Apparently, OpenAI’s loss is Microsoft’s gain. As the tech titan announced that it just hired ousted OpenAI chief executive Sam Altman, its shares shot up by 2.1%, closing trading on Monday, November 20th, by $377.44. This beats its previous high of $376.17.
This is good news for Microsoft in light of the way its share price dropped by 1.7% on Friday, November 17th, just as the news of Altman’s ouster broke. Microsoft is OpenAI’s largest stakeholder, having invested around $13 billion into the generative AI developer.
2023 has been a good year for Microsoft as its shares are up by around 56%, making it one of just seven tech companies – dubbed by the media as the Magnificent Seven – who are responsible for the bulk of the stock market’s returns thanks to analysts’s forecasts about artificial intelligence’s emergence as an innovative force in the tech sector.
Other Magnificent Seven firms that saw positive trading action on Monday included Nvidia whose shares rose by 2.3%, enabling it to close the day at $504.20 and marking a record high.
A Quick Backgrounder
Altman was kicked out of OpenAI by the board of directors who claimed that he had been inconsistent with his communiques in and out of the company. He will now head Microsoft’s division for artificial intelligence innovation. It is expected that OpenAI cofounder Greg Brockman who tendered his resignation following the board coup will be joining him there.
While it was previously assumed that Altman would be persuaded to return to OpenAI, his acceptance of the Microsoft offer has put the rumors to rest. Former Twitch CEO Emmett Shear will be taking over as OpenAI’s chief executive, succeeding Mira Murati who has served as interim CEO since Altman’s dismissal.