Microsoft Quarterly Report Shows Significant Loss at OpenAI
Microsoft's latest quarterly report reveals that OpenAI, the AI company partly owned by Microsoft, has incurred losses reaching up to $12.1 billion in the third quarter.
Details on Microsoft's Investment in OpenAI
Although OpenAI is not publicly listed and does not release its own financial statements, Microsoft, which owns 27% of OpenAI, discloses relevant financial information in its reports. By September 30, 2025, Microsoft had provided $11.6 billion of the $13 billion committed capital to OpenAI.
Accounting Impact on Microsoft
Microsoft uses the equity method to account for its stake in OpenAI, incorporating OpenAI's profits or losses directly into its financial results. As OpenAI suffered losses, Microsoft’s net profit and diluted earnings per share declined accordingly.
- Net losses from OpenAI investments reduced Microsoft's net profit by $3.1 billion.
- Diluted earnings per share decreased by $0.41 because of these losses.
Microsoft states: "The net profit and diluted earnings per share for the current year have been negatively impacted by net losses from investments in OpenAI, leading to a decrease in net profit and diluted earnings per share by 3.1 billion US dollars and 0.41 US dollars, respectively."
This information is detailed on page 9 and page 33 of Microsoft’s quarterly report.
Summary
Microsoft’s report highlights that OpenAI’s significant losses have directly affected Microsoft's profits, reflecting the risks involved in its substantial investment.
Author’s summary: Microsoft’s financial disclosure reveals that OpenAI’s multibillion-dollar losses have caused a notable decline in Microsoft’s net income and earnings per share in 2025.