Artificial intelligence

Why tech giants will rake in AI’s big gains

6 Feb 2024

Amazon, Microsoft, Nvidia and Alphabet powered roughly 8% of 2023’s North American venture deals, largely in artificial intelligence. In this Exchange podcast, Altimeter Capital investor Apoorv Agrawal explains why these companies are reaping rewards from the latest tech craze.

TikTok and Universal will stage reunion tour soon

5 Feb 2024

The music giant’s decision to yank its catalog off the social-media app hurts singers and bands more than either business. And yet mixing tunes, both new and old, with a powerful algorithm is harmonious. There are plenty of financial reasons for the duo to get back together.

Apple’s AI absence may be its advantage

1 Feb 2024

Microsoft and Alphabet pepper quarterly results with the promise of artificial intelligence. The $2.9 trln Apple barely mentions it. The risk is a giant missed opportunity. But its gadgets may indirectly benefit, and without the ballooning capital expenditure at peers like Meta.

Big Tech and AI get too close for comfort

29 Jan 2024

Microsoft, Amazon, Nvidia and Alphabet alone contributed about a third of the $70 bln raised by data and artificial intelligence startups last year. Some of the investments could turn into revenue generators. Mounting regulatory and financial risks also might offset the benefits.

IBM boom suggests a lack of pattern recognition

25 Jan 2024

AI is thriving, says CEO Arvind Krishna. Investors responded by giving IBM shares their best day in 23 years. Yet the tech firm’s reported numbers are pedestrian. Until the benefits show up in top-line growth, IBM’s promise remains – in AI-speak – a hallucination.

Venture capital’s facelift shows modest scars

24 Jan 2024

Growth-company investors are paying higher prices, new data suggests, even if dealmaking overall is still muted. Interest is shifting to areas like AI and manufacturing. The result is a new look for the recovering startup ecosystem, albeit with a little less youthful vigor.

Capital Calls: SAP, Abrdn

24 Jan 2024

Concise views on global finance: The German software giant is cutting 7% of its workforce, sending shares to an all-time high; outflows at the British fund manager accelerated in the second half of 2023, exacerbating the company’s effort to turn itself around.

Elon Musk’s losing streak is heading for Tesla

17 Jan 2024

The billionaire wants 25% control at the $690 bln carmaker, after trimming his stake in part to finance an ill-advised deal for Twitter. Musk’s social-media frolic risked making him an absentee CEO; containing that threat means following bad governance with worse.

HPE’s Juniper deal magnifies power of competition

10 Jan 2024

Buying the networking-gear maker for $14 bln is designed to cash in on AI growth. Despite riding the internet boom, however, Juniper has generated less than half the return of the S&P 500 Index since its IPO 24 years ago. It’s a timely lesson on how robust rivalries erode profit.

AI startups’ key challenge is creativity, not cost

9 Jan 2024

Developing humanlike models is notoriously expensive. In this Exchange podcast, venture capital investor Konstantine Buhler of Sequoia Capital discusses how new breakthroughs are starting to lower costs and how that presents opportunities for challengers like OpenAI.

Mobileye’s bullwhip will come for Nvidia too

4 Jan 2024

The maker of chips for autonomous-car systems warned that customer stockpiling would hit first-quarter revenue. Gluts are inevitable across the industry, but this one sent the Intel-backed company’s shares down 25%. AI-semiconductor suppliers are bound to face similar surpluses.

New York Times arrives in new tech with AI lawsuit

28 Dec 2023

The 172-year-old newspaper publisher is suing OpenAI and its backer Microsoft for alleged unauthorized use of its articles to train chatbots. It could help compel tech companies to pay publishers for news content, shifting a modicum of power back to the battered media industry.

Gen Alpha will tire of living online

26 Dec 2023

As kids born since 2010 age into the digital world, their fatigue from being forced online will prompt backlash similar to Gen Z. Both will become smarter about the implicit agreement of trading services for data and make life more difficult for companies from Alphabet to OpenAI.

Artificial intelligence will embark on a data dash

22 Dec 2023

Text and photos produced by professionals are key to training and improving AI models. But accessing this information is getting harder and pricier. AI firms will have little choice but to pay for data, pushing up already-high costs – and delivering a windfall to publishers.

AI firms lead quest for intelligent business model

12 Dec 2023

Automating a swathe of tasks could help startups capture $140 bln in revenue. But even sector darling OpenAI is deeply unprofitable. To justify the billions invested by backers like Microsoft and Amazon, artificial intelligence will have to deliver lasting productivity gains.

Capital Calls: OpenAI’s Microsoft dilemma

11 Dec 2023

Concise views on global finance: When boss Sam Altman’s ouster threatened to implode the ChatGPT maker, $2.7 trln backer Microsoft helped restore order. That necessary boon, however, will draw ever-more trustbuster scrutiny about tech giants’ unshakable influence in AI.

OpenAI’s value comes full circle

5 Dec 2023

Despite recent chaos, the Microsoft-backed artificial intelligence startup is moving ahead with a share sale that could value it at roughly $86 bln. Even after the temporary ouster of boss Sam Altman that nearly spurred an employee exodus, its prospects are largely unchanged.

Capital Calls: AI funding

5 Dec 2023

Concise views on global finance: French AI model-maker Mistral is on track to notch a $2 bln valuation from investors like Andreessen Horowitz despite scant revenue.

AI investments carry whiff of vicious circles past

29 Nov 2023

Turmoil at Microsoft-backed OpenAI lays bare governance risks for such tie-ups. A linked, and equally concerning, problem is tech titans injecting capital in exchange for revenue, inflating valuations in the process. The mutual back-scratching evokes dangers of the dot-com era.

EU watchdogs muck up Amazon’s messy iRobot cleanup

28 Nov 2023

The European Commission says the e-commerce giant’s $1.4 bln takeover of the Roomba maker could shut out robot-vacuum rivals. Trustbusters are mainly concerned about Amazon’s market clout. Yet if the deal collapses, iRobot shareholders will suffer more downward suction.