OpenAI-Microsoft revenue-sharing deal gets $38 billion cap: Report

CALIFORNIA: OpenAI and Microsoft have reportedly agreed to cap total revenue-sharing payments between the two companies at $38 billion, according to media reports.

The revised arrangement follows a renegotiation of the companies’ partnership agreement last month, creating room for OpenAI to pursue fresh alliances with rivals including Amazon and Google.

According to the report, the payment cap could strengthen OpenAI’s pitch to investors as the artificial intelligence company explores a potential public listing. Some executives reportedly believe an IPO could happen as early as the end of this year.

Microsoft had earlier stated in April that revenue-sharing payments from OpenAI would continue through 2030 at the previously agreed percentage structure, subject to an overall cap.

The partnership between the two companies has been central to the rapid rise of generative AI. Since 2019, Microsoft has invested around $13 billion in OpenAI, backing the company’s growth while also strengthening its own Azure cloud computing business.

The recalibration of the deal suggests the AI alliance is entering a new phase, one where OpenAI is seeking greater strategic flexibility even as Microsoft remains one of its biggest financial and infrastructure partners.