It’s been a horrible week for Microsoft Company NASDAQ: MSFT shareholders. As of the shut on Apr. 21, MSFT inventory has dropped greater than 8.6% over the previous 5 buying and selling days. One cause is concern over OpenAI’s plans to amass the AI firm Windsurf for $3 billion.
Microsoft At this time$374.58 +7.76 (+2.12%) As of 04/23/2025 03:59 PM Jap This can be a honest market worth worth offered by Polygon.io. Be taught extra.52-Week Vary$344.79▼$468.35Dividend Yield0.89percentP/E Ratio30.16Price Goal$494.80
Though the deal is unlikely to straight influence Microsoft, traders could possibly be promoting as an expression of concern that OpenAI’s ventures might eat away at Microsoft’s earnings. The irony is that Microsoft inventory jumped sharply in June 2024 when Microsoft’s partnership with OpenAI was first introduced.Get Microsoft alerts:Signal Up
However traders have began to query that funding. That is notably true as OpenAI is selecting to make an exterior acquisition somewhat than utilizing that cash to reinforce Microsoft’s personal AI expertise. There should be some concern that this received’t be OpenAI’s final acquisition, contemplating the corporate just lately closed a $40 billion funding spherical, the most important on document for an organization of its dimension.
Nevertheless, the information shouldn’t utterly shock traders. As just lately as January 2025, OpenAI revealed its blueprint for U.S. AI infrastructure. Within the doc, it acknowledged that it was essential for U.S. firms to put money into AI initiatives to remain forward of China. And in a weblog put up in January, Microsoft president Brad Smith advisable new public/non-public partnerships to fund large-scale AI infrastructure initiatives.
Why Windsurf?
Windsurf is the world’s most superior AI coding assistant. The corporate’s revolutionary improvement surroundings combines AI brokers and co-pilots to reinforce coding effectivity and productiveness.
Windsurf straight competes with Cursor, one other pure-play AI coding assistant. It additionally competes with different AI coding options from Anthropic, which just lately acquired a $2 billion funding from Alphabet Inc. NASDAQ: GOOGL and, sarcastically, Microsoft and OpenAI itself. This places the acquisition within the class of business consolidation, which was prone to occur anyway. Nevertheless, the timing, which took place two weeks earlier than Microsoft stories earnings on Apr. 30, is lower than best.