Software

Who can serve up the Goldilocks recipe for AI?

25 Apr 2024

Investors slapped down Facebook owner Meta for hefty spending on artificial intelligence with uncertain returns. Conversely, they have feted chipmaker Nvidia for its real-life revenue from AI tools. Microsoft and Alphabet are doing a decent job of landing in the middle.

TikTok’s fate matters only up to a point for Meta

24 Apr 2024

Under a new US law, owner ByteDance is likely to sell the app without its secret sauce, suffer a ban or win a court challenge. Mark Zuckerberg’s social-media colossus should capitalize on the first two scenarios. Even the third allows it to make decent headway against its rival.

Walmart-backed IPO makes brick-and-mortar AI pitch

17 Apr 2024

Ibotta is chasing a $2.6 bln public valuation for one of marketing’s oldest tricks: rebates on in-store purchases. Its data-gathering is simple – customers scan receipts – yet solid and profitable. But efforts to cover the company in a high-tech sheen look like a stretch.

Microsoft’s G42 deal puts UAE in America’s AI tent

16 Apr 2024

The $3 trln software giant is paying $1.5 bln for a minority stake in Abu Dhabi-based artificial intelligence group G42. Microsoft gets years of cloud storage business. But it also implies an end to the Gulf state’s effort to be a neutral AI counterparty to China and the US.

Microsoft-backed IPO breaks rule of 40 at bad time

16 Apr 2024

Cybersecurity firm Rubrik is going public despite failing the sector’s metric to judge success. Sure, the company backed by the $3 trln giant is starting to rely on stable subscriptions. But it’s burning cash. Based on others that flout the rule, a low valuation is in store.

Sotheby’s next hot auction: a Picasso-backed bond

11 Apr 2024

The auctioneer owned by Patrick Drahi is selling securities backed by collectors’ hoards. With only $34 bln of art-based lending, there’s scope to reach more borrowers. But there are good reasons why art, which is hard to verify and value, has resisted slice-and-dice financing.

Google will struggle with Apple-generated AI query

5 Apr 2024

Artificial intelligence presents the first serious threat to the search engine’s 25-year dominance. Parent Alphabet has the money and tech nous to fend off rivals. The bigger financial risk is its $120 bln relationship with the iPhone maker as trustbusters try to pry them apart.

Middle East AI dream depends on luring brainpower

22 Mar 2024

An abundance of cheap energy to power data centres gives artificial intelligence startups reason to consider the Gulf. But to become a force in AI, Saudi Arabia and the UAE will have to design their own advanced chips. Attracting talent to the region will require more than money.

Crypto’s roaring comeback may be harder to undo

19 Mar 2024

Bitcoin’s price broke its record, nearly two years after crypto exchange FTX went bust. In this Exchange podcast, Andreessen Horowitz’s Arianna Simpson explains why digital assets and the ledgers underpinning them are inextricable, and what’s driving new excitement around both.

Alphabet and Apple have cause to circle AI wagons

18 Mar 2024

The $2.7 trln iPhone-maker is in talks to license Alphabet’s artificial intelligence models, according to Bloomberg. Apple has underinvested, but Google search’s pride of place on its devices is also at risk. A deal would help both defend their turf, if regulators don’t kill it.

China’s new tastes will spit out more than Apple

6 Mar 2024

The iPhone maker is losing share in the People’s Republic to domestic champion Huawei. American companies in the giant market face both weakening demand and a move to homegrown brands. Chinese consumers’ shifting attitudes suggest the woes will worsen.

Musk vs. Altman is a battle everyone loses

5 Mar 2024

The Tesla boss's complaint that OpenAI ignored obligations to the human race distracts from a bigger problem. Existential issues are best overseen by democratic governments, because to leave them to techno-libertarians and private contracts is absurd. AI is no different.

VCs don shades even as tech storm clouds gather

29 Feb 2024

Even as OpenAI faces a probe, entrepreneurs and their backers meeting in California have high hopes for the industry. It’s not clear why. Last year’s funding and dealmaking rout leaves founders short on cash, and attempts by big tech firms to fill the void may make matters worse.

Snowflake shows how easily AI valuations can melt

29 Feb 2024

Growth slows a little and a 65-year-old CEO retires. The result: a fifth of the data firm’s $75 bln market value vanishes. It’s a sign of how much perfection is priced into AI-related stocks. Snowflakes are never alike, but when it comes to investor exuberance, tech firms can be.

Apple picks a better road to AI dominance

28 Feb 2024

The $2.8 trln tech giant has ditched a decade-long quest to build a car. Though huge, the auto market is cutthroat. Besides, making cars would have mostly been a new way to capture customers’ data and brainspace. The iPhone maker has more effective ways to achieve that goal.

Klarna IPO now makes less sense than one later

28 Feb 2024

Decent growth and lower losses mean the Swedish buy now, pay later group can justify a $20 bln valuation. Given that’s three times the level of its last cash injection, there’s an argument for a speedy listing. Still, Klarna’s messy governance suggests a 2025 IPO is more logical.

Reddit loves users, so it’s giving itself a deal

26 Feb 2024

The social media firm plans to reserve IPO shares for loyal visitors, a tactic enlisted by the maker of Sam Adams beer and trading firm Robinhood. So-called “affinity programs” are risky, as Robinhood’s 2021 offering shows. But it may help Reddit get the valuation it wants.

Europe shares’ granola rush will become thin gruel

26 Feb 2024

The STOXX 600 Index has hit a record, but local funds are seeing outflows. As in the US a small bunch of companies – the so-called GRANOLAS group – are behind the good news. But in the Old Continent they’re more dependent on weak economic growth rather than the AI revolution.

Rivian swerves dangerously into crowded slow lane

22 Feb 2024

The electric-truck maker’s market value fell by a quarter to $11 bln after warning that production would flatline at about 57,000 vehicles. It joins rivals rapidly rewriting growth-to-profitability manuals copied from Tesla. Grinding down costs instead will be a far tougher road.

Cloudflare risks a lesson in giants’ AI advantage

16 Feb 2024

At 23 times expected sales, the $34 bln cybersecurity firm is one of the most richly valued software companies. Using its network to power AI holds promise, but enormous spending and the risk of being overshadowed by titans like Microsoft makes investors look overambitious.