OpenAI has made headlines by entering into a significant five-year agreement worth $11.9 billion with CoreWeave, a cloud service provider focused on graphics processing units (GPUs). This arrangement includes approximately $350 million in equity for OpenAI. Sources indicate that this investment is separate from CoreWeave’s plan to go public; the company recently filed for an IPO but has yet to finalize pricing or a launch date.
The partnership is advantageous for both parties. Previously, Microsoft was CoreWeave’s largest customer, contributing to a remarkable revenue growth from $229 million in 2023 to $1.9 billion in 2024, with Microsoft accounting for 62% of those earnings. With support from Nvidia, which has a 6% stake in CoreWeave, the company operates a GPU-centered cloud service across a network of 32 data centers, housing more than 250,000 Nvidia GPUs. As of late 2024, CoreWeave expanded its GPU resources, incorporating the latest Nvidia technology that enhances AI reasoning.
The dependency on Microsoft raised concerns for potential investors ahead of the IPO, but acquiring OpenAI as a direct customer through this multi-billion-dollar deal could alleviate some of those worries. Interestingly, this move marks a shift in the relationship between Microsoft and OpenAI, which have had a shared but competitive dynamic. CEO Sam Altman’s decision to engage directly with CoreWeave not only gives OpenAI access to essential cloud services but also includes an ownership stake in the provider.
Tensions have been mounting as OpenAI and Microsoft vie for enterprise clients, with OpenAI reportedly developing high-demand AI tools after Microsoft ceased being OpenAI’s exclusive cloud service partner earlier this year.
Meanwhile, the founders of CoreWeave, who previously launched the company as a cryptocurrency mining venture, have sold off significant shares worth $488 million collectively and are preparing to address the company’s $7.9 billion debt with future IPO proceeds.
