Microsoft and OpenAI unveil a deal extending IP rights, adding independent AGI verification, and giving both sides more freedom while maintaining Azure ties.

On October 29, 2025, Microsoft reported strong fiscal first quarter results, highlighted by robust Azure and cloud growth, a restructured partnership with OpenAI valued at US$135 billion, and plans to double its data center footprint over the next two years to meet rising AI demand.

In the new agreement, Microsoft gets a 27% stake in OpenAI's for-profit business, the OpenAI Group PBC, worth around $135 billion.

Since 2019, Microsoft and OpenAI have shared a vision to advance artificial intelligence responsibly and make its benefits broadly accessible. What began as an investment in a research organization has grown into one of the most successful partnerships in our industry.

Microsoft and OpenAI announced the long-awaited details of their new partnership agreement Tuesday morning — with concessions on both sides that keep the companies aligned but not in lockstep as they move into their next phases of AI development.

Microsoft made its first investment in Sam Altman's OpenAI in 2019. It now holds a 27% in OpenAI's for-profit business.

A new era has dawned in the extensive association between Microsoft and OpenAI, with partners signing a definitive agreement.

OpenAI said Tuesday it has reorganized its ownership structure and converted its business into a public benefit corporation after two crucial regulators, the Delaware and California attorneys general, said they would not oppose the plan.

However, Microsoft revealed a major drop in profit due to what it termed was an “equity method investment” in OpenAI Group PBC, resulting in a 41-cents-per-share hit to its earnings and a $3.1 billion drop in its net income. Even so, the company’s bottom line was still healthy at $27.7 billion, up from $24.67 billion in the year-ago quarter.