Is Microsoft Over-Earning on OpenAI?

I have been trying to work out whether Microsoft is over-earning on its relationship with OpenAI. The question has been on my mind since Microsoft’s FY26 10-K, which for the first time disclosed how much revenue it books from OpenAI: $24.1 billion for the fiscal year ended June 2026, “inclusive of revenue-sharing payments”. Azure crossed $100 billion of revenue in the same year, so one customer, which Microsoft also partly owns, seemingly accounts for almost a quarter of Azure.

Of course, the concentration itself has been well covered. What I want to work through is slightly different: how much of Microsoft’s current earnings, and more importantly its earnings growth, comes from pieces of the OpenAI relationship that are contractually finite and unusually profitable?

I will explore that question behind the paywall.

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