Amy Hood, who has become Microsoft’s longest-tenured chief financial officer in two decades, tells new employees her job is to make sure “you still want to pick us every day.”
Clad in jeans and a gray sweatshirt, Amy Hood stands before a room of 140 Microsoft recruits. The feeling in the air is a bit like the first day of school, and new hires are taking selfies outside in front of a big Microsoft logo.
Hood tells the crowd that her job as chief financial officer is not simply to balance the books and plan spending, although she’s pretty good at that. Her main role is to make sure every one of them is glad they chose Microsoft.
“My kids will tell you I practice counting, but my job is really a little different than that,” she tells the crowd, grouped at round tables by the business unit they’re joining. “I may have thought about it that way when I took the job almost five years ago. But now it’s about creating an environment in which you all remember that you still want to pick us every day. That’s my job as a CFO.”
Career: Worked for Goldman Sachs, joined Microsoft in 2002 in investor relations. Named CFO by Steve Ballmer a few months before he stepped down.
It’s not how most people think of the role of finance chief. But since taking the gig in 2013 — making Hood Microsoft’s longest-tenured CFO since the mid-1990s in a company that wears down finance professionals — a more expansive view of the job is what keeps her in it. Along with CEO Satya Nadella, Hood, 46, has played a key role in winning people — employees, customers, investors — back to Microsoft after the company spent more than a decade losing its way.
The world’s largest software maker, once undisputed ruler of the PC desktop, has remade itself into a cloud behemoth. This second coming looked highly unlikely when Hood took on the CFO job. But since then she has partnered with Nadella to turn the company around, becoming more influential than previous Microsoft CFOs and translating her boss’ strategy and product priorities into precise spending plans and forecasts. She has refocused Wall Street on cloud-computing metrics and handily beat them.
“She was able to change everybody’s perspective on a company where everyone thought their best days were behind them,” says Heather Bellini, a Goldman Sachs analyst who has covered Microsoft for more than 15 years. “People view her as being very instrumental to the change in strategy at Microsoft. Satya has done an excellent job but people think of them as a package together.”
As Nadella plots strategy to cope with Microsoft’s challenges, Hood manages spending to support it. Microsoft is sitting on one of the biggest cash piles in tech — $132.3 billion — and Hood is extremely judicious in deploying it. Acquisitions are carefully vetted, and she has shown herself willing to take money away from legacy divisions such as Windows that are used to getting what they want and giving it to more promising businesses like the cloud group.
When challenged, she always has the data to make her case. Between pieces of her kids’ artwork on a wall in her office hangs an award for “Excellence in Forecasting.” It’s a finance geek’s gag, bestowed on Hood by her team when they were so off base about a prediction and she was right.
“She’s not combative but she’s determined,” says former board member Maria Klawe. “She’s really good at what she does. She’s persistent but she’s not obnoxious ever.”
Hood joined Microsoft in 2002 and expected to stay only a few years before decamping to a startup; she even timed her start date to get the maximum access to the employee stock-purchase plan. But over time, she fell in love with the place and has emerged as one of Microsoft’s most passionate cheerleaders. In a rare interview, she explains why she loves her gig.
“Why does anybody do a job?” she asks. “Because they think they can make a positive difference and feel like you want to be a part of something. Those things are really true for me.”
Hood was named CFO during one of the bleakest periods in Microsoft history. A last-ditch effort to drag Windows into the mobile era had largely failed, the PC market was sliding; investors, the board and even some of then-CEO Steve Ballmer’s own executives didn’t believe he had the answers.
Hood was a few months back from maternity leave after the birth of her second daughter when Ballmer offered her the job. Despite graduating from Harvard Business School and holding several roles including Office group CFO, Hood hadn’t studied finance in school and recalls feeling she wasn’t ready for the job.
A few years later, in 2016, Hood told a conference she always takes stretch jobs that are a little uncomfortable and then grows in the role.
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Year One is trying for most new CFOs, but Hood couldn’t have anticipated the chaos. Weeks into the job, she flew to Europe to negotiate the purchase of Nokia assets; shortly after that Ballmer shook up the C Suite, giving Hood more power over the finances of each product. A month later he announced his departure.
It took almost six months to replace Ballmer with Nadella, whom Hood knew well because he’d overseen small-business accounting and customer software while she ran strategy for the larger Office group that included his business.
Once Nadella took over as CEO in February 2014, Hood needed to correct missteps made on Ballmer’s watch. First up: the $9.5 billion Nokia deal. Less than a year after closing, it was foundering and had missed Hood’s initial forecast for sales and savings.
“Once the forecast failed to pan out, Amy was extremely rigorous on first calling attention to the failing performance and then encouraging everyone to focus on making hard decisions quickly,” says Microsoft President and Chief Legal Officer Brad Smith, whose office shares a small hallway with Hood’s.
During the interview in May at Microsoft’s Redmond headquarters, Hood acknowledges she will make mistakes and says she’s comfortable making tough decisions once she has the right data. She doesn’t believe in continuing a strategy or an investment just because the company has already spent a lot or put in a lot of work.
“You can’t change anything,” she says. “[A] time machine doesn’t exist. So reflect, learn and move on. I just don’t dwell much on those things. Otherwise you get too fearful. You lose your bravery.”
Nadella and Hood are trying to fix Microsoft’s spotty track record on big deals. Rather than buying shrinking businesses such as Nokia to prop up ailing ones like Microsoft’s mobile-software unit, they look for strong companies in growing sectors.
Hood came to the CFO job well-equipped to handle balky shareholders. Her first job at Microsoft after joining from Goldman Sachs was investor relations. She got Ballmer’s attention by vigorously disagreeing with his reluctance to woo Wall Street.
“My first impression was this lady is smart and she’s willing to push back, she’s got an edge, she has her own point of view and is not just going to parrot what management thinks,” Ballmer recalls. “She didn’t make headway with me at the time, but she didn’t sit there like a doormat and say ‘yeah, yeah, yeah, whatever.’ ” He says Hood is the best CFO Microsoft has ever had.
Hood bakes, and she’s obsessed with creating structurally complex pastry, complete with working parts. A rocket resulted in many “#PinterestFails” she says. Recently she built a Paw Patrol cake for her daughter, complete with a large tower. She remembers that her mother’s homemade cakes made her feel cared for, and so she does the same for her two daughters.
Her younger girl’s birthday happens to coincide with the end of Microsoft’s fiscal year. Hood lets her team close the books and throws herself into baking the best birthday cake ever.