Latent Space AI Leaked Data Shows OpenAI’s Finances Hit Hard by Microsoft Fees
Nov 18, 2025
Leaked documents reveal how surging AI usage is straining OpenAI's finances due to hefty Microsoft fees. The podcast unpacks a 20% revenue share agreement and explores the complexities of net versus gross revenue reporting. It discusses OpenAI's soaring inference costs and a strategic shift from relying solely on Azure to engaging multiple cloud providers. With projections of a $20B annual run rate and significant spending increases, the broader implications for the AI market are also examined.
AI Snips
Chapters
Transcript
Episode notes
Microsoft's Large Revenue Share
- Leaked documents reveal Microsoft received large revenue-share payments from OpenAI in 2024 and 2025.
- The payments stem from a reported 20% revenue-share tied to Microsoft's multi-billion dollar investment in OpenAI.
Revenue Flows Between Microsoft And OpenAI
- Microsoft and OpenAI apparently exchange revenue shares: OpenAI pays Microsoft and Microsoft returns revenue from Bing/Azure OpenAI.
- Public filings don't break these flows down, making true net gains opaque for both firms.
Soaring Inference Costs
- Leaks estimate OpenAI's inference (serving) costs rose from ~$3.8B in 2024 to ~$8.65B in the first nine months of 2025.
- These inference costs are mostly cash expenses and pressure profitability as usage surges.