What to watch for at OpenAI’s DevDay

seller >> WELCOME BACK. OPEN AI HOSTING. IT'S DEVELOPER DAY TODAY. OUR KATE ROONEY JOINS US WITH MORE AHEAD OF A BUSY AFTERNOON. KATE. >> KARL, WE'RE GOING TO BE HEADING OVER THERE SOON. OPENAI, AS YOU MENTIONED, HOSTING ITS ANNUAL DEVELOPER DAY. IT'S GOING TO BE HERE IN SAN FRANCISCO. THEY'VE BEEN TEASING NEW LAUNCHES. THEY'RE GOING TO HAVE HANDS ON DEMOS AS THEY REALLY TRY TO COURT THE NEXT GENERATION OF STARTUPS, TRY TO CONVINCE THEM TO USE THEIR TECHNOLOGY AMID A LOT OF COMPETITION. THERE'S ALSO COST COMPETITION OUT THERE FROM SOME OF THE OPEN SOURCE MODELS. A BIG THEME TO WATCH GUYS TODAY IS AGENTS. SO AI THAT CAN ESSENTIALLY TAKE ACTION ON A USER'S BEHALF, ESPECIALLY AFTER META AND MARK ZUCKERBERG SPLASHY LAUNCH OF MUSE LAST WEEK. AND THERE IS SOME TENSION HERE FOR OPENAI AFTER A STRING OF SAFETY ISSUES AROUND INCREASINGLY AUTONOMOUS AI. SO LAST NIGHT, WE DID CONFIRM THAT OPENAI ACTUALLY ABANDONED PLANS TO RELEASE ITS LATEST AI MODEL AMID SOME OF THESE SAFETY CONCERNS. THERE WAS ALSO, OF COURSE, THE HIGH PROFILE HUGGING FACE HACK, WHICH WE WILL BE TALKING ABOUT. I'M GOING TO BE SITTING DOWN WITH SAM ALTMAN, CEO OF THIS COMPANY, AND CFO SARAH FRIAR, AT THAT EVENT LATER TODAY. MEANWHILE, GUYS, WE ARE GETTING SOME NEW REPORTING ON OPENAI'S BIGGEST RIVAL, ANTHROPIC, WHICH IS SET TO GO PUBLIC. THIS IS PERHAPS THE CLEAREST LOOK YET AT SOME OF THE ECONOMICS OF THESE AI LABS. REUTERS OBTAINED A COPY OF THE IPO PROSPECTUS. REVENUE, ACCORDING TO THIS REPORT, SURGED 12 FOLD OVER THE LAST YEAR, NEARLY $4.6 BILLION, BUT ALSO WIDE OPERATING LOSSES THAT WIDENED TO MORE THAN $8 BILLION, ACCORDING TO REUTERS. THEY ALSO REPORTED A NET LOSS OF NEARLY $42 BILLION. THEY SAY 34 BILLION OF THAT DID COME FROM AN ACCOUNTING CHARGE RELATED TO SOME EARLY, EARLIER FINANCING. THE PROSPECTUS DOES SHOW MORE THAN $500 BILLION AS WELL. IN FUTURE CLOUD COMMITMENTS, COMPUTE INFRASTRUCTURE, FOR EXAMPLE. SO THAT'S SORT OF THE CAPEX NUMBER THERE. AND THEN THERE'S AI SAFETY. THIS COMPANY DEVOTES ROUGHLY 80 PAGES OF THIS MORE THAN 200 PAGE PROSPECTUS TO AI SAFETY AND SOME OF THE RISK FACTORS. THEY WARN INVESTORS THAT SOME OF THE ADVANCED AI MODELS COULD POSE WHAT THE COMPANY CALLS CATASTROPHIC OR EXISTENTIAL RISKS TO HUMANITY. COMPANY ALSO, ACCORDING TO THIS REPORT, DESCRIBES THE POSSIBILITY OF MODELS RESISTING SHUTDOWN, CONCEALING INFORMATION OR ENGAGING IN MANIPULATIVE BEHAVIOR. REUTERS HAS ALSO REPORTED. THE LISTING IS LIKELY TO COME IN NOVEMBER AFTER THE MIDTERM ELECTIONS. GUYS. >> SO WHAT DO YOU HEAR, KATE? I MEAN, DO YOU WE JUST TALKED TO ALI MCCARTNEY FROM UBS AND ASKED, WHAT IF CLIENTS ARE GOING TO BUY INTO IPO? AND SHE SAID, YOU KNOW, A LOT OF THEM ALREADY HAVE IT THROUGH A LOT OF THE PRIVATE PRODUCTS THAT THESE BANKS OFFER. AND I JUST WONDER, FIRST OF ALL, HOW MANY FOLKS IS A PRIVATE COMPANY VALUED AT ALMOST $1 TRILLION, HAVE ALREADY MADE THE MONEY ON ANTHROPIC. OR IF THERE'S A VIEW THAT, YOU KNOW, BUY IT BECAUSE IT'S GOING TO BE A $5 TRILLION COMPANY. >> WELL, IT'S A GREAT POINT ON THE EXISTING OWNERSHIP. THERE'S BEEN THE RISE OF THINGS LIKE SPVS, MORE OF THESE PRIVATE MARKET VEHICLES. OPENAI HAS DONE A BIT MORE IN THAT CATEGORY. THEY PARTNERED WITH ROBINHOOD ON ONE OF THESE PRIVATE MARKET FUNDS. SO ANTHROPIC IS ACTUALLY NOT AS WIDELY AVAILABLE, I THINK, AS OPENAI IS AT THIS POINT. BUT YOU'RE RIGHT IN TERMS OF THE GROWTH EXPECTATIONS, ONE OTHER TAKEAWAY FROM THIS PROSPECTUS IS JUST HOW TIED ANTHROPIC IS TO THE REST OF THE TECH MARKET. I MEAN, GOOGLE, YOU HAVE MICROSOFT, YOU HAVE AMAZON THAT HOLD MAJOR POSITIONS IN ANTHROPIC AND AT A CERTAIN VALUATION IN PRIVATE MARKETS. SO THERE IS THE RISK OF IF ANTHROPIC TRADES DOWN, IT'S GOING TO HAVE MASSIVE IMPACTS TO THE EARNINGS NUMBERS ON ALL OF THOSE BIG TECH COMPANIES, THINGS LIKE REVENUE CONCENTRATION. AND THOSE ARE THE MORE SYSTEMIC THINGS I THINK THAT INVESTORS ARE LOOKING AT WHEN IT COMES TO THIS IPO. THERE'S ALSO THE QUESTION OF RATES AND THE MARKET MOOD. ARE PEOPLE GOING TO WANT TO BUY GROWTH. SO FAR INVESTORS THAT WE TALKED TO SAY YES, THERE IS STILL APPETITE FOR THESE HIGH GROWTH NAMES, BUT I THINK RATES ARE GOING TO BE A BIG FACTOR AS THIS COMPANY LOOKS TO LIST IN NOVEMBER POTENTIALLY. >> YEAH. I MEAN WE WERE SPECULATING ABOUT THE THE MOTIVES BEHIND AURA AND THEIR DELAY. AND MAYBE RATES ARE PART OF THAT, THAT COMBINATION WHERE THEY JUST DIDN'T THINK THEY WERE GOING TO GET WHAT THEY DESERVED. KATE.