Microsoft (MSFT) has come under pressure after the company and OpenAI announced a major rewrite of their commercial relationship that ended Microsoft’s exclusive license to OpenAI technology. MSFT fell as low as $405.60 during the session, nearly 5% below its intraday high of $426.92, before trimming losses. At the latest reading, the stock was trading at $423.06, down 0.37% from the prior close.
The move followed a joint statement from OpenAI and Microsoft saying the partnership had been amended to give both sides more flexibility. Under the new terms, Microsoft remains OpenAI’s primary cloud partner, but OpenAI can now serve all of its products across any cloud provider.
Microsoft will still hold a license to OpenAI intellectual property for models and products through 2032, but that license is now non-exclusive. Microsoft will also stop paying a revenue share to OpenAI, while OpenAI will continue paying Microsoft a revenue share through 2030 at the same percentage, subject to a total cap.
That change appears to be the main reason the stock sold off early in the session. Reports noted some investors viewed the revised structure as Microsoft losing a valuable competitive advantage in the AI race because OpenAI can now distribute its products across rival cloud platforms, including Amazon and Google.
OpenAI Deal Removes a Key Layer of Exclusivity
For much of the AI cycle, Microsoft’s relationship with OpenAI gave it a privileged position in cloud distribution and product access. The amended agreement keeps some of that structure in place, but it loosens one of the market’s most closely watched links between the two companies. OpenAI said its products will still ship first on Azure unless Microsoft cannot and chooses not to support the needed capabilities, but the company is no longer locked into Microsoft as the only route to market.
That matters because exclusivity has been part of the investment case around Microsoft’s AI strategy. The revised agreement leaves Microsoft with continued access, continued ownership exposure as a major shareholder, and continued preferred cloud status, but it no longer guarantees exclusive access to OpenAI’s models and products. For equity investors, that changes how Microsoft’s AI edge may be valued against other hyperscalers.
The new structure also reflects how the relationship has been changing over time. AP reported that OpenAI has been moving toward a more commercial model and has been balancing its reliance on Microsoft with other cloud partners such as Amazon, Google and Oracle. Reuters separately reported that tensions had risen as OpenAI pursued deals with Microsoft rivals while investors paid closer attention to the two companies’ alignment.
Revenue-Share Changes also Shift the Financial Picture
Another point investors are likely weighing is the new revenue-sharing setup. According to Sam Altman, Microsoft will no longer pay a revenue share to OpenAI. At the same time, OpenAI will keep paying Microsoft a revenue share through 2030, independent of OpenAI’s technology progress, at the same percentage but with a total cap. According to reports, the existing percentage is 20%, citing a source familiar with the agreement.
That means Microsoft is giving up one financial obligation while keeping another stream of participation in OpenAI’s growth. Even so, the market reaction suggests that investors focused more on the loss of exclusivity than on the reduction in Microsoft’s revenue-sharing payments. Moreover, most traders have seen the revised arrangement as giving both companies more flexibility but also as reducing Microsoft’s unique hold on OpenAI’s technology.
The agreement also removed another layer of uncertainty around OpenAI’s future development path. Consequently, Microsoft no longer needs to determine its response if OpenAI concludes it has reached artificial general intelligence, or AGI, under the previous structure. That simplification may reduce legal and contractual friction, but it also makes the relationship look more like a flexible commercial alliance than an exclusive strategic lock-up.
However, the timing has added another reason for caution in the stock. According to reports, the company will report fiscal 2026 third-quarter earnings on April 29. With the report only two days away, investors are likely to be especially sensitive to any change that could affect how Azure, Copilot, and broader AI monetisation are evaluated.
