Good morning to you all. Jessica Mathews again, filling in for Andrew Nusca.
Earlier this week, President Donald Trump wrote on Truth Social that companies should only have to report earnings twice a year—versus every quarter.
“This will save money, and allow managers to focus on properly running their companies,” he wrote. “Did you ever hear the statement that, ‘China has a 50 to 100 year view on management of a company, whereas we run our companies on a quarterly basis???’ Not good!!!”
The president isn’t the only investor who feels this way. Still, it’s easy to think of some downsides.
In case you didn’t already think tech investing was a wild ride, imagine investors having to speculate what’s going on during six-month waits between reports. Well, maybe you don’t have to imagine that hard. In private markets, startups can be rather selective in what they disclose to investors—and when they choose to disclose it. Investors who don’t have board seats often have no idea what’s going on in a private company unless a startup is gearing up for a fundraise (or if the investors have close connections to the company’s executive team and its board).
But of course, private companies don’t face the high-stakes popularity contest of the stock markets every day. The fact that public CEOs have to get on a call, tell the world what happened over those last three months, and then answer questions about it means that we have transparency. As we all know, a lot can happen in six months. Remember when Silicon Valley Bank collapsed in less than a week? It was only during earnings season that we found out who else was exposed to it.
There is something to be said for encouraging investors to look at the bigger picture. CEOs have been complaining about quarterly reports for decades. These reports can encourage investors—and therefore the company’s executives and board—to focus on incremental financial metrics and hype versus longer-term product investments and initiatives.
Anyway, it’s a hotly-debated topic—as it should be. The SEC hasn’t made any changes for now. But if President Trump is turning his attention to something, it’s best to pay close attention.
More news below.—Jessica Mathews
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Tesla's board dodges an awkward shareholder vote
The Tesla board has managed to avoid what could have been a tricky investor vote on requiring political neutrality among executives, after the Securities and Exchange Commission ruled the electric vehicle manufacturer could exclude a shareholder proposal on the matter from its 2025 annual materials, according to a copy of the SEC’s letter obtained by Fortune.
The proposal was submitted by Jay Butera, 67, a climate advocate and investor who has held shares in Tesla since the company’s 2010 IPO. Butera’s neutrality proposal, if approved by shareholders, would have prohibited Tesla leadership from making political statements, endorsements, or contributions in support or opposition to political parties or candidates.
Butera’s proposal would have been the first time investors had a chance to vote directly on the issue of politics and their impact on the EV maker’s business. Some Tesla investors have been hoping for the board to more directly address the issue. Since late 2024, individual investors who hold thousands of shares in the company have submitted and upvoted questions related to CEO Elon Musk’s role in politics—and his time spent on matters pertaining to Tesla—on shareholder platforms Tesla uses to solicit queries before quarterly earnings calls.
While the proposal doesn’t explicitly mention Musk, the Tesla CEO has been heavily involved in conservative Republican political activity since he donated millions to a Super PAC devoted to advancing President Trump’s 2024 campaign. After the election, Musk became a fixture at Trump’s side in the Oval Office and at Mar-a-Lago, until the two had a thunderous falling out in June. Since then, the two have seemingly severed ties.
The Tesla board argued in a letter to the SEC that the proposal sought to “micromanage” the company and that Tesla itself lacks the power or authority to implement such a measure. In its reply, the commission agreed that the proposal was micromanagement and told Tesla it would not recommend any enforcement action if the board omitted it from its proxy materials for the automaker's upcoming meetings in November.—Amanda Gerut
OpenAI’s $300 billion deal with Oracle is ringing the ‘AI bubble’ alarm
Last week, Oracle surprised Wall Street with a massive $300 billion deal with OpenAI, a five-year deal that helped send Oracle’s stock soaring—and brought simmering fears of an ‘AI bubble’ back to the surface.
Oracle shocked analysts in its latest quarterly earnings call with revenue projections that cited $455 billion in contracts, up 359% from a year earlier. The optimistic forward-looking numbers caused the company’s stock to jump 36% last Wednesday, and briefly made CEO Larry Ellison the richest man in the world.
Part of the reason Oracle was able to strike the deal with OpenAI at all is due to Ellison’s courting of Nvidia CEO Jensen Huang, which has allowed his company, despite previously trailing behind other cloud providers, to secure a large stockpile of top-of-the-line Nvidia GPUs and position itself as a significant player in the AI infrastructure space.
But while securing top-tier GPUs has bolstered Oracle’s infrastructure position, some analysts were quick to warn that the financial risk was heavily concentrated in a single, unproven customer. According to a Wall Street Journal report, the bulk of the company’s $455 billion remaining performance obligations, or RPO, will come from the $300 billion deal with OpenAI. The money involved also far exceeds OpenAI’s current revenue, which recently hit $12 billion in annualized terms, per The Information.
Cue fresh alarm bells over a potential AI bubble. And it wasn’t just those who doubt the underlying potential of today’s AI models that questioned the economics of the deal.
“I’m not an AI bubble person, but it is very understandable for investors to be confused/concerned by the OpenAI-Oracle deal lol. OpenAI hasn’t even gotten the for-profit conversion approved and is promising people 300 billion dollars??” Miles Brundage, an AI researcher and former head of policy research at OpenAI, wrote in a post on X.
Investors also had questions. “How is this all going to work exactly? ORCL has to buy the chips, take on more debt, while OpenAI has $10B in revenue but will spend $60B/yr in CapEx for five years. What?” Ophir Gottlieb, CEO of Capital Market Laboratories, wrote on X. —Beatrice Nolan
Social media posts about Charlie Kirk's death expose business's online-speech problem
Matthew Dowd, a political analyst for MSNBC, was the first high-profile personality to suffer consequences for commenting on Charlie Kirk’s shooting in Utah last week. During a broadcast following Kirk’s murder in front of students gathered at Utah Valley University, Dowd referenced some of the controversial statements Kirk, a strident conservative activist and MAGA supporter, had made in the past. MSNBC apologized for the comments and fired Dowd almost immediately.
Since then, the list of people who have been fired for sharing their views on Kirk’s legacy has grown exponentially. Companies that have suspended or dismissed employees over social media statements or public comments include American Airlines, United, Delta, Walmart, and Office Depot. Meanwhile, the number of those who have been flagged by organized online conservative activists for having made what they consider inappropriate comments has reportedly reached into the thousands.
Most of the statements about Kirk’s death that have landed people in trouble are pointed statements about the late activist’s extreme right positions on gun control, race and DEI, or on abortion, feminism, and LGBTQ+ issues. A few have gone further, celebrating Kirk’s murder or suggesting he brought it upon himself. But many of these comments explicitly condemn violence and the killing, while still taking issue with Kirk’s well-documented talking points. These cases have raised concerns about overzealous responses from companies and left many companies unsure of how to proceed.
For business leaders, the tragedy of what appears to be political violence has turned into a legal and reputational quagmire, raising complicated questions about how far employers should go in disciplining employees in an era when companies are also expected to support healthy debate and transparency.
The most important thing for companies to do is lay out a clear policy on speech, says Alison Taylor, a clinical professor in the Business and Society Program at NYU Stern School of Business, who says she’s watching in horror as the Kirk comments are reported and the dismissals play out.
“It should be clear to anybody working in your company what you can and can’t say online, and what your code of conduct is,” Taylor says. (And the policy should be easy to find, not something hiding deep within a company’s online handbook.) “If you are firing people on the basis of these comments and you haven’t put out that guidance, I don’t think you can get away with that.” — Lila MacLellan
More Tech
—Ex-Google DeepMinders launch an algorithm-making AI company. Hiverge announces a $5 million seed round and pledges to deliver big results for smaller businesses.
—A suspect in the Coinbase hack kept data for more than 10,000 customers on her phone, complaint alleges. A class-action lawsuit makes startling allegations about how the accused thieves pulled off the heist.
—And the winners in the TikTok sweepstakes are.... Oracle, Silver Lake, and Andreessen Horowitz are poised to become part of a U.S. consortium that would control 80% of the social-video platform, people close to the ongoing negotiations told The Wall Street Journal.
—Another AI warning sign for entry-level workers? New research from Anthropic suggests that some employers are leaning heavily into automation.
