Perplexity Secures $750 Million Microsoft Azure Deal Amid Amazon Legal Dispute

Perplexity, an AI-powered search engine startup, has inked a three-year, $750 million agreement with Microsoft to utilize its Azure cloud services. The deal grants Perplexity access to cutting-edge AI models through Microsoft's Foundry service, including offerings from OpenAI, Anthropic, and xAI. This strategic move comes as the company remains embroiled in a legal battle with longtime cloud provider Amazon Web Services.

Industry observers note the agreement represents a significant pivot in cloud infrastructure strategy. While Perplexity maintains it will continue spending with AWS, the Microsoft partnership signals a diversification of its technological dependencies. The deal's timing—amid ongoing litigation with Amazon—has sparked intense speculation about shifting alliances in the competitive cloud computing sector.

Microsoft gains another high-profile AI client in its escalating rivalry with Amazon's cloud dominance. For Perplexity, access to multiple frontier AI models through a single provider could accelerate product development. The arrangement exemplifies how AI startups are leveraging competition between cloud giants to negotiate favorable terms.