Microsoft and OpenAI renegotiate partnership amid PBC transition talks

Microsoft and OpenAI are renegotiating their multibillion-dollar partnership terms. OpenAI aims to transition to a public benefit corporation (PBC). The change could enable OpenAI’s future initial public offering (IPO). Discussions focus on Microsoft’s equity stake in OpenAI’s for-profit arm.

Partnership Restructuring

The deal will address Microsoft’s equity share after their $13 billion investment since 2019. Microsoft may give up some equity in exchange for extended access to OpenAI technologies beyond 2030.

This renegotiation reflects changing relations between tech giants and AI startups. OpenAI’s PBC structure seeks to attract more investors to boost AI innovation.

However, this has raised debate on maintaining balance between profits and OpenAI’s original mission. Co-founder Elon Musk and others have voiced concerns about shifting from a non-profit focus.

Historical Context and Recent Developments

The partnership evolved notably in January 2025. Microsoft revised its agreement allowing OpenAI to partner with Oracle and SoftBank on the Stargate AI data center project, valued up to $500 billion.

Despite this, Microsoft kept exclusivity over OpenAI API offerings. OpenAI also plans to reduce Microsoft’s revenue share from 20% to 10% by the end of the decade.

• Microsoft invested over $13 billion in OpenAI to date.
• OpenAI targets a transition to a public benefit corporation.
• Microsoft may trade equity for extended technology access after 2030.
• OpenAI’s revenue share arrangement with Microsoft is under revision.
• Stargate is OpenAI’s ambitious AI infrastructure project.

The evolving business terms illustrate the complex balance among financial interests, strategic partnerships, and advancing artificial intelligence responsibly.

Sources say OpenAI is in “a tough negotiation” with its largest investor. The nonprofit board remains in control despite the PBC transition, as OpenAI recently announced a major change.

Microsoft and OpenAI’s relationship has become more competitive. OpenAI’s enterprise business growth impacts rivals and aligns with the Stargate infrastructure project.

This strategic renegotiation could shape OpenAI’s future funding and market presence significantly, ensuring sustained innovation with Microsoft as a key stakeholder per the Financial Times.