Microsoft made its first investment in Sam Altman's OpenAI in 2019. It now holds a 27% in OpenAI's for-profit business.

OpenAI established a for-profit arm valued at $500 billion Tuesday, doing so through a long-anticipated corporate restructure that provides Microsoft with a large stake in the new company as it looks to expand on its rapidly expanding artificial intelligence offerings.

OpenAI is restructuring into a public benefit corporation with Microsoft retaining a 27% stake in the new "OpenAI PBC," worth roughly $135 billion. OpenAI PBC will still be overseen by the non-profit OpenAI Inc.

Microsoft lifted a funding restriction on OpenAI that became a point of conflict after ChatGPT took off required more computing power.

Microsoft and OpenAI on Tuesday said they had reached a deal to allow the ChatGPT maker to restructure itself into a public benefit corporation, valuing OpenAI at $500 billion and clearing the way for it to become a publicly traded company.

Microsoft and OpenAI announced the long-awaited details of their new partnership agreement Tuesday morning — with concessions on both sides that keep the companies aligned but not in lockstep as they move into their next phases of AI development.