OpenAI’s Restructuring Is a Big Positive for Multiple Holdings

Shares of Microsoft (MSFT) are climbing nicely Tuesday, and we can trace this move to the latest development with OpenAI.

On Tuesday, OpenAI announced it completed its recapitalization, cementing its structure as a nonprofit with a controlling stake in its for-profit business. We discussed some of this Monday, as part of SoftBank’s latest investment in OpenAI, and this latest news puts it one step further on the path to an eventual IPO. We see that as a positive not only for Microsoft, which on a pro-forma basis owns 27% of the for-profit OpenAI entity, but also our position in SuRo Capital (SSSS) .

More on OpenAI’s New Structure

Following its re-organization, the nonprofit arm of OpenAI will now be called the OpenAI Foundation, and it holds an equity stake worth about $130 billion in its for-profit arm, a public benefit corporation called OpenAI Group PBC.

As noted above, Microsoft holds an investment in the PBC that is valued at $135 billion, roughly 27% of the company on an as-converted diluted basis. The OpenAI Foundation owns 26% of the PBC, while current and former employees, as well as investors, including our own SuRo Capital, Nvidia (NVDA) , and others, own 47%.

Microsoft Gets a Nice Incremental Azure Win

As part of the announcement, Microsoft said OpenAI has agreed to purchase an incremental $250 billion of Azure services, but going forward, Microsoft will no longer have a first right of refusal to be OpenAI’s compute provider. That comes as little surprise given OpenAI’s involvement in Project Stargate and other initiatives. However, that incremental $250 billion is a sizable figure compared to the $368 billion in commercial remaining performance obligations the company had exiting the June 2025 quarter and the $46.7 billion in cloud revenue booked during that same quarter.

Ahead of that announcement, Microsoft telegraphed its capacity constraints would stretch well into 2026, and odds are Wednesday we will hear that constraint will stretch even further. That means that we are will likely see Microsoft adjust its capital spending levels higher for its current fiscal year 2026. And we continue to see rising AI adoption and usage keeping capacity tight at other Big Tech companies and hyperscalers, which suggests another leg up in overall capital spending that should benefit our shares of Nvidia and Marvell (MRVL) , and help Qualcomm (QCOM) as it moves to compete in this market.

Thoughts on Microsoft and SuRo Shares

Tuesday’s developments have very positive implications for Microsoft and SuRo Capital. The news has pushed MSFT shares into overbought territory with a current RSI near 74. If our position size were much larger, that may lead us to do some prudent trimming, but given the current position size and what should be upbeat quarterly results from Microsoft this Wednesday night, we are going to hold off. Should we see a very positive market reaction to Microsoft's earnings and updated outlook, and the RSI level moves higher, that may lead us to lock in a slice of what would be some very nice gains.

Turning to SuRo, we’ve stated previously that we are interested in expanding the Pro Portfolio’s position because of the monetization opportunities that should drive its net asset value per share and dividend stream higher in the coming quarters. That remains our intent, but the Portfolio’s current cash position could mean we have some tough choices to make to remain prudent investors.

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At the time of publication, TheStreet Pro Portfolio was long MSFT, SSSS, QCOM, NVDA and MRVL.