Microsft reported a $7.6 billion increase in net income for its latest quarter, attributed to its investment in OpenAI.
The company has invested more than $13 billion in the AI firm. OpenAI reportedly operates under a 20% revenue-share agreement with Microsoft, though neither has publicly confirmed the arrangement.
OpenAI is currently seeking additional funding at a valuation between $750 billion and $830 billion, according to Bloomberg.
In September, Microsoft and OpenAI renegotiated partnership terms following OpenAI’s restructuring into a public-benefit corporation. OpenAI committed to purchasing an additional $250 billion in Azure services as part of the agreement.
This commitment contributes to Microsoft’s “commercial remaining performance obligations,” which rose to $625 billion from $392 billion in the prior quarter. Microsoft stated that 45% of these obligations stem from OpenAI.
The earnings report also highlighted Anthropic’s role in driving Microsoft’s future revenue through commercial bookings, which grew 230%.
In November, Microsoft announced a $5 billion investment in Anthropic. Anthropic signed on for $30 billion in Azure compute capacity and expressed intent to purchase more in the future.
Microsoft’s capital expenditures reached $37.5 billion during the quarter. Two-thirds of this amount went toward “short-lived” assets, primarily GPUs and CPUs for the Azure cloud to support AI workloads.
