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Microsoft briefly reached a market cap of $4 trillion, thanks to OpenAI’s completed restructuring. As the largest shareholder, Microsoft holds a $135 billion stake, or 27% of OpenAI. This $135 billion valuation of its share of OpenAI marks a significant success for the company, as it is almost 10 times greater than the $13.75 billion Microsoft has invested in OpenAI since 2019, according to the Financial Times. Barclays analyst Raimo Lenschow told Reuters about the restructuring: “We see Microsoft shares acting better again. The new OpenAI agreement creates a solid framework for years to come and removes an overhang that has pressured shares in recent months. We hope that solid earnings tomorrow will be the next driver to put Microsoft back on investors’ radar.” Microsoft is advancing its artificial intelligence strategy and has secured three separate deals in a single day. Microsoft makes deals with Lambda, IREN, and the government Lambda, builder of gigawatt-scale AI factories for training and inference, entered into a multibillion-dollar agreement with Microsoft to deploy AI infrastructure powered by tens of thousands of Nvidia GPUs, including Nvidia GB300 NVL72 systems. “It’s great to watch the Microsoft and Lambda teams working together to deploy these massive AI supercomputers,” said Stephen Balaban, CEO of Lambda. “We’ve been working with Microsoft for more than eight years, and this is a phenomenal next step in our relationship.” Microsoft signs $9.7 billion deal with IREN Microsoft has signed a multi-year contract with IREN Limited (IREN) for GPU cloud services. IREN will provide Microsoft with access to NVIDIA GB300 GPUs over a five-year term, with a contract value of $9.7 billion, including a 20% prepayment. Dell Technologies will provide the GPUs and ancillary equipment to IREN for approximately $5.8 billion. The GPUs are expected to be deployed in phases through 2026 at IREN’s 750 MW Childress, Texas campus. Jonathan Tinter, president, Business Development and Ventures at Microsoft, stated: “Together with IREN, Microsoft is delivering cutting-edge AI infrastructure for our customers. IREN’s expertise in building and operating a fully integrated AI cloud — from data centers to GPU stack — combined with their secured power capacity, makes them a strategic partner. This collaboration unlocks new growth opportunities for both companies and the customers we serve.” Microsoft gets approval to ship AI chips to the UAE Microsoft has secured U.S. approval to ship Nvidia chips to the United Arab Emirates (UAE) and plans to invest approximately $8 billion in data centers, cloud computing, and other AI projects in the UAE over the next four years. The company invested $1.5 billion last year to take a minority stake in Abu Dhabi AI company G42. G42’s past ties to China have sparked scrutiny in Washington, due to concerns over Beijing’s access to advanced AI chips, including those facilitated by third parties such as the UAE, according to Reuters. Microsoft’s investments will total $7.3 billion in the UAE between 2023 and the end of 2025. The company plans to invest an additional $7.9 billion over the period from 2026 to the end of 2029. Security hawks warn that the deals could backfire, given the UAE’s close ties to China, and are concerned about offshoring critical infrastructure, reported the Wall Street Journal. Bank of America says Microsoft’s AI scale advantage is growing Microsoft reported its Q1 2026 earnings results on October 29, and following the report, Bank of America analyst Brad Sills updated his opinion on MSFT stock. Here are the earnings highlights: Revenue increased 18% to $77.7 billion year-over-year Operating income increased 24% to $38.0 billion YoY Net income increased 12% to $27.7 billion YoY Diluted earnings per share (EPS) increased 13% to $3.72 YoY Sills said that concerns about Microsoft’s participation in AI infrastructure projects have been addressed with the announcement of the renewed OpenAI partnership, which includes a $250 billion commitment to Azure and continued AI exclusivity, reaffirming Microsoft’s central role in the build-out and commercialization of AI. He noted that Azure’s growth of 39% beat guidance by 150 basis points, though it is down from the 450 basis points beat in Q4. Sills raised his capital expenditures estimate for fiscal year 2026, from $125 billion to $140 billion (43% of revenue). He said that these investments are expected to drive non-linear growth in capacity (80% more AI capacity this year), suggesting Microsoft’s scale advantage is building. In a research note shared with TheStreet, Sills reiterated a buy rating and the price target of $640. Sills noted downside risk factors for Microsoft:
