The big shake-up in the artificial intelligence (AI) industry over the past few days rocked the foundations of numerous AI stocks. Among these was one of the sector’s leading names, C3.ai (NYSE: AI), which rallied early on Monday before falling to close down by 4%.
For those unaware, the major event occurred at OpenAI, the developer of the widely used AI flagship program ChatGPT.
On Friday, OpenAI announced that co-founder and CEO Sam Altman was out, to be replaced on an interim basis by CTO Mira Murati. The move followed a board of directors review, which found that Altman “was not consistently candid in his communications with the board, hindering its ability to exercise its responsibilities.”
Meanwhile, Murati was quickly replaced as OpenAI’s leader. On Sunday, the company hired Emmett Shear to serve as its interim CEO instead.
Altman was quickly hired by Microsoft (NASDAQ: MSFT) to head a new AI unit at the tech behemoth. Microsoft also scooped up ex-OpenAI president Greg Brockman.
Altman’s firing wasn’t going down well at OpenAI. Nearly all of the approximately 770 employees at the company wrote a letter to the board, in which they threatened to quit unless the board resigns. They also called for the reinstatement of both Altman and Brockman. One of the document’s signees is Murati.
While it’s early days for the modern AI industry, this will surely come to be seen as a seismic event in its development.
Microsoft — which was already involved, albeit indirectly as an investor, with OpenAI — is now the employer of a towering figure in the business, and one of his key associates. We can be certain Microsoft will devote considerable resources to pushing AI forward and profiting from it handsomely.
So it was little wonder that investors lost confidence in specialty AI stocks like C3.ai, many of which continue to struggle to establish themselves. C3.ai has numerous advantages and may yet carve out a profitable business, but that won’t be easy against the 800-pound gorilla that is Microsoft.
10 stocks we like better than C3.ai
When our analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
They just revealed what they believe are the ten best stocks for investors to buy right now… and C3.ai wasn’t one of them! That’s right — they think these 10 stocks are even better buys.
*Stock Advisor returns as of November 20, 2023
Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Microsoft. The Motley Fool recommends C3.ai. The Motley Fool has a disclosure policy.
—
Blog powered by G6
Disclaimer! A guest author has made this post. G6 has not checked the post. its content and attachments and under no circumstances will G6 be held responsible or liable in any way for any claims, damages, losses, expenses, costs or liabilities whatsoever (including, without limitation, any direct or indirect damages for loss of profits, business interruption or loss of information) resulting or arising directly or indirectly from your use of or inability to use this website or any websites linked to it, or from your reliance on the information and material on this website, even if the G6 has been advised of the possibility of such damages in advance.
For any inquiries, please contact [email protected]
