Sam Altman has been fired as CEO of OpenAI and rehired at Microsoft, all since Friday afternoon, when four members of OpenAI’s board abruptly ousted him after concluding he was not “candid in his communications” with them. No detail was offered but reports since suggest a split between board and Altman over the company’s increasingly commercial direction and approach to AI on his watch.
The move triggered an immediate public backlash from investors, led by Microsoft, and several senior employees who began pushing for his return. The board initially wavered, opening discussions about reinstating Altman and resigning en-masse – Altman returned to OpenAI’s offices on Sunday for negotiations. But he left empty-handed and the board appointed former Twitch CEO Emmett Shear to lead the company instead.
Microsoft’s CEO Satya Nadella then announced on X that the company remained “committed to our partnership with OpenAI” – it is OpenAI’s biggest investor – and in the same post announced Altman would lead a new AI research team at Microsoft.
Greg Brockman, Open AI’s president and Altman’s ally, was also removed from the board and swiftly resigned. Altman, OpenAI employees and investors were all caught by surprise – Microsoft executives, who have put $11 billion into the company, were reportedly told only minutes before the announcement.
The exact reasons for Altman’s firing are still unclear. OpenAI’s COO, Brad Lightcap, said the decision was “not made in response to malfeasance […] this was a breakdown in communication between Sam and the Board”. Ilya Sutskever, OpenAI’s co-founder, told employees on Friday the board had acted to ensure the “mission of the non-profit”. The company’s governance structure is highly unusual – a for-profit company run by a non-profit board, committed by charter to ensuring artificial general intelligence is developed for the “benefit of all humanity”, rather than to any fiduciary duty to shareholders.
The board, consisting of Sutskever, Quora CEO Adam D’Angelo, robotics engineer Tasha McCauley and AI safety academic Helen Toner, may have been trying to uphold the principles of the charter. In practice OpenAI has operated with the financial support of Microsoft since 2019 – much of its $11 billion investment comes in the form of computing credits which are necessary to train and deploy AI models and it’s unclear whether that arrangement will continue. OpenAI may also face an exodus of its best researchers. Several senior employees publicly backed their former boss on X over the weekend, and many will likely join Altman in his new role at Microsoft.