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Elizabeth Holmes, founder of Theranos Inc., exits federal court in San Jose, California, on Tuesday, Aug. 31, 2021.
David Paul Morris | Bloomberg | Getty Images

SAN JOSE, CALIF. — A hedge fund manager who put $96 million into Theranos said he thoroughly investigated the company but was still misled by CEO Elizabeth Holmes about its blood-testing technology.

Brian Grossman, chief investment officer at PFM Health Sciences, told jurors in Holmes’ criminal trial on Tuesday that in 2014, as part of his due diligence, he got his own blood drawn from a Theranos machine at a Walgreens pharmacy.

“I had my blood drawn with a venous draw, not a finger stick,” said Grossman, adding that the experience undermined what he’d been told about Theranos.

Grossman said he met with Holmes and her top executive, Ramesh “Sunny” Balwani, at their office in Palo Alto, California, in December 2013. He said Holmes did most of the talking, and that he and his colleagues were told Theranos could run 1,000 blood tests on its proprietary technology.

“Ms. Holmes was actually very clear that they could match any test on a Labcorp and Quest menu of tests,” Grossman said. He told jurors that “was a really big statement about how much they had accomplished, where the technology was at that time.”

Earlier witnesses, including lab associate Erika Cheung, have testified that Theranos devices couldn’t run more than 12 different tests, contradicting the company’s public pronouncements.

Grossman said that in the meeting he was told Theranos was working with the military and that its technology was being used on medivacs in the battlefield.

“What better application for a technology like this than in a military setting under harsh conditions like one would expect in a place like Afghanistan or Iraq?” Grossman said. Theranos indicated that it had “something over $200 million in revenue from the Department of Defense,” he said.

Daniel Edlin, a former Theranos employee, told jurors last month that, to his knowledge, the blood-testing devices were never used in the Middle East.

‘No ambiguity and no confusion’

Grossman said that following his initial meeting with Holmes and Balwani, he sent them an e-mail in January 2014, with the subject: “Due Diligence Questions.”

His questions from PFM fell into seven categories. He wanted more details on issues like the accuracy and speed of the tests compared to those from traditional vendors, the limitations of the technology and whether the Walgreens relationship was exclusive.

“We as a group came up with questions that we wanted to better understand the business,” Grossman said. “We wanted to ask the same questions in as many ways as we could so there was no ambiguity and no confusion as to what the technology was doing.

PFM then met with Holmes and Balwani a second time. Grossman testified that Holmes left about halfway through the meeting. Theranos executives told him at the time that it could get test results back in under four hours in retail stores and within one hour in hospitals.

Grossman told the jury that Holmes never told him the company was using third-party machines to run the blood tests. About his own experience at Walgreens, Grossman said he was surprised to find out that the blood was drawn from his arm and said his test results took longer than four hours.

“I asked [Balwani] why I didn’t receive a finger stick and why it was a venous draw,” Grossman said. “I also asked him why it took longer than four hours to get my test results back.”

Balwani assured him it was because his doctor ordered an unusual test, Grossman said.

Still, PFM invested $96.1 million in Theranos in February 2014. That investment included $2.2 million from a friends and family fund, which Grossman said had money in it from low-income people.

PFM eventually settled its lawsuit against Theranos after accusing the company of securities fraud.

Holmes has pleaded not guilty to 12 counts of wire fraud and conspiracy to commit wire fraud. As a witness to the prosecution, Grossman’s testimony underpins one of the wire fraud counts.

For 11 weeks, Holmes has sat at the defense table as government witnesses have testified. A key question remaining is whether the defense will present a case after the prosecution rests.

“We don’t even know if there is a defense case and if there is what it might be,” Lance Wade, an attorney for Holmes, said before the jury entered the courtroom. “We’re still in the government’s case.”

Last week Holmes’ defense team provided the government a list of potential witnesses. However, Wade said, “we’re not saying we’re presenting a defense case by giving them a sense of the witnesses.”

WATCH: The deposition tapes from the Elizabeth Holmes trial

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No ‘woke AI’ in Washington, Trump says as he launches American AI action plan

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No ‘woke AI’ in Washington, Trump says as he launches American AI action plan

U.S. President Donald Trump holds an executive order related to AI after signing it during the “Winning the AI Race” Summit in Washington D.C., U.S., July 23, 2025.

Kent Nishimura | Reuters

U.S. President Donald Trump has vowed to keep “woke AI” models out of Washington and to turn the country into an “AI export powerhouse” through the signing of three artificial intelligence-focused executive orders on Wednesday. 

The phasing out of diversity, equity and inclusion (DEI) initiatives — an umbrella term encompassing various practices, policies, and strategies aimed at fostering a more inclusive and equitable culture — has been a major focus of the second Trump administration. Now, the White House is bringing the battle to AI. 

The “PREVENTING WOKE AI IN THE FEDERAL GOVERNMENT” order states that the federal government “has the obligation not to procure models that sacrifice truthfulness and accuracy to ideological agendas.”

The executive order identifies DEI as one of the “most pervasive and destructive” of these ideologies to be kept out of AI models used by the government. 

“LLMs shall be neutral, nonpartisan tools that do not manipulate responses in favor of ideological dogmas such as DEI,” the order said, adding that developers should not intentionally encode partisan or ideological judgments into an LLM’s outputs unless those judgments are prompted by users. 

As acknowledged by the order, the use of AI is increasingly prevalent across Americans’ daily lives and is expected to play a critical role in the way they learn and consume information — making “reliable outputs” necessary.

In the eyes of the Trump administration, DEI in AI can lead to discriminatory outcomes; distort and manipulate AI model outputs in regard to race and sex; and incorporate concepts like critical race theory, transgenderism, unconscious bias, intersectionality and systemic racism. 

“DEI displaces the commitment to truth in favor of preferred outcomes and, as recent history illustrates, poses an existential threat to reliable AI,” the anti-woke order reads. 

Without giving specifics, the order refers to past examples of this, including a major AI model that changed the race or sex of historical figures such as the pope and Founding Fathers when prompted for images.  

In response to backlash last year, Google had pulled its Gemini AI image generation feature, saying it offered “inaccuracies” in historical pictures. Months later, the company rolled out an improved version. 

Instead of “woke AI”, the government should procure “truth-seeking” AI models that “prioritize historical accuracy, scientific inquiry, and objectivity, and shall acknowledge uncertainty where reliable information is incomplete or contradictory,” the order stated. 

However, it adds that the federal government “should be hesitant” to regulate the functionality of AI models in the private marketplace.

In other AI developments on Wednesday, the Trump administration signed an order to spur innovation in the technology by removing what it called “onerous Federal regulations that hinder AI development and deployment.”

Another order aims to establish and implement an “American AI Exports Program” to support the development and deployment of the U.S. AI technology stack abroad. 

The moves are part of the administration’s “Winning the AI Race: America’s AI Action Plan,” which it says identifies 90 federal policy actions across three pillars: the acceleration of innovation, building of AI infrastructure, and leadership in international diplomacy and security.

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Estonia’s tech elite are getting behind a European challenger to Robinhood

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Estonia's tech elite are getting behind a European challenger to Robinhood

The Lightyear app.

Lightyear

Some of the biggest names of Estonia’s tech scene are backing Lightyear, a startup looking to become Europe’s answer to commission-free trading pioneer Robinhood.

Based in London, Lightyear develops an app that lets users invest in a range of over 5,000 stocks, exchange-traded funds and money market funds. It was founded by two former Wise employees, Martin Sokk and Mihkel Aamer, in 2021.

The company is set to announce later on Thursday that it has raised $23 million in a new round of funding led by NordicNinja, a Japanese-backed venture capital fund based in Europe. Estonian tech entrepreneur Markus Villig, who co-founded ride-hailing unicorn Bolt has also invested.

Lightyear CEO Sokk told CNBC that the firm didn’t necessarily need to raise more cash for the business but chose to do so because of the caliber of investors involved.

“People like Markus have been building massive companies in many, many markets, and this is something that’s really exciting for us because it’s so hard to go into all the markets and understand their local dynamics and what people need,” he said.

Lightyear currently operates in 25 countries. However, with help from angel investors like Bolt’s Villig, the firm will be able to launch in another five markets “pretty quickly,” Sokk said.

Villig told CNBC that it can be “challenging to scale a business across multiple countries in a heavily regulated sector,” adding that Europe’s less developed retail investing market provides ample opportunities for disruption.

Other Estonian angel investors who have previously backed Lightyear also participated in the funding round, including Wise co-founder Taavet Hinrikus, Checkout.com’s former Chief Technology Officer Ott Kaukver and Skype founding engineer Jaan Tallinn.

Estonia is widely considered a prominent tech hub in Europe. The country is home to the highest number of unicorns per capita in Europe, according to the Estonian Investment Agency. Meanwhile, Estonia’s e-residency scheme has also enabled foreigners to become digital residents and launch their companies in the country.

The new round values five-year-old Lightyear at between $200 million and $300 million, significantly higher than its valuation in 2022 when it raised $25 million, according to two people familiar with the matter who preferred to remain anonymous as the information has not been made public.

Pushing into AI, crypto

Alongside the additional funding, Lightyear is also launching new artificial intelligence features. AI has been a hot area of investment for startups following the explosive popularity of generative AI services like OpenAI’s ChatGPT.

One of the features, called “Why Did It Move,” allows users to select a point in time on a stock chart and see what happened that day to cause a jump or fall in a company’s share price. The firm is also using AI to provide “bull” and “bear” theses on stocks as well as short updates on assets in their own portfolios.

“In the end, you’re going to have two models” when it comes to investing, according to Sokk: “Self-driving money,” where you ask an AI to achieve certain investment goals, and a “manual gearbox” approach of figuring out different strategies and approaches on your own.

Still, the market for online investment products is heavily competitive. Lightyear faces some hefty competition from both incumbent brokerage services as well as more modern tech players such as Robinhood, Revolut and Trade Republic.

However, Sokk insists Lightyear is building a differentiated enough product to stand out from the crowd. While competitors like Robinhood profit from offering risky products like crypto and margin trading, Lightyear is focused on serving long-term investors, he told CNBC.

To that end, Sokk said Lightyear is planning on rolling out a crypto product of its own in two months’ time — one that’s “more focused on a long-term view.”

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Google’s $85 billion capital spend spurred by cloud, AI demand

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Google's  billion capital spend spurred by cloud, AI demand

Sundar Pichai, CEO of Alphabet Inc., during Stanford’s 2024 Business, Government, and Society forum in Stanford, California, April 3, 2024.

Justin Sullivan | Getty Images

Google is going to spend $10 billion more this year than it previously expected due to the growing demand for cloud services, which has created a backlog, executives said Wednesday.

As part of its second quarter earnings, the company increased its forecast for capital expenditures in 2025 to $85 billion due to “strong and growing demand for our Cloud products and services” as it continues to expand infrastructure to power more AI services that use its cloud technology. That’s up from the $75 billion projection that Google provided in February, which was already above the $58.84 billion that Wall Street expected at the time.

The increased forecast comes as demand for cloud services surges across the tech industry as AI services increase in popularity. As a result, companies are doubling down on infrastructure to keep pace with demand and are planning multi‑year buildouts of data centers.

In its second quarter earnings, Google reported that cloud revenues increased by 32% to $13.6 billion in the period. The demand is so high for Google’s cloud services that it now amounts to a $106 billion backlog, Alphabet finance chief Anat Ashkenazi said during the company’s post-earnings conference call.

“It’s a tight supply environment,” she said.

The vast majority of Alphabet’s capital spend was invested in technical infrastructure during the second quarter, with approximately two-thirds of investments going to servers and one-third in data center and networking equipment, Ashkenazi said.

She added that the updated outlook reflects additional investment in servers, the timing of delivery of servers and “an acceleration in the pace of data center construction, primarily to meet Cloud customer demand.”

Ashkenazi said that despite the company’s “improved” pace of getting servers up and running, investors should expect further increase in capital spend in 2026 “due to the demand as well as growth opportunities across the company.” She didn’t specify what those opportunities are but said the company will provide more details on a future earnings call.

“We’re increasing capacity with every quarter that goes by,” Ashkenazi said. 

Due to the increased spend, Google will have to record more expenses over time, which will make profits look smaller, she said.

“Obviously, we’re working hard to bring more capacity online,” Ashkenazi said.

WATCH: Alphabet shares Q2 shares sink despite revenue and earnings beat

Alphabet shares Q2 shares sink despite revenue and earnings beat

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