Microsoft will record an $800 million impairment charge following General Motors’ decision to discontinue its Cruise robotaxi program, according to a recent regulatory filing. The charge, which stems from Microsoft’s 2021 investment in Cruise, will appear under “other income and expense” and is projected to negatively affect second-quarter diluted earnings per share by approximately $0.09.
GM, which holds a 90% stake in Cruise, has begun buying out minority shareholders to increase its ownership to over 97%. Cruise had previously attracted investments from Microsoft, Walmart, SoftBank, Honda, and others, raising $2 billion in January 2021 and achieving a valuation of $30 billion. Microsoft’s involvement included a strategic partnership for Cruise to utilize its Azure cloud platform for autonomous ride-hailing services.
Last week, GM announced it would cease funding Cruise’s robotaxi development, instead integrating the subsidiary into its broader efforts to develop driver assistance and autonomous driving features for personal vehicles. Honda, another minority investor, confirmed it would also halt funding for a joint robotaxi venture with Cruise in Japan.
GM acquired Cruise in 2016 for $1 billion and has since invested over $10 billion in the subsidiary to advance autonomous vehicle technology. The decision to scale back marks a significant shift in strategy as GM reallocates resources toward enhancing its core automotive technologies.
See Also
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