to develop applications. In a lot of ways, the wind is at our backs. There's been incredible growth over the last few years. The Visual Studio family growth is up over 60% over the last 18 months. It's also a really exciting moment in time for the developer community, because what we're seeing is that developer workloads themselves are actually moving into the cloud. This is a huge shift for companies that are more traditional companies that have managed their own, you know, on-premises software and kind of hosting their developer infrastructure. This is a huge opportunity.
I bet.
For us as well. What we're trying to do is to basically build tools and platforms that will make it easier to migrate that developer workload into the cloud so that it makes it easier for developers to go from their idea to the code and then ultimately from that code to the cloud.
Love it. I love the vision. I'm sure it's evolved a ton. Thomas, you're coming in with GitHub. What would you share in terms of where GitHub is today and
Yeah.
I always love to hear kind of the journey and what that experience is like for you and the team.
Yeah, you know, GitHub was born in 2008, and originally GitHub offered, you know, Git source code management, a way to manage all your source code in a repository on a cloud platform at github.com. Very fast, developers started adopting GitHub for all their projects, for open source projects, for private repositories, for all the code that they were writing. They were collaborating with each other in the cloud. The fascinating thing about this collaboration model is that you don't care who the developer is, you don't care where they are, what their title is. All you care about is the code and what value that adds to your project. GitHub has been growing and growing over the years.
You know, since the acquisition through Microsoft, we have added a number of new features to GitHub that expands GitHub from just the source control management platform to whole DevOps Suite or DevSecOps Suite, adding features like CI/CD, continuous integration, continuous delivery, and package management, Codespaces, and Copilot. We have expanded, you know, the feature set of GitHub to offer everything a developer needs to manage their projects. We're really proud about the growth that we've been seeing.
Yeah.
You know, in 2018 when we announced the GitHub acquisition, GitHub was at 28 million developers, and we are now at 83 million developers with over 4 million organizations, 90% of the Fortune 100. Really every developer has some dependency on GitHub. We see that, you know, oftentimes when GitHub has a technical issue, how many people really depend on GitHub because they're frustrated about it, and they're frustrated because they wanna download a package from GitHub. They wanna download a dependency. They wanna install a new version of the Linux operating system. Somehow in that process is a dependency on GitHub. Really every developer is a GitHub customer, and that obviously comes with a huge responsibility for us, but also with a huge opportunity for us.
Yeah. I'm sure it's an expansive-
Yeah.
group of folks for sure.
Yeah.
Just shifting back to Amanda, I know you announced the developer cloud recently. What else could you share with our audience on that and, you know, the associated market opportunity that you see?
Yeah, I mean, you know, I think we have some of the most broadest set of developer offerings of really any company. The way that I always think about it is that I'm empowering developers to keep them in the zone so that they can focus on writing the code that only they can write.
Right.
that means that we need to make our developer tools much more productive and kind of allow people to focus on their code. We may need to make it easier for them to collaborate with other developers and even other disciplines as well. We also need to make it easier for them to find the building blocks that they might need to use to build those applications. When I think about the developer cloud, there's really three different main components. There's the Visual Studio family of products, which is in some ways the place where developers do the code authoring. It's really where they are doing the software development, how they build those application building blocks, and all of the applications and services that they build.
Right.
GitHub is really the place where developers can come together to collaborate, to find one another, to, you know, submit contributions to one another's code bases, to be able to learn from the broad community.
Right.
of developers that are building. Azure really provides the hosting infrastructure and a lot of the application foundation that allows developers to quickly assemble these building blocks into services and ultimately the applications that they deliver to their users. From our perspective, what we're trying to work on is to make sure that we have the best in class tools that allow developers to collaborate, especially given that teams are increasingly geo-distributed.
Right.
geographically remote. Also we really need to meet our customers and developers kind of where they are in their journey, because while some, you know, teams are really advanced and they use, you know, continuous integration, continuous deployment to do their application development, a lot are still
Getting started.
Just getting started on that.
Yeah.
You know, what we wanna do is to make sure that we're providing the tools and the services that allow the devs to focus on the value that they're adding to their organization, but not have to work on boilerplate code or, you know, code that we could help build for them.
Makes sense. Our investors will be super interested to hear that you mentioned Azure, so we'll come back to that. They're always on us about Azure information. Back to you, Thomas. You know, I mean, development at its heart is innovation, but you know, what's some of the latest innovation on GitHub that you would share with the group?
Yeah. You know, Amanda mentioned boilerplate code, and we wanna make developers more efficient. We wanna keep them in the flow, on the wave, surfing, you know, into the sunset. One way to do this is to make them really more productive in their editor and when they're writing code. We announced a new product last year called Copilot, which helps developers to do that. Copilot was trained, is an ML model that was trained on open source code. When developers type code in their editor, it proposes the next word, the next line or a full method of code, and oftentimes the boilerplate code that is really efficient in the way it does this.
In fact, you know, when we look at our telemetry, we see that in files where Copilot is enabled, Copilot writes up to 35%-40% of the code.
Wow!
That's a mind-blowing.
Yeah.
You know, productivity improvement. If we look back, you know, the last five or 10 years, no other product has enabled developers to have this productivity gain. More importantly, it enables developer happiness. The way it does that is because it keeps the developer in the workflow. You know, you have your first coffee in the morning, you start your work, you look up a GitHub issue, you kinda know what you're working on, and then you start typing, and you get stuck relatively quickly. There's always so much, you know, APIs and new features in a programming language that you never can remember all these things to type. What you do is you go into your browser, and so you have an immediate distraction from your work, right? Instead of typing more code, you're looking up things.
You get distracted by, you know, arguments on the Internet. There's lots of those, right? Twenty minutes later, you're back in your editor, and you forgot what you actually wanted to do. Copilot keeps you in that flow. It keeps you productive, you know, during the time of the day when you are the most creative, and that makes you more happy. That makes you more happy because you can build the things you want to build instead of get distracted and stuck. You know, if you think back 20, 30 years ago, before the time of the Internet, that was the biggest problem being a developer, right? It's that you had a problem, and all you had was a couple of books available to you, and you couldn't ask anyone.
You couldn't look it up because there was no Internet available to you. You got frustrated, and you kinda like got into this mode of not being able to do the things you wanted to do. Copilot in that journey really gets developers into the next level, into the next stage of innovation as a software developer. You know, as Copilot is an ML model that requires you know, lots of GPUs, it naturally runs in the cloud. It runs on Azure. It needs to run on Azure. Even as your GPU in your Surface Book gets more powerful, we need hundreds of thousands of GPUs in the cloud to run a large language model like Copilot.
With that transition, we think also that the whole dev environment is transitioning to the cloud. Instead of your developers on their first day on the job or when they switch the team, installing all the tools or the dependencies, compilers, you know, often
Mm.
Developers spend a day or two installing all the things they need to, and then often they have to find, you know, the right developer that knows where the how-to is and the Wiki article, and that's outdated. Or the new guy has to update that Wiki article. Instead of doing that, they can just spin up a virtual machine, a container in the cloud that has everything installed, and ready to run, quickly make the change they wanna make, and then send that pull request to deploy to production on their first day, maybe on their first hour. The cool thing about this is not only you get onboarding down. At GitHub, we moved 800 employees to Codespaces and get onboarding down from 45 minutes to 10 seconds.
Wow!
That's obviously great, you know, as an engineering manager, you get your onboarding really fast, but you also can now have multiple of those environments next to each other, right? To get an infinite laptop in the cloud, if you will. That's not only great for a new team member, it's also great when you switch between different projects, when you try to contribute back, you know, to another project within the company. For example, between GitHub and the developer division, you know, we work on lots of projects together like TypeScript, where it's great if I can spin up just an environment, you know, get everything up and running really quickly and can make the small change I can make. Yeah, Copilot and Codespaces together in the developer cloud, that's where the innovation is going.
We believe, you know, this is going to elevate, you know, innovation for so many of our customers in the next five years.
Super interesting. You know, Satya loves, and I'm sure the two of you know, he loves himself some Copilot.
Yeah.
When I hear the productivity gains and happiness both associated with that, it helps me understand a little bit why. I'm sure you all spend plenty of quality time with him on the topic. Amanda, same question for you. From an innovation standpoint, what are a couple things that you would highlight?
You know, a couple of weeks ago, we had our big annual developer conference.
Right.
Microsoft Build, there were two announcements that we made there that I think are really touching on both the developer workload and the application workload. On the developer workload front, you know, Thomas was talking a little bit earlier about Codespaces, which really allows developers to have an instant access developer box hosted in the cloud, really quickly. That's fantastic for developers who are working on, you know, web solutions, Linux-based solutions that are hosted in GitHub as the hosted source code control. For those developers who need a Windows developer box or are hosted in a different source code control, we introduced Microsoft Dev Box, which is basically a way that you can get a hosted dev box, a Windows-based dev box that's optimized for developer users.
You can get, you know, all of the high-powered GPUs and CPUs that you need, you know, high-powered SSDs and things like that, as well as allowing it to be optimized for the use pattern that is common to developers so that it can, you know, wake up in the morning when you wake up and get to work and.
Love it.
You know, shut down at night. This really is kind of along the pattern of virtualizing the developer workstation. The other big announcement that we made was the GA of Azure Container Apps, and that really kind of builds on this microservices container-based cloud-native application development pattern that we're seeing that allows developers to super easily go from either source code or container image to host it directly in Azure.
Yeah.
get their application, you know, available to their users as quickly as possible.
Your security is top of mind for all of our customers. It will continue to be for a long time. You guys are related to GitHub. How do you and the team think about security? You know, what sort of role do you play for our developer community? What can you share there?
Yeah, I mean, obviously, you know, security underlies everything we do. It has to.
Right.
The most obvious one is that we have to protect our customers' code, that all our major customers, that's where they store their private source code, their most important assets on GitHub. Security underlies everything we do. We have a really strong security team that secures our platform that also helps open-source maintainers to find security vulnerabilities in their source code through the GitHub Security Lab. We also provide solutions to our customers that helps them to create more secure software. With GitHub Advanced Security, we have technologies that allow you to scan code for vulnerabilities, to scan codes for secrets, passwords, tokens, all the other things that we can no longer afford to store on source code.
That helps them to make sure that all the dependencies, all the open source components that are naturally used in your projects are up to date. They have the latest security patches, and you didn't miss the one component somewhere upstream in your dependency tree that then leads to an attack of your production services. The way we think about this is that the developer needs to solve these issues as early as possible in the life cycle. We call this shift left.
Mm-hmm.
We wanna not have security issues happen in production environments. That's typically very costly, not only from an engineering perspective, because you have to find the issue, you have to deploy all the servers, but it's a PR nightmare. It's often a customer relationship nightmare. We want to shift this left from the production environment to the pull request and even further left into the editor, where the developer quickly, while writing code, can apply best practices, can use Copilot, you know, to get suggestions about better code.
Then when they send the pull request, the pull request kinda captures, you know, it's the first line of defense, running checks, running CI/CD, running code and secret scanning, making sure the developer has not made a mistake, using, you know, pair programming and code reviewers to figure out, you know, have a human, second and third pair of eyes look at this, and then finally merging into the main branch and then deploying to production. Security really is underlying everything we do, and with the GitHub Advanced Security, GitHub Copilot and Codespaces.
I forgot to mention, you know, with Codespaces, obviously, if your dev environment moves to the cloud, you can apply exactly the same practices that you have in your production environment, as in CI/CD, automatic dependency updates, nightly builds, all of that you can apply to your dev environment. You no longer have to run behind hundreds of developers, making sure they have updated their tools, sent them emails saying, "If you don't upgrade to VS 2022 or whatnot, some dependency library or whatnot, you're behind in the security workflow.
Amanda, go back to you. You know, you touched on, you know, dev and app workloads a little bit earlier. What else would you highlight there? You know, specifically, you know, from an investment thesis, you know, Azure is obviously one of the topics we hear a lot about. Why is that topic so important to Azure? How would you help people relate it?
Yeah. Just kind of going back to the developer workload and the application workload, which both of these are super important to us. The developer workload, I think about as everything that a developer needs and a development team needs that's pre-production. In other words, it's that software development life cycle. I need, you know, a code editor, I need a way to collaborate with the other developers on my team, I need security checks as a part of doing that software development life cycle. I need test infrastructure to actually make sure that the quality of the product that I'm building is good. All of that relates to what we call the developer workload.
As I had talked about a little bit earlier, the really exciting part of this is that we have an opportunity to migrate that into the cloud and to host that on behalf of our customers so that they can get started super quickly with a secure engineering system that they can have confidence in that also delivers more happiness and more productivity to the developers. You know, for the developer workload itself, that move to the cloud is certainly one huge opportunity that we see. We also can continue to grow our base. You know, while I said we have a ton of developers that use Visual Studio and GitHub today, it is by no means all of the developers out there.
Right. Right.
We have still a lot of room for growth in terms of, you know, bringing more Java developers onto our tools, Python developers, as well as data scientists, which is a kind of new category of, you know, that's adjacent to developers that.
Growing, yeah.
You know, it's what we're seeing is that data is increasingly being used in the process of software development, and we have an opportunity to actually bring those into our developer environment as well and make that a part of the usual workflow. Kind of shifting gears, thinking about the application workload, which is basically everything that runs in production. It's you know, everything that you might think of as after the application or service that you've been building has been deployed to your customers, to your end users. What does it take to actually operate that service?
Yeah.
You can think about it as the cogs for our customers.
Okay.
Right?
Finance terms. I like it.
Yeah, exactly.
Track.
Yeah, yeah, exactly. You know, the bottom line there is how can we bring more devs to Azure? How can we introduce them to Azure tastefully?
Right.
You know, we have many Visual Studio customers that have not yet used Azure. We have many GitHub customers that have not yet used Azure. We wanna make it really easy to allow them to take their idea, to put it into code, to create an application and a service, and then ultimately to deploy that into our cloud. That's one big area that we've been working on. Also this trend of cloud-native development.
Mm.
You know, the application patterns that developers are building these days is evolving with the presence of the public cloud. It used to be that the traditional application pattern was what we would call a client-server architecture, where I'd build the client that the end user would use, and I'd build the server that would host all of the interfacing for the
Right.
that client portion of the application. Now in a cloud-native app architecture, it tends to be much more distributed.
Okay.
Much more dependent on microservices and other services that the cloud can provide to app developers. What we're seeing is a pattern towards what we call cloud-native development, which, you know, really starts with what we call microservices. You can think about microservices as being, you know, we call them APIs.
Right.
That's, you know, programming interfaces that are basically ways to invoke another service as a part of your application. This microservice architecture and providing infrastructure to host that microservice architecture is a huge opportunity for us. Some people might have heard of something called Kubernetes. They might have heard of containers. That's some of the core infrastructure that we can provide to developers so that they can focus again on the code that only they can write, and they don't have to worry as much about the infrastructure and the management of what it takes to actually operate it once it's deployed.
The other thing that's really important here is, you know, being a developer is increasingly kind of like being a systems integrator, in that, you know, you are using all of these different services to assemble together into a single solution. One really amazing category of cloud infrastructure that we've been working on is called Enterprise IPaaS. It's basically the integration platform as a service. How do you take all of these different APIs that are available, you know, developed inside of your company, developed in the public market that you might use externally, developed by other developers out there? How do I assemble all of these things?
Right.
so that I can modernize the systems that I have so that I can, you know, create new applications more quickly? How can I make sure that I'm providing governance and compliance?
Right.
To make sure that, you know, anytime that I'm calling an API, I have the confidence that the right people are accessing the data that API has access to. In a sense, our huge opportunity here is to kind of marry the experience of our developer tools to our Azure business, where we can kind of take the huge momentum that we've built up with both GitHub and Visual Studio, and introduce developers to what we can offer with Azure.
It's a fascinating space. I'm getting sad because we're already starting to get to the wrap-up, and I'm learning a ton from the two of you. I expected the themes of productivity, but I love that each of you mentioned happiness as part of what we're trying to solve for the different communities that we work with and support. That's great to hear. Maybe as we move to wrap, and I know we looked at a few kind of look-ahead topics already, but in terms of, you know, what we would want the developer community to think about as coming or what's next for that group, either summarizing things we've already mentioned or anything else you would add. I would love to hear from you both on that.
Maybe, you know, Thomas, you can start.
Yeah. I think as the world, you know, builds more and more software, and the projects become more and more complex, we need to constantly focus on allowing developers to learn and grow, right? There's always another new stack, new cool technology.
That's true.
New programming languages. There's always another next thing. If you just look back how far we have come over the last 10 years and how, you know, how the world or life has changed within our phones, in our pockets that are way more powerful than the computers that I had as a kid, projects become more complex, but the developers need to constantly learn and evolve with their projects. Otherwise, we are all landing in this nightmare of too much spaghetti code, you know, too many dependencies and no overview, where as managers and leaders of those groups, we lose track of where we're actually going.
Mm.
It's that challenge that I think we know we wanna solve with the Developer Cloud, enabling small and large team to be innovative, to be creative, and ultimately be happy because if they're, if those people, if our developers are not happy, they're not delivering the value that we need them to. We believe with Copilot, with Codespaces, with Visual Studio and Visual Studio Code, with the Developer Cloud, and of course with Azure, we can achieve this goal and get software development to the next level because we need it to get to the next level.
Absolutely.
To create the human progress that we all wanna achieve.
Love it. Amanda, take us home.
Yeah, I mean, I think what's so exciting about the next chapter that we're in is that we're seeing enterprises really want to become more agile.
Mm.
We're seeing the cost of a startup dramatically decreasing because there's so many existing building blocks that are already there in terms of your engineering systems, what it takes to actually, you know, outfit a development team, as well as the building blocks for hosting and assembling the applications that you ultimately want to build. That means that also startups can scale like an enterprise really quickly. I think this is just an era where we're going to see incredible amounts of productivity.
I love it. Well, thank you both for the time. I really appreciate it. I probably could keep you here another half an hour, but. We thank everyone for watching. You know, we're really excited about significant opportunities that lie ahead for developers at Microsoft, and we appreciated having some time to talk with you about it today. Thank you. Thanks, team.