Mercedes and Microsoft have announced a multi-year partnership said to be worth $60m a year, which, if correct, would be among the sport's biggest individual team sponsorship deals.

Through the new collaboration, the companies aim to drive efficiencies and innovations that will help drive performance and amplify the excitement for the more than 800 million F1 fans worldwide.

The 2026 regulation changes usher in a new era of racing for the sport, with increased electrification, efficiency and sustainability, representing one of the most significant technical evolutions in modern Formula 1 history. As Mercedes prepares for this transformation, it is partnering with Microsoft to harness the power of its trusted cloud and enterprise AI technologies across the business, from the factory to the racetrack.

"Our sport is driven by those who lead through innovation," said Toto Wolff. "We are delighted to partner with Microsoft, one of the world's foremost technology leaders, whose name is synonymous with groundbreaking innovation. This partnership also reflects our commitment to staying at the forefront of performance and progress.

"By putting Microsoft's technology at the centre of how we operate as a team, we will create faster insights, smarter collaboration and new ways of working as we look ahead to the next generation in F1."

In a sport where races are decided by tenths of a second and every decision is data driven, Formula 1 represents the ultimate stress test for modern enterprise systems: extreme data volumes, real-time decision making, global operations and zero margin for error. United by the belief that technology is a competitive advantage, Microsoft and the Mercedes will look to set a new standard for how enterprise technology drives performance at the highest levels of competition.

"This partnership puts Microsoft's cloud and enterprise AI technologies at the heart of racing performance, where milliseconds matter and data determines outcomes," said Judson Althoff, CEO, Microsoft commercial business. "Together with the Mercedes, we are harnessing data and turning it into real-time intelligence that powers faster decisions, smarter strategies and sustained competitive advantage both on and off the track."

Each Mercedes car carries more than 400 sensors, generating over 1.1 million data points per second. From tyre degradation and aerodynamic behaviour to Energy Recovery System deployment and evolving track conditions, every variable must be interpreted in real time.

Microsoft Azure and its AI capabilities will expand the team's existing high-performance computing and data capabilities, both at the factory and trackside, with scalable cloud and AI resources supporting simulation workloads, performance analysis, race strategy modelling and cross-team analytics. The flexibility and agility of this platform will help ensure engineers and strategists have real-time insights available at the moments that matter most.

"It is a privilege to welcome Microsoft into the Mercedes partner ecosystem," said Richard Sanders, Chief Commercial Officer, Mercedes-AMG Petronas F1 team. "Microsoft's technology already plays a central role in how we operate as a business, and this partnership opens new opportunities to innovate as we look toward the next era of technological development. I look forward to seeing how our teams collaborate to unlock new ways of working across the organization."

Microsoft 365 and GitHub already underpin many of the team's engineering and operational workflows across its headquarters in Brackley and Brixworth, as well as trackside in the paddock. Building on this foundation, the team will expand its use of Microsoft 365 to unlock new levels of agility, accelerate innovation and enhance operational efficiency across the business.

Microsoft's GitHub development tools and platforms help engineers innovate faster, optimize performance and push the boundaries of design, modelling and simulation. Going forward, the team's engineering, simulation and software development groups will deepen their integration of GitHub to modernize and accelerate development workflows enabling greater consistency, speed and efficiency.

Working with Microsoft Azure to accelerate AI technology experimentation and scale, Mercedes used real-time sensor data and Azure cloud tools to pilot intelligent virtual sensors, enabling rapid testing without waiting for new on-premises infrastructure.

With Azure Kubernetes Service (AKS), they were able to easily adjust computing power, scaling up when demand is high and down when it's not, delivering meaningful technological advancements while meeting strict financial and regulatory requirements.