Microsoft (NASDAQ: MSFT) is betting on AI and could invest $10 billion into OpenAI, the owner of ChatGPT, according to a Semafor report. This investment would value OpenAI at $29 billion.
The report stated that it was not clear whether the deal had been finalized but if MSFT goes ahead with this investment, it would be part of a complicated deal where the tech giant would get “75% of OpenAI’s profits until it recoups its investment.”
Microsoft had already backed OpenAI in 2019 with $1 billion in funding
Once MSFT recoups its investment, the shareholding structure for OpenAI would reflect the company having a 49% stake in OpenAI, other investors with another 49%, while OpenAI’s nonprofit parent getting the remaining 2%.
Analysts are bullish about MSFT with a Strong Buy consensus rating based on 26 Buys and three Holds.
