Proactive Investors - Microsoft Corporation (NASDAQ:MSFT) CEO Satya Nadella’s "poker move for the ages" will see the tech giant absorb former OpenAI CEO Sam Altman, Brockman, and the entire OpenAI for its initial $10 billion investment, Wedbush analysts stated in a note to clients.
"The circus and clown show with the OpenAI board continues to play out as now nearly all of the 700+ OpenAI employees have signed a letter saying they will resign if the four person board does not resign," the analysts wrote.
Adding to the "Twilight Zone" story, they noted, is that one of the main four board members and OpenAI co-founder IIya Sutskever, who was instrumental in the firing of Altman and causing this chaos, now is saying he regrets his decision and signed the letter asking for the board removal.
"In our view this is like burning a house down and then the next day coming back with a Hallmark card saying 'I am sorry'," they added.
Analysts at Wedbush concluded that Microsoft now appears to be in an even stronger position with Altman and Brockman running its AI initiative, as even if they go back to OpenAI, if its board resigns, they expect Microsoft would take a board seat at OpenAI in order to have more control from a governance perspective.
They reiterated their ‘Outperform’ rating and $425 price target on Microsoft stock.
Shares of Microsoft slipped 1.5% to $371.86 in late-morning trading on Tuesday but have gained 55% year to date.