New York: OpenAI is reportedly preparing to cut the revenue share allocated to Microsoft in half by the end of the decade, marking a significant shift in its commercial and structural strategy. According to a report from The Information, the artificial intelligence pioneer has informed investors of plans to reduce Microsoft’s cut from 20% to roughly 10%, in a move aimed at recalibrating its financial commitments and organizational structure.
This adjustment comes alongside OpenAI’s decision to abandon an earlier internal restructuring plan that would have expanded CEO Sam Altman’s control. Instead, the company’s nonprofit parent entity will maintain its governance role, preserving the checks on executive authority that the earlier proposal sought to loosen.
Microsoft, OpenAI’s largest and most influential partner, has invested approximately $13.75 billion into the AI firm, including a widely publicized $10 billion commitment made in early 2023. Under the current agreement, Microsoft receives 20% of OpenAI’s revenue until 2030. However, internal financial briefings now suggest that this figure will drop to 10%, shared between Microsoft and other commercial stakeholders.
Despite the financial revision, both companies have emphasized the durability of their collaboration. Microsoft continues to rely heavily on OpenAI’s foundational models to power key offerings such as Copilot, and OpenAI’s APIs remain exclusively hosted on Microsoft’s Azure platform.
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“The key elements of our partnership remain in place for the duration of our contract through 2030, with our access to OpenAI’s IP, our revenue sharing arrangements and our exclusivity on OpenAI’s APIs all continuing forward,” Microsoft confirmed in a statement.
The announcement follows Microsoft’s January agreement revisions, which came in the wake of its ambitious $500 billion AI data center initiative in partnership with Oracle and Japan’s SoftBank Group. Industry observers note that Microsoft is eager to retain privileged access to OpenAI’s innovations beyond the life of the current contract.
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“We continue to work closely with Microsoft, and look forward to finalising the details of this recapitalisation in the near future,” an OpenAI spokesperson told The Information.
