Why MSFT Stock Is Climbing Today

Microsoft (MSFT) stock is advancing 4% after the tech conglomerate was named as a “tech partner” in the new Stargate AI venture. Additionally, MSFT clarified that the “key elements” of its alliance with OpenAI remain unchanged.

Microsoft’s Role in Stargate

MSFT indicated that it intends to invest $80 billion in Stargate, the new $500 billion AI infrastructure expansion project being spearheaded by Oracle (ORCL), Open AI, and Japanese investment bank Softbank (SFTBY).

A development team working together to create the next version of Windows.

Specifically, Microsoft CEO Satya Nadella told CNBC today during a discussion about the funding of the project that ““All I know is, I’m good for my $80 billion.”

Microsoft’s participation in the huge undertaking is likely exciting investors today, helping to boost the firm’s shares.

MSFT and OpenAI

“Our access to OpenAI’s (intellectual property), our revenue sharing arrangements and our exclusivity on OpenAI’s (application program interface are) all continuing” under a contract that is set to expire in 2030, MSFT reported in a blog post yesterday.

What’s more, OpenAI’s application program interface can only run on Azure, Microsoft’s cloud infrastructure system, MSFT reported. Finally, the firms have “revenue sharing agreements that flow both ways,” the conglomerate noted.

The Recent Price Action of MSFT Stock

In the last month, the shares are up 1.2%, while they have gained 5% in the last three months.

While we acknowledge the potential of MSFT, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than MSFT but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.