Win-Win For Microsoft: Satya Nadella Hires Ousted OpenAI CEO Sam Altman, Stocks Go Up

In a dramatic twist in the chaos stirred on Friday, Microsoft CEO Satya Nadella hires Sam Altman, 3 days after being sacked by the OpenAI board. Altman was terminated from his position at OpenAI last Friday following the board's loss of confidence in his leadership. Over the weekend, discussions took place to explore the possibility of Altman returning to OpenAI. However, Microsoft CEO Satya Nadella revealed that both Altman and co-founder Brockman will now be heading Microsoft's newly established advanced AI research team.

Altman will have the CEO title of this new group. This move aligns with Microsoft's tendency to appoint CEOs for significant divisions, indicating potential substantial plans for the advanced AI research team. Altman confirmed his move to Microsoft by reposting a message from Nadella, adding, "the mission continues." In response, Nadella dropped some hints about his perspective on Altman's new CEO role at Microsoft.

Brockman disclosed that Microsoft's new team will incorporate key talent from OpenAI. The phrase "OpenAI is nothing without its people" is also being shared by OpenAI employees on X, indicating the possibility of more resignations in the future.
 

Microsoft maintains a "multibillion dollar investment" in OpenAI, estimated to be around $10 billion. Serving as the exclusive cloud partner for OpenAI, Microsoft's cloud services drive all OpenAI workloads, spanning products, API services, and research. The newly appointed CEO at the Microsoft AI Research Team, Sam Altman stated shed light on the way ahead for their partnership.

Rishi Jaluria, managing director at RBC Capital Markets, characterized the recent days as the "most eventful" in his over a decade of covering software. He perceives the outcome as a significant victory for Microsoft, considering the tech giant as the forefront leader in generative AI. In an interview with Yahoo Finance Live, he stated, “Customers would get worried. I think by bringing in Sam and Greg, and Sam is really the ultimate visionary when it comes to AI, it's really the best-case scenario for Microsoft."

Microsoft shares closed at $377.44 on Monday, up more than 2%, after initially falling on Friday afternoon following the announcement Altman was out at OpenAI. These developments have been a ladder to Microsoft securing the most sought-after and talented AI data scientists and engineers amid the turbulent fiasco prompted by OpenAI. Despite a rocky few days and constant tumult with regards to its positioning within the chaos as a major investor, Microsoft has been able to carve its way amidst the circumstances and secure a win-win for itself.