Microsoft and OpenAI Agree to Cap Revenue-Sharing at 38 bln US Dollars

Mintesinot Niggusie

Microsoft and OpenAI have agreed to cap total revenue-sharing payments at 38 billion US dollars, as the two companies restructure elements of their long-term commercial partnership.

The revised arrangement follows renegotiations last month that introduced greater flexibility for OpenAI to expand its external partnerships, including potential collaborations with cloud and technology providers such as Amazon and Google.

Microsoft said in April that revenue-sharing payments from OpenAI would continue through 2030 under previously agreed percentage terms, but subject to an overall cap introduced in the updated structure.

The adjustment is expected to support OpenAI’s longer-term corporate planning, including preparations for a possible public listing. Some executives have indicated that an initial public offering could take place as early as the end of this year, according to the report.

Microsoft has invested about 13 billion US dollars in OpenAI since 2019. The partnership has played a central role in OpenAI’s development as an artificial intelligence company and has also supported the expansion of Microsoft’s Azure cloud computing business.