Technology giant Microsoft (MSFT) is reportedly in talks to invest as much as $10 billion U.S. in OpenAI, the company behind the ChatGPT artificial intelligence bot.
The potential investment from Microsoft values San Francisco-based OpenAI at $29 billion U.S. Media reports say talks are ongoing and that no deal has yet been reached.
OpenAI was founded by Tesla (TSLA) chief executive officer (CEO) Elon Musk and investor Sam Altman. It made the ChatGPT chatbot available for free public testing on November 30 of last year.
A chatbot is a software application designed to mimic human conversations based on user prompts. ChatGPT is fast becoming a global phenomenon as people use it for everything from writing books to designing video games.
Terms of the deal being discussed with Microsoft would see the Seattle-based company receive 75% of OpenAI’s profits until it recovers its initial investment.
Should the funding deal close, Microsoft would hold a 49% stake in OpenAI, with other investors taking the other 49% and OpenAI’s non-profit parent company having a 2% stake.
Microsoft, which invested $1 billion U.S. in OpenAI back in 2019, is planning to launch a version of its Bing search engine using the same artificial intelligence technology that powers ChatGPT, according to multiple media reports.
Microsoft’s stock is down 28% over the last year and trading at $227.12 U.S. per share.
