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Microsoft (NASDAQ:MSFT) shares are up slightly in early trading today even though Sam Altman is returning to his post as CEO of OpenAI. The latter company is the innovator behind ChatGPT, the popular artificial intelligence (AI) chat room.
Altman was fired from OpenAI’s Board of Directors last Friday. Over the weekend, Microsoft later announced that the executive will lead a new AI research operations team at the software giant. As of today, however, Altman is now returning to OpenAI.
Altman’s Return to OpenAI
Indeed, Altman will be reinstated to his previous position as CEO of OpenAI, which the company revealed this morning in an announcement about X, the platform formerly known as Twitter. According to CNBC, OpenAI has been under “huge pressure from employees and investors” following its ouster of the AI executive.
Also worth mentioning is that the board will undergo restructuring, with former Salesforce (NYSE:CRM) co-CEO Bret Taylor and former US Treasury Secretary Larry Summers joining the table. Taylor will also become Chairman of the Board of Directors at OpenAI.
What This Means for Microsoft and MSFT Stock
Is Altman returning to OpenAI a big loss for Microsoft?
Well, on the one hand, Altman is clearly a great manager; OpenAI and ChatGPT were extremely successful under his tenure. moreover, Y Combinator — the company where Altman previously served as President — successfully helped startups like Airbnb (NASDAQ:ABNB) and Reddit get up and run After Altman’s dismissal, many other talented employees also indicated that they would be happy to follow the executive to Microsoft.
However, Microsoft has the ability and willingness to spend a large amount of money on its AI ventures. After all, the company’s capital expenditures soared to $10.7 billion in the fiscal third quarter, largely due to its investments in new data centers to support its AI initiatives.
Given the huge amounts Microsoft is willing to invest in its AI efforts, the company will likely have little trouble attracting talent as impressive as Altman and his colleagues. Therefore, I do not expect today’s news to have a significant impact on MSFT stock.
As of the date of publication, Larry Ramer did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines of InvestorPlace.com.
Larry Ramer has conducted research and written articles on US stocks for 15 years. He was employed by The Fly and Israel’s largest trade newspaper, Globes. Larry began writing columns for InvestorPlace in 2015. Among his highly successful contrarian picks were PLUG, XOM and solar stocks. You can reach him on Stocktwits at @larryramer.
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