Microsoft Reports $3.1 Billion Loss from OpenAI Investment as AI Giant Burns Through $11.5 Billion in Single Quarter
Summary
Microsoft reports a staggering $3.1 billion loss from its OpenAI investment as the AI giant burns through $11.5 billion in a single quarter, revealing massive financial struggles despite generating billions in annual revenue.
Key Points
- Microsoft reports a $3.1 billion loss from its OpenAI investment in Q1 FY26, suggesting OpenAI incurred approximately $11.5 billion in losses during the quarter
- Microsoft now owns 27% of OpenAI Public Benefit Corporation valued at $135 billion, meaning it absorbs 27% of OpenAI's profits and losses under their equity accounting method
- OpenAI continues struggling financially despite generating $3.5-4.5 billion annually, as it spends $7 billion on AI model training and $1.5 billion on staffing costs