Microsoft signs $750 million Azure cloud deal with Perplexity

AI startup Perplexity has reportedly signed a $750 million deal with Microsoft Corp. to use its Azure cloud service, spreading its business beyond longtime cloud partner Amazon.com Inc. The three-year commitment will let Perplexity deploy AI models through Microsoft’s Foundry service, including those made by OpenAI, Anthropic and xAI.

"We are excited to partner with Microsoft for access to frontier models from X, OpenAI and Anthropic," a Perplexity spokesperson said.

Perplexity however, hasn’t shifted spending from Amazon Web Services, the long-time cloud provider for the start-up.

"AWS remains Perplexity's preferred cloud infrastructure provider, and we're excited to announce expansions of that partnership in the coming weeks," the Perplexity spokesperson said.

Perplexity is one of the more richly valued AI startups but faces stiff competition from Alphabet Inc.’s Google and OpenAI. The company also hasn't raised nearly as much capital as OpenAI and Anthropic, which have recently engaged in a wave of infrastructure deals.

Perplexity built much of its business on AWS, using Amazon's Bedrock service to access Anthropic models for Perplexity's search engine. Perplexity Chief Executive Officer Aravind Srinivas is a repeat speaker at AWS conferences, saying in a 2023 appearance that he had decided to go "all-in" on Amazon's cloud. AWS, in turn, has held up Perplexity as one of the cutting-edge AI customers using its services.