Microsoft Corp (NASDAQ:MSFT) and OpenAI have edged closer to reshaping one of the most-watched alliances in artificial intelligence, with a non-binding deal paving the way for OpenAI to adopt a conventional for-profit structure.
The agreement, announced after hours UK time on Thursday, signals progress in lengthy negotiations that could eventually clear the path to a stock market listing.
Precise terms have not been disclosed, but both sides said they aim to finalise a definitive contract.
The talks reflect OpenAI’s need to secure capital and greater flexibility as demand for computing power surges.
Microsoft has already committed more than $11 billion since 2019, but OpenAI has also struck infrastructure deals with Oracle and Google, moving away from its earlier reliance on Microsoft’s Azure cloud.
At stake for Microsoft is continued access to OpenAI’s most advanced models, even if the start-up claims to achieve human-level intelligence, a milestone that would currently terminate their partnership.
For OpenAI, the revised framework would give its nonprofit parent a vast funding stream while unlocking billions in new investment, subject to regulatory approval in California and Delaware.