What Microsoft kept when OpenAI gained more cloud options

On 27 April 2026 Microsoft and OpenAI announced new terms for their partnership. Microsoft would remain OpenAI’s primary cloud provider, and OpenAI products would ship first on Azure, subject to the stated exception when Microsoft cannot and chooses not to support the necessary capabilities. OpenAI gained the ability to serve its products through other cloud providers. Microsoft kept a model and product licence through 2032, now on a non-exclusive basis. Joint announcement of amended terms

The change gives OpenAI more choices while preserving Microsoft’s role in getting products to customers. For Microsoft’s investors, the question is how much of the value comes from maintaining a preferred route to market, and how much still depends on one lab paying for the capacity it has agreed to use.

In 2019 Microsoft announced a $1 billion investment and a plan for OpenAI to use Azure. Microsoft’s January 2023 announcement described another multiyear, multibillion-dollar investment and called Azure the exclusive cloud provider at that stage. The UK Competition and Markets Authority later recorded a $10 billion investment in January 2023. The public announcement and regulator’s decision do not establish how much of that investment took the form of cash or computing credits. 2019 partnership announcement · Microsoft’s January 2023 announcement · CMA decision, paragraph 5(a)

When OpenAI’s board removed Sam Altman in November 2023, Satya Nadella announced that Altman and Greg Brockman would lead a team at Microsoft. Two days later Nadella publicly supported OpenAI’s plan for Altman to return. The announcements establish what Microsoft offered and when it took that position. OpenAI’s published summary of a later review attributes the dismissal to a breakdown in trust. What Microsoft knew in advance and how much its offer contributed to reinstatement remain Unresolved without the private communications. Nadella’s November statements · OpenAI’s published review summary

Microsoft reported a $13 billion funding commitment and $12 billion funded as of 30 September 2026. It put its ownership interest in OpenAI at about 24% on an as-converted basis, which measures the stake assuming the relevant securities have converted to common equity. This is a dated financial interest. The CMA reached a separate legal conclusion in March 2025 that Microsoft’s existing material influence had not increased to de facto control for the purposes of its merger inquiry. Microsoft’s September 2026 Form 10-Q · CMA merger decision

Microsoft reported $677 billion in remaining commercial performance obligations at the end of September. This figure measures contract revenue allocated to goods and services still to be provided. It can include sums the company has already billed or received and has yet to recognise as revenue. The amount is Verified as disclosed. Microsoft did not report OpenAI’s share of the September balance. An older concentration figure cannot answer that question because both the customer mix and the total have changed. Microsoft’s fiscal 2027 first-quarter earnings materials · September quarterly filing

The company reported quarterly capital expenditure of $45.2 billion on a basis that includes finance leases. This measures spending and financing for capacity at Microsoft as a whole. The reported September backlog gives the company reason to build, while the cost arrives ahead of some of the revenue it expects to recognise. If demand misses expectations or a customer delays a project, investors need to know which commitments can be deferred and which costs are already fixed. Microsoft’s first-quarter earnings materials

September quarter revenue offers a more immediate measure of what customers were already buying. Microsoft reported $92.3 billion in total revenue and $63.9 billion in Microsoft Cloud revenue, with Azure and other cloud services revenue up 48% year on year. Those are operating results from the completed quarter. The backlog includes future work, some of which can take years to complete. Keeping those measures separate makes it possible to ask whether the capacity build is turning into delivered services. Microsoft’s October 2026 earnings release

Electricity can tie the economics of computing to a project years before it opens. Constellation describes a 20-year agreement with Microsoft supporting the planned restart of the Crane Clean Energy Center, formerly Three Mile Island Unit 1. The operator expects the reactor to return in 2027, subject to approvals. When the project begins supplying power and what it means for other electricity customers remain Unresolved. Constellation’s Crane project description

The April announcement gives OpenAI more freedom to use other providers. Microsoft still has a preferred route for launches, a licence and a financial interest in the company. Microsoft’s payments of a share of revenue to OpenAI stop under the announced terms. OpenAI’s payments to Microsoft continue through 2030 at the same percentage, subject to a total cap and independently of technical progress. The companies did not disclose the cap or publish the amended contract. How the remaining terms work in practice remains Unresolved. April 2026 partnership terms

There is a serious case that Microsoft can earn money whichever models attract customers. It can sell computing and distribution to several developers, and management reported that its commercial backlog had grown 25% year on year in June excluding OpenAI. That measure does not reveal how much Microsoft could lose from an OpenAI delay or default. The Federal Trade Commission’s January 2025 staff report identified potential switching costs and effects on access to computing resources and talent in major cloud partnerships. It said a full analysis of the effects on competition was beyond its scope and made no assessment of illegal conduct. Microsoft’s fiscal 2026 fourth-quarter earnings materials · FTC staff study of AI partnerships

Microsoft reported $10.0 billion in revenue from its commercial arrangements with OpenAI, including revenue-sharing payments, for the three months ended 30 September 2026. It reported $7.2 billion in accounts receivable from OpenAI at that date. Neither figure is the OpenAI share of the commercial backlog. Microsoft September Form 10-Q, Note 1

Evidence cutoff 11 November 2026. This account compares Microsoft’s filed accounts, company announcements, a UK merger decision, the FTC staff study and the power operator’s project account. The public terms leave private contractual triggers, revenue caps and current concentration unresolved.

Microsoft has the contracts, capacity and distribution to make money from more than one lab. Its stake, the announced revenue-sharing agreement and the scale of the cloud relationship still give it substantial exposure to OpenAI. A current disclosure of customer concentration in the commercial backlog, the amended contract or evidence that OpenAI moved a major workload would make it possible to judge how durable Microsoft’s position is.