OpenAI and Microsoft have established a $38 billion cap on total revenue-sharing payments. This agreement enhances OpenAI’s attractiveness to investors ahead of a potential initial public offering by the end of the year.
Updated Partnership Details
The companies renegotiated their partnership in April. Microsoft continues as OpenAI’s main cloud provider, with OpenAI products launching first on Azure unless Microsoft cannot support specific needs. OpenAI now gains flexibility to deploy across other platforms, including those from Amazon and Google.
Microsoft retains a non-exclusive license to OpenAI’s intellectual property for models and products until 2032. The new terms eliminate Microsoft’s revenue share obligation to OpenAI. Instead, OpenAI will pay Microsoft a revenue share through 2030 at the prior rate, capped at the overall $38 billion limit.
Nadella Addresses Early Investment
During testimony in the Musk v. Altman trial, Microsoft CEO Satya Nadella stated that Elon Musk never directly expressed concerns to him about Microsoft’s OpenAI investments breaching any agreements. Nadella emphasized Microsoft’s pride in the early partnership, noting, “very proud” of taking a significant risk when “no one else was willing.”
A deposition from Microsoft executive Michael Wetter disclosed that the company recognized approximately $9.5 billion in revenue from the OpenAI partnership as of March 2025.
Musk previously claimed Microsoft’s $10 billion investment signaled OpenAI’s shift from nonprofit principles, leading to his lawsuit over alleged misuse of charitable assets. Nadella countered that the collaboration was always commercial, providing Microsoft discounted computing resources in return for business and marketing advantages.
