Welcome to Eye on AI! AI reporter Sharon Goldman right here, filling in for Jeremy Kahn. On this version… Sam Altman’s AI paradox…AI has quietly develop into a fixture of promoting…Silicon Valley’s AI offers are creating zombie startups…sources say Nvidia engaged on new AI chip for China that outperforms the H20.
I used to be not invited to Sam Altman’s cozy dinner with reporters in San Francisco final week (whomp whomp), however perhaps that’s for the most effective. I’ve bother suppressing exasperated eye rolls once I hear peak Silicon Valley–ironic statements.
I’m not certain I might have managed myself when the OpenAI CEO mentioned that he believes AI could possibly be in a “bubble,” with market situations much like the Nineties dotcom growth. Sure, he reportedly mentioned, “buyers as a complete are overexcited about AI.”
But, over the identical meal, Altman additionally apparently mentioned he expects OpenAI to spend trillions of {dollars} on its information middle buildout within the “not very distant future,” including that “it is best to anticipate a bunch of economists wringing their arms, saying, ‘That is so loopy, it’s so reckless,’ and we’ll simply be like, ‘ what? Allow us to do our factor.’”
Ummm…what could possibly be extra frothy than pitching a multi-trillion-dollar growth in an business you’ve simply known as a bubble? Cue an eye fixed roll reaching the highest of my head. Positive, Altman could have been referring to smaller AI startups with sky-high valuations and little to no income, however nonetheless, the irony is wealthy. It’s significantly notable given the weak GPT-5 rollout earlier this month, which was imagined to mark a leap ahead however as an alternative left many dissatisfied with its routing system and lack of breakthrough progress.
As well as, at the same time as Altman speaks of bubbles, OpenAI itself is elevating file sums. In early August, OpenAI secured a whopping $8.3 billion in new funding at a $300 billion valuation—a part of its plan to lift $40 billion this yr. That determine was 5 occasions oversubscribed. On prime of that, workers are actually poised to promote about $6 billion in shares to buyers like SoftBank, Dragoneer, and Thrive, pushing the corporate’s valuation doubtlessly as much as $500 billion.
OpenAI is hardly an outlier in its infrastructure binge. Tech giants are pouring unprecedented sums into AI buildouts in 2025: Microsoft alone plans to spend $80 billion on AI information facilities this fiscal yr, whereas Meta is projecting as much as $72 billion in AI and infrastructure investments. And on the fundraising entrance, OpenAI has firm too — rivals like Anthropic are chasing multibillion-dollar rounds of their very own.
Wall Road’s greatest bulls, like Wedbush’s Dan Ives, appear unconcerned. Ives mentioned Monday on CNBC’s “Closing Bell” that demand for AI infrastructure has grown 30% to 40% within the final months, calling the capex surge a validation second for the sector. Whereas he acknowledged “some froth” in components of the market, he mentioned the AI revolution with autonomous techniques is simply beginning to play out and we’re within the “second inning of a nine-inning sport.”
And whereas a bubble implies an eventual bursting, and all of the harm that outcomes, the underlying phenomenon inflicting a bubble typically has actual worth. The arrival of the online within the ’90s was revolutionary; The bubble was a mirrored image of the large alternatives opening up.
Nonetheless, I’d be curious if anybody pressed Altman on the AI paradox—warning of a bubble whereas concurrently bragging about OpenAI’s large fundraising and spending. Maybe over a glass of bubbly and a sugary candy dessert? I’d additionally like to know if he fielded more durable questions on the opposite massive points looming over the corporate: its shift to a public profit company (and what which means for the nonprofit), the present state of its Microsoft partnership, and whether or not its mission of “AGI to profit all of humanity” nonetheless holds now that Altman himself has mentioned AGI “is just not a super-useful time period.”
In any case, I’m sport for a follow-up chat with Altman & Co (name me!). I’ll carry the bubbly, pop the questions, and do my finest to maintain the attention rolls at bay.
Additionally: In only a few weeks, I will probably be headed to Park Metropolis, Utah, to take part in our annual Brainstorm Tech convention on the Montage Deer Valley! Area is restricted, so in case you’re fascinated by becoming a member of me, register right here. I extremely suggest: There’s a incredible lineup of audio system, together with Ashley Kramer, chief income officer of OpenAI; John Furner, president and CEO of Walmart U.S.; Tony Xu, founder and CEO of DoorDash; and plenty of, many extra!
With that, right here’s extra AI information.
Sharon Goldman
sharon.goldman@fortune.com
@sharongoldman
FORTUNE ON AI
Wall Road isn’t anxious about an AI bubble. Sam Altman is – by Beatrice Nolan
MIT report: 95% of generative AI pilots at corporations are failing – by Sheryl Estrada
Silicon Valley expertise retains getting recycled, so this CEO makes use of a ‘moneyball’ method for uncovering hidden AI geniuses within the new period – by Sydney Lake
Waymo experimenting with generative AI, however exec says LiDAR and radar sensors necessary to self-driving security ‘below all situations’ – by Jessica Matthews
AI IN THE NEWS
Extra shakeups for Meta AI. The New York Instances reported in the present day that Meta is predicted to announce that it’s going to cut up its A.I. division — which is called Meta Superintelligence Labs — into 4 teams. One will concentrate on AI analysis; one on “superintelligence”; one other on merchandise; and one on infrastructure akin to information facilities. In accordance with the article’s nameless sources, the reorganization “is prone to be the ultimate one for a while,” with strikes “aimed toward higher organizing Meta so it will possibly get to its aim of superintelligence and develop AI merchandise extra shortly to compete with others.” The information comes lower than two months after CEO Mark Zuckerberg overhauled Meta’s complete AI group, together with bringing on Scale AI CEO Alexandr Wang as chief AI officer.
Madison Avenue is beginning to love AI. In accordance with the New York Instances, artificial intelligence has quietly develop into a fixture of promoting. What felt novel when Coca-Cola launched an AI-generated vacation advert final yr is now mainstream: practically 90% of big-budget entrepreneurs are already utilizing—or planning to make use of—generative AI in video adverts. From hyper-realistic backdrops to artificial voice-overs, the know-how is slashing prices and manufacturing occasions, opening TV spots to smaller companies for the primary time. Firms like Shuttlerock and ITV are serving to manufacturers exchange weeks of labor with hours, whereas tech giants like Meta and TikTok push their very own AI advert instruments. The shift raises moral questions on displacing creatives and fooling viewers, however business leaders say the genie is out of the bottle: AI isn’t simply streamlining advert manufacturing—it’s reshaping the complete industrial playbook.
Silicon Valley’s AI offers are creating zombie startups: ‘You hollowed out the group.’ In accordance with CNBC, Silicon Valley’s AI startup scene is being hollowed out as Large Tech sidesteps antitrust guidelines with a brand new playbook: licensing offers and expertise raids that intestine promising younger corporations. Windsurf, as soon as in talks to be acquired by OpenAI, collapsed into turmoil after its founders bolted to Google in a $2.4 billion licensing pact; interim CEO Jeff Wang described tearful all-hands conferences as workers realized they’d been left with “nothing.” Related strikes have seen Meta sink $14.3 billion into Scale AI, Microsoft scoop up Inflection’s founders, and Amazon strip expertise from Adept and Covariant—forsaking so-called “zombie corporations” with little future. Whereas founders and prime researchers money out, buyers and rank-and-file workers are sometimes left stranded, sparking rising concern that these quasi-acquisitions not solely skirt regulators but in addition threaten to choke off AI innovation at its supply.
Nvidia engaged on new AI chip for China that outperforms the H20, sources say. In accordance with Reuters, Nvidia is growing a brand new China-specific AI chip, codenamed B30A, based mostly on its cutting-edge Blackwell structure. The chip, which could possibly be delivered to Chinese language purchasers for testing as quickly as subsequent month, can be extra highly effective than the present H20 however nonetheless fall beneath U.S. export thresholds—utilizing a single-die design with about half the uncooked computing energy of Nvidia’s flagship B300. The transfer comes after President Trump signaled attainable approval for scaled-down chip gross sales to China, although regulatory approval is unsure amid bipartisan considerations in Washington over giving Beijing entry to superior AI {hardware}. Nvidia argues that retaining Chinese language consumers is essential to stop defections to home rivals like Huawei, at the same time as Chinese language regulators solid suspicion on the corporate’s merchandise.
EYE ON AI RESEARCH
Research finds AI-led interviews improved outcomes. A brand new examine checked out what occurs when job interviews are run by AI voice brokers as an alternative of human recruiters. In a big experiment with 70,000 candidates, individuals had been randomly assigned to be interviewed by an individual, by an AI, or given the selection. Surprisingly, AI-led interviews really improved outcomes: candidates interviewed by AI had been 12% extra prone to get job provides, 18% extra prone to begin jobs, and 17% extra prone to nonetheless be employed after 30 days. Most candidates didn’t thoughts the change—78% even selected the AI when given the choice, particularly these with decrease check scores. The AI additionally pulled out extra helpful info from candidates, main recruiters to price these interviews larger. Total, the examine reveals that AI interviewers can carry out simply in addition to, and even higher than, human recruiters—with out hurting applicant satisfaction.
AI CALENDAR
Sept. 8-10: Fortune Brainstorm Tech, Park Metropolis, Utah. Apply to attend right here.
Oct. 6-10: World AI Week, Amsterdam
Oct. 21-22: TedAI San Francisco. Apply to attend right here.
Dec. 2-7: NeurIPS, San Diego
Dec. 8-9: Fortune Brainstorm AI San Francisco. Apply to attend right here.
BRAIN FOOD
Do AI chatbots have to be protected against hurt?
AI lab Anthropic has launched a brand new security measure in its newest Claude fashions, which empowers the AI to terminate conversations in excessive instances of dangerous or abusive interplay. The characteristic prompts solely after repeated redirections fail—usually for content material requests involving sexual exploitation of minors or facilitation of large-scale violence. The corporate is notably framing this as a safeguard not principally for customers, however for the mannequin’s personal “AI welfare,” reflecting an exploratory stance on the machine’s potential ethical standing.
Unsurprisingly, the thought of granting AI ethical standing is contentious. Jonathan Birch, a philosophy professor on the London College of Economics, advised The Guardian he welcomed Anthropic’s transfer for sparking a public debate about AI sentience—a subject he mentioned many within the business would slightly suppress. On the identical time, he warned that the choice dangers deceptive customers into believing the chatbot is extra actual than it’s.
Others argue that specializing in AI welfare distracts from pressing human considerations. For instance, whereas Claude is designed to finish solely essentially the most excessive abusive conversations, it is not going to intervene in instances of imminent self-harm—despite the fact that a New York Instances opinion piece yesterday urged such safeguards, written by a mom who found her daughter’s ChatGPT conversations solely after her daughter’s suicide.
