OpenAI Restructures as Public Benefit Firm, Retains Microsoft Ties

OpenAI Restructures as Public Benefit Firm, Retains Microsoft Ties

OpenAI announced on Tuesday that it has completed a major restructuring to become a public benefit corporation, following approval from attorneys general in Delaware and California.

The shift enables the developer of ChatGPT to generate profits more efficiently while ensuring that its nonprofit arm retains overall control. The move comes after more than a year of negotiations over governance and investor influence.

Chief Executive Sam Altman said the company’s future plans may include a public listing to meet growing capital demands, though no specific timeline was set.

Under the new structure, Microsoft remains a central partner, holding about 27% of the for-profit entity — slightly ahead of the nonprofit’s share. Microsoft’s $135 billion investment continues to play a vital role in OpenAI’s funding and infrastructure plans.

Delaware Attorney General Kathy Jennings and California Attorney General Rob Bonta said their offices would continue to oversee whether OpenAI maintains its charitable mission and AI safety standards.

Bret Taylor, chair of OpenAI’s board, said the simplified corporate framework ensures nonprofit oversight “with a direct path to major resources before AGI arrives.” AGI, or artificial general intelligence, refers to systems that outperform humans in most economically valuable tasks.

The renewed agreement with Microsoft guarantees access to OpenAI’s advanced technology until at least 2030, with product rights secured through 2032. Analysts described the deal as a “positive development,” citing seven years of assured collaboration.

OpenAI’s restructuring follows ambitious global expansion plans, including a large data centre in Texas with Oracle and SoftBank, and additional facilities worldwide. Altman said these projects raise the company’s long-term commitments to about $1.4 trillion.

The nonprofit arm, now called the OpenAI Foundation, plans to allocate $25 billion toward initiatives in healthcare, disease prevention, and cybersecurity.

Despite these safeguards, critics argue the changes may still prioritise profit over public benefit. Robert Weissman of Public Citizen said the nonprofit’s control “appears largely symbolic.”

The restructuring comes nearly a year after Altman’s brief ousting by the board triggered governance reforms. Meanwhile, Elon Musk continues to pursue a lawsuit accusing OpenAI of straying from its founding mission — a case a federal judge has allowed to proceed.