In a surprising turn of events, Microsoft, the renowned technology giant, has been deeply affected by the recent shake-up at OpenAI. OpenAI, a small yet highly influential non-profit AI start-up, is best known for developing the popular ChatGPT chatbot. The unexpected removal of Sam Altman, OpenAI’s co-founder and CEO, sparked a series of events that caused Microsoft’s market value to plummet by billions of dollars. This incident underscores the significant role OpenAI plays within the tech behemoth.
Having invested a staggering $13 billion in OpenAI, Microsoft’s close competitors, including Apple, Google, and Meta, have swiftly followed suit, trying to catch up by offering their own AI solutions. Microsoft’s stock, displaying a roller coaster-like behavior since Altman’s departure, experienced a sharp drop on Friday, which continued into after-hours trading. This decline of over 2 percent signifies a substantial loss for a company nearing a market capitalization of $3 trillion.
Microsoft’s stock performance has effectively become a barometer for its partnership with OpenAI. Over the weekend, Microsoft took the lead in a concerted effort to convince OpenAI’s board to reinstate Altman, a charismatic and well-connected figure in Silicon Valley who was simultaneously pitching a new AI start-up to investors. Ultimately, on Sunday night, Microsoft announced its decision to hire Altman, along with Greg Brockman, OpenAI’s president and co-founder who left the company in solidarity. The duo will now spearhead an advanced research lab at Microsoft, with CEO Satya Nadella emphasizing the fresh impetus it will bring to innovation.
As a result of Microsoft’s strategic move, its stock showed signs of recovery in turbulent pre-market trading on Monday, making up for a significant portion of the previous decline. Industry analysts praised Microsoft’s decision to bring the ousted OpenAI leaders on board. In a research note, Macquarie analysts commented, “We believe that Mr. Nadella has accomplished his own coup by acquiring the most crucial aspect of OpenAI: its driven talent.”
In response to Altman’s departure, OpenAI swiftly appointed Emmett Shear, the former CEO of Twitch, as its second interim chief executive within a span of two days. Initially, Mira Murati, a longstanding executive at OpenAI, assumed the role of interim chief following Altman’s exit.