OpenAI has recently reached a non-binding agreement with Microsoft to restructure their partnership. This new arrangement would see OpenAI’s for-profit arm transformed into a public benefit corporation (PBC).

The specifics of the commercial terms are not disclosed, but both companies confirm they are actively working towards finalizing a definitive deal. According to CNN, this development signifies an important phase in their discussions, as OpenAI looks to secure capital through a more conventional corporate structure and eventually go public for AI research funding.

Key Details of the Partnership

OpenAI has regulatory hurdles to clear before converting to a PBC. Approval from California and Delaware’s attorneys general is necessary, with completion expected by the end of 2025.

Microsoft’s investment in OpenAI amounts to $1 billion in 2019, followed by an additional $10 billion at the start of 2023. The previous agreement granted Microsoft exclusive rights to sell OpenAI’s software tools through its Azure cloud platform and provided access to their technology.

This year, Microsoft reduced its grip on OpenAI’s compute needs, enabling the startup to pursue independent projects like Stargate and partnerships with Oracle and Google for cloud computing services. As revenue increases, OpenAI seeks broader corporate structure and additional cloud provider collaborations to expand sales and ensure sufficient computing power.

This move comes after an announcement in May 2025 regarding potential renegotiations for new funding and an IPO. The intention is to prepare for a future IPO while safeguarding OpenAI’s access to advanced AI models, as reported by the Financial Times.