BuzzFeed stock surges on plan to use ChatGPT parent OpenAI

BuzzFeed’s stock spiked another 62% on Friday, extending its surge after the digital media firm revealed it would work with ChatGPT creator OpenAI’s artificial intelligence platform to create content for its website.

The stock’s rise followed a blockbuster day of trading in which BuzzFeed shares more than doubled on the report of its AI-centric plans.

In a memo to staffers, BuzzFeed CEO Jonah Peretti said the firm would use AI technology to improve its quizzes by personalizing results based on a reader’s responses, the Wall Street Journal reported.

“In 2023, you’ll see AI inspired content move from an R&D stage to part of our core business, enhancing the quiz experience, informing our brainstorming, and personalizing our content for our audience,” Peretti said in a blog post on the effort, adding that he would “share more soon” with the public.

“Over the next three years, the future of digital media will be defined by two major trends: creators, and AI. We will help shape these trends to create massive value for our audience, our employees, and our shareholders,” Peretti added.

BuzzFeed later clarified that it was not planning to use the popular ChatGPT tool itself, but rather “OpenAI’s publicly available API (application programming interface).”

The media company’s shares were also bolstered by a separate Wall Street Journal report that tech giant Meta had reached a deal with BuzzFeed to help produce content for its Facebook and Instagram apps. The deal was said to be worth nearly $10 million.

The company had struggled since it went public via a special purpose acquisition company (SPAC) deal in late 2021. Shares are still down more than 60% since its public debut.

In December, BuzzFeed announced plans to trim its workforce by 12% as part of cost-cutting efforts.  The company had 1,522 employees through the end of last year.

OpenAI is a burgeoning tech firm that just secured a $10 billion investment from Microsoft earlier this week. OpenAI is managed by a non-profit organization of the same name.

The firm is best known for its development of “ChatGPT,” an AI-powered chat bot that has shocked the public in recent weeks with its ability to produce humanlike answers to user prompts. The tool generates high-quality responses on an array of topics and in many forms, including essays, poetry and jokes.

While proponents have touted its many potential uses in the business and educational worlds, critics have warned it could eventually replace humans in many jobs or fuel a rise of cheating and misinformation in schools.

The bot is imperfect and can use false information in its responses.

With Post wires