Microsoft restructures OpenAI partnership

The four tech hyperscalers — Amazon, Alphabet, Meta and Microsoft — reported quarterly earnings this week with OpenAI looming large over their results, as the ChatGPT creator, now valued at more than $850 billion by private investors, has become a major market mover whose revenue and spending are increasingly viewed as a proxy for the artificial intelligence trade. The focus on OpenAI intensified after a Wall Street Journal report suggested the company missed revenue and user growth projections, sending shares of Oracle, Nvidia, Advanced Micro Devices and Broadcom lower before the earnings reports. OpenAI characterized the report as "ridiculous." The week also brought fresh attention to OpenAI's sprawling industry ties, as Microsoft announced a major shake-up to its established partnership with OpenAI — which has already received $13 billion from Microsoft — while Amazon revealed that OpenAI's models would be available on its AWS cloud computing service, with Amazon having recently committed $50 billion to the AI company. The hyperscalers reporting earnings maintain complex, overlapping relationships with OpenAI: Microsoft is both a major investor and partner, Amazon has become a strategic partner despite its closer ties to Anthropic, Alphabet directly competes through its Gemini models, and Meta competes primarily for AI talent. Analysts at Roth described OpenAI as a "real competitive threat" to Google but characterized it as "manageable," noting Google's success with its cloud business and custom tensor processing units as popular alternatives to Nvidia's GPUs. At Meta, CEO Mark Altman revealed that the company attempted to poach OpenAI employees with signing bonuses as high as $100 million. Meta responded by saying OpenAI countered those offers, with Chief Technology Officer Andrew Bosworth describing the hiring environment as "kind of unprecedented" in his 20-year career. Meanwhile, Meta recently introduced its first proprietary model, Muse Spark, from its Meta Superintelligence Labs division led by Alexandr Wang. Separately, cash-rich AI startups are fueling a commercial real estate boom in Manhattan, with AI companies signing leases for more than 845,000 square feet in 2025 at nearly double that rate in the first quarter of 2026. Real estate brokers report seeing AI firms leasing spaces 60% larger than their current head count requires, betting on future growth while securing prime downtown Manhattan locations in SoHo, Flatiron and NoMad. Blake Anderson, founder of AI startup 10x, pays $28,500 a month for a 3,000-square-foot SoHo office with 30 desks despite having only four employees, saying the extra space increases his ability to think clearly. Landlords, scarred by the dot-com collapse in the early 2000s, typically scrutinize balance sheets and revenue projections before committing, but remain willing to bet on AI growth given the industry's cash reserves and rapid expansion.