Microsoft integrating ChatGPT a 'potential game changer,' Wedbush says
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Microsoft (NASDAQ:MSFT) is reportedly in talks to make a substantial investment in the owner of ChatGPT, OpenAI, while also discussing whether to integrate the noteworthy technology into its services, like its Bing search engine and more.
Such an initiative from Microsoft (MSFT) would be seen as a "smart, strategic move" from the tech giant and one that could be a "potential game changer," investment firm Wedbush Securities said on Wednesday.
Analyst Dan Ives, who has an outperform rating on Microsoft (MSFT), said deepening ties between the company and OpenAI could not only help the Satya Nadella-led company financially, but boost its technological prowess as well. 
"While investing significant capital in the OpenAI platform to incorporate new features into existing Microsoft programs, Microsoft is set to work alongside OpenAI to create a game-changing technology fully integrated into MSFT over the next decade in our opinion," Ives wrote in a note to clients.
"While ChatGPT is naturally a high cash burn situation today, we view this as a strategic step for Nadella & Co. to double down on its artificial intelligence strategy as more use cases boost unprecedented demand for AI solutions with more use cases emerging," Ives added.
Earlier reports indicate that Microsoft (MSFT) could inject $10B into OpenAI at a $29B valuation and then receive 75% of the company's profits until its investment is recouped. From there, it would hold 49% of OpenAI, while other investors own 49% and the remaining 2% would be held by its nonprofit parent.
"With ChatGPT being one of the most innovative AI technologies seen in the industry, MSFT is clearly being aggressive on this front and not going to be left behind on what could be a potential game changing AI investment," Ives added. 
Last month, Microsoft (MSFT) was named one of Morgan Stanley's top software picks.