OpenAI becomes public-benefit corp, revises Microsoft deal

OpenAI has completed its controversial transition to a public benefit corporation and simultaneously renegotiated its partnership terms with Microsoft, the newsletter reports. The original nonprofit has been rebranded as the OpenAI Foundation and now holds roughly $130B of equity; the foundation will direct $25B toward health research and “AI resilience infrastructure.”

Under the new arrangement Microsoft’s ownership in the new entity falls from 32.5% to about 27%, though that stake is now worth an estimated ~$135B after recent funding. The deal also adds governance measures: an independent expert panel will be tasked with verifying any future AGI claims, and Microsoft retains certain technology rights through 2032 even if AGI is achieved.

The revised terms allow both parties more flexibility: Microsoft and OpenAI can pursue AGI with other partners, and while OpenAI committed to $250B in Azure purchases, it is not exclusively tied to Microsoft for compute. The newsletter frames the moves as ending a long, bumpy restructuring process and as steps that should ease tensions between the AI leader and its largest partner.

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