Artificial intelligence

AI may force IT spending into economic decoupling

11 Oct 2023

If companies want to gain from artificial intelligence, they’ll have to spend big on IT. Clients are holding back for now as global growth slows but valuations of tech giants like Accenture and Tata Consultancy suggest clients will loosen purse strings sooner rather than later.

AI is making Meta virtually cool again

28 Sep 2023

Mark Zuckerberg talked up his $780 bln social media company’s artificial intelligence products at a developer conference. If they added as much value as Instagram, Meta could be worth $140 bln more. But Zuckerberg has to show he can monetize something he’s building from scratch.

OpenAI value ignores CEO’s fundraising odyssey

27 Sep 2023

The ChatGPT maker may ask investors to buy stock off employees at a $80-90 bln price tag. Based on Nvidia’s valuation, OpenAI could justify that mark by doubling revenue each year to 2026. A big risk is that boss Sam Altman keeps raising money, diluting existing shareholders.

Capital Calls: Net neutrality is back, again

26 Sep 2023

Concise views on global finance: US regulators want to reopen a decade-old fight over the internet’s rules of the road. But just like merger cops who have struggled to gain traction, they are trying to use yesterday’s tools to predict tomorrow’s problems.

EU regulators have tech giants in their sights

26 Sep 2023

Brussels is taking on the likes of Amazon and Apple with a slew of new rules aimed at curbing market dominance and taking back control over data. Former EU Commission economist Bertin Martens explains to The Exchange podcast how the industry giants could be forced to open up.

Listing duo offers followers a cautious playbook

21 Sep 2023

Chip designer Arm and grocery delivery company Instacart have secured relatively successful stock launches, offering hope of a wider reopening of the IPO market. In this Viewsroom podcast, Breakingviews columnists explain how cornerstone investors and lowly valuations helped.

Arm’s IPO valuation rests on big dose of hope

7 Sep 2023

The SoftBank-owned chip designer is getting ready to list. In this Viewsroom podcast, Breakingviews columnists argue that even the company’s reduced price tag of $50 bln is still far too high, and debate what investors would have to believe to buy the shares.

SoftBank’s reduced Arm price tag is still too high

5 Sep 2023

The Japanese group may float its UK chip designer for $50-54 bln. That’s lower than initially hoped, but still implies an implausible future where revenue and profitability soar. If Arm merely grows at recent rates and nudges up margins, its market worth is more like $35 bln.

Alphabet moonshots are ready for launch

29 Aug 2023

Google’s parent lost $6 bln last year on experimental ventures, such as health-data cruncher Verily and self-driving outfit Waymo. As CFO and former tech banker Ruth Porat takes charge of the unit, it’s probably a good time to consider carving out some and refocusing on others.

Arm’s changing business model is wildcard for IPO

24 Aug 2023

As well as jumping on the AI bandwagon, SoftBank’s soon-to-float chip designer has altered the way it charges big customers to boost growth and smooth out revenue. If it works, a valuation north of $60 bln looks slightly less implausible. But investors lack evidence so far.

AI frenzy’s feedback loop stuffs Nvidia

23 Aug 2023

The $1.2 trln semiconductor designer’s second-quarter revenue doubled. Tech giants’ valuations are soaring on AI hype, so naturally companies are pouring money into it, including by buying Nvidia's chips. As long as investors quack for more, Jensen Huang's firm gets fed.

Big Tech is mostly leaping a low bar

10 Aug 2023

The stock market’s mood increasingly hinges on the vagaries of tech giants like Meta, Amazon and Apple. In this Viewsroom podcast, Breakingviews columnists discuss how most of their recent earnings held up – even if only compared to muted expectations for their core businesses.

America’s new China curbs eschew scale for smarts

10 Aug 2023

The Biden administration’s plan for screening US investments in the People’s Republic is not the wide-ranging proscription many expected. It targets only a handful of deals, would ban even fewer and isn’t retroactive. That’s a relief for most investors – and for diplomacy, too.

Chinese AI arrives by stealth, not with a bang

28 Jul 2023

Beijing’s new rules for the technology are less onerous than expected. Armed with vast data troves, giants from Alibaba to Baidu are leading the industry’s development. But President Xi Jinping’s focus on national security and censorship, plus US chip curbs, will slow progress.

Capital Calls: KKR’s reluctant bidding war

30 Jun 2023

Concise views on global finance: Despite pushing arguments about antitrust and financing risks, the buyout shop ended up parrying a rival suitor for industrials company Circor by matching it on price.

Alphabet threats show up everywhere but its shares

29 Jun 2023

The Google-owner’s valuation has powered ahead as it touts its prowess in artificial intelligence, in spite of mounting menaces. A report questioning Google's video ad sales compounds ongoing antitrust threats, and even AI might not be an unalloyed good.

LinkedIn ages like fine wine in Microsoft’s cellar

28 Jun 2023

In contrast to souring Meta and Twitter, the drier social media app is flourishing. Although veiled by its parent’s cloud dominance, the 2016-vintage acquisition has tripled in value from its $26 bln price tag. Business-related data also will help it keep maturing in the AI era.

AI’s deflationary winds will blow away profits

27 Jun 2023

Artificial intelligence could add $8 trln a year to world GDP, McKinsey estimates, defying the gloom about robots replacing humans. Though companies should benefit from lower costs, consumers could use the technology to find better deals. It all adds up to lower prices.

Big Tech backlash swells the AI gold rush

26 Jun 2023

Cloud provider Databricks is buying a machine learning startup for $1.3 bln, almost six times its valuation earlier this year. Models backed by Microsoft and Google dominate artificial intelligence. But a bet that companies want to control their data is pumping up smaller rivals.

Masayoshi Son’s new AI push merits a pinch of salt

22 Jun 2023

The SoftBank founder said he would place further bets on artificial intelligence after taking a pause. Some of his investments may pay off. But Arm is his only real AI win from a $112 bln portfolio, his credibility has taken a knock, and his war chest is smaller than it looks.