Category: 3. Business

Mark Zuckerberg and Meta are spending billions to recruit top artificial intelligence talent, triggering debates about whether the aggressive hiring spree will pay off in the competitive generative AI race, reported AFP.

OpenAI CEO Sam Altman recently complained that Meta has offered $100 million bonuses to lure engineers away from his company, where they would join teams already earning substantial salaries.

Several OpenAI employees have accepted Meta’s offers, prompting executives at the ChatGPT maker to scramble to retain their best talent.

“I feel a visceral feeling right now, as if someone has broken into our home and stolen something,” Chief Research Officer Mark Chen wrote in a Saturday Slack memo obtained by Wired magazine.

Chen said the company was working “around the clock to talk to those with offers” and find ways to keep them at OpenAI.

Meta’s recruitment drive has also landed Scale AI founder and former CEO Alexandr Wang, a Silicon Valley rising star, who will lead a new group called Meta Superintelligence Labs, according to an internal memo, whose content was confirmed by the company.

Meta paid more than $14 billion for a 49 per cent stake in Scale AI in mid-June, bringing Wang aboard as part of the acquisition. Scale AI specialises in labelling data to train AI models for businesses, governments, and research labs.

“As the pace of AI progress accelerates, developing superintelligence is coming into sight,” Zuckerberg wrote in the memo, which was first reported by Bloomberg.

“I believe this will be the beginning of a new era for humanity, and I am fully committed to doing what it takes for Meta to lead the way,” he added.

US media outlets report that Meta’s recruitment campaign has also targeted OpenAI co-founder Ilya Sutskever, Google rival Perplexity AI, and the buzzy AI video startup Runway.

Seeking ways to expand his business empire beyond Facebook and Instagram, Zuckerberg is personally leading the charge, driven by concerns that Meta is falling behind competitors in generative AI.

The latest version of Meta’s AI model, Llama, ranked below heavyweight rivals in code-writing performance on the LM Arena platform, where users evaluate AI technologies.

Meta is integrating new recruits into a dedicated team focused on developing “superintelligence” — AI that surpasses human cognitive abilities.

‘Mercenary’ approach

Tech blogger Zvi Moshowitz believes Zuckerberg had little choice but to act aggressively, though he expects mixed results from the talent grab.

“There are some extreme downsides to going pure mercenary… and being a company with products no one wants to work on,” Moshowitz told AFP.

“I don’t expect it to work, but I suppose Llama will suck less.”

While Meta’s stock price approaches record highs and the company’s valuation nears $2 trillion, some investors are growing concerned.

Institutional investors worry about Meta’s cash management and reserves, according to Baird strategist Ted Mortonson.

“Right now, there are no checks and balances” on Zuckerberg’s spending decisions, Mortonson noted.

Though the potential for AI to enhance Meta’s profitable advertising business is appealing, “people have a real big concern about spending.”

Meta executives envision using AI to streamline advertising from creation to targeting, potentially bypassing creative agencies and offering brands a complete solution.

The AI talent acquisitions represent long-term investments unlikely to boost Meta’s profitability immediately, according to CFRA analyst Angelo Zino. “But still, you need those people on board now and to invest aggressively to be ready for that phase” of generative AI development.

The New York Times reports that Zuckerberg is considering moving away from Meta’s Llama model, possibly adopting competing AI systems instead.

 

(Bloomberg) — Asian shares were poised for a cautious open as investors awaited US jobs data after stocks hit another record following Donald Trump’s announcement of a trade deal with Vietnam.

An MSCI gauge of global shares set a new peak after the S&P 500 rose 0.5% to a new high Wednesday. The Nasdaq 100 gained 0.7% as tech outperformed. News of a trade deal supported apparel stocks including Nike Inc. amid hopes the latest accord will avert a potential supply-chain catastrophe. Asian equity-index futures were little changed. Tesla Inc. jumped 5% as a drop in sales was seen as better than feared.

Treasuries fell Wednesday following heavy selling in the UK, where concerns about Chancellor of the Exchequer Rachel Reeves’ future reignited questions over the nation’s fiscal position. The US 10-year yield climbed four basis points while the UK 10-year yield soared 16 basis points Wednesday. Gold rose, oil climbed around 3% and the dollar was little changed.

The cross-asset moves underscored cautious optimism as traders contend with pockets of uncertainty ahead of US jobs data that will help identify the path ahead for interest rates. Like in the UK, investors have also raised similar concerns in the US, where Trump’s signature economic legislation stalled in the House Wednesday afternoon as Republican fiscal conservatives delayed a key procedural vote.

“Investors are already pricing in the One Big Beautiful Bill, at least in some form,” Zachary Griffiths, head of investment-grade and macroeconomic strategy at CreditSights, told Bloomberg Television Wednesday. “We’re going to see more supply from the US and there’s concerns fiscally across the globe” including in the UK.

On the Vietnam trade deal, Trump said he reached a deal with the country after weeks of negotiations. A 20% tariff will be placed on Vietnamese exports to the US, with a 40% levy on any goods deemed to be transshipped through the country. Trump said that Vietnam had agreed to drop all levies on US imports.

Markets Live Strategist Mary Nicola says:

The deal also includes a 40% duty on transshipped goods, a clause clearly aimed at Chinese exports. Details on enforcement remain scarce, but this heightens risks of a potential response from Beijing.

Meanwhile, UK Prime Minister Keir Starmer said Rachel Reeves will stay on as Chancellor of the Exchequer, as he sought to draw a line under speculation about her future that sparked the bond selloff.

Back in the US, monthly nonfarm payroll data due later Thursday — a day earlier than usual due to a holiday —  will show slower hiring and the highest unemployment rate since 2021 as the Trump administration’s trade and immigration policy shifts start to leave an imprint.

Separate private payrolls data from ADP Research on Wednesday showed employment at US companies fell for the first time in over two years. Despite signs of a downshift, Federal Reserve Chair Jerome Powell has repeated the labor market remains solid. Policymakers have refrained from lowering interest rates this year as they wait to see the impact of tariffs on inflation.

“One of the reasons the Fed has been able to be patient before cutting rates was because the job market was holding up so well, so if that were to change, then the Fed may be forced to move earlier than they would like,” said Chris Zaccarelli at Northlight Asset Management.

Following ADP Research’s private payrolls data, traders added to wagers on at least two rate reductions this year, with the first coming in September. If the upcoming jobs report shows further weakness, traders reckon the Fed could move up cuts.

Some of the main moves in markets:

Stocks

• S&P 500 futures were little changed as of 8:22 a.m. Tokyo time
• Hang Seng futures were little changed
• S&P/ASX 200 futures fell 0.1%

Currencies

• The Bloomberg Dollar Spot Index was little changed
• The euro was little changed at $1.1800
• The Japanese yen was little changed at 143.56 per dollar
• The offshore yuan was little changed at 7.1620 per dollar
• The Australian dollar was little changed at $0.6585

Cryptocurrencies

• Bitcoin fell 0.1% to $109,061.54
• Ether fell 0.2% to $2,586.18

Bonds

• Australia’s 10-year yield advanced three basis points to 4.18%

Commodities

• West Texas Intermediate crude fell 0.3% to $67.25 a barrel
• Spot gold fell 0.1% to $3,352.62 an ounce

This story was produced with the assistance of Bloomberg Automation.

–With assistance from Richard Henderson.

©2025 Bloomberg L.P.

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Drax

DUBAI: Stock markets in the Gulf ended mixed on Wednesday as investors monitored global trade developments ahead of the United States’ potential re-imposition of sweeping tariffs on July 9.

President Donald Trump said on Tuesday he was not thinking of extending the July 9 deadline for countries to negotiate trade deals with the US, and continued to express doubt that an agreement could be reached with Japan.

Saudi Arabia’s benchmark index edged 0.1% higher, after two consecutive sessions of losses, helped by 1.7% rise in Saudi Arabian Mining Company.

The cautious mood dominating the region contributed to mixed sector performances, said Joseph Dahrieh, managing principal at Tickmill.

“Investors are awaiting further developments to gain more clarity, while low oil prices continue to pose a risk, despite a positive economic outlook,” he said.

Among gainers, oil giant Saudi Aramco rose 0.8%.

Oil futures edged up as Iran suspended cooperation with the UN nuclear watchdog and markets weighed expectations of more supply from major producers next month, while the US dollar softened further.

Dubai’s main share index dropped 0.4%, hit by a 1.3% fall in toll operator Salik Company.

Separately, Dubai commuters may soon have a new way to beat traffic, as Joby Aviation successfully completed the first test flight of its fully-electric air taxi in the emirate this week – a significant step toward the city’s goal of integrating airborne transport into its mobility network as early as next year.

In Abu Dhabi, the index eased 0.1%, while the Qatari index closed flat.

A report on Tuesday suggested that the US labour market stayed resilient in May, sharpening the focus on US nonfarm payrolls figures due on Thursday as investors try to gauge when the Federal Reserve is likely to cut interest rates next.

Fed Chair Jerome Powell on Tuesday reiterated the US central bank’s plans to “wait and learn more” before lowering rates.

Microsoft says it is laying off about 9,000 workers, its second mass layoff in months and its largest in more than two years.

The tech giant began sending out layoff notices Wednesday that hit the company’s Xbox video game business and other divisions.

Among those losing their jobs are 830 workers tied to Microsoft’s headquarters in Redmond, Washington, according to a notice sent to state officials Wednesday.

Microsoft said the cuts will affect multiple teams around the world, including its sales division, part of “organizational changes” needed to succeed in a “dynamic marketplace.” The company won’t say the total number of layoffs except that it was about 4% of the workforce it had a year ago.

READ MORE: Trump’s tariffs would cost U.S. employers $82.3 billion, potentially causing price hikes and layoffs

A memo to gaming division employees Wednesday from Xbox CEO Phil Spencer said the cuts would position the video game business “for enduring success and allow us to focus on strategic growth areas.”

Xbox would “follow Microsoft’s lead in removing layers of management to increase agility and effectiveness,” Spencer wrote.

Microsoft employed 228,000 full-time workers as of June 2024, the last time it reported its annual headcount. Its latest layoffs would cut fewer than 4% of that workforce, according to Microsoft. But it has already had at least three layoffs this year and it’s unlikely that new hiring has matched the amount lost. Either way, a 4% cut would amount to somewhere in the range of 9,000 people.

Until now, this year’s biggest layoff was in May, when Microsoft began laying off about 6,000 workers, nearly 3% of its global workforce and its largest job cuts in more than two years.

The cutbacks come as Microsoft continues to invest huge amounts of money in the data centers, specialized computer chips and other infrastructure needed to advance its AI ambitions. The company anticipated those expenses would cost it about $80 billion in the last fiscal year. Its new fiscal year began Tuesday.

Microsoft just last month cut another 300 workers based out of its Redmond headquarters, on top of nearly 2,000 who lost their jobs in the Puget Sound region in May, most of them in software engineering and product management roles, according to information it sent to Washington state employment officials.

Microsoft’s chief financial officer Amy Hood said on an April earnings call that the company was focused on “building high-performing teams and increasing our agility by reducing layers with fewer managers.”

The company has repeatedly characterized its recent layoffs as part of a push to trim management layers, but the May focus on cutting software engineering jobs has fueled worries about how the company’s own AI code-writing products could reduce the number of people needed for programming work.

Microsoft CEO Satya Nadella said earlier this year that “maybe 20, 30% of the code” for some of Microsoft’s coding projects “are probably all written by software.”

The latest layoffs, however, seemed centered on slower-growing areas of the company’s business, said Wedbush Securities analyst Dan Ives.

“They’re focused more and more on AI, cloud and next-generation Microsoft and really looking to cut costs around Xbox and some of the more legacy areas,” Ives said. “I think they overhired over the years. This is Nadella and team making sure that they’re keeping with efficiency and that’s the name of the game in Wall Street.”

The trimming of the Xbox staff follows Microsoft’s years-long expansion of the business surrounding its gaming console, culminating in 2023 with the $75.4 billion acquisition of Activision Blizzard — the California-based maker of hit franchises like Call of Duty and Candy Crush.

Before that, in a bid to compete with Sony’s PlayStation, it spent $7.5 billion to acquire ZeniMax Media, the parent company of Maryland-based video game publisher Bethesda Softworks.

Many of those game studios, which have locations across North America and Europe, were struggling with the layoffs Wednesday, according to social media posts from employees who announced they were looking for new jobs.

NEW YORK — Sales of Tesla electric cars fell sharply in the last three months as boycotts over Elon Musk’s political views continue to keep buyers away.

The 13% plunge in global sales over a year earlier suggests the damage to Tesla’s brand from Musk’s embrace of U.S. President Donald Trump and far-right European politicians is much deeper, widespread and lasting than some investors had expected. The figures reported by Tesla on Wednesday also signal that its quarterly earnings report due later this month could disappoint as rival electric-vehicle makers pounce on its weakness and steal market share. v

Sales fell to 384,122 in April through June, down from 443,956 in the same three months last year.

During the latest period, Musk formally left the Trump administration as a cost-cutting czar, and hopes rose that sales would recover. The Tesla CEO himself recently said the company was in the midst of a “major rebound” in sales, a statement contradicted by the latest figures.

Still, some parts of the report were encouraging. Sales of the Models 3 and Y totaled 373,728, above the estimate of 356,000 from Wall Street analysts. Tesla shares rose 5% on the news.

“The numbers weren’t as bad as thought with all the analyst forecast cuts we saw over the past week,” said Morningstar’s Seth Goldstein, though he added the report overall showed the company faces big challenges. “The current product lineup is at market saturation and Tesla will need the new affordable vehicle to grow deliveries.”

Musk has promised a cheaper EV model would be coming this year that would boost sales.

It’s not clear yet if Musk’s latest feud with Trump will help lure back buyers who have been angry at the billionaire’s political positions. After Musk once again took to social media to criticize Trump’s budget bill, the president threatened Tuesday to use the power of his office to hurt his companies, including Tesla, pushing its stock down more than 5%.

A June AP-NORC poll showed about half of U.S. adults have an unfavorable opinion of Tesla, including 30% of Republicans.

The new figures come as Tesla is focusing less on new models and more on robots, self-driving technology and robotaxis ferrying passengers around without anyone behind the wheel.

Tesla is in the midst of a test run of robotaxis in Austin, Texas, that seems to have gone smoothly for the most part. But it also has drawn the scrutiny of federal car safety regulators because of a few mishaps, including one case in which a Tesla cab was shown on a video heading down an opposing lane.

The competition from rival EV makers is especially fierce in Europe where China’s BYD has taken a bite out of its market share. Tesla sales fell 28% in May in 30 European countries even as the overall market for electric vehicles expanded sharply, according to the European Automobile Manufacturers’ Association.

Musk has acknowledged that his work as head of the Department of Government Efficiency and his embrace of European far-right candidates have hurt the company. But he said earlier this year that much of the sales plunge is due to customers holding off while they waited for an ugrade to Tesla’s best selling Model Y. That new version has been out for months now.

Tesla reports second quarter financial results on July 23. In the first quarter, net income fell 71%.