Microsoft will use OpenAI’s custom chip designs to boost its next generation of AI processors.
The partnership deepens hardware collaboration as Microsoft scales chip production and OpenAI leverages global cloud support.
New Fairwater datacentres with faster systems and low-water cooling will power advanced AI training and deployment.
Microsoft is preparing for its next major leap in artificial intelligence by partnering with OpenAI to incorporate their custom chip designs into its in-house semiconductor plans. This shows how seriously Microsoft takes the global competition in AI. CEO Satya Nadella said Microsoft will leverage OpenAI’s hardware research to integrate chip designs optimised for training large, complex AI models. The initiative reflects a broader industry trend, as tech giants worldwide develop specialised processors to reduce reliance on third-party suppliers while improving the speed and efficiency of AI operations. By developing its own chips, Microsoft aims to gain greater control over performance, reduce long-term costs, and accelerate breakthroughs in model training. This partnership also signals a deeper alignment between the two companies as AI innovation rapidly intensifies.
SurveyAlso read: OnePlus 16 display details leaked ahead of OnePlus 15 launch: Here’s what we know
Microsoft and OpenAI collaboration
Nadella said that Microsoft will fold OpenAI’s system-level chip designs into its own in-house work. This includes processors and networking hardware that OpenAI has been developing with Broadcom. Microsoft plans to refine these designs so they can be produced at a large scale and then expand them further under its own intellectual property.
Also read: Google Pixel 9 Pro price drops by over Rs 25,000 on Amazon: How this deal works
The updated agreement strengthens the already close relationship between the two companies. Microsoft gains access to hardware specifically suited for training OpenAI’s large models, while OpenAI benefits from Microsoft’s global cloud infrastructure. Nadella called the alignment “strategic”, noting that OpenAI’s design strengths will help speed up Microsoft’s semiconductor goals.
New datacentres to be built for the AI growth
Microsoft’s new Fairwater datacentres will play a central role in this push, as these sites function as connected hubs for training and deploying the next generation of AI models. One facility in Atlanta uses a new chip and rack design that allows very high data processing speeds. It also includes advanced cooling systems that use almost no water, a sharp contrast to older data centres that require large amounts of it.
As per Scott Guthrie, Microsoft’s Cloud and AI group lead, the aim is not only to add more hardware but to build systems that work together smoothly. Microsoft says it has spent years improving the architecture and networking behind large AI training so customers can rely on stable performance at scale. This approach sets Microsoft apart from rivals that develop chips mostly for use within their own ecosystems.
Follow Us
Bhaskar Sharma
Bhaskar is a senior copy editor at Digit India, where he simplifies complex tech topics across iOS, Android, macOS, Windows, and emerging consumer tech. His work has appeared in iGeeksBlog, GuidingTech, and other publications, and he previously served as an assistant editor at TechBloat and TechReloaded. A B.Tech graduate and full-time tech writer, he is known for clear, practical guides and explainers. View Full Profile
