Microsoft gets 27% of OpenAI in $135B restructuring deal

Microsoft and OpenAI have restructured their partnership, with Microsoft receiving a 27% ownership stake in OpenAI valued at approximately $135 billion. This marks OpenAI’s transformation from a non-profit research lab into a public benefit corporation, removing profit caps and enabling unlimited returns for investors while securing Microsoft’s access to OpenAI’s technology through 2032.

What you should know: The restructuring fundamentally changes OpenAI’s business model after years of operating under a hybrid structure.

• OpenAI launched in 2015 as a non-profit research lab focused on developing AI that benefits humanity.
• In 2019, it created a capped-profit subsidiary to attract major investments needed for training models like ChatGPT.
• The new agreement transforms OpenAI into a public benefit corporation, essentially making it a for-profit entity that can reward shareholders without profit limitations.

Key details: Microsoft’s expanded stake comes with significant benefits and continued partnership terms.

• Microsoft will maintain access to OpenAI’s technology until 2032, including models that achieve artificial general intelligence (AGI) benchmarks.
• Bloomberg reports that Microsoft will continue receiving 20% of OpenAI’s revenue, though this wasn’t officially confirmed in the announcement.
• OpenAI will remain Microsoft’s “frontier model partner” under the new structure.

Why this matters: The restructuring addresses OpenAI’s need for massive capital while positioning both companies for long-term growth in the AI market.

• OpenAI can now attract larger investments for ambitious projects like proposed data centers and advanced AI model development.
• Microsoft’s investment is no longer subject to profit caps, meaning returns will scale directly with OpenAI’s growth.
• The move mirrors Anthropic’s recent focus on corporate relationships as a path to AI profitability.

What they’re saying: Both companies emphasized the partnership’s evolution in their joint announcement.

• “As we enter the next phase of this partnership, we’ve signed a new definitive agreement that builds on our foundation, strengthens our partnership, and sets the stage for long-term success for both organizations,” the companies stated in a blog post.