One of Microsoft’s (MSFT) most notable claims to fame lately has been its decision to back OpenAI in its early stages.
The tech leader made its first investment in the AI research organization in 2019, years before ChatGPT changed the way the world saw artificial intelligence (AI). This year began with the two companies announcing plans to evolve their relationship even further by partnering on Stargate, an effort to build new AI infrastructure for OpenAI.
However, January 2025 also brought another development, one that suggests that tides are shifting in Silicon Valley. Microsoft also announced that it is no longer the exclusive cloud provider for OpenAI, coming at a time when the AI startup is expanding rapidly and rolling out new models.
A few months later, the story has an interesting new development: OpenAI has found a new cloud services partner, one that Microsoft recently opted to scale back its relationship with.
Sam Altman, CEO of OpenAI, has made a deal with a prominent tech startup.
An AI newcomer is caught between Microsoft and OpenAI
One of the hottest names among AI stocks isn’t even publicly traded yet. CoreWeave is a cloud-computing startup that provides graphics processing unit (GPU) infrastructure for companies in the AI development space, gearing up to start trading at a highly strategic time.
CoreWeave is poised to be the first major initial public offering (IPO) of the year, something the sector definitely needs. While the company hasn’t announced a date or price for its IPO, it recently filed to go public and investors are excited.
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As CoreWeave IPO hype continues to rise, though, the company is facing both good and bad news. Microsoft recently revealed it would be scaling back its CoreWeave purchases, but OpenAI followed the news by announcing that it would commit $119 billion to CoreWeave over the next several years and receive $350 million in equity.
According to the Financial Times, a source with knowledge of Microsoft cited “delivery issues and missed deadlines” as the primary reason for the company’s decision to opt against furthering its relationship with CoreWeave. But clearly OpenAI isn’t worried about these factors, as its deal with the startup extends for five years.
“It’s a win for both companies. One reason this agreement is so eye-popping (besides the billions involved) is that before this deal, CoreWeave’s biggest customer was Microsoft. In fact, in 2024, Microsoft accounted for 62% of CoreWeave’s revenue, which grew to a stunning $1.9 billion — nearly an eightfold increase from just $228.9 million in 2023.”
That said, Microsoft isn’t the only leading tech company with strong ties to CoreWeave. The startup is likely better known for its longstanding relationship with Nvidia NVDA, which holds a stake worth roughly 5% in it.
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This deal doesn’t necessarily mean that OpenAI’s decision is tied to Microsoft’s. But it’s hard to ignore the fact that it chose to work with CoreWeave just after Microsoft decided to scale back its own relationship.
Will this impact the CoreWeave IPO?
Microsoft’s timing could certainly have negatively impacted CoreWeave’s IPO plans, given that losing such a major customer would likely make some investors nervous. However, the fact that it has picked up OpenAI should help appease any fears that Wall Street may have as CoreWeave maneuvers to raise $4 billion by going public.
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Some experts are optimistic that the AI startup can find its footing and hold its own in the booming AI market, particularly as it isn’t consumer facing and has a somewhat unique business model.
”CoreWeave will need to find the right market positioning. Hyperscalers may decide to build out their own infrastructure (like Meta’s (META) plan), but smaller tech companies could still need a scalable solution that CoreWeave provides,” states Phil Haslett, co-founder and Chief Strategy Officer at EquityZen.
OpenAI is growing quickly and seems to have no plans on slowing down. This new partnership could prove highly advantageous for CoreWeave as it enters a market full of companies with cloud services and AI infrastructure needs, regardless of its relationship with Microsoft.
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