Tech investors last week finally heard utterance of their favorite three-letter acronym: IPO.
It’s been 20 months since a notable venture-backed tech company went public in the U.S., and the chatter in Silicon Valley has centered around who will break the ice. On Friday, grocery delivery startup Instacart and data and marketing automation company Klaviyo filed for stock market debuts.
Earlier in the week, chip designer Arm, which is owned by Japan’s SoftBank, said it plans to hit the Nasdaq seven years after being taken private in a $32 billion acquisition.
The three companies have very little in common, but collectively they represent a test of the excitement level among public market investors for new opportunities. Depending on how they perform out of the gate, their offerings could propel others to follow in the fourth quarter.
“Other teams will watch the reception of these and it could encourage some of those management teams to stop waiting around for yesteryear and just get it done,” said Lise Buyer, founder of IPO consultancy Class V Group.
By “yesteryear,” Buyer is referring to the kinds of valuations tech companies were achieving in 2020 and 2021, which were record years for tech IPOs. Software vendor Snowflake, which debuted in late 2020 and saw its price-to-sales multiple shoot up to about 50, now trades at under 17 times revenue. Food delivery company DoorDash has seen its stock drop by more than two-thirds since its high in 2021, even though revenue has since grown by over 60%.
“We aren’t going back to 2021 anytime soon,” Buyer said.
Instacart, backed at high prices by venture firms including Sequoia and Andreessen Horowitz, has had a big valuation haircut ahead of its IPO. After raising private cash at a $39 billion valuation in early 2021, the company slashed that number to $24 billion in March of last year as tech stocks sank and growth slowed dramatically in a post-Covid world. The valuation reportedly fell by another 50% by late 2022.
DoorDash, which is probably Instacart’s closest public market comparison, currently trades at 3.8 times revenue. That kind of multiple would value Instacart at around $11 billion.
Instacart, which reported revenue growth of 15% in the latest quarter to $716 million, has managed to turn a profit for five straight periods by keeping costs in check and slashing head count. Net income increased to $114 million from $8 million a year earlier.
Klaviyo, which was valued at $9.5 billion in a 2021 funding round, has not been forced to reduce its valuation, according to Pitchbook and public reports. Founded in 2012, the company’s technology helps clients store user data and build profiles that enable targeted marketing via email, text messages and other channels.
Andrew Bialecki, CEO and co-founder of Klaviyo, poses for a portrait in Boston on Sep. 5, 2019.
Barry Chin | Boston Globe | Getty Images
Even though it has a much lesser-known brand, Klaviyo is growing significantly faster than Instacart, with revenue in the second quarter climbing 50% to $164.6 million. The business swung to a profit of $10.9 million in the period after losing close to $12 million a year earlier.
When looking for comparisons, the Bessemer Cloud Index, which consists of about 70 publicly traded cloud companies, provides the cleanest data. Klaviyo’s growth rate would put it near the top of the index, where companies trade at around 12 times revenue. That would imply a valuation for Klaviyo in the neighborhood of $7 billion.
Klaviyo’s biggest institutional backer is Summit Partners, followed by e-commerce software vendor Shopify, which is a key business partner. Venture firm Accel is also an investor.
According to Buyer, it’s not surprising to see companies filing to go public right now. The way SEC rules work, management teams and bankers have to wait at least 15 days after the IPO filing before they can start their roadshow. The offering could take place two weeks later.
Companies that filed last week can hit the road in early September, right after Labor Day, and go public in the middle of the month.
“Historically, late August is when you see filings for companies that want to be first in the back-to-school season,” Buyer said. “The timing makes all sorts of sense. People are coming back from the summer holidays with a fresh look at the market and interest in adding new names in Q4.”
While Instacart and Klaviyo could have significant implications for startup investors as they look at what to expect for the rest of 2023 and into next year, Arm has a slightly different audience.
The chip designer is owned by Masayoshi Son’s SoftBank, which is seeking liquidity after losing billions of dollars in recent years on mistimed and overly aggressive investments in names like WeWork, Chinese ride-hailing company Didi and Indian hotel company Oyo.
Not only is Arm much bigger than a typical venture-backed company at the time of IPO, but it’s based in the U.K. and was a public company in the past.
Arm, whose technology is critical to almost all of the world’s smartphones, reported $524 million in net income on $2.68 billion in revenue in its fiscal 2023, which ended in March, according to its filing. Arm’s 2023 revenue was slightly down from the company’s 2022 sales of $2.7 billion.
To capture a public market valuation of $32 billion, Arm would need a multiple of roughly 61 times earnings. Within the semiconductor market, Nvidia towers over everyone, with a price-to-earnings ratio of 114. But that’s a company that’s tripled in value this year and just told investors to expect 170% sales growth in the current quarter. Elsewhere in the chip space, Qualcomm trades for 15 times earnings and Applied Materials has a ratio of 19.
The technology sector may be starting to slow again. The Nasdaq is up 30% this year, coming off its worst year since 2008, but an outsized portion of the gains come from huge rallies in shares of Nvidia and Meta. So far in August, the Nasdaq is down 5.3% and is headed for its first monthly drop since February.
But at some point, companies have to stop focusing on market conditions and just decide it’s time to be public, Buyer said, as there hasn’t been a significant VC-backed tech IPO in the U.S. since HashiCorp and Samsara went public in December 2021.
The market will determine a company’s value, and if it performs over time, there will always be opportunities to sell shares at a higher price.
“You’ve got to prove your worth in the marketplace,” she said.
Hidden among the majestic canyons of the Utah desert, about 7 miles from the nearest town, is a small research facility meant to prepare humans for life on Mars.
The Mars Society, a nonprofit organization that runs the Mars Desert Research Station, or MDRS, invited CNBC to shadow one of its analog crews on a recent mission.
“MDRS is the best analog astronaut environment,” said Urban Koi, who served as health and safety officer for Crew 315. “The terrain is extremely similar to the Mars terrain and the protocols, research, science and engineering that occurs here is very similar to what we would do if we were to travel to Mars.”
SpaceX CEO and Mars advocate Elon Musk has said his company can get humans to Mars as early as 2029.
The 5-person Crew 315 spent two weeks living at the research station following the same procedures that they would on Mars.
David Laude, who served as the crew’s commander, described a typical day.
“So we all gather around by 7 a.m. around a common table in the upper deck and we have breakfast,” he said. “Around 8:00 we have our first meeting of the day where we plan out the day. And then in the morning, we usually have an EVA of two or three people and usually another one in the afternoon.”
An EVA refers to extravehicular activity. In NASA speak, EVAs refer to spacewalks, when astronauts leave the pressurized space station and must wear spacesuits to survive in space.
“I think the most challenging thing about these analog missions is just getting into a rhythm. … Although here the risk is lower, on Mars performing those daily tasks are what keeps us alive,” said Michael Andrews, the engineer for Crew 315.
Formula One F1 – United States Grand Prix – Circuit of the Americas, Austin, Texas, U.S. – October 23, 2022 Tim Cook waves the chequered flag to the race winner Red Bull’s Max Verstappen
Mike Segar | Reuters
Apple had two major launches last month. They couldn’t have been more different.
First, Apple revealed some of the artificial intelligence advancements it had been working on in the past year when it released developer versions of its operating systems to muted applause at its annual developer’s conference, WWDC. Then, at the end of the month, Apple hit the red carpet as its first true blockbuster movie, “F1,” debuted to over $155 million — and glowing reviews — in its first weekend.
While “F1” was a victory lap for Apple, highlighting the strength of its long-term outlook, the growth of its services business and its ability to tap into culture, Wall Street’s reaction to the company’s AI announcements at WWDC suggest there’s some trouble underneath the hood.
“F1” showed Apple at its best — in particular, its ability to invest in new, long-term projects. When Apple TV+ launched in 2019, it had only a handful of original shows and one movie, a film festival darling called “Hala” that didn’t even share its box office revenue.
Despite Apple TV+being written off as a costly side-project, Apple stuck with its plan over the years, expanding its staff and operation in Culver City, California. That allowed the company to build up Hollywood connections, especially for TV shows, and build an entertainment track record. Now, an Apple Original can lead the box office on a summer weekend, the prime season for blockbuster films.
The success of “F1” also highlights Apple’s significant marketing machine and ability to get big-name talent to appear with its leadership. Apple pulled out all the stops to market the movie, including using its Wallet app to send a push notification with a discount for tickets to the film. To promote “F1,” Cook appeared with movie star Brad Pitt at an Apple store in New York and posted a video with actual F1 racer Lewis Hamilton, who was one of the film’s producers.
(L-R) Brad Pitt, Lewis Hamilton, Tim Cook, and Damson Idris attend the World Premiere of “F1: The Movie” in Times Square on June 16, 2025 in New York City.
Jamie Mccarthy | Getty Images Entertainment | Getty Images
Although Apple services chief Eddy Cue said in a recent interview that Apple needs the its film business to be profitable to “continue to do great things,” “F1” isn’t just about the bottom line for the company.
Apple’s Hollywood productions are perhaps the most prominent face of the company’s services business, a profit engine that has been an investor favorite since the iPhone maker started highlighting the division in 2016.
Films will only ever be a small fraction of the services unit, which also includes payments, iCloud subscriptions, magazine bundles, Apple Music, game bundles, warranties, fees related to digital payments and ad sales. Plus, even the biggest box office smashes would be small on Apple’s scale — the company does over $1 billion in sales on average every day.
But movies are the only services component that can get celebrities like Pitt or George Clooney to appear next to an Apple logo — and the success of “F1” means that Apple could do more big popcorn films in the future.
“Nothing breeds success or inspires future investment like a current success,” said Comscore senior media analyst Paul Dergarabedian.
But if “F1” is a sign that Apple’s services business is in full throttle, the company’s AI struggles are a “check engine” light that won’t turn off.
Replacing Siri’s engine
At WWDC last month, Wall Street was eager to hear about the company’s plans for Apple Intelligence, its suite of AI features that it first revealed in 2024. Apple Intelligence, which is a key tenet of the company’s hardware products, had a rollout marred by delays and underwhelming features.
Apple spent most of WWDC going over smaller machine learning features, but did not reveal what investors and consumers increasingly want: A sophisticated Siri that can converse fluidly and get stuff done, like making a restaurant reservation. In the age of OpenAI’s ChatGPT, Anthropic’s Claude and Google’s Gemini, the expectation of AI assistants among consumers is growing beyond “Siri, how’s the weather?”
The company had previewed a significantly improved Siri in the summer of 2024, but earlier this year, those features were delayed to sometime in 2026. At WWDC, Apple didn’t offer any updates about the improved Siri beyond that the company was “continuing its work to deliver” the features in the “coming year.” Some observers reduced their expectations for Apple’s AI after the conference.
“Current expectations for Apple Intelligence to kickstart a super upgrade cycle are too high, in our view,” wrote Jefferies analysts this week.
Siri should be an example of how Apple’s ability to improve products and projects over the long-term makes it tough to compete with.
It beat nearly every other voice assistant to market when it first debuted on iPhones in 2011. Fourteen years later, Siri remains essentially the same one-off, rigid, question-and-answer system that struggles with open-ended questions and dates, even after the invention in recent years of sophisticated voice bots based on generative AI technology that can hold a conversation.
Apple’s strongest rivals, including Android parent Google, have done way more to integrate sophisticated AI assistants into their devices than Apple has. And Google doesn’t have the same reflex against collecting data and cloud processing as privacy-obsessed Apple.
Some analysts have said they believe Apple has a few years before the company’s lack of competitive AI features will start to show up in device sales, given the company’s large installed base and high customer loyalty. But Apple can’t get lapped before it re-enters the race, and its former design guru Jony Ive is now working on new hardware with OpenAI, ramping up the pressure in Cupertino.
“The three-year problem, which is within an investment time frame, is that Android is racing ahead,” Needham senior internet analyst Laura Martin said on CNBC this week.
Apple’s services success with projects like “F1” is an example of what the company can do when it sets clear goals in public and then executes them over extended time-frames.
Its AI strategy could use a similar long-term plan, as customers and investors wonder when Apple will fully embrace the technology that has captivated Silicon Valley.
Wall Street’s anxiety over Apple’s AI struggles was evident this week after Bloomberg reported that Apple was considering replacing Siri’s engine with Anthropic or OpenAI’s technology, as opposed to its own foundation models.
The move, if it were to happen, would contradict one of Apple’s most important strategies in the Cook era: Apple wants to own its core technologies, like the touchscreen, processor, modem and maps software, not buy them from suppliers.
Using external technology would be an admission that Apple Foundation Models aren’t good enough yet for what the company wants to do with Siri.
“They’ve fallen farther and farther behind, and they need to supercharge their generative AI efforts” Martin said. “They can’t do that internally.”
Apple might even pay billions for the use of Anthropic’s AI software, according to the Bloombergreport. If Apple were to pay for AI, it would be a reversal from current services deals, like the search deal with Alphabet where the Cupertino company gets paid $20 billion per year to push iPhone traffic to Google Search.
The company didn’t confirm the report and declined comment, but Wall Street welcomed the report and Apple shares rose.
In the world of AI in Silicon Valley, signing bonuses for the kinds of engineers that can develop new models can range up to $100 million, according to OpenAI CEO Sam Altman.
“I can’t see Apple doing that,” Martin said.
Earlier this week, Meta CEO Mark Zuckerberg sent a memo bragging about hiring 11 AI experts from companies such as OpenAI, Anthropic, and Google’s DeepMind. That came after Zuckerberg hired Scale AI CEO Alexandr Wang to lead a new AI division as part of a $14.3 billion deal.
Meta’s not the only company to spend hundreds of millions on AI celebrities to get them in the building. Google spent big to hire away the founders of Character.AI, Microsoft got its AI leader by striking a deal with Inflection and Amazon hired the executive team of Adept to bulk up its AI roster.
Apple, on the other hand, hasn’t announced any big AI hires in recent years. While Cook rubs shoulders with Pitt, the actual race may be passing Apple by.
Tesla CEO Elon Musk speaks alongside U.S. President Donald Trump to reporters in the Oval Office of the White House on May 30, 2025 in Washington, DC.
Kevin Dietsch | Getty Images
Tesla CEO Elon Musk, who bombarded President Donald Trump‘s signature spending bill for weeks, on Friday made his first comments since the legislation passed.
Musk backed a post on X by Sen. Rand Paul, R-Ky., who said the bill’s budget “explodes the deficit” and continues a pattern of “short-term politicking over long-term sustainability.”
The House of Representatives narrowly passed the One Big Beautiful Bill Act on Thursday, sending it to Trump to sign into law.
Paul and Musk have been vocal opponents of Trump’s tax and spending bill, and repeatedly called out the potential for the spending package to increase the national debt.
The independent Congressional Budget Office has said the bill could add $3.4 trillion to the $36.2 trillion of U.S. debt over the next decade. The White House has labeled the agency as “partisan” and continuously refuted the CBO’s estimates.
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The bill includes trillions of dollars in tax cuts, increased spending for immigration enforcement and large cuts to funding for Medicaid and other programs.
It also cuts tax credits and support for solar and wind energy and electric vehicles, a particularly sore spot for Musk, who has several companies that benefit from the programs.
“I took away his EV Mandate that forced everyone to buy Electric Cars that nobody else wanted (that he knew for months I was going to do!), and he just went CRAZY!” Trump wrote in a social media post in early June as the pair traded insults and threats.
Shares of Tesla plummeted as the feud intensified, with the company losing $152 billion in market cap on June 5 and putting the company below $1 trillion in value. The stock has largely rebounded since, but is still below where it was trading before the ruckus with Trump.
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Tesla one-month stock chart.
— CNBC’s Kevin Breuninger and Erin Doherty contributed to this article.