In a move with implications for Microsoft, Japan tech titan Masayoshi Son's SoftBank is reportedly close to finalizing a new investment in generative artificial intelligence leader OpenAI. Microsoft stock dipped amid the news.
SoftBank will pony up $40 billion in OpenAI at a $260 billion valuation, CNBC reported. Part of the funding could go toward the Stargate project recently announced by President Donald Trump.
With the funding, SoftBank would replace Microsoft as the biggest investor in OpenAI. Microsoft has provided over $13 billion in funding to OpenAI.
Microsoft Stock: OpenAI Relationship Cools?
However, Microsoft recently has moved away from being the exclusive provider of cloud computing infrastructure to OpenAI, which has turned to Oracle, Coreweave and others.
Revenue growth in Microsoft's Azure cloud computing unit has lagged expectations amid data center capacity constraints.
OpenAI recently raised $6.6 billion in new funding, valuing the startup at $157 billion. New investors included SoftBank and Nvidia.
OpenAI plans to adopt a for-profit business structure in 2025. Also, OpenAI said it plans to create a Delaware public benefit corporation to oversee commercial operations.
OpenAI, Anthropic and other startups are scrambling for cash infusions from well-capitalized tech industry giants in order to continue operating.
Amazon.com in November put $4 billion more in Anthropic, bringing its investment to $8 billion.
The AI boom has relied mainly on large language models, or LLMs, which require massive amounts of data and computing power to be trained. Large language models allow users to interact with AI systems without the need to write algorithms.
DeepSeek Shakes Up AI Industry
Chinese startup DeepSeek's low-cost, open-source artificial intelligence training models have roiled the tech industry. Controlled by Chinese hedge fund High Flyer, DeepSeek competes with Meta Platforms' open-source AI models.
OpenAI released generative AI-based ChatGPT in late 2022 and has been adding new LLMs to its family.
On the stock market today, Microsoft stock dropped a fraction to 413.60. Microsoft stock has dropped 1% in 2025. Also, Microsoft stock holds a Composite Rating of only 66 out of a best-possible 99.
Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.
