OpenAI’s path to a public offering may hinge on a reworked deal with Microsoft—negotiations are underway to redefine their $13B alliance.
OpenAI and Microsoft are in the middle of high-stakes negotiations to restructure their multibillion-dollar partnership, according to a Financial Times report. This negotiation is made with the goal of paving the way for OpenAI’s potential initial public offering (IPO) while preserving Microsoft's long-term access to next-generation AI technologies.
At the heart of the talks is Microsoft's $13 billion-plus investment in OpenAI, and how that will translate into equity in the company’s new for-profit entity. OpenAI, currently transitioning its for-profit operations into a public benefit corporation (PBC) controlled by its nonprofit parent, is reportedly seeking to revise key terms of its 2019 contract with Microsoft. This was an agreement that granted Microsoft access to OpenAI's intellectual property, models, and a share in revenue.
Microsoft, for its part, appears open to reducing its equity stake in the restructured OpenAI business in exchange for continued access to future AI models developed beyond the current deal’s 2030 expiration.
OpenAI is also planning to cut the revenue share it provides to Microsoft—from 20% to about 10%—by the end of the decade. These changes are seen as critical steps for OpenAI to maintain greater independence and financial flexibility as it moves toward future fundraising rounds or a public listing.
The negotiations come amid an evolving dynamic between the two tech giants. While Microsoft remains OpenAI’s biggest backer and cloud partner, OpenAI’s growing enterprise ambitions and major infrastructure projects like the Stargate AI supercomputing initiative suggest a desire to chart a more autonomous course.
Notably, Microsoft and OpenAI already revised parts of their original agreement earlier this year, following a separate partnership involving Oracle and SoftBank to develop AI data centers worth up to $500 billion in the U.S.
While an IPO isn’t officially on the table yet, the restructuring marks a pivotal moment—not just for OpenAI and Microsoft, but for the entire AI industry. As the lines blur between partners and competitors, these negotiations could redefine how the next decade of AI innovation is funded, controlled, and commercialized.
One thing is certain: the outcome of this deal could set the tone for who truly leads the race of artificial intelligence—not just in labs, but in boardrooms.
