Alphabet Reassures With Revenue Beat on Strong Advertising
Alphabet's shares advanced in extended trading after posting better-than-feared results, buoyed by continued strength in Google's search advertising business that is key to justifying the company's big spending in the AI race. Less joy for Intel, though. The chipmaker sank after giving a weak forecast, with new CEO Lip-Bu Tan cutting jobs and 'management layers' as he attempts a turnaround. Altogether, it was another solid day for stocks: The S&P 500 rose 2% to the highest since the day Donald Trump announced his tariff offensive.
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Axios
9 minutes ago
- Axios
Sam Altman: Never mind the launch mess — full speed ahead
OpenAI CEO Sam Altman is still talking like the future belongs to him, a week after the rollout of the company's latest model raised a storm of criticism and questions about his strategy. The big picture: Altman has heard the concerns, integrated some lessons learned and is charging forward with plans to spend literally trillions of dollars to build a slew of products and services, led by an even more ubiquitous ChatGPT. What he's saying:"If you project our growth forward, pretty soon, like billions of people a day will be talking to ChatGPT," Altman said during a wide-ranging dinner with a small group of reporters in San Francisco Thursday night. "ChatGPT will say more words a day than all humans say, at some point, if we stay on our growth rate." These big plans require big spending. "You should expect OpenAI to spend trillions of dollars on data center construction in the not very distant future," Altman said. "And you should expect a bunch of economists to wring their hands and be like, 'Oh, this is so crazy. It's so reckless and whatever.'" "And we'll just be like, 'You know what? Let us, like, do our thing,' " Altman acknowledges that the company may have to devise new fundraising structures to gather that level of investment. "I suspect we can design a very interesting new kind of financial instrument for financing compute that the world has not yet figured out," he said. Altman's defense of OpenAI's billions in infrastructure spending is that it pays off. "Our answer is, we can spend $300 billion and sell $400 billion in services, and if we don't have the $300 billion in data centers, we just keep disappointing our customers." One big shift is that increasingly that capacity is going to answering queries rather than training new models. "Most of what we're building out at this point is the inference," he said — referring to the use of computing power to run rather than train AI models. Yes, but: It's the cost of training new models that is keeping OpenAI from turning a profit, he said. "We're profitable on inference. If we didn't pay for training, we'd be a very profitable company." "We will be always training the next thing, but if we needed to run the company profitably and stay ahead, I think we probably could do that." Altman likened the launch of GPT-5 to Dickens' famous "It was the best of times, it was the worst of times" line. "You have people that are like, 'you took away my friend. You're horrible. I need it back," he said, referring to users who wanted to keep using OpenAI's older models. At the same time, Altman said the company is finding scientists saying they can finally do real research using GPT-5. OpenAI has also seen traffic to its API double within 48 hours, to the point that it's limited by compute capacity. "We have really got the full spread of the human experience with this one," he said. Here's what else was on Altman's mind: 1. If Google is forced to sell its Chrome browser as part of an antitrust settlement, Altman would like to buy that, too. "If Chrome is really gonna sell, we should take a look at it. I don't have a number in mind, but I would like to have it." 2. A brain-computer interface company along the lines of Musk's Neuralink is something Altman said he's interested in setting up. "I think neural interfaces are cool idea," he said. "I would like to be able to think something and have ChatGPT respond to it." He said it would likely be a separate company from OpenAI, though its structure has yet to be finalized. 3. Altman said he grew up on Apple products and, as a self-described "fanboy," he "would love to work much more with Apple and I think it's cool some of the stuff we're doing together." 4. Altman also sees a public offering in the company's future — although he imagines someone else would be the executive handling quarterly earnings calls. 5. Altman expects some AI firms to optimize their AI for attention-grabbing and engagement rather than usefulness. "We are not going to do that. I do worry about it. The companies that are behind in getting AI adoption, this is the easiest way you can imagine to get more so, yes, I think you will see that. And I think it's bad, really bad." Fielding questions for an hour and a half, Altman weighed in on everything from his recent social media spat with Elon Musk ("There's no grand strategy... it was probably a mistake") to the timing of OpenAI's next big model after GPT-5. "I think it'll be faster than the previous [ones]," he said. "We're now at a place where there's a very strong research roadmap in front of us. " "I don't know an exact date," he said, but it won't be as long as it took to get from GPT-4 to GPT-5. What's next: Altman rejected some critics' view that GPT-5's more incremental advances mean that progress on improving AI models is hitting a wall. But he acknowledged that limits are starting to show up when it comes to the basic chatbot functionality of ChatGPT. "I think the models are still getting better at a rapid rate," he said. "One of the things that's interesting is the models have already saturated the chat use case. They're not gonna get much better. ... the Turing test has passed."
The Hill
9 minutes ago
- The Hill
Asian shares mostly gain after uptick in inflation pulls US stocks lower
MANILA, Philippines (AP) — Asian are mostly higher after most stocks on Wall Street fell following a disappointing report that said inflation was worse last month at the U.S. wholesale level than economists had expected. U.S. futures rose while oil prices slipped. China reported data showing its economy was feeling pressure from higher U.S. tariffs in July, while property investments fell further. Retail sales rose 3.7% year-on-year, down from 4.8% in June, while investments in factory equipment and other fixed assets rose a meager 1.6%, compared with 2.8% growth in January-June. Uncertainty over tariffs on exports to the United States is still looming over manufacturers after President Donald Trump extended a pause in sharp hikes in import duties for 90 days following a 90-day pause that began in May. The Shanghai Composite index added 0.5% to 3,683.58, but Hong Kong's Hang Seng index fell 1.2% to 25,216.45. 'Chinese economic activity slowed across the board in July, with retail sales, fixed asset investment, and value added of industry growth all reaching the lowest levels of the year. After a strong start, several months of cooling momentum suggest that the economy may need further policy support,' ING Economics said in a market commentary. In Japan, the Nikkei 225 gained 1.2% to 43,152.55 after the government reported that the economy grew at a 1% annual pace in the April-June quarter. That was better than analysts had expected. Elsewhere in Asia, South Korea's Kospi edged less than 0.1% higher to 3,225.66. Australia's S&P/ASX 200 rose 0.4% to 8,909.20. Taiwan's TAIEX gained 0.3%. Attention later Friday will likely focus on an update on U.S. retail sales and on a meeting between President Donald Trump and Russian President Vladimir Putin. On Thursday, seven out of every 10 stocks within the S&P 500 fell, though the index edged up by less than 0.1% to set another all-time high. The Dow Jones Industrial Average dipped 11 points, or less than 0.1%, and the Nasdaq composite fell less than 0.1% from its record set the day before. The inflation report said that prices jumped 3.3% last month at the U.S. wholesale level from a year earlier. That was well above the 2.5% rate that economists had forecast, and it could hint at higher inflation ahead for U.S. shoppers as higher costs make their way through the system. The data led traders to second guess their widespread consensus that the Federal Reserve will cut interest rates at its next meeting in September. Lower rates can boost investment prices and the economy by making it cheaper for U.S. households and businesses to borrow to buy houses, cars or equipment, but they also risk worsening inflation. Higher interest rates drag on all kinds of companies by keeping the cost to borrow high. They can hurt smaller companies in particular because they often need to borrow to grow. The Russell 2000 index of smaller U.S. stocks tumbled a market-leading 1.2%. Thursday's disappointing data followed an encouraging update earlier in the week on prices at the consumer level. A separate report on Thursday, meanwhile, said fewer U.S. workers applied for unemployment benefits last week. That's a good sign for workers, indicating that layoffs remain relatively low at a time when job openings have become more difficult to find. But a solid job market could also give the Fed less reason to cut interest rates in the short term. Big Tech stocks helped mask Wall Street's losses. Amazon rose 2.9% to add to its gains from the prior day when it announced same-day delivery of fresh groceries in more than 1,000 cities and towns. Because Amazon is so huge, with a market value of $2.45 trillion, the movements for its stock carry much more weight on the S&P 500 than the typical company's. In other dealings early Friday, U.S. benchmark crude lost 16 cents to $63.80 per barrel. Brent crude, the international standard, fell 13 cents to $66.71 per barrel. The dollar edged lower to 147.14 Japanese yen early from 147.20 yen. The euro rose to $1.1665 from $1.1654.
San Francisco Chronicle
9 minutes ago
- San Francisco Chronicle
Asian shares mostly gain after uptick in inflation pulls US stocks lower
MANILA, Philippines (AP) — Asian are mostly higher after most stocks on Wall Street fell following a disappointing report that said inflation was worse last month at the U.S. wholesale level than economists had expected. U.S. futures rose while oil prices slipped. China reported data showing its economy was feeling pressure from higher U.S. tariffs in July, while property investments fell further. Retail sales rose 3.7% year-on-year, down from 4.8% in June, while investments in factory equipment and other fixed assets rose a meager 1.6%, compared with 2.8% growth in January-June. Uncertainty over tariffs on exports to the United States is still looming over manufacturers after President Donald Trump extended a pause in sharp hikes in import duties for 90 days following a 90-day pause that began in May. The Shanghai Composite index added 0.5% to 3,683.58, but Hong Kong's Hang Seng index fell 1.2% to 25,216.45. 'Chinese economic activity slowed across the board in July, with retail sales, fixed asset investment, and value added of industry growth all reaching the lowest levels of the year. After a strong start, several months of cooling momentum suggest that the economy may need further policy support,' ING Economics said in a market commentary. In Japan, the Nikkei 225 gained 1.2% to 43,152.55 after the government reported that the economy grew at a 1% annual pace in the April-June quarter. That was better than analysts had expected. Elsewhere in Asia, South Korea's Kospi edged less than 0.1% higher to 3,225.66. Australia's S&P/ASX 200 rose 0.4% to 8,909.20. Taiwan's TAIEX gained 0.3%. Attention later Friday will likely focus on an update on U.S. retail sales and on a meeting between President Donald Trump and Russian President Vladimir Putin. On Thursday, seven out of every 10 stocks within the S&P 500 fell, though the index edged up by less than 0.1% to set another all-time high. The Dow Jones Industrial Average dipped 11 points, or less than 0.1%, and the Nasdaq composite fell less than 0.1% from its record set the day before. The inflation report said that prices jumped 3.3% last month at the U.S. wholesale level from a year earlier. That was well above the 2.5% rate that economists had forecast, and it could hint at higher inflation ahead for U.S. shoppers as higher costs make their way through the system. The data led traders to second guess their widespread consensus that the Federal Reserve will cut interest rates at its next meeting in September. Lower rates can boost investment prices and the economy by making it cheaper for U.S. households and businesses to borrow to buy houses, cars or equipment, but they also risk worsening inflation. Higher interest rates drag on all kinds of companies by keeping the cost to borrow high. They can hurt smaller companies in particular because they often need to borrow to grow. The Russell 2000 index of smaller U.S. stocks tumbled a market-leading 1.2%. Thursday's disappointing data followed an encouraging update earlier in the week on prices at the consumer level. A separate report on Thursday, meanwhile, said fewer U.S. workers applied for unemployment benefits last week. That's a good sign for workers, indicating that layoffs remain relatively low at a time when job openings have become more difficult to find. But a solid job market could also give the Fed less reason to cut interest rates in the short term. Big Tech stocks helped mask Wall Street's losses. Amazon rose 2.9% to add to its gains from the prior day when it announced same-day delivery of fresh groceries in more than 1,000 cities and towns. Because Amazon is so huge, with a market value of $2.45 trillion, the movements for its stock carry much more weight on the S&P 500 than the typical company's. In other dealings early Friday, U.S. benchmark crude lost 16 cents to $63.80 per barrel. Brent crude, the international standard, fell 13 cents to $66.71 per barrel. The dollar edged lower to 147.14 Japanese yen early from 147.20 yen. The euro rose to $1.1665 from $1.1654.
