OpenAI's Profit Shift: Microsoft's $135B Stake Sparks AI Governance Debate

OpenAI has completed a significant corporate restructuring, transforming into a public benefit corporation (PBC) while solidifying Microsoft's position as its largest shareholder with a 27% stake valued at $135 billion, according to Business Insider. The restructuring, finalized after months of negotiations with regulators and stakeholders, positions the nonprofit OpenAI Foundation to hold a $130 billion equity stake in the for-profit entity, OpenAI Group PBC, as reported by The Verge. This move, designed to attract capital and remain competitive in the AI race, also grants the foundation additional ownership once OpenAI reaches an unspecified valuation milestone, according to Engadget.

The partnership with Microsoft, a key backer since 2019, has been expanded under the new agreement. Microsoft will supply OpenAI with an additional $250 billion in Azure cloud services, according to Seeking Alpha. The deal also extends Microsoft's access to future AI models, including those developed post-Artificial General Intelligence (AGI), provided AGI's declaration is verified by an independent expert panel, Business Upturn reported. In return, Microsoft relinquished its right of first refusal to remain OpenAI's sole compute provider, allowing the AI firm greater flexibility to collaborate with third parties, per Investing.com.

The restructuring aligns with broader industry trends as tech giants vie for dominance in AI infrastructure. Microsoft's Azure cloud division, which surpassed $75 billion in annual revenue in fiscal 2025, has integrated OpenAI's models into products like Copilot and Office 365, reinforcing its leadership in AI-driven enterprise solutions, according to the Times of India. OpenAI's partnership with Microsoft also complements its recent $41 billion private funding round, including a $30 billion investment from SoftBank, which required the restructuring to unlock the final $22.5 billion tranche, as reported by Tekedia.

The shift to a for-profit model has drawn scrutiny, particularly regarding OpenAI's governance and nonprofit commitments. Critics argue the foundation's substantial equity stake could blur the line between profit motives and public benefit. However, OpenAI maintains that the nonprofit will use its growing stake to fund philanthropic initiatives, such as healthcare advancements and AI resilience research, The Verge noted. The company also announced plans to develop consumer AI hardware in collaboration with former Apple designer Jony Ive, signaling its ambition to expand beyond software, Seeking Alpha reported.

Meanwhile, Microsoft's investment underscores its strategic push to dominate AI infrastructure. The company recently opened the Fairwater datacenter in Wisconsin, capable of delivering 10x the performance of current supercomputers, and announced a $4 billion initiative to train 20 million people in AI skills through 2027, the Times of India reported. With Azure now powering 80% of Fortune 500 AI workloads and OpenAI's models embedded in Microsoft's ecosystem, the partnership cements Microsoft's role as a cornerstone of the AI era, Business Upturn added.