Will Trump bring the hammer down on Microsoft?

US President Donald J. Trump owns the tech industry. Many of the world’s largest and most influential tech firms and their leaders, including those at Alphabet, Amazon, Apple and Meta, have gone all-in on MAGA — praising Trump’s leadership and policies, and doing his bidding.

There’s been one notable holdout: Microsoft. 

The company’s CEO, Satya Nadella, stayed away from Trump’s inauguration, refused to shutter Microsoft’s DEI efforts, and hasn’t given Trump the praise the president so desperately wants. Most recently, when Trump demanded that Microsoft fire the company’s recently appointed President of Global Affairs Lisa Monaco (a former Biden administration official), Nadella simply ignored him.

So far, Trump hasn’t taken any public action against Microsoft (though there is an ongoing antitrust probe that could make waves). But the president isn’t known for giving up easily or ignoring a snub. He’s particularly furious about the Monaco appointment, so don’t be surprised if he makes another run at trying to take her down.

The big-dollar question for Microsoft is this: If Trump brings down the hammer on the company for hiring Monaco, what might Microsoft do in response?

For clues, let’s recall how other tech companies have bowed to the president’s wishes, see what about Monaco sets him off, and then look at what leverage, if any, Microsoft may in any blow-out fight.

The tech bro billionaires bow down

Trump adulation has become so common in America’s C-suites that it’s easy to forget just how completely tech billionaires have praised him and done whatever he wants.

Meta founder and CEO Mark Zuckerberg, Amazon founder and Executive Chairman Jeff Bezos, Google CEO Sundar Pichai, and Apple CEO Tim Cook all attended his Jan. 20 inauguration in Washington, DC. They were on display front and center like prized trophies. 

Because of Trump, Meta, Amazon, and Google dropped support for DEI (diversity, equity and inclusion) programs. Zuckerberg praised Trump as a “badass” and sounded like Trump’s mini-me when he said on a Joe Rogan podcast, “The corporate world is pretty culturally neutered. A culture that celebrates aggression a bit more has its own merits. Masculine energy, I think, is good.”

Bezos, as owner of The Washington Post, squashed the newspaper’s endorsement of then-Vice President Kamala Harris last year when she ran against Trump; killed a cartoon of tech leaders and Mickey Mouse bowing down to him; and turned the paper’s editorial and opinion pages into right-wing mouthpieces.

For his part, Cook showed up at the White House in August — ostensibly to talk about manufacturing in the US — and handed Trump a gold and glass statue. 

And then, of course, there’s tech entrepreneur Elon Musk, who at one point was Trump’s Wrecking Ball in Chief, right-hand man and primary tech adviser. These days the two of them are engaged in a slow-burn war.

Microsoft pushes back

Microsoft, though, hasn’t yet given in to Trump. The company has not only kept its diversity efforts, but publicly touted them. The company’s Chief Diversity Officer, Lindsay-Rae McIntyr, wrote on LinkedIn that Microsoft’s DEI efforts are vital to the company’s success: “The business case for D&I [diversity and inclusion] is not only a constant, but is stronger than ever, reinforcing our belief that a diverse and inclusive workforce is crucial for innovation and success.”

After that, Microsoft dropped the law firm of Simpson Thacher & Bartlett when it pledged to give the administration $125 million in free legal work after threats from Trump. As a replacement, Microsoft hired Jenner & Block, which has sued the Trump administration instead of giving in to it.

Microsoft’s biggest Trump test yet

All that was prelude to Trump’s demand that the company fire Monaco. It was no passing whim — it’s a centerpiece of his retribution-and-vengeance campaign against anyone who he believes has crossed him. He’s already forced his Department of Justice to prosecute former FBI Director James Comey and New York Attorney General Letitia James.

Monaco was second in command of Biden’s Justice Department, and played a key role in the prosecutions of Trump for misusing classified documents and support for overturning the 2020 presidential election.

In October, Trump wrote on Truth Social, “Corrupt and Totally Trump Deranged Lisa Monaco…has been shockingly hired as the President of Global Affairs for Microsoft, in a very senior role with access to Highly Sensitive Information. Monaco’s having that kind of access is unacceptable, and cannot be allowed to stand. She is a menace to U.S. National Security, especially given the major contracts that Microsoft has with the United States Government.” He demanded she be fired.

Note the not-so-veiled threat against Microsoft if the company doesn’t get rid of her. 

Trump could threaten outright to pull billions of dollars in federal contracts if the company doesn’t fire her. He could also have the Justice Department prosecute her as it has Comey, James, and likely eventually others.

Politico reports that Microsoft has been awarded $2.7 billion in federal contracts since 2020, and those could be at risk if the company doesn’t do as it’s told. Tech consultant Niki Christoff warned, “This administration rewards companies that demonstrate political loyalty,” and targets companies that don’t.

Microsoft is well aware of that. So, while the company hasn’t given in to Trump’s biggest demands, it has quietly done smaller things to please him. It did donate money to his inauguration fund and, more recently, to the fund used to build a $250 million ballroom that will replace the White House’s East Wing. (The East wing was demolished last week.)

Microsoft’s decades-long relationships with federal agencies might help insulate it from the pressure, according to Nu Wexler, who has worked in Congress and for Twitter, Facebook and Google. He told Politico that it might be hard to eliminate Microsoft’s contracts because, “their products are already deeply embedded in federal systems.”

Still, Trump is Trump. He’s not one to back down from threats.

Don’t be surprised if DOJ indicts Monaco and the US government threatens to pull Microsoft’s contracts if she’s not fired. Nadella has shown plenty of backbone standing up to Trump. No matter what comes next, he should do what’s best for the company and remain firm.