(This article is part of Today’s Cache, The Hindu’s newsletter on emerging themes at the intersection of technology, innovation and policy. To get it in your inbox, subscribe here.)
Apple, Nvidia expected to join OpenAI funding
Apple and Nvidia are in talks to invest in OpenAI as part of a new fundraising round that would value the ChatGPT maker above $100 billion, according to media reports on Thursday. The news comes a day after the Wall Street Journal reported that venture-capital firm Thrive Capital would invest around $1 billion in OpenAI, leading the funding round. OpenAI has become increasingly important to Apple’s artificial intelligence strategy, with the iPhone maker bringing the AI firm’s chatbot, ChatGPT, to Apple devices in June as part of “Apple Intelligence.”
Apple was also reported to gain an observer role on OpenAI’s board. Microsoft, OpenAI’s largest strategic investor with over $10 billion invested, is also expected to participate in the funding round. The exact investment amounts from Apple and Microsoft remain undisclosed. OpenAI’s high valuation is a result of the AI arms race it sparked with the launch of ChatGPT in 2022.
Nvidia’s forecast dampens AI enthusiasm
Nvidia dragged technology heavyweights lower after the chip maker’s earnings disappointed investors who had been hoping they would fuel fresh gains in Wall Street’s most valuable companies, and sent stocks in Asia down on Thursday. Nasdaq futures initially dropped about 1% following Nvidia’s quarterly earnings report late Wednesday, suggesting traders expected tech stocks to lose ground.
Nvidia dropped almost 7% and lost $200 billion in stock market value after it forecast third-quarter gross margins that could miss market estimates and revenue that was largely in line. A handful of other AI-related companies shed around $100 billion in combined value. Shares of Broadcom and Advanced Micro Devices were each down about 2%. Microsoft and Amazon each dipped almost 1%. Nvidia’s chip contractor TSMC slid 2%, and declines in other tech names weighed on shares in Tokyo and Seoul, dragging Korea’s KOSPI to a two week low.
Character.AI lays off 5% staff
Chatbot startup Character.AI laid off at least 5% of its staff, The Information reported on Thursday, citing a person briefed by company leaders. The employees who were laid off mostly worked on marketing and recruiting for the startup, the report said. “We are refocusing the company to ensure all roles align with our new direction to build personalised AI (artificial intelligence) products,” a Character.AI spokesperson told Reuters. “As a result, we have made a small reduction in our workforce,” the spokesperson said, without giving the numbers of the laid off employees.
Earlier this month, Character.AI signed an agreement with Alphabet’s Google that grants the search engine giant a non-exclusive license to the chatbot maker’s large language model technology. Character.AI will get more funding as part of the deal with Google, the startup had said in a blog, without disclosing the amount.
