Microsoft announced a $750 million, three‑year agreement that will see AI startup Perplexity run its generative‑AI models on Microsoft Azure. The deal gives Perplexity access to Microsoft’s global data‑center network, AI‑optimized infrastructure, and the Foundry platform, which bundles models from OpenAI, Anthropic, and xAI.
Perplexity’s partnership with Azure complements its existing relationship with Amazon Web Services, where it continues to host core workloads. The new Azure contract allows the company to diversify its cloud footprint, reduce vendor lock‑in, and tap into a broader set of AI models—an advantage that is especially valuable amid ongoing legal tensions with Amazon.
Microsoft’s strategy is to position Azure as the preferred platform for AI developers. The Foundry platform, powered in part by Microsoft’s Maia 200 inference accelerator, offers high‑performance, cost‑effective token generation. The new deal is expected to add recurring revenue to Microsoft’s Intelligent Cloud segment and reinforce Azure’s leadership in the AI‑as‑a‑service market, which is projected to reach $123.89 billion by 2031.
For Microsoft, the agreement signals continued momentum in its AI‑cloud ecosystem. Azure revenue has been growing at a double‑digit pace, and the addition of Perplexity’s workloads will deepen the company’s penetration in the generative‑AI space, strengthening its competitive moat against AWS and Google Cloud.
For Perplexity, the Azure partnership expands its multi‑cloud strategy, providing flexibility and access to a wider array of models while maintaining its primary AWS relationship. The deal also positions Perplexity as a growing competitor to traditional search engines, leveraging Microsoft’s infrastructure to accelerate model training and deployment.
The transaction reflects broader market dynamics: the AI‑as‑a‑service sector is expanding rapidly, and Perplexity’s valuation has surged to $20 billion as of September 2025. Microsoft’s investment in AI chips and data‑center infrastructure underpins this partnership, underscoring the company’s commitment to capturing a larger share of the AI‑cloud economy.
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