Microsoft unveils Windows update to run coding AI models and agents locally on PCs

Microsoft CEO Satya Nadella said on X that the company has begun a "new chapter" for Windows, with the goal of bringing what he called "unmetered intelligence" to desktops and homes and making each PC a place where AI agents can work securely for users. [1]

Among the announcements, Nadella listed MAI-Code-1.1 Flash, a coding model with 137 billion parameters and a 256K context window. He said the model is now optimized to run directly on a PC. [1]

Nadella said GitHub Copilot can now pass work to local models such as MAI-Code-1.1 Flash, which he said helps projects cost much less without lowering quality. He also said a feature called Hybrid Intelligence allows Copilot to take action on the PC and keep sensitive work on the device. [1]

In a second post, Nadella said that, with a user's permission, Copilot on Windows can draw on context stored on the PC, act for the user and use local models when appropriate. He said this gives users more capability while helping their tokens go further. [2]

Nadella also described a feature called Code in Copilot, which he said lets users build software on their desktops without cloud token spend. On security, he said Windows and Agent 365 are being brought together so agents operate within secure boundaries on the device, including MXC, a local sandbox for agent execution. [1]

Nadella said the changes will arrive on a new generation of devices, including Surface Laptop Ultra, powered by NVIDIA RTX Spark. In a later post, he said it was great to partner with NVIDIA as the company kicks off its next chapter for Windows, and thanked the accounts @JensenHuang and @sriramk for "joining us today." [1][3]