Microsoft’s Investment in OpenAI Yields $7.6B Gain Last Quarter

Seattle: Microsoft and OpenAI have a rocky relationship. But Microsoft is making a lot of money from it. Last quarter, Microsoft reported that it gained $7.6 billion from its investment in OpenAI. This growth is because OpenAI does well with its earnings.

Microsoft has invested over $13 billion in OpenAI. They have a deal where Microsoft gets 20% of OpenAI’s revenue, although neither side has confirmed it. OpenAI is now looking to raise more money and might be worth between $750 billion and $830 billion.

Recently, Microsoft and OpenAI changed some terms of their agreement. OpenAI turned into a public benefit company. In this new deal, OpenAI said it would purchase $250 billion of Azure services. This shows that Microsoft has big contracts to fulfill, and part of that is from OpenAI.

Microsoft said its future earnings grew thanks to companies like Anthropic. In November, Microsoft announced a $5 billion investment into Anthropic, and that company plans to buy $30 billion worth of Azure services soon.

However, Microsoft is spending a lot to support its AI plans. Last quarter, it spent $37.5 billion, mostly on new computers to run AI services. Overall, Microsoft earned $81.3 billion, which was more than analysts expected. Microsoft Cloud reached $50 billion in revenue for the first time. Most parts of Microsoft grew well, except for Windows devices and Xbox services, which had small declines.