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An advocacy group backed by Facebook received a $34 million donation from an anonymous donor as it waged a battle against antitrust legislation that would have more tightly regulated the tech industry.

A person who works with the group, American Edge Project, told CNBC that the $34 million was from Facebook. This person declined to be named in order to speak freely about the group’s finances.

The nonprofit raised the massive amount almost two years ago, according to the organization’s latest 990 tax forms. The documents reflect the nonprofit’s finances starting on Nov. 1, 2020, and carrying into Oct. 31, 2021. These disclosures are the most recent tax records available for public viewing and do not list names of the group’s donors.

A Meta spokesman declined to comment and referred CNBC to American Edge instead.

Doug Kelly, American Edge’s CEO, told CNBC in a statement that “the threats to America’s technological edge have a profound impact on our national security and economic well being and we’re leading the charge to make sure everyone is aware.”

The new documents show the tech advocacy group scored its biggest fundraising haul yet when bipartisan lawmakers on Capitol Hill were attempting to take on tech giants, including through antitrust legislation that didn’t pass Congress and a hearing in March 2021 featuring tech CEOs such as Facebook’s Mark Zuckerberg. Facebook changed its name to Meta in late 2021.

The American Edge Project launched its first pro-tech industry ad in 2020. The group’s previous 990 forms, from 2019 through late 2020, showed it raised all of its money from a single anonymous $4 million donation during that period. Facebook confirmed in 2020 to The Washington Post that it was contributing to the group. The person who works with American Edge told CNBC that the $4 million was also entirely from Facebook.

American Edge launched a wave of TV and digital ads from late 2020 through 2021, taking on antitrust proposals. A TV spot funded by the group suggested that small-business innovation could be affected if such legislation made its way through Congress.

In June 2021, the House Judiciary Committee passed a package of sweeping tech antitrust reforms. The measures proposed new rules on the largest online platforms, like requiring them to have capabilities for users to easily transfer their data to other services, shifting the burden of proof in merger cases onto dominant tech platforms, blocking platforms from operating businesses with conflicts of interest and from advantaging their own products on platforms they run.

The Senate later introduced a version of one of the bills, the American Innovation and Choice Online Act, in October 2021, which aimed to bar self-preferencing on dominant tech services. That bill advanced out of the Senate Judiciary Committee in January 2022.

Taken together, the bills were poised to create a much more uncertain legal environment for Facebook and its peers, including by making it harder to acquire firms that could help their businesses grow.

Almost all of these bills did not get a full House or Senate vote after Big Tech companies and their industry groups opposed the pieces of legislation, saying they would impose unfair restrictions and result in negative effects for consumers. For example, Chamber of Progress, backed by Apple, Amazon, Google and Meta, has warned that the Senate bill would significantly alter Amazon Prime’s offerings like two-day shipping and make it harder to offer low-cost basics from its first-party brand, for fear of being charged with illegal self-preferencing.

American Edge spent over $5 million between TV and digital ads in 2021, according to data from AdImpact. It spent over $10 million on TV ads last year, AdImpact says. The group went into 2022 with over $13 million in net assets, according to its 990 forms.

The $34 million donation also came as American Edge announced it was adding former Rep. Greg Walden, R-Ore., and former Sen. Heidi Heitkamp, D-N.D., as advisory board co-chairs to “lead the coalition’s efforts on internet openness, accessibility and free expression,” according to the press release. Walden is still listed on the group’s website as a leader of an advisory board, while Heitkamp is no longer listed.

A 2022 report by the watchdog Tech Transparency Project says Facebook isn’t just a “contributor” to American Edge, as the company confirmed to The Washington Post, but potentially its “sole funder.” The Tech Transparency Project receives funding from the George Soros-backed Open Society Foundations, Craig Newmark Philanthropies, Bohemian Foundation and Omidyar Network, according to its website.

American Edge’s website lists Facebook as a member of their supportive coalition. Other listed members include Bear Hill Advisors, the Center for Individual Freedom, NetChoice, the Connected Commerce Council, the National Black Chamber of Commerce and the National Small Business Association.

Facebook itself has spent over $58 million since the start of 2020 on federal lobbying, according to data compiled by the nonpartisan OpenSecrets.

Beyond the $34 million donation, the only other contribution listed on the tax disclosure was an another anonymous donation – of $25,000. The multimillion-dollar contribution allowed American Edge to spend just over $19 million on what the forms refer to as media placement and strategic services.

The 990 forms, which were signed and filed by the group in 2022, also show that powerful consulting firms that work for American Edge also received over $3 million combined from the organization. Cavalry LLC, a firm founded by former strategists of Senate Minority Leader Mitch McConnell, R-Ky., was paid $1.1 million by American Edge from November 2020 through October 2021. The Washington Post reported that John Ashbrook, a founding partner at Cavalry and a former McConnell advisor, is helping guide the group.

Global Strategy Group, a political and corporate consulting firm that was founded by three Democratic strategists, received $910,000 from American Edge over that same time period. GSG has a history of working with Big Tech. Amazon previously employed the group while the company fought unionization efforts. Amazon itself has donated to a similar group while that nonprofit took on tech-related legislation.

The Washington Post reported that Jim Papa, a partner at Global Strategy Group who was an aide to former President Barack Obama, was also helping the organization. Papa says on his GSG profile page that among his current and former clients is FWD.us, a fellow 501(c)(4) nonprofit that was co-founded by Zuckerberg and actively lobbies on immigration-related issues.

A GSG representative did not return requests for comment.

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Nvidia must show Blackwell chip can drive growth in earnings report

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November 19, 2024

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Nvidia must show Blackwell chip can drive growth in earnings report

Despite rising competition, Nvidia holds 80% of the fast-growing market for artificial intelligence chips as the tech industry’s graphics processing unit, or GPU, of choice for making and deploying generative AI software.

What investors will want to see when Nvidia reports its third-quarter earnings on Wednesday is whether it can continue to grow at a fierce rate, even as the boom in AI enters its third year.

Nvidia is entering “uncharted territory” as it attempts to continue growing on a $3.5 trillion market cap, wrote HSBC analyst Frank Lee in a report this week.

“We have pondered this amazing growth trajectory and not only do we see no signs of a slowdown, we expect further upside in 2026 data center momentum,” Lee said in his note. He has a buy rating on the stock.

Future growth will have to come from Blackwell, its next-generation chip that has just started shipping to end-users such as Microsoft, Google and OpenAI. More important than Nvidia’s third-quarter results will be what the company says about demand for the Blackwell chip.

Nvidia CEO Jensen Huang will likely update investors about how that is shaping up on Wednesday, and he will potentially address reports that some of the systems based on Blackwell chips are experiencing overheating issues.

In August, Nvidia said it expected about “several billion” in Blackwell sales during the January quarter.

“Our base case is for NVDA to ship ~100K Blackwell GPUs in 4Q, which we believe is near the low-end of investor expectations,” Raymond James analyst Srini Pajjuri wrote in a note last week. He has a strong buy rating on the stock.

Since Nvidia’s last earnings report, the stock is up nearly 19%, capping off a stunning run that has seen the share price rise eightfold since ChatGPT was released in late 2022. Alongside the stock’s rise has been a fierce increase in sales and margin, and its forward price to earnings ratio has expanded to just under 50, according to FactSet.

Growth is slowing, but that is partially because Nvidia’s top line is so much larger than before. Nvidia reported 122% growth in sales in the most-recent quarter. That was lower than the 262% year-over-year growth it reported in the April quarter and the 265% growth in the January quarter.

Analysts polled by LSEG are expecting around $33.12 billion in revenue, which would be nearly 83% growth compared to a year ago. The company is also expected to post 75 cents in earnings per share, according to LSEG consensus estimates.

Nvidia’s data center business accounted for nearly 88% of sales in the most-recent quarter, taking the focus off the company’s legacy computer games business.

The company makes the chip for the Nintendo Switch, for example, which the Japanese video game company says is seeing major sales declines as the game console ages. Nvidia’s gaming business is expected to grow about 6% to $3.03 billion, according to a FactSet estimate. Its automotive business, making chips for electric cars, is still small, even though analysts expect it to grow 38% to about $360 million in sales.

But none of that will matter as long as Nvidia’s data center business continues to grow at a rate that is nearly doubling on an annual basis and Huang signals to investors that the party won’t end.

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Microsoft introduces PC that has one job: connect users to their computers in the cloud

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2 hours ago

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November 19, 2024

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Microsoft introduces PC that has one job: connect users to their computers in the cloud

Microsoft CEO Satya Nadella watches from the audience during a press briefing at Microsoft’s campus in Redmond, Washington, on May 20, 2024.

Jason Redmond | Afp | Getty Images

Microsoft is previewing a new PC that’s designed to connect corporate workers to their programs and files in the cloud.

The Windows 365 Cloud Link is available in limited use in the U.S., Canada and a handful of other countries. It will be for sale in a few markets at $349 in April.

After years spent failing to crack the list of top PC manufacturers with its Surface product line, Microsoft is trying something new in an established category of hardware. In the second quarter, Microsoft said its $1.2 billion in devices revenue was down about 11%, while total PC shipments increased about 2%, according to one estimate.

Early testers have used the devices in call centers and for hot-desking, the practice of temporarily placing workers in available work areas rather than having them stick to the same assigned spots, Jalleen Ringer, product leader for Windows cloud endpoints, told CNBC in an interview.

The device is meant to be simple and secure. It runs a stripped-down operating system called Windows CPC, with no local applications or local users, and has a strict application control policy that can’t be disabled. It automatically downloads updates in the background and installs them at night.

Microsoft’s Windows 365 Link supports dual 4K monitors.

Microsoft

An Intel chip runs inside the computer, which comes with 8GB of RAM and 64GB of storage. Weighing less than a pound, the puck-like package can be kept on a desk or even mounted behind a PC monitor.

The release comes three years after Microsoft introduced Windows 365, which gives employees access to their custom virtual desktops on any device. Desktop virtualization, including an earlier Microsoft product called Azure Virtual Desktop, took off after the start of the Covid pandemic in 2020, with workers stuck at home.

In July 2023, Microsoft CEO Satya Nadella said Azure Virtual Desktop and Windows 365 together generated $1 billion in revenue for the first time in the 2024 fiscal year.

Dell and HP both sell thin client PCs that connect to virtual desktop infrastructure. Organizations can configure them with Windows or proprietary operating systems.

The Windows 365 Cloud Link is a “nice alternative” to thin clients, said Melissa Grant, a senior director of product marketing at Microsoft.

WATCH: ‘In many ways China is close to or is even catching up,’ Microsoft’s Brad Smith says

'In many ways China is close to or is even catching up,' Microsoft's Brad Smith says

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European tech funding declines for third consecutive year — but the sector is finally stabilizing

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5 hours ago

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November 19, 2024

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European tech funding declines for third consecutive year — but the sector is finally stabilizing

On Monday, British tech lobby group Startup Coalition warned in a blog post that there was a risk Reeves’ tax plans could result in a tech “brain drain.”. (Photo by Oli Scarff/Getty Images)

Oli Scarff | Getty Images

Venture capital investment in European technology startups is projected to decline for a third straight year, according to VC firm Atomico — but there are signs that things are finally stabilizing as valuations improve and interest rates fall.

Europe’s venture-backed startups are expected to secure $45 billion of investment by the end of 2024 — slightly lower than the $47 billion they raised last year, Atomico said Tuesday in its “State of European Tech” report.

Still, Atomico said this shows that European tech funding levels have finally “stabilized” despite worsening global macroeconomic conditions leading to three consecutive years of declines.

The firm stressed that the continent’s tech ecosystem is in a much better place than it was a decade ago, with funding this year still set to eclipse the $43 billion startups raised between 2005 and 2014.

In the period spanning 2015 to 2024, European startups have bagged $426 billion, dwarfing the sum of investment deployed into tech firms the decade prior.

Tom Wehmeier, head of insights at Atomico, told CNBC that Europe still has a few key areas of improvement to address before it can produce companies of similar scale to the largest tech firms in the U.S. and China.

“There’s frustrations about the continued challenges faced when it comes to regulation, bureaucracy, access to capital and this idea of scaling across the fragmented European marketplace,” Wehmeier said in an interview.

For example, pension funds in Europe face barriers to investing in venture capital funds and therefore aren’t gaining much exposure to the continent’s fast-growing startup ecosystem, Wehmeier said.

European pension funds allocate just 0.01% of the $9 trillion worth of assets they manage into venture capital funds based in the continent, according to Atomico’s report.

The 2024 publication marks the 10th anniversary since Atomico began compiling its annual report, which is produced in partnership with data firm Dealroom.

Europe’s first $1 trillion tech firm?

According to Atomico there are signs that the sector is improving. In the U.K., for example, Finance Minister Rachel Reeves last week laid out plans to consolidate 86 separate local government pension pots into eight “megafunds” to boost investment in domestic assets.

I deeply believe that Germany's role is to bring Europe together: Habeck

British tech advocacy group techUK said the reforms “should address barriers to greater availability of pension fund capital and encourage a vision that sees more investment into UK tech science start-ups and scale-ups.”

Reforms to pension schemes are either underway or being discussed in several other countries across Europe.

“These changes could result in billions more being made available to European scale-ups — and that’s something that could be the difference between the best and brightest companies scaling from here in Europe, versus being forced to relocate,” Wehmeier told CNBC.

Atomico said it’s optimistic about the next decade in European tech. The VC firm, which was established by Skype co-founder Niklas Zennström, is predicting the entire European tech ecosystem combined could be valued at $8 trillion by 2034, up from around $3 trillion currently.

Atomico also predicts that Europe will mint its first-ever trillion-dollar tech company in a decade’s time.

While Europe is home to several so-called “decacorns” valued at $10 billion and above, including Arm, Adyen, Spotify and Revolut, it has so far failed to produce a company valued at $1 trillion.

That’s unlike the United States, where several of the so-called “Magnificent Seven” technology companies are now worth over $1 trillion. They include Google parent company Alphabet, Amazon, Apple, Facebook-owner Meta, Microsoft, Nvidia and Tesla.

“If we can unlock capital at scale, keep the brightest minds in Europe, maintain that focus on solving really hard problems for society and the economy, that’s how we go and unlock the first trillion-dollar company,” Wehmeier said.

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