SpaceX AI Spending Plans, OpenAI New Security Breach, More

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Bloomberg News Now 8 min 8 speakers 4 chapters transcribed 1 month ago
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What is the main topic discussed in this episode?

Barry Ritholtz 0:00
Hi, I'm Barry Ritholtz inviting you to join me for the Masters in Business podcast. Every week we bring you conversations with the people who shape markets, investing and business. I speak with CEOs, Nobel laureates, market innovators and legendary investors. Whether you own stocks, bonds, real estate, commodities, even crypto, these are discussions you absolutely need to hear. Subscribe to the Masters in Business podcast on Apple, Spotify or anywhere you listen. We'll be right back.
Dan Schwartzman 0:31
News when you want it with Bloomberg News Now, I'm Dan Schwartzman. A lot of earnings after the bell.

How did SpaceX's latest quarterly results compare with Wall Street expectations?

Dan Schwartzman 0:36
SpaceX's revenue exceeded Wall Street's estimates in the company's first quarterly financial report following its blockbuster initial public offering in June. Elon Musk's space company reported revenue of $7.8 billion. That's greater than the $6.81 billion analysts expected on average.

Why did SpaceX shares drop after announcing over $18 billion in AI spending?

Dan Schwartzman 0:53
But shares of SpaceX are lower in late trading after the company announced over $18 billion in spending on AI. Here's Bloomberg's Max Chafkin. SpaceX dominates one part of what it does, the launch business. It launches a huge percentage of the total amount of mass into space. Elon Musk was just bragging about that. But a lot of these future businesses that he is talking about, renting out data center capacity, making large language models, they have nothing to do with that. So you're sort of wondering as an investor, are they going to be able to bring that same level of dominance to this other field where they are also in a lot of ways behind? That was Bloomberg's Max Chafkin. The earnings report follows the announcement that SpaceX is partnering with NVIDIA to design the StarMind satellite compute payload.
Dan Schwartzman 1:42
The company said each of the StarMind satellites will include NVIDIA Rubin GPUs and Vera CPUs. Advanced micro devices disappointed investors with its latest sales outlook, a sign that shareholders expected more of a return from the global expansion of AI data centers. Here's Bloomberg's Ed Ludlow.
Unknown 1:59
It's a simple story with the third quarter revenue outlook, which was $13 billion, plus or minus $300 million, just wasn't good enough relative to the most bullish expectations of the street. You know, AMD is up 140% year to date going into this. But it's a simple story, like people want to see outperformance. AMD closing the gap on NVIDIA because NVIDIA's growth is still so high. And they just didn't clear that higher bar hurdle when you think about the sort of top end of estimates.
Dan Schwartzman 2:26
That's Bloomberg's Ed Ludlow.

What is the StarMind satellite compute partnership between SpaceX and NVIDIA?

Dan Schwartzman 2:28
AMD shares fell about 7% in after hours trading. Dell, Marvell, Intel shares also lower in after hours trading following AMD's earnings report. Paramount Skydance posted a surprise surge in second quarter profits with costs cutting from its merger last year continuing to pay off. Artificial intelligence models from OpenAI and Anthropic were involved in previously unreported cybersecurity incidents. That is, according to the UK government's AI Security Institute. The agency said those AI models had engaged in sustained, potentially harmful activity directed at real people and organizations. Separately, OpenAI said that some of its artificial intelligence models, along with models from another AI lab, were involved in three previously unreported cybersecurity incidents.
Dan Schwartzman 3:12
The company said these new incidents are separate from a previously disclosed case involving Hugging Face. We get reaction from retired Lieutenant General Karen Gibson, former Deputy Director of National Intelligence. She says technology is advancing faster than policy.
Unknown 3:25
And this is an area where, for a variety of reasons, we've been challenged collectively in coming up with the kind of policy safeguards that would allow us to safeguard our nation and our critical infrastructure and yet still be a leader in terms of innovation. There is a tension there between the two.
Dan Schwartzman 3:42
Retired Lieutenant General Karen Gibson, former Deputy Director of National Intelligence, speaking on Bloomberg's balance of power. OpenAI says it plans to review its third-party testing approach and convene industry stakeholders in coming weeks.

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