To be clear, the GP wasn’t making a claim about Microsoft’s strategy; what they’re claiming is that Linux is robust against such threats. Linux is constantly “Embraced” and “Extended” by all sorts of people, but it’s far too large a tent at this point for any entity, no matter how large, to gain the control necessary to “Extinguish” it.
(In this specific case, it’s because Linux has many in-kernel hypervisor systems, not just Microsoft’s. And at no point would they get rid of any of them, even if Microsoft’s is “better” in some sense. That’s not how Linux works: those systems are there to allow various groups to scratch their own itches, not as some central ideologically-driven top-down design. Microsoft can certainly add to Linux—anyone can—but nobody can force Linux to take away alternatives until it becomes dependent in some way on their particular code.)