Oregon State University (OSU) this week laid the foundation stone for a new research building that will be named in his honor Nvidia CEO Jensen Huang and his wife Lori, both of whom attended the school. In a conversation with OSU President Jayathi Murthy, Huang said, “This is the beginning of a new world,” referring to recent developments in generative AI.
Huang went on to say that thanks to chatbots like OpenAI’s ChatGPT, “You essentially always have an agent with you, essentially always a teacher.”
If Huang is right, and I believe he is, Microsoft (NASDAQ: MSFT) is already ready to reap the benefits of this groundbreaking technology.
Flying high
Microsoft made headlines last year for its $13 billion investment in the ChatGPT maker, but the partnership goes much deeper. Microsoft first took a stake in OpenAI in 2019 and has been working on perfecting these digital assistants ever since. The result is Copilot, a set of generative AI-powered helpers deeply integrated into Microsoft’s most widely used products.
Copilot for Microsoft 365 streamlines a wide range of tasks, including summarizing and composing emails, preparing presentations, creating charts from spreadsheet data, and more – all with just a few simple commands. But that’s just the beginning.
GitHub Copilot can automate the writing and debugging of computer code. Copilot for Sales integrates with popular CRM (Customer Relationship Management) platforms to collect information, organize meetings and provide summaries – all based on first-party customer data. Copilot for Service provides customer service agents with similar tools, gathering content from a number of sources – all controlled via simple voice or typed commands from the user.
Microsoft is still rolling out these Copilots, so we don’t yet know what impact they will have on the company’s financial results. Estimates range from $25 billion per year to as much as $100 billion in additional revenue.
The stock currently trades at 35 times forward sales. It sounds high, but it’s an attractive valuation given the enormous potential ahead.
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Danny Vena has positions at Microsoft and Nvidia. The Motley Fool holds positions in and recommends Microsoft and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls to Microsoft and short January 2026 $405 calls to Microsoft. The Motley Fool has a disclosure policy.
Nvidia CEO Jensen Huang said, “This is the beginning of a new world” thanks to artificial intelligence (AI). 1 Stock to Buy If He’s Right was originally published by The Motley Fool
