Microsoft Is Riding OpenAI's Gen AI Coat-Tails
What has MSFT done to deserve the Gen AI multiple that its shares trade at?
MSFT has not developed IP in the Gen AI space. OpenAI did that hard work. OpenAI created the intellectual property. OpenAI is building the LLMs underpinned by that IP. OpenAI is enjoying rapid revenue growth, not MSFT.
Big deal that MSFT has baked OpenAI into Azure and Copilot. It is not as though MSFT revenues have spiked as a result. Therefore, MSFT does not deserve its 3,000x MVA to Gen AI revenue multiple.