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Logistics startup Zipline has flown more than 38 million miles with its autonomous electric delivery drones since the company was founded in 2014. Zipline put its first fleet to work in Rwanda, delivering blood and other health supplies to clinics and hospitals. Since then, the Silicon Valley startup has expanded its service in six other countries, with limited delivery service and distribution centers in three states.

On Wednesday, Zipline showed off its next-generation aircraft, which it hopes will make rapid aerial deliveries an everyday convenience for customers throughout the U.S., even in densely populated urban areas.

Zipline’s new drone, dubbed the Platform 2 or P2 Zip, is capable of carrying up to eight pounds worth of cargo within a ten-mile radius, and can land a package on a space as small as a table or doorstep.

“The reason that number is important,” says Zipline CEO and co-founder Keller Rinaudo Cliffton, “is that when you look at e-commerce in the US, a vast majority of packages weigh five pounds or less.”

Zipline cofounders, CEO Keller Rinaudo Cliffton and CTO Keenan Wryobek

Zipline

The P2 Zip can travel ten miles in ten minutes, and the company can make a delivery approximately seven times faster than any typical service you may order from today, the CEO said. Rapid deliveries by drone may put an end to “porch pirates,” Rinaudo Cliffton said, referring to the theft of packages left on a doorstep while the customer is away from home.

While Zipline’s original drone, the P1 Zip, features a fixed wing or glider-like design, the P2 employs both lift and cruise propellers and a fixed wing. These help it maneuver precisely and quietly, even in rainy or windy weather.

To deliver cargo to a customer’s door, the P2 Zip hovers around 300 feet above ground level and dispatches a kind of mini-aircraft and container called the “droid.” The droid descends on a long thin tether, and maneuvers quietly into place with fan-like thrusters before setting down for package retrieval.

Zipline’s original P1 drones will remain in production and in wide use, says Rinaudo Cliffton. The P1 Zip can fly a longer distance, delivering up to five pounds of cargo within a 60-mile radius, but it requires a larger space for take off, landings and “the drop.”

The P1 Zip lets cargo down with a parachute attached, so its payload lands within a space about the size of two car parking spots. After a P1 Zip returns to base, an employee needs to disassemble it, then set up a new one, dropping in a freshly charged battery for the next flight.

Zipline’s new P2 Zip can dock and power up autonomously at a charging station that looks something like a street lamp with an arm and a large disc attached to that arm:

A rendering of P2 Zips charging at a docking station.

Zipline

Zipline docks can be installed in a single parking spot or alongside a building depending on zoning and permits. Zipline envisions the docks set up by restaurants in a downtown shopping district, or alongside the outer wall of a hospital, where the droid can be inserted into a window or dumbwaiter, retrieved, and reloaded by healthcare workers indoors.

Setting up one of these docks takes about as much work as installing an electric vehicle charger, Rinaudo Cliffton said.

Before developing the P2 Zip, Zipline had established logistics networks in Cote d’Ivoire, Ghana, Japan, Kenya, Nigeria and Rwanda already. It is operating some drone delivery networks in the US, in North Carolina, Arkansas and Utah — but the P2 will help it expand that network.

Partners who plan to test deliveries via P2 Zip include the healthy fast-casual restaurant Sweetgreen, Intermountain Health in Salt Lake City, Michigan Medicine, Multicare Healthcare System in Tacoma, Wash., and the government of Rwanda.

Zipline is not alone in its ambitions. Zipline is part of a program with other startups like DroneUp and Flytrex to make deliveries for Walmart. Amazon, meanwhile, has been working on making drone deliveries a reality here for nearly a decade, although that business has struggled to overcome a thicket of regulation and low demand from test customers.

Quiet and green is the goal

Zipline head of engineering Jo Mardall told CNBC the company focused much of its engineering on making sure the drones were not just safe and energy-efficient, but also quiet enough that residents would embrace their use. 

“People are worried about noise, rightly. I’m worried about noise. I don’t want to live in a world where there’s a bunch of loud aircraft flying above my house,” he said. “Success for us looks like being in the background, being barely audible.” That means something closer to rustling leaves than a car driving by. 

The droid component of the P2 Zip is designed to enter distribution centers through a small portal, where it’s loaded up with goods for delivery.

Zipline

The P2 Zips have a unique propeller design that makes this possible, Mardall explained, adding, “The fact that the Zip delivers from from 300 feet up really helps a lot.”

Mardall and Rinaudo Cliffton emphasized that Zipline aims to have a net-beneficial impact on the environment while giving business a better way to move everything from hot meals to refrigerated vaccines just in time to customers. 

Unmanned aerial vehicles, they explained, avoid worsening traffic congestion by going overhead. And since Zipline’s drones are electric, they can be powered with renewable or clean energy, without the emissions from burning jet fuel, gasoline, or diesel.

But most importantly, the CEO said, Zipline’s drone delivery allows companies to “centralize more inventory,” and “dramatically reduce waste.”

A study published by Lancet found that hospitals using Zipline services were able to reduce their total annual blood supply waste rate by 67%, the CEO boasted.

“That is a mind-blowing statistic, and a really big deal. It saves health systems millions of dollars, by reducing inventory at the last mile and only sending it when it’s needed.”

Zipline is aiming to bring that efficiency to every corner of commerce, the CEO said. It’s also aiming to keep the cost of drone delivery competitive with existing services, like FedEx and UPS, or food delivery apps like Uber Eats and Instacart.

But first, the startup plans to conduct more than 10,000 test flights using about 100 new P2 Zips this year. With its existing P1 drones, Zipline is already on track to complete about 1 million deliveries by the end of 2023, and by 2025 it expects to operate more flights annually than most commercial airlines.

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Microsoft AI chief Suleyman sees advantage in building models ‘3 or 6 months behind’

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Microsoft AI chief Suleyman sees advantage in building models ‘3 or 6 months behind’

Microsoft owns lots of Nvidia graphics processing units, but it isn’t using them to develop state-of-the-art artificial intelligence models.

There are good reasons for that position, Mustafa Suleyman, the company’s CEO of AI, told CNBC’s Steve Kovach in an interview on Friday. Waiting to build models that are “three or six months behind” offers several advantages, including lower costs and the ability to concentrate on specific use cases, Suleyman said.

It’s “cheaper to give a specific answer once you’ve waited for the first three or six months for the frontier to go first. We call that off-frontier,” he said. “That’s actually our strategy, is to really play a very tight second, given the capital-intensiveness of these models.”

Suleyman made a name for himself as a co-founder of DeepMind, the AI lab that Google bought in 2014, reportedly for $400 million to $650 million. Suleyman arrived at Microsoft last year alongside other employees of the startup Inflection, where he had been CEO.

More than ever, Microsoft counts on relationships with other companies to grow.

It gets AI models from San Francisco startup OpenAI and supplemental computing power from newly public CoreWeave in New Jersey. Microsoft has repeatedly enriched Bing, Windows and other products with OpenAI’s latest systems for writing human-like language and generating images.

Microsoft’s Copilot will gain “memory” to retain key facts about people who repeatedly use the assistant, Suleyman said Friday at an event in Microsoft’s Redmond, Washington, headquarters to commemorate the company’s 50th birthday. That feature came first to OpenAI’s ChatGPT, which has 500 million weekly users.

Through ChatGPT, people can access top-flight large language models such as the o1 reasoning model that takes time before spitting out an answer. OpenAI introduced that capability in September — only weeks later did Microsoft bring a similar capability called Think Deeper to Copilot.

Microsoft occasionally releases open-source small-language models that can run on PCs. They don’t require powerful server GPUs, making them different from OpenAI’s o1.

OpenAI and Microsoft have held a tight relationship shortly after the startup launched its ChatGPT chatbot in late 2022, effectively kicking off the generative AI race. In total, Microsoft has invested $13.75 billion in the startup, but more recently, fissures in the relationship between the two companies have begun to show.

Microsoft added OpenAI to its list of competitors in July 2024, and OpenAI in January announced that it was working with rival cloud provider Oracle on the $500 billion Stargate project. That came after years of OpenAI exclusively relying on Microsoft’s Azure cloud. Despite OpenAI partnering with Oracle, Microsoft in a blog post announced that the startup had “recently made a new, large Azure commitment.”

“Look, it’s absolutely mission-critical that long-term, we are able to do AI self-sufficiently at Microsoft,” Suleyman said. “At the same time, I think about these things over five and 10 year periods. You know, until 2030 at least, we are deeply partnered with OpenAI, who have [had an] enormously successful relationship for us.

Microsoft is focused on building its own AI internally, but the company is not pushing itself to build the most cutting-edge models, Suleyman said.

“We have an incredibly strong AI team, huge amounts of compute, and it’s very important to us that, you know, maybe we don’t develop the absolute frontier, the best model in the world first,” he said. “That’s very, very expensive to do and unnecessary to cause that duplication.”

WATCH: Microsoft Copilot beginning of a seismic shift in AI integration, says Microsoft AI CEO Suleyman

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Former Microsoft CEO Steve Ballmer says, as shareholder, tariffs are ‘not good’

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Former Microsoft CEO Steve Ballmer says, as shareholder, tariffs are 'not good'

President Trump’s new tariffs on goods that the U.S. imports from over 100 countries will have an effect on consumers, former Microsoft CEO Steve Ballmer told CNBC on Friday. Investors will feel the pain, too.

Microsoft’s stock dropped almost 6% in the past two days, as the Nasdaq wrapped up its worst week in five years.

“As a Microsoft shareholder, this kind of thing is not good,” Ballmer said, in an interview with Andrew Ross Sorkin that was tied to Microsoft’s 50th anniversary celebration. “It creates opportunity to be a serious, long-term player.”

Ballmer was sandwiched in between Microsoft co-founder Bill Gates and current CEO Satya Nadella for the interview.

“I took just enough economics in college — that tariffs are actually going to bring some turmoil,” said Ballmer, who was succeeded by Nadella in 2014. Gates, Microsoft’s first CEO, convinced Ballmer to join the company in 1980.

Gates, Ballmer and Nadella attended proceedings at Microsoft’s Redmond, Washington, campus on Friday to celebrate its first half-century.

Between the tariffs and weak quarterly revenue guidance announced in January, Microsoft’s stock is on track for its fifth straight month of declines, which would be the worst stretch since 2009. But the company remains a leader in the PC operating system and productivity software markets, and its partnership with startup OpenAI has led to gains in cloud computing.

“I think that disruption is very hard on people, and so the decision to do something for which disruption was inevitable, that needs a lot of popular support, and nobody could game theorize exactly who is going to do what in response,” Ballmer said, regarding the tariffs. “So, I think citizens really like stability a lot. And I hope people — individuals who will feel this, because people are feeling it, not just the stock market, people are going to feel it.”

Ballmer, who owns the Los Angeles Clippers, is among Microsoft’s biggest fans. He said he’s the company’s largest investor. In 2014, shortly after he bought the basketball team for $2 billion, he held over 333 million shares of the stock, according to a regulatory filing.

“I’m not going to probably have 50 more years on the planet,” he said. “But whatever minutes I have, I’m gonna be a large Microsoft shareholder.” He said there’s a bright future for computing, storage and intelligence. Microsoft launched the first Azure services while Ballmer was CEO.

Earlier this week Bloomberg reported that Microsoft, which pledged to spend $80 billion on AI-enabled data center infrastructure in the current fiscal year, has stopped discussions or pushed back the opening of facilities in the U.S. and abroad.

JPMorgan Chase’s chief economist, Bruce Kasman, said in a Thursday note that the chance of a global recession will be 60% if Trump’s tariffs kick in as described. His previous estimate was 40%.

“Fifty years from now, or 25 years from now, what is the one thing you can be guaranteed of, is the world needs more compute,” Nadella said. “So I want to keep those two thoughts and then take one step at a time, and then whatever are the geopolitical or economic shifts, we’ll adjust to it.”

Gates, who along with co-founder Paul Allen, sought to build a software company rather than sell both software and hardware, said he wasn’t sure what the economic effects of the tariffs will be. Today, most of Microsoft’s revenue comes from software. It also sells Surface PCs and Xbox consoles.

“So far, it’s just on goods, but you know, will it eventually be on services? Who knows?” said Gates, who reportedly donated around $50 million to a nonprofit that supported Democratic nominee Kamala Harris’ losing campaign.

— CNBC’s Alex Harring contributed to this report.

WATCH: There will be many LLM winners, says infrastructure investor Morrison

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AppLovin can offer TikTok ‘much stronger bid than others,’ CEO says

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AppLovin can offer TikTok 'much stronger bid than others,' CEO says

Piotr Swat | Lightrocket | Getty Images

AppLovin CEO Adam Foroughi provided more clarity on the ad-tech company’s late-stage effort to acquire TikTok, calling his offer a “much stronger bid than others” on CNBC’s The Exchange Friday afternoon.

Foroughi said the company is proposing a merger between AppLovin and the entire global business of TikTok, characterizing the deal as a “partnership” where the Chinese could participate in the upside while AppLovin would run the app.

“If you pair our algorithm with the TikTok audience, the expansion on that platform for dollars spent will be through the roof,” Foroughi said.

The news comes as President Trump announced he would extend the deadline a second time for TikTok’s Chinese-owned parent company ByteDance to sell the U.S. subsidiary of TikTok to an American buyer or face an effective ban on U.S. app stores. The new deadline is now in June, which, as Foroughi described, “buys more time to put the pieces together” on AppLovin’s bid. 

“The president’s a great dealmaker — we’re proposing, essentially an enhancement to the deal that they’ve been working on, but a bigger version of all the deals contemplated,” he added.

AppLovin faces a crowded field of other interested U.S. backers, including Amazon, Oracle, billionaire Frank McCourt and his Project Liberty consortium, and numerous private equity firms. Some proposals reportedly structure the deal to give a U.S. buyer 50% ownership of the company, rather than a complete acquisition. The Chinese government will still need to approve the deal, and AppLovin’s interest in purchasing TikTok in “all markets outside of China” is “preliminary,” according to an April 3 SEC filing.

Correction: A prior version of this story incorrectly characterized China’s ongoing role in TikTok should AppLovin acquire the app.

WATCH: AppLovin CEO Adam Foroughi on its bid to buy TikTok

AppLovin CEO Adam Foroughi on its bid to buy TikTok

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