OpenAI and Microsoft are renegotiating the terms of their complex partnership as the artificial intelligence firm prepares for a possible public listing.
At the centre of the talks is how much equity Microsoft will retain after pumping over $13 billion into the company.
According to reports, Microsoft is ready to give up a portion of its stake in exchange for something more valuable, ongoing access to OpenAI’s future AI models beyond the current 2030 agreement. This shows a change in priorities. Microsoft appears to want long-term technological leverage rather than a dominant equity position.
The Financial Times, quoting people familiar with the matter, notes that the original 2019 contract that kicked off Microsoft’s involvement is being reworked entirely. Back then, the software giant had put in $1 billion, laying the foundation for what became a major player in global AI development.
Now, OpenAI is on the brink of a more aggressive commercial path, but with a twist—it still wants to preserve control under its nonprofit board, even as it converts its business arm into a public benefit corporation (PBC).
That’s a sticking point.
Microsoft reportedly needs to sign off on the restructuring, and sources say it’s not an easy sell. The deal has been made harder by growing friction between the two companies. What began as a strategic alliance is now more of a competitive coexistence.
OpenAI’s enterprise goals are expanding. Its massive Stargate AI infrastructure project, planned in partnership with SoftBank and Oracle and valued at up to $500 billion, is one example that seems to be pushing Microsoft into a more defensive posture.
Some within Microsoft are not hiding their displeasure. “Arrogant” is the word reportedly used to describe OpenAI’s recent conduct. That issue is being aggravated by regulatory oversight. Authorities in California and Delaware are watching the restructuring closely, and investor demands are increasing.
Just last week, The Information revealed that OpenAI told some investors it would be cutting back on how much of its revenue it shares with Microsoft as part of the restructuring. That adjustment appears to favour future returns to new investors over existing ones, putting Microsoft, once its largest backer, in a more uncertain position.
Both firms have refused to comment publicly on the negotiations. Silence, however, isn’t unusual at this stage, especially when valuations are in play and IPO ambitions in the background.
In January, Microsoft had already started changing direction. It revised some of its OpenAI deal terms shortly after entering a separate venture with Oracle and SoftBank to build next-generation AI data centres in the U.S. That was seen by analysts as a sign that Microsoft was preparing for a less central role in OpenAI’s future ecosystem.
Now, OpenAI is pressured on all sides. It raised $40 billion in new capital from backers like SoftBank, is under increased regulatory investigation, and still has to navigate Elon Musk’s objection of its drift towards commercialisation.
OpenAI wants to keep its nonprofit DNA intact. Microsoft wants reliable access to top-tier AI models.
