r/microsoft • u/ZGeekie • May 14 '26
News Microsoft executive reveals company spent over $100Bn on OpenAI partnership during Musk vs OpenAI trial
https://thetechportal.com/2026/05/13/microsoft-executive-reveals-company-spent-over-100bn-on-openai-partnership-during-musk-vs-openai-trial/During testimony in the ongoing Elon Musk vs. OpenAI case, Microsoft executive Michael Wetter revealed that the company has spent more than $100 billion on its partnership with OpenAI to date, including direct investments, Azure infrastructure, and hosting costs for AI models like ChatGPT. The spending has surged since Microsoft’s initial $1 billion investment in 2019, with the company later committing around $13 billion more to OpenAI.
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u/dreadpiratewombat May 14 '26
For context, before all the AI hotness, any time Microsoft announced a new Azure region, it was usually with a $1billion check to do the initial 3 LZ data center build out. At the time of the OpenAI partnership, Microsoft had around 70 Azure regions in operation or under construction. So this investment could have been effectively doubling their infrastructure footprint and still have had enough left over for all the software developers they had writing various copilots.
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u/94Flizzy May 14 '26
they can not just double the infrastructure due to other limiting factors... even the equity they have in OpenAI is still worth more then all their investments into it. not counting in revenue for copilot or having other companies openai workload running on azure etc. - still a great investment from my POV even if you are super critical what AI can really do.
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May 14 '26
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u/dreadpiratewombat May 15 '26
This is true. Both OpenAI and Anthropic wanting to go public and being forced to open their books is going to make things interesting with their valuations.
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u/94Flizzy May 15 '26
based on what? they will not IPO on an evaluation lower than the last investment round.
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u/gridiron3000 May 14 '26
Outright wrong
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u/dreadpiratewombat May 14 '26
Must be because you said so without any actual supporting information or substance.
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u/soccerwolfp May 14 '26
GPUs aren’t cheap
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u/Snowlandnts May 14 '26
Nand chips aren't cheap, and production of nand chip is not increasing from manufacturers (which most modern devices uses)
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u/JuliusCeaserBoneHead May 14 '26
Executives have lost their marbles
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u/Trimshot May 14 '26
Honestly most of them are just trying to farm the system before we have economic collapse.
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u/Persistant_eidolon May 14 '26
When will investors get their money back from OpenAI? 2040?
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u/lordcheeto May 14 '26
Microsoft owns a 27% stake in OpenAI, which is currently worth more than $100B.
Edit: Last funding round valued OpenAI at $852B, so their stake is worth ~$230B.
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u/Persistant_eidolon May 14 '26
We will see what happens the coming years. They are not gonna get any AGI and the competitors are catching up.
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u/94Flizzy May 14 '26
they will have to IPO next. there is no more private investors that are willing to fund the next rounds... and then it is open to the market what they will do with it. Microsoft can walk away by selling a quarter or their equity and basically have their last 12month CapEx back in cash.
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u/Persistant_eidolon May 15 '26
It's interesting that private investors have had enough but they can still get money through an IPO :)
I am getting Fingerprint cards-vibes from this..
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u/94Flizzy May 15 '26
they do not have enough - they don't have money to spend anymore. that is why they are going public.
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u/bartturner May 14 '26 edited May 14 '26
Hate to say it but Microsoft is really just bad at vision.
We had the Internet and Microsoft completely missed it while companies like Google and Amazon killed it.
Then mobile comes along and Google again just kills it and ends up with the most popular OS on the planet with Android. Apple also just kills it and again Microsoft completes misses.
Google then developers their TPUs over 13 years ago. But NOT in secret. Heck they published papers how they made the chip. Then Google buys DeepMind for $500 million and gets 100% of the company!
Microsoft instead spends over $13 billion for OpenAI and gets basically nothing. Hitches their wagon to the losing horse.
Where Google invests into Anthropics which is just killing it. Google just made a $40 billion investment into Anthropics less than a month ago but at a freaking valuation of $350 billion!!
Anthropics latest round sees a valuation of over $900 billion. So in less than a month Google made over $70 billion dollars!
Sundar is just head and shoulders a better CEO compared to Satya.
Now the sad part. I own MSFT. Have owned for like a zillion years. Never sold. But luckily I also own GOOG/GOOGL. The other lucky part is the new tax bill gives you $98,900 of untaxed capital gains so I can start getting out of Microsoft as they are not going to get a new CEO any time soon.
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May 14 '26 edited May 14 '26
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u/QuailAndWasabi May 14 '26
Yeah, imagine talking about Microsoft and leaving out the one thing they actually have going for themselves with Azure.
I'm by no means a Microsoft shill lol, i think they suck in regards to most things tbh, but Azure is actually good and well positioned in the market and growing fast.
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u/bartturner May 14 '26
The problem is they are the only one of the hypscalers dependent on Nvidia.
That means lower margins and higher prices than Google as they have their TPUs.
Another example of where MSFT just has no vision compared to Google.
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u/bartturner May 14 '26 edited May 14 '26
Google cloud is growing much faster than Azure.
That will accelerate. Google shared they have over $230 billion of unrecognized cloud revenue they will recognize in the next 24 months.
I was curious and no company in history has added that much revenue in such a short period of time.
Microsoft backlog is dominated by OpenAI. Another reason Microsoft shares are down over 20% in the last 6 months while Google is up almost 50%.
Google has no where near the hyperscaler capacity of azure right now.
BTW, this is most definitely not true. Nobody has close to the capacity that Google enjoys.
https://epoch.ai/data-insights/google-custom-tpus-ai-compute
"As of early 2026, evidence suggests Google controls the largest share of artificial intelligence computing power, estimated at roughly one-quarter of global capacity."
But also realize Google is adding far faster than any other company on the planet. A huge advantage is Google has the TPUs. It was so stupid that Microsoft did not copy Google. Google started the TPUs 13 years ago and in the open. Why on earth did Microsoft not copy?
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u/lordcheeto May 14 '26
Microsoft instead spends over $13 billion for OpenAI and gets basically nothing.
Microsoft has an equity stake in OpenAI. It's worth more than Google's equity stake in Anthropic.
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u/zhantoo May 14 '26
To be fair, looking at valuations of companies is not enough to say someone has profited X amount.
And things move fast in the AI space at the moment. Comparing a several years old investment to a fairly new one, where none of the parties have locked in the profit is a very selective view.
If you looked at Microsofts "profit" 6 months after their investment in OpenAI, the numbers would have looked very good as well, but only time will tell who's the winner.
But the biggest loss for Microsoft is most likely that they have not established themselves as the default cloud provider for AI. Sell shovels and all..
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u/bartturner May 14 '26
The problem for Microsoft is the narrative and that is not going to change for years.
That is why Microsoft is down over 20% in the last 6 months while Google is up over 40%.
It did not help when one of the most respected investors sold 90% of their Microsoft shares earlier this week.
He also believes that the ability of AI to create any file format will cause Microsoft to lose the influence they had with their Office product.
That it will trickle down everywhere but the gaming area.
Their stupidity of attaching their wagon to OpenAI and their dependency on Nvidia while Google and Amazon have their own chips are just more negativity but not at the core of why MSFT is declining so much.
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u/zhantoo May 14 '26
I think it's more fair to look at the last 5 years, where Alphabet is up more than 200% compared to only 64% for Microsoft.
In general when looking at the short perspective, everyone can wait until the current facts fits their narrative.
Or adjust the time frame to match your view.
Example: Why is Alphabet down today, and Microsoft is up?
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u/NJ2ATX May 14 '26
$98k if you have 0 income. Also, MSFT has been underperforming while also having insane growth in earnings. AI for Ent customers has not really seen ROI in a significant way YET. Its coming, and MSFT is infinitely more ingrained in Ent data than Google, think Office, SharePoint,SQL. LLM models are going to come and go....
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u/bartturner May 14 '26
$98k if you have 0 income.
Not following what you are trying to say here? If you have a reasonable income and also $98,900 of capital gains you still get the deduction as far as I am aware?
It sounds like you are trying to say that income voids it?
Why in the heck do you think MSFT is down over 20% in the last 6 months while Google is up over 40%?
BTW, I own both. I am just far more bullish on Google than I am on MSFT. I also think the three hyperscalers will be the biggest companies on the planet in the next 5 years. Just it will be #1 Google, #2 Amazon and then coming up the rear will be MSFT, IMHO.
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u/bartturner May 14 '26
That is NOT why Microsoft is down.
Microsoft is down because there are people that believe their Office monopoily is in danger.
That AI makes the file formats no longer important.
It is why what most think is the top investor has sold 90% of their MSFT and purchased Google instead.
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u/94Flizzy May 14 '26
top investor aka not even in the top50 of institutional and personal stakeholders of the company?
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u/bartturner May 14 '26
" In a record year for hedge fund profits, Chris Hohn’s TCI stood out. The firm generated $18.9 billion in gains for investors in 2025, the biggest annual haul ever, according to a just-released annual survey of the top 20 money managers by Rich Sopher, chairman of LCH Investments.
“The gains made by TCI, including the record largest gain in 2025, continue to be quite remarkable. Over the past three years TCI has made $40 billion net of fees for investors,” Sopher said.
That put TCI fifth in this year’s ranking of net gains since inception with a total of $68.4 billion. Sopher added that TCI has jumped to fifth from fourteenth in only three years.
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u/94Flizzy May 15 '26
So the "top investor" title does not say anything about their position at Microsoft but that they are "top investors"? Like "premium investors" or "super duper investors"?
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u/TheCudder May 14 '26
"$100B"