The British regulator, the Competition and Markets Authority (CMA), is probing AI partnerships involving Microsoft (NASDAQ:MSFT) and Amazon (NASDAQ:AMZN). Specifically, the CMA is soliciting opinions on Microsoft’s collaboration with French AI firm Mistral and Amazon’s partnership with U.S. startup Anthropic. Additionally, the CMA is examining Microsoft’s recruitment practices regarding individuals from Inflection AI.
The CMA has requested feedback by May 9 to determine whether these partnerships qualify as mergers. The CMA’s invitation to comment is the first part of an information-gathering process that precedes the formal Phase 1 review by the regulator.
Earlier this year, MSFT made a $16 million investment in Mistral, while in the previous year, Amazon invested $4 billion in Anthropic.
Response from Microsoft and Amazon
Following the news, a Microsoft spokesperson commented that hiring talent from startups and investments in AI companies promotes competition and should not be classified as mergers. Additionally, the spokesperson affirmed that the company would fully cooperate with the CMA’s inquiry.
On the other hand, a spokesperson for Amazon stated that the CMA’s review of its partnership with Anthropic was “unprecedented.”
Is Microsoft a Buy, Hold, or Sell?
Analysts are bullish about MSFT stock, with a Strong Buy consensus rating based on 32 Buys and one Hold and Sell each. Over the past year, MSFT has soared by more than 40%, and the average MSFT price target of $477.41 implies an upside potential of 16.2% from current levels
