San Francisco, Oct 07, 2026 -

Microsoft is pushing a "hybrid intelligence" future with a new Surface Ultra laptop that runs on Nvidia artificial intelligence (AI) chips and will cost more than $2,500, the company announced Wednesday.

The launch is part of a broader push by tech companies to release hardware that can handle more AI computing on-device and offline, so users don't have to rely solely on remote cloud data centers, where running AI is slower and more expensive.

It also sees Nvidia, whose data center processors power the AI revolution, make a move into personal computing, a sector dominated for decades by chips from Intel and Qualcomm.

"The trajectory for me is so clear. There will never be a moment where we will go and look and say: 'Oh, this runs locally, this runs in the cloud.' You will expect this hybrid intelligence to be everywhere and pervasive," CEO Satya Nadella said during an event in San Francisco.

He was joined onstage by Nvidia CEO Jensen Huang, who echoed the idea that AI will be integrated into all computing going forward and on all devices.

Agentic AI, in particular, will be central to software development, Huang said, referring to systems programmed to be autonomous and perform tasks without supervision.

With all the changes from AI, "the computer has to be revolutionized," Huang said.

The partnership between the two US-based tech titans helps them compete with Apple, Intel and AMD in the personal computing market.

Apple unveiled two desktop computers in September, the Mac mini and Mac Studio, which it touted as powerful new options capable of processing AI software locally.

Microsoft has been working on building "AI PCs" since at least 2024, when its laptops were powered by Qualcomm chips.

The new Surface Ultra will use Nvidia's state-of-the-art AI chip, RTX Spark, which the semiconductor giant announced earlier this year.

It will cost $2,599 and begins shipping on October 16.

Some AI computing power and data will be processed locally, or on the device, while other applications are still handled remotely via Microsoft's cloud computing services.

"We built it for developers and creators pushing the limits of performance," Microsoft Executive Vice President of Windows and Device Pavan Davuluri said on Wednesday.

The news comes just a couple of weeks after Microsoft announced it would integrate Word, Excel and Powerpoint into its AI-powered assistant Copilot, in an effort to make AI the entry point for its famous suite of productivity software.

OpenAI, the company behind ChatGPT, and Claude-maker Anthropic each launched their own document creation tools in recent months.

The two San Francisco-based AI labs are also key suppliers for Microsoft, since Copilot runs primarily on their models.

Microsoft's in-house models currently only power a few products, such as GitHub's Copilot coding tool.

In June, Microsoft also unveiled its own cutting-edge artificial intelligence models -- a crucial step toward reducing its dependence on OpenAI, the creator of ChatGPT.

Microsoft, the first company to have invested massively in OpenAI, has for several years been seeking to reduce its reliance on its Sam Altman-led partner.

It renegotiated their alliance last year and retains only a non-exclusive license on its technology until 2032 though is OpenAI's biggest shareholder.