Yahoo Finance Microsoft exits OpenAI drama with 'one of best possible outcomes'
After an eventful five days of back-and-forth that included the ouster of Sam Altman and a potential bid for the exec to join Microsoft (MSFT), the OpenAI co-founder is back where he started.
This tentative resolution to the biggest personnel drama in the tech world in years still appears to leave Microsoft emerging as the imbroglio's biggest winner, even if Altman won't be directly working for Microsoft after all.
"From a Microsoft perspective, it’s back to business as usual on the AI front and Satya Nadella and team deserve a lot of credit for allowing this outcome to come about," Evercore ISI analyst Kirk Materne wrote in a research note on Wednesday morning.
"By offering to hire Altman and team, it forced the OpenAI Board to act quickly and kept the situation from unravelling to a point that it would be difficult to put the band back together."
Microsoft shares were up about 1% in early trading Wednesday following the news.
The moves at OpenAI also included a shakeup on the board that initially fired Altman.
Former Salesforce (CRM) co-CEO Bret Taylor will be the chair of a new board, which will also include former Treasury Secretary Larry Summers and current director Adam D'Angelo, the CEO of Quora.
Jefferies equity analyst Brent Thill described the scenario as one of the "best possible outcomes."
"We believe the additions to the board will help to establish investor stability," Thill wrote in a note to clients on Wednesday. "We expect this 4-day situation to have a limited impact on MSFT and will continue to monitor it closely."
And for Thill, this resolution likely negates any fears some investors may have had around the tech giant falling behind in the fast-moving AI space.
As the AI hype cycle has proven throughout 2023, demand for the emerging technology that Microsoft provides customers access to across its product suite won't be going anywhere, per Thill.
"The situation's quick resolve minimizes the near term impact on M365 Copilot & Azure Open AI services demand, with customers FOMO looking past potential OpenAI concerns," Thill said.
Josh Schafer is a reporter for Yahoo Finance.
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