AI startup Perplexity has signed a $750 million agreement with Microsoft Corp. to use its Azure cloud platform, thereby expanding its operations beyond longtime cloud partner Amazon.com Inc.
Under this three-year commitment, Perplexity will deploy its AI models through Microsoft’s Foundry service, including models built by OpenAI, Anthropic, and xAI, according to people familiar with the agreement who requested anonymity because the matter remains private.
Commenting on the development, a Perplexity spokesperson said, “We are excited to partner with Microsoft for access to frontier models from X, OpenAI, and Anthropic.”
At the same time, the spokesperson clarified that the Microsoft partnership does not reduce Perplexity’s spending on Amazon Web Services (AWS), which has long served as the startup’s primary cloud provider.
Emphasising this continuity, the spokesperson added, “AWS remains Perplexity’s preferred cloud infrastructure provider, and we’re excited to announce expansions of that partnership in the coming weeks.”
Meanwhile, both Microsoft and Amazon declined to comment on the deal.
Although Perplexity ranks among the more richly valued AI startups, it continues to face intense competition from Alphabet Inc.’s Google and OpenAI in its effort to redefine how people search for information online. Additionally, Perplexity has raised significantly less capital than OpenAI and Anthropic, both of which have recently pursued a wave of large-scale infrastructure partnerships.
In general, large enterprises rely on multiple cloud providers to access specialised services while reducing dependence on any single vendor. Notably, this multi-cloud strategy has accelerated in the AI era as companies experiment with emerging tools and sign agreements with both model developers and the cloud platforms that support them.
Historically, the AI startup built much of its business on AWS, using Amazon’s Bedrock service to access Anthropic models for its AI-powered search engine. Perplexity Chief Executive Officer Aravind Srinivas has frequently spoken at AWS conferences and stated during a 2023 appearance that he chose to go “all-in” on Amazon’s cloud.” In turn, AWS has regularly showcased Perplexity as a leading-edge AI customer using its services.
However, in recent months, the relationship between the two companies has grown contentious. In November, Amazon sued Perplexity, seeking to prevent the startup from enabling consumers to use its AI tools to shop and purchase products from Amazon’s online marketplace. In response, Perplexity described Amazon as a bully and labeled the lawsuit “a threat to user choice.” Srinivas also said in November that Perplexity has made “hundreds of millions” of dollars in commitments to AWS.
For Microsoft, the Perplexity agreement strengthens its strategy to position Azure as a premier platform for building AI applications and deploying models from multiple vendors. While Microsoft has long offered models from its partner OpenAI, it further expanded its ecosystem by signing a deal with Anthropic in November.
Highlighting this approach, Microsoft Chief Executive Officer Satya Nadella said during an earnings call earlier this week, “Our customers expect to use multiple models as part of any workload,” adding, “And we offer the broadest selection of models of any hyperscaler.”
Nadella further noted that more than 1,500 Microsoft Foundry customers have already used both OpenAI and Anthropic models. Moreover, he said the number of customers spending over $1 million per quarter on Foundry rose nearly 80% in the quarter that ended in December.
