Microsoft AI chief says the company beat OpenAI at its own game, using a quarter of the computing power

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Key takeaways

Microsoft AI CEO Mustafa Suleyman said an in-house model outperformed OpenAI's offering.
The new model reportedly used one-quarter of the compute power OpenAI required.
Microsoft and OpenAI maintain a multibillion-dollar partnership despite growing competition.

Microsoft AI CEO Mustafa Suleyman told employees an in-house model was better than a similar offering from OpenAI, one of the software giant's biggest customers and partners. “We now have a stronger pre-trained base model than the model that currently powers GPT 5.6 Sol,” Suleyman said during a town hall meeting with employees on Thursday. “And in fact, we used one-quarter of the compute that OpenAI used to train their model.”

Pre-training is the first stage of building an AI model, when it learns patterns from huge amounts of text, images, and other information. This takes massive amounts of expensive computing power, so Microsoft could save money if it's worked out a way to do this more efficiently. Microsoft announced the model, MAI-Base-2, earlier on Thursday. Suleyman said Microsoft privately tested this model against OpenAI models, including one nicknamed “Spud” that powers GPT-5.6.

Internal testing and performance comparisons

He added that Microsoft's model performed better on tests measuring how well AI can understand and predict patterns in information. The comparisons are based on technical information Microsoft has about OpenAI's models, Suleyman said. “Privately and confidentially, we've also compared it to the OpenAI models,” Suleyman told employees, while suggesting that Microsoft has special access to information on how OpenAI models perform.

It's notable that Suleyman would choose to highlight limitations of OpenAI models, even in private discussions. Microsoft has invested billions of dollars in OpenAI, and owns a stake in the startup that is likely worth more than $100 billion. Any criticism of OpenAI could potentially dent the value of this huge investment. The two companies also have a major partnership, with Microsoft offering OpenAI models to its Azure cloud customers. Microsoft has used OpenAI models for its own products such as Copilot, too.

Fraying ties and future development

But the relationship between the two companies has frayed in the past year or so. Increasingly, Microsoft has tried to branch out from OpenAI, including by working on its own models. Suleyman also said Microsoft's new AI model used “12 times less computation than was used for DeepSeek, for example, on compute efficiency.” Suleyman didn't specify which DeepSeek model, but a public blog post described the pre-training of MAI-Base-2 being a lot more efficient than a similar offering from the Chinese lab, called DeepSeek-V4-Pro-Base.

Microsoft in March created a new combined team for its commercial and consumer Copilot products and reassigned Suleyman to focus on building AI models in the company's superintelligence unit. Microsoft declined to comment and OpenAI did not respond to a request for comment on Thursday.

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