OpenAI Finalizes Corporate Restructuring, Gives Microsoft 27% Stake and Technology Access Until 2032 (microsoft.com)
(Tuesday October 28, 2025 @12:44PM (msmash)
from the artificial-general-commitment dept.)
- Reference: 0179891146
- News link: https://slashdot.org/story/25/10/28/149254/openai-finalizes-corporate-restructuring-gives-microsoft-27-stake-and-technology-access-until-2032
- Source link: https://blogs.microsoft.com/blog/2025/10/28/the-next-chapter-of-the-microsoft-openai-partnership/
Microsoft and OpenAI have [1]finalized a new agreement that removes uncertainty for investors and clears the path for OpenAI to restructure as a for-profit business. Microsoft receives a 27% ownership stake in OpenAI worth approximately $135 billion and retains access to the AI startup's technology until 2032, including models that achieve AGI. OpenAI completed its recapitalization, simplifying its corporate structure while keeping the nonprofit in control of the for-profit entity. The OpenAI Foundation receives an equity stake worth roughly $130 billion and plans to initially focus on funding work to accelerate health breakthroughs.
Microsoft backed OpenAI with $13.75 billion and was the biggest holdout among investors during negotiations. Once OpenAI achieves AGI, verified by an independent expert panel, Microsoft will no longer receive a cut of OpenAI's revenue. Microsoft also loses its right of first refusal on new cloud infrastructure business from OpenAI, though OpenAI commits an additional $250 billion to Azure.
[1] https://blogs.microsoft.com/blog/2025/10/28/the-next-chapter-of-the-microsoft-openai-partnership/
Microsoft backed OpenAI with $13.75 billion and was the biggest holdout among investors during negotiations. Once OpenAI achieves AGI, verified by an independent expert panel, Microsoft will no longer receive a cut of OpenAI's revenue. Microsoft also loses its right of first refusal on new cloud infrastructure business from OpenAI, though OpenAI commits an additional $250 billion to Azure.
[1] https://blogs.microsoft.com/blog/2025/10/28/the-next-chapter-of-the-microsoft-openai-partnership/
Predeicting the bubble popping? (Score:2)
by gurps_npc ( 621217 )
If Microsoft has access until 2032, does that mean the crash will happen in 2031? Or 2033?
Not Really OpenAI, Not LocalAI (Score:2)
by BrendaEM ( 871664 )
Just more society-ruining crap.
Value stuck (Score:2)
by reanjr ( 588767 )
So, this deal values OpenAI at $500B.
OpenAI was valued at around $500B sometime last year.
So, over the last year OpenAI's growth has essentially hit a dead end. Not a good sign for a company that is built on promises.
What industry will be wrought... (Score:2)
by reanjr ( 588767 )
What industry will be wrought by the all the excess hardware left over from the LLM boom. At some point, everyone will give up on AGI and there will be a crash and we will have all these data centers filled with specialized hardware. Presumably, some industry will be able to take off when the hardware becomes dirt cheap.
For example, it could lead to advancements in gaming AI or DLSS or any number of things.
Okay but... (Score:3)
> Microsoft receives a 27% ownership stake in OpenAI worth approximately $135 billion and retains access to the AI startup's technology until 2032
Is that actual value of the hardware or speculative value of the brand?
As far as I know, there is still zero plan to actually make the trillions of dollars from AI that they will need to justify the trillion plus they've thrown at it so far. Like they need to make a lot of money just to break even, and so far the only plan seems to be "then a miracle occurs."
So I guess if Microsoft at least gets 27% of the physical hardware that's something tangible they can recover when the bubble pops.
=Smidge=
Re: (Score:3)
>> Microsoft receives a 27% ownership stake in OpenAI worth approximately $135 billion and retains access to the AI startup's technology until 2032
> Is that actual value of the hardware or speculative value of the brand?
> As far as I know, there is still zero plan to actually make the trillions of dollars from AI that they will need to justify the trillion plus they've thrown at it so far. Like they need to make a lot of money just to break even, and so far the only plan seems to be "then a miracle occurs."
> So I guess if Microsoft at least gets 27% of the physical hardware that's something tangible they can recover when the bubble pops. =Smidge=
If the bubble pops, that hardware won't be worth much as everyone will be offloading the same type of hardware at the same time.
That said, we now have not just companies, but also governments the world over propping up this bubble. All the big decision makers seem to have fallen into the AI cult mentality, where the AI is already god, or soon will be, and the only hope anyone has is to be on the AI team that spins up god, so that they can win the race to... uh, um, carry the three... uh, the irrelevance of
Re: (Score:2)
> If the bubble pops, that hardware won't be worth much as everyone will be offloading the same type of hardware at the same time.
The hardware will be worth something in that it exists and can be re-deployed for literally any other computing task. They will not have to build a new data center for whatever bullshit waste of time they come up with next. Yes, the hardware will be basically worth scrap on the secondary market, but we're probably not talking about outright liquidation.
> All the big decisio
Re: Okay but... (Score:2)
What hardware? OpenAI rents all their hardware from companies like MS.