Good morning. Well, that was quick. Just yesterday, we remarked upon the unusual corporate interbreeding going on in the Musk-verse, with Tesla investing $2 billion in Elon Musk’s xAI. Turns out, Musk has something even more extreme in mind.
According to Reuters, Musk is now planning to merge SpaceX, his rocket ship company, with xAI. The deal, if it happens, would come ahead of SpaceX’s planned IPO this year.
When it comes to synergies, it’s hard to immediately see how xAI’s Grok chatbot (which has been criticized for creating sexualized images) can help make better rockets. Maybe that’s not the point.
Today’s news below.
Alexei Oreskovic
@lexnfx
alexei.oreskovic@fortune.com
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Why did Apple's blowout earnings get a shrug?
Apple delivered the goods in its holiday quarter, ringing up billions more than expected in global iPhone sales and in its China business, while beefing up its already impressive profit margins and boasting more than 2.5 billion active Apple devices in the wild.
Waymo hits a child in LA
Waymo, the self-driving car company owned by Alphabet, has pulled ahead as the early leader in the self-driving car business. Its robotaxis are ubiquitous in San Francisco, and increasingly in other cities including Atlanta, Miami, and Austin.
But on Thursday, the company shared some bad news. One of its cars recently hit a child in Santa Monica, Calif. Fortunately, the child, whose age and identity have not been released, suffered only minor injuries, according to TechCrunch.
According to Waymo, the "young pedestrian" entered the roadway "suddenly," from behind an SUV. The driverless Waymo, which was traveling at 17 miles per hour, quickly hit the brakes and collided with the child at a speed of roughly 6 miles per hour (Waymo claimed in its blog post that a human driver in the same situation would have only had time to slow to 14 mph). Authorities were quickly contacted, the company noted. And the National Highway Traffic Safety Administration has opened an investigation into the incident.
As General Motors can attest, collisions can spell the end of a self-driving business. The company pulled the plug on its Cruise robotaxi business in 2024 in the wake of a high-profile incident in which a San Francisco pedestrian was dragged under the car. Waymo is believed to be worth more than $100 billion and has big plans for its robotaxis. But that could change very quickly if one of its cars has a bad accident. —AO
DeepSeek Takes Aim at Silicon Valley with AI Search Push
Chinese AI startup DeepSeek may be gearing up for a direct challenge to Silicon Valley's dominance in AI-powered search and automation. According to over a dozen recent job postings first reported by Bloomberg, the company is recruiting engineers to build a multilingual AI search engine that is capable of handling text, images, and audio. The startup strike also appears to be seeking engineers who can build the infrastructure for AI agents that can operate with minimal human oversight and run continuously in the background.
The headcount expansion comes roughly one year after DeepSeek shocked the U.S. tech industry—and, for a while, Big Tech share prices—with the release of its R1 model, which matched or in some cases outperformed leading American systems despite being built at a fraction of the cost. The new postings repeatedly emphasize the company's AGI ambitions, which could position the Chinese open-source AI company in more direct competition with U.S. AI labs like OpenAI and Google DeepMind.—Beatrice Nolan
More tech
—Google lets Genie out of the bottle. AI 'world model' is getting rave reviews.
—OpenAI aiming for Q4 IPO. A race to beat Anthropic.
—Apple acquires Q.ai—speculation of possible uses in Apple gadgets ensues.
—Anthropic engineers go all-in. Using AI to write 100% of code.
—Tesla's stratospheric multiple. A core PE of 632!
—Amazon Go post-mortem. What its demise teaches us about the retailer.
