Tech giant Microsoft (NASDAQ:MSFT) is focusing on capitalizing on ChatGPT’s capabilities to boost its digital ad business, the Wall Street Journal reported. Microsoft has already integrated ChatGPT into Bing, its web search engine, to experiment with paid advertising links in chat results.
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The company is accelerating its efforts to grow its share of the digital advertising market. It acquired Xandr from AT&T (NYSE:T) in 2021 to boost its data-led advertising solutions. The rise of AI (Artificial Intelligence) and the integration of ChatGPT in its ad solutions will likely drive its share in the segment, which is primarily dominated by Alphabet (NASDAQ:GOOGL)(NASDAQ:GOOG).
Kya Sainsbury-Carter, Vice President of MSFT’s Ad business, told WSJ that the company’s digital ad business is at an inflection point and has witnessed many changes.
With AI and continued investment in the business, MSFT could deliver more relevant ads faster, which will drive its market share. It’s worth highlighting that Microsoft owns about 49% stake in OpenAI, which built the popular AI chatbot ChatGPT.
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During the last reported quarter, MSFT said that despite headwinds in the ad market, Bing continued to gain share in the U.S., and daily users of its Start personalized content feed jumped over 30% year-over-year.
While MSFT will be able to grow its share of the digital advertising market with ChatGPT remains a wait-and-watch story, let’s check what analysts recommend for its stock.
What is the Future of MSFT?
MSFT stock has increased nearly 20% year-to-date, matching the gains of the NASDAQ 100 Index (NDX). Analysts are upbeat about MSFT’s prospects. MSFT stock has received 27 Buy, four Hold, and one Sell recommendations for a Strong Buy consensus rating. These analysts’ average price target of $300.28 implies an upside of 4.94%.
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