Microsoft and OpenAI Sign New Tech Deal to Reshape AI Partnership

By siliconindia  |  Friday, 12 September 2025, 09:46 IST

Microsoft and OpenAI Sign New Tech Deal to Reshape AI Partnership
  • Microsoft and OpenAI have signed a non-binding deal to allow OpenAI to restructure into a for-profit company.
  • The agreement signals progress in OpenAI's plans to raise capital and possibly go public.
  • Exact terms are still under discussion, with regulatory approvals pending.

Microsoft and OpenAI are taking their partnership to a new level. The two tech giants have signed a non-binding agreement that sets the stage for OpenAI to restructure itself into a for-profit company, moving away from its current nonprofit status. This step could help OpenAI raise more funds and eventually go public.

Although the details of the new commercial terms haven’t been revealed yet, both companies confirmed they are working to finalize a definitive agreement. This move shows progress in their ongoing talks and reflects OpenAI’s ambition to scale its artificial intelligence development with stronger financial backing.

Microsoft initially invested $1 billion in OpenAI back in 2019 and followed up with another $10 billion in 2023. So far, Microsoft has had exclusive rights to sell OpenAI’s tools through its Azure cloud platform. But this new deal could shift things, especially as OpenAI works to expand its partnerships with other cloud providers like Oracle and Google.

As OpenAI’s revenue crosses into billions, it is aiming for a more standard corporate structure. The company is also building its own data center project, Stargate, and has already signed $300 billion in long term contracts to support its growing infrastructure needs.

Microsoft, on the other hand, wants to keep access to OpenAI’s tech, even if OpenAI reaches a point where its models are as intelligent as humans and a milestone that could otherwise end the current agreement.

Also Read: OpenAI in Discussions with Indian Firms on $500 Billion AI Project

For now, OpenAI still faces some legal hurdles. Attorneys general in California and Delaware must approve the restructuring. The company hopes to wrap up the process by the end of the year to avoid losing major funding opportunities.

The deal is a big step for both companies as they try to maintain a competitive edge in the fast moving world of AI, from consumer chatbots to enterprise solutions.

ON THE DECK