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Microsoft, OpenClassrooms Team Up to Address AI Skills Crisis

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Microsoft MSFT recently collaborated with OpenClassrooms, a notable online education provider, with an aim to offer students in-demand skills and knowledge required for artificial intelligence (AI) jobs.

Per the terms of the deal, Microsoft’s strength in AI content will be leveraged by Paris, France-based OpenClassrooms to conduct a new online program providing masters-level diploma degree.

The companies will work together in empowering candidates with robust AI skills to fill in the significant talent gap for AI and data science. Notably, this talent gap has been hindering growth of the technology industry.

Coming to price performance, shares of Microsoft have gained 34.3% in the past year, outperforming the industry’s rally of 30.6%.

Program in Detail

OpenClassrooms aims to recruit around 1,000 “promising” candidates across France, the U.K., and the United States, for the latest program.

The candidates are guaranteed of securing a job within six months of completion of the program or else they are entitled to 100% money back from OpenClassrooms, which strengthens the prospects of the latest deal.

In addition, OpenClassrooms courses are already recognized in France, and the company is striving to gain accreditation in the United States and the U.K.

Notably, OpenClassrooms employs a mentor to personally guide and monitor candidates through their progress every week. This provides it an edge over other online education providers.

Attempt to Address AI Skills Crisis: A Key Catalyst

As AI and robotics are becoming mainstream, the work place is transforming, paving the way for more skilled jobs to sustain digital transformation. Lack of skilled workers particularly from STEM (Science, Technology, Engineering and Mathematics) fields in the United States has been hindering technology players for quite some time.

We believe the latest development is in sync with Microsoft’s aim to address the much-hyped AI skills crisis. Per the estimate quoted by the tech-giant, “by 2022, a talent shortage will leave as many as 30% of AI and data skills jobs open.”

Strategic Initiatives to Spur Microsoft’s Ed-Tech Goals

Microsoft is looking to improve educational outcomes with its ever-expanding platforms and tools. Notably, the company has rolled out lower-priced Surface laptop to take on Apple’s budget iPads, and Alphabet’s GOOGL lower-priced Chromebook.

The tech giant is expanding footprint in education with its productivity suite Office 365, to counter Google’s G Suite. The company also has a special version of Windows 10 for students.

Furthermore, Microsoft remains focused on developing software expertise among youth which enables them to build and enhance their professional career. Notably, with Github buyout, the company is well poised to enhance its machine learning (ML) base further, which is likely to improve the capabilities of the professional programs.

Additionally, the company acquired Flipgrid in the past to counter Google’s Classroom app, and other peers. In fact, Microsoft made the Flipgrid app free for schools in a bid to expand customer base. Moreover, the company conducts various certified courses across EdX, Coursera, among others.

Per ResearchAndMarkets, the global EdTech market is forecast to reach $40.9 billion at a CAGR of 18.3% between 2017 and 2022. We believe Microsoft is well poised to capitalize on the lucrative opportunity.

Zacks Rank & Key Picks

Currently, Microsoft carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the same industry are Cadence Design Systems, Inc CDNS and Synopsys, Inc. SNPS, both sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Cadence Design and Synopsys have a long-term earnings growth rate of 12% and 10%, respectively.

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