Artificial intelligence could bring almost $10 billion a year to Microsoft’s search business, according to SVB MoffettNathanson. This week the tech giant revealed a new version of Bing , its search engine launched in 2009, powered by the OpenAI’s ChatGPT. The explosive popularity around the chatbot led Google to introduce its own version . Baidu also this week revealed plans for a similar launch . MSFT 1Y mountain MSFT over past 12 months. “We believe that the AI-powered Bing could be the catalyst that actually gets people to start using the often-maligned [Bing] search engine,” Sterling Auty, an analyst at SVB MoffettNathanson, wrote in a note Thursday. “If Microsoft took just 5% market share from Google, that’s an incremental $9.5 billion in revenue for Microsoft, and if the updates to Bing managed to take 10% market share, that’s an incremental $19 billion.” Search engine market share varies, but the consensus is that Google has close to 85%, SVB MoffettNathanson said. Estimates for Bing vary from about 3% to 10%, though Auty noted 10% is the most frequently cited number. The business passed $10 billion in revenue last fiscal year (SVB MoffettNathanson pegs news and search revenue at approximately $12 billion over the past four quarters), and Microsoft management has discussed ambitions to raise it to $20 billion over an unspecified time frame. “With the Bing announcement … that target seems much more reasonable, and we think the search and news segment can become another driver of Microsoft’s growth over the next few years,” Auty said. — CNBC’s Michael Bloom contributed reporting Correction: SVB MoffettNathanson is the name of the financial services firm. An earlier version of this story misstated the name.
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