No pressure, but five companies carrying the market report earnings over the next 48 hours.
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Alphabet, Amazon, Meta, and Microsoft all report today after the bell. Apple closes things out on Thursday. In total, more than $15 trillion in market capitalization is telling investors how they’re doing.
Their massive size isn’t the only important thing. Since almost all these companies are vying for AI supremacy, their success (or failure) is a report card on the technology reshaping everything.
BI’s Joe Ciolli, author of the great First Trade newsletter, breaks down what to look out for with each company. We’ve also got analyst roundups for Amazon and Meta.
A private company’s reported challenges are also weighing heavily on these public giants.
A story from The Wall Street Journal about OpenAI missing key revenue and user targets has some investors spooked. Public companies directly partnering with OpenAI — like CoreWeave and Oracle — took the brunt of it. But the impact was felt across the tech sector. The Nasdaq 100 index finished down 1% on Tuesday.
The WSJ reports that OpenAI CEO Sam Altman and CFO Sarah Friar don’t see eye to eye over the AI giant’s massive data-center spending ahead of a potential IPO.
In a joint statement, Altman and Friar called the story “ridiculous,” but it’s not the first time reports have surfaced that the two don’t get along. BI’s Peter Kafka breaks it all down here.
BI’s Alistair Barr, author of our Tech Memo newsletter (another great one), found the recent reports strange to read. While concerns about OpenAI’s heavy compute spending persist, its aggressive push to lock in capacity now looks pragmatic as rivals like Anthropic face outages and growing pains, Alistair writes. But the bigger challenge isn’t just building powerful AI, it’s figuring out who will pay for it, and why.
A reported dispute between a CEO and CFO over spending seems very specific to that company. But a lot of OpenAI’s challenges are what the wider tech industry is facing.
Just like OpenAI, almost every Big Tech company can’t stop talking about how much they’re spending on AI. And just like OpenAI, whenever they get pressed on that approach, they all say the risk of overspending is far smaller than the risk of underspending.
So if OpenAI is facing budgetary pressure, what does that say about the rest of Big Tech that’s followed suit?
Tech giants benefit from having established businesses besides AI that generate substantial revenue. Still, they’ve all also made it clear that their future is all about AI.
And if the math ain’t working for OpenAI, how long until the numbers don’t work for Big Tech either?
