Windows is a loss leader at this point
Twenty years ago, Windows was Microsoft's business model. It was the golden goose that printed cash for the company, which it used to not only maintain and develop Windows, but to fund their other endeavours.
Then, Office become more profitable. Windows was still important, of course, but it shared top billing. When Office became just as important, it and Windows became codependent, in the eyes of Microsoft, and were treated as such.
But then they focused on cloud services. And not so slowly, Office moved to the cloud. Windows became less of a partner to Office and more of an onramp.
Now, the focus (almost obsession) is on AI, and Windows, while still profitable, is now only about 15% of Microsoft's revenues. Windows doesn't have to develop new OS features, because Microsoft doesn't care about the OS; they see it as an AI entry point and a cloud onramp.
Customers do, however. As do investors. MS took a massive $400B stock loss, and companies have been giving scathing feedback, with governments and many major corporations either slowing Windows adoption, looking at split solutions, or migrating away from the OS entirely.
The message couldn't be clearer. The OS is turning into garbage because Microsoft is not only ignoring it, but focusing on nonsense customers to not want, and many are fleeing. The numbers finally got high enough that the accountants are starting to notice, which means the board notices.
So, MS will trot out the "we heard you" excuse, they'll reassign people to at least give the appearance of stability, for a quarter or two, and they'll tone down the avalanch of hated AI features being inflicted on customers.
Of course, as with Recall, once the bad press dies down, I expect them to go right back to what they were doing, only they'll be quieter about it.