Microsoft's stock surged to a record high on Monday following the announcement that Sam Altman, former CEO of OpenAI, will be joining the company to lead its artificial intelligence innovation division. The tech giant's shares rose by 2.1%, closing at an all-time high of $377.44, surpassing the previous record of $376.17. This positive momentum comes after a 1.7% dip in Microsoft's stock on Friday, coinciding with Altman's abrupt removal from his position at OpenAI.
The hiring of Altman and Greg Brockman, OpenAI's co-founder who resigned after Altman's termination, fueled investor optimism. Microsoft, as OpenAI's largest stakeholder with a $13 billion investment, seems strategically positioned to leverage Altman's expertise in AI. Altman's return to Microsoft concluded days of speculation about his potential comeback to the company after the controversial boardroom upheaval at OpenAI.
Emmett Shear, the former CEO of Amazon-owned Twitch, will take over as interim CEO at OpenAI, succeeding Mira Murati. Microsoft's shares have experienced a robust performance throughout the year, recording a 56% increase. The company is part of the "Magnificent Seven," a group of stocks driving significant market returns in 2023. Analysts, like Dan Ives from Wedbush Securities, reiterated a positive outlook on Microsoft's stock, emphasizing the strengthened AI position with Altman and Brockman on board.
The positive sentiment in Microsoft's stock also influenced other members of the "Magnificent Seven." Nvidia, another key player, witnessed a 2.3% gain, closing at a record high of $504.20. The broader market sees these developments as affirming the significance of artificial intelligence in the tech industry, with investors betting on its transformative potential.