Tech giants Microsoft and OpenAI have finalized a landmark deal that restructures OpenAI into a public benefit corporation, valuing the AI powerhouse at $500 billion. The agreement also gives OpenAI greater freedom to pursue business opportunities and raise capital, resolving constraints that have existed since the companies first partnered in 2019.

---

Details of the Microsoft-OpenAI Deal

Under the new structure:

• Microsoft retains a 27% stake in OpenAI Group PBC, currently valued at approximately $135 billion.
• OpenAI remains under the control of the OpenAI Foundation, a nonprofit entity.
• The deal ends Microsoft’s previous restrictions on OpenAI’s ability to raise outside capital, a limitation that had created tension as ChatGPT surged in popularity.
• CEO Sam Altman will not receive equity in the restructured company, reversing earlier discussions about an equity grant.

The agreement also secures a massive cloud computing contract: OpenAI will purchase $250 billion in Azure services from Microsoft, cementing a partnership that extends through at least 2032.

---

Why the Deal Matters

The 2019 Microsoft-OpenAI agreement had tied OpenAI’s growth to Microsoft’s infrastructure, including rights over much of OpenAI’s work in exchange for cloud computing services. While this arrangement was critical during ChatGPT’s early development, the explosive growth of the AI platform—now boasting over 700 million weekly users as of September 2025—made those restrictions a significant obstacle for OpenAI’s expansion.

By restructuring as a public benefit corporation, OpenAI gains:

• More flexibility in raising capital from investors
• Clearer governance over technology ownership and rights
• Continued alignment with its mission to ensure AI safety and public benefit

Bret Taylor, board chair of the OpenAI Foundation, stated:

“The nonprofit remains in control of the for-profit, and now has a direct path to major resources before AGI arrives.”

---

Impact on Microsoft

The deal is a major win for Microsoft as well. Having invested $13.8 billion in OpenAI to date, the company has effectively generated a nearly 10x return on its investment. Following the announcement, Microsoft shares rose 2.5%, pushing its market value above $4 trillion once again.

Importantly, Microsoft will not have rights to OpenAI hardware and no longer holds the right of first refusal for providing computing services, offering OpenAI greater independence in managing its operations while maintaining a strategic partnership through Azure.

---

Future of AI and OpenAI

This restructuring positions OpenAI to accelerate research in artificial general intelligence (AGI) and advanced AI models. Independent panels will verify claims of AGI, ensuring transparency and accountability. Analysts suggest the new structure also clarifies investment paths, making it easier for OpenAI to secure future funding and pursue innovative AI projects.

Adam Sarhan, CEO of 50 Park Investments, commented:

“OpenAI still faces ongoing scrutiny around transparency, data usage, and safety oversight. But overall, this structure provides a clearer path forward for innovation and accountability.”

---

ChatGPT and OpenAI’s Continued Growth

Since its founding as a nonprofit AI safety organization, OpenAI has become a household name thanks to ChatGPT, the AI chatbot that has reshaped public awareness of artificial intelligence. With this new corporate structure, OpenAI can continue expanding its AI research, computing capabilities, and technological partnerships, while maintaining alignment with its mission-driven goals.