MSFT · 10-Q · 2026Q1 · Full report

OpenAI Partnership and Gains

MICROSOFT CORP · 2026-04-29 · Importance 90 · Surprise 100 · In source text

Microsoft reiterates its long‑term strategic partnership with OpenAI, noting extensions to the partnership in October 2025 and April 2026 and that Microsoft will continue to receive revenue‑sharing payments and hold rights to OpenAI IP for product integration. The company reported net recognized gains from OpenAI investments that materially affected other income (expense), net — including $5.9 billion of net gains for the nine months ended March 31, 2026 primarily related to a dilution gain from the OpenAI Recapitalization. Microsoft states current‑year net income and diluted EPS were positively impacted by net gains from OpenAI investments amounting to $4.5 billion and $0.60, respectively. The partnership drives product integration across Microsoft Cloud and Copilot offerings and represents a significant strategic and financial exposure in the MD&A.

Key facts

• We extended our long-term strategic partnership with OpenAI in October 2025 and April 2026 and will continue to receive revenue-sharing payments and hold rights to OpenAI’s intellectual property for integration into our products. source
• Other income (expense), net included $19 million of net losses and $5.9 billion of net gains for the three and nine months ended March 31, 2026, respectively, from investments in OpenAI. source
• For the nine months ended March 31, 2026 current year net income and diluted EPS were positively impacted by net gains from investments in OpenAI, which resulted in an increase in net income and diluted EPS of $4.5 billion and $0.60, respectively. source
• Current year net income and diluted EPS for the three months ended March 31, 2026 were negatively impacted by net losses from investments in OpenAI, which resulted in a decrease in net income of $14 million. source

Impact estimates