OpenAI’s golden touch spreads as stocks soar off mere mentions

[CHICAGO] OpenAI has already proved it has a golden touch when it comes to partnering with other tech firms to deploy its artificial intelligence (AI) products. Its power to move shares, though, is rapidly spreading to companies it even briefly discusses teaming up with.

The company behind ChatGPT held its annual developers event on Monday (Oct 6), and mere mentions of other publicly traded firms by presenters sent those shares soaring. Among notable movers: Figma climbed 7.4 per cent, HubSpot added 2.6 per cent, and Salesforce gained 2.3 per cent.

Online travel companies also saw brief pops, with Expedia Group and TripAdvisor both advancing at least 7 per cent before paring those gains. Even shares of toymaker Mattel jumped nearly 6 per cent, though it closed essentially flat.

Most were named as partners whose apps are being incorporated into ChatGPT, the AI bot that counts some 800 million weekly users. While those integrations fall well short of the deal Advanced Micro Devices (AMD) and OpenAI disclosed on Monday, that pact served to show retail and momentum traders just how influential such a move can be: AMD shares soared 24 per cent, adding US$63 billion in market value.

“This is a momentum market, where anything related to OpenAI moves stocks and people throw fundamentals out the window,” said Joe Saluzzi, a partner at Themis Trading.

Others were more positive on the event’s implications. Bloomberg Intelligence’s Anurag Rana wrote that it was “highlighting new potential use cases and even helping these software providers attract new users”, and that expanded partnerships between OpenAI and other enterprises could help soothe “fears of a big disruption to the software industry”.

Monday’s moves were reminiscent of those seen by stocks of companies mentioned by Nvidia chief executive officer Jensen Huang at its GTC conference last year. Shares of engineering software makers Synopsys, Cadence Design Systems and Ansys climbed after Huang said the companies will use its new Blackwell-based processors to put more AI enhancements in their products.

OpenAI recently completed a deal to help employees sell shares, which resulted in a US$500 billion valuation for the company, making it the world’s largest startup. That valuation, coupled with the scale of AI-related moves, has led to growing concerns that the growth and stock moves are unsustainable. Talk of an AI bubble has been growing louder in recent months, with some investors likening such trading to the dot-com euphoria.

“Obviously, we don’t know the revenue implications of anything being mentioned by OpenAI, but while these kinds of moves can be a concern, there is a lot of money being made and spent on AI,” Saluzzi said. “We are not talking about Pets.com. Everyone realises we are in a bubble stage. The problem is no one knows if we are at the beginning or near the end.”

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Sam Altman, OpenAI’s chief executive officer, was asked about the company’s influence on other stock moves today during a press conference at the event.

It’s “a strange new thing that started happening”, he said. “We are trying to figure out how to adjust for this kind of world, but it’s weird.” BLOOMBERG