CoreWeave Secures: In a strategic power play, OpenAI has signed a monumental five-year, $11.9 billion agreement with CoreWeave, a leading GPU-driven cloud service provider, according to Reuters. The deal includes $350 million in equity for OpenAI, further solidifying its stake in the AI cloud computing race.
CoreWeave’s Meteoric Rise & Microsoft’s Role
Before this deal, CoreWeave’s largest customer was none other than Microsoft, which accounted for 62% of CoreWeave’s revenue in 2024—a staggering $1.9 billion, up from just $228.9 million in 2023. With this new OpenAI agreement, CoreWeave diversifies its customer base, a strategic move that may ease investor concerns ahead of its anticipated IPO, filed last week.
Backed by Nvidia (which holds a 6% stake), CoreWeave operates 32 data centers and manages over 250,000 Nvidia GPUs, including the latest Blackwell AI processors designed for advanced AI reasoning.
Tensions Escalate: OpenAI vs. Microsoft
This deal underscores the increasing tension between OpenAI and Microsoft. While Microsoft has been a key backer of OpenAI, with a revenue-sharing agreement in place, the companies have been on a collision course as OpenAI expands its own enterprise offerings.
Microsoft has also been aggressively developing its own AI models (such as MAI) to compete with OpenAI’s GPT-powered services. In a bold hiring move, Microsoft even brought on Mustafa Suleyman, co-founder of DeepMind and a direct rival of OpenAI’s CEO, Sam Altman.
Adding another layer to the rivalry, OpenAI recently ended its reliance on Microsoft as its sole cloud provider, signing the Stargate AI infrastructure deal with SoftBank, Oracle, and others to secure more computing power. Altman himself has openly expressed concerns, stating that OpenAI is “out of GPUs”, highlighting the urgent need for cloud expansion.
CoreWeave’s Risky Yet Lucrative Bet
CoreWeave, originally a crypto-mining startup, was founded by former hedge fund investors who have since cashed out $488 million in shares. However, the company carries a hefty $7.9 billion debt load—a risk factor that could impact its IPO success. If the public offering brings in the anticipated billions, CoreWeave plans to pay down some of its debt while expanding its AI infrastructure.
What’s Next?
With OpenAI now holding a stake in CoreWeave, Microsoft’s dominance over AI cloud services faces a major shake-up. This deal not only gives OpenAI direct access to high-performance AI computing power but also strengthens its independence from Microsoft’s Azure cloud services.
The AI cloud wars are heating up, and this $12 billion bet could be a game-changer in the future of AI development and cloud dominance.
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What is CoreWeave, and why is it important?
CoreWeave is a GPU-powered cloud computing provider specializing in AI workloads. Backed by Nvidia, it operates 32 data centers and manages over 250,000 Nvidia GPUs. This makes it a key player in AI infrastructure, rivaling traditional cloud providers like Microsoft Azure, Google Cloud, and AWS.
What is the significance of OpenAI’s $12 billion deal with CoreWeave?
OpenAI has signed a five-year, $11.9 billion agreement with CoreWeave to secure high-performance AI computing resources. This move diversifies OpenAI’s cloud infrastructure, reducing its dependence on Microsoft Azure.
