Things may be about to get even rockier for OpenAI, as Microsoft AI chief Mustafa Suleyman confirmed that the firm is gearing up to ditch OpenAI’s models.
“We have to develop our own foundation models, which are at the absolute frontier, with gigawatt-scale compute and some of the very best AI training teams in the world,” Suleyman said.
The strategic shift comes as OpenAI-linked activity accounts for an estimated 45% of Microsoft’s broader AI-driven revenue pipeline, creating what analysts describe as a concentration risk.
While Microsoft continues to benefit financially from its partnership — reporting roughly $7.6 billion in quarterly net income tied to its OpenAI stake — the company is simultaneously directing significant resources toward internal alternatives designed to achieve long-term AI self-sufficiency
Capital expenditure reflects the scale of the transition. Microsoft’s quarterly infrastructure spending surged 66% to $37.5 billion, part of a planned $140 billion AI infrastructure commitment for the current fiscal year.
The investment push includes development of the Maia 200 AI accelerator, expansion of the Fairwater data-centre network, and supply agreements for advanced SK Hynix HBM3E memory — moves that mirror the industry-wide race toward proprietary AI hardware stacks.
On the software side, Microsoft is building its MAI family of foundation models while broadening Azure’s multi-model marketplace, which already hosts systems from Anthropic, Meta, Mistral, and others.
Office 365 is also expected to integrate Anthropic’s Claude Sonnet 4 across Word, Excel, Outlook, and PowerPoint, signalling a deliberate move away from exclusive reliance on OpenAI-powered productivity features.
Despite exceeding revenue expectations, the spending surge has weighed on investor sentiment.
Microsoft shares have declined more than 16% year-to-date and dropped a further 7% following earnings, as Azure’s 39% growth fell short of analyst forecasts and gross margins narrowed to roughly 68%, their lowest level in three years.
Meanwhile, OpenAI is pursuing parallel independence strategies of its own, exploring alternative financing partnerships, developing proprietary infrastructure with Broadcom, and reportedly evaluating expansion into new digital platforms.
Public sentiment toward AI remains broadly negative even as usage surges, with relatively few consumers willing to pay for the technology.
Microsoft has become a focal point of that frustration — from the “Microslop” meme mocking its uneven Windows 11 AI rollout to a multibillion-dollar market slide driven by investor concerns that its massive AI infrastructure spending may be outpacing real-world demand.
