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OpenAI’s IPO prep gets a little less messy
OpenAI and Microsoft have reportedly agreed to cap total revenue-sharing payments at $38 billion, a change that gives the ChatGPT maker a cleaner story to tell when it starts wooing public-market investors. Translation: fewer weird financial overhangs, more “please buy our future” vibes.
Microsoft keeps the seat at the cool-kids table
The revised terms sound like a relationship status update: complicated, but still exclusive-ish. Microsoft remains OpenAI’s primary cloud partner, and OpenAI products are still expected to launch on Azure first unless Microsoft can’t support the needed capabilities. At the same time, OpenAI now gets more freedom to use other clouds — yes, including Amazon and Google — which is a nice way of saying it’s no longer putting all its eggs in one Microsoft-branded basket.
Why investors should care
This matters because the economics of the deal are finally becoming more legible. According to the report:
- OpenAI will keep paying Microsoft through 2030 at the same percentage, but only up to the new cap.
- Microsoft’s license to OpenAI IP reportedly runs through 2032 and is now non-exclusive.
- Microsoft would no longer be on the hook for paying a revenue share back to OpenAI.
That’s the kind of fine print that can move from “lawyer stuff” to “valuation stuff” pretty quickly if OpenAI heads toward an IPO later this year.
Nadella’s not exactly hiding the swagger
On Monday, Satya Nadella also testified in the Musk v. Altman trial and made the usual CEO move: turning a risky early bet into a victory lap. He said Microsoft is “very proud” it backed OpenAI when nobody else wanted to. Big picture: Microsoft isn’t just an investor here — it’s trying to make sure its AI trophy remains useful, flexible, and not accidentally turned into a public-company headache.