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Microsoft Expects $800M Impairment Charge After GM Axes Cruise Robotaxis


Microsoft Expects $800M Impairment Charge After GM Axes Cruise Robotaxis

Microsoft, Walmart (WMT), Honda and others were minority investors in the startup, while GM has held a majority stake since 2016. The automaker said Tuesday that the "robotaxi" service had become too expensive to develop and scale, and said it would work to buy out remaining shareholders.

Late Wednesday, the tech giant said in a regulatory filing that it expected the $800 million charge to have a negative impact on second-quarter earnings per share (EPS) of roughly 9 cents per share.

GM said the project's costs had become too much to continue funding as it was also trying to scale alongside competitors like Waymo, owned by Google parent Alphabet (GOOGL), along with the Tesla (TSLA) robotaxi the EV maker wants to get on the roads at scale in the coming years.

The automaker said the Cruise team would be realigned to work on other driver assistance systems, and said it will continue developing its partially self-driving, "hands off, eyes on" Super Cruise system.

In the filing, Microsoft also informed regulators of the results of a number of shareholder votes from its annual shareholder day that took place Tuesday. The company's board was re-elected, executive pay packages and an independent auditor were also approved, while several proposals from shareholders failed to pass.

Microsoft shares edged 0.26% lower in premarket trading Thursday.

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