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Ali Ghodsi, co-founder and CEO of Databricks.

Databricks

As some high-valued tech startups look to the long-dormant IPO market for their next funding round, Databricks is still finding investors that are happy to keep the company private, at least for now.

Databricks, which sells data analytics software, said Thursday that it raised more than $500 million in fresh capital at a $43 billion valuation.

Founded in 2013 and based in San Francisco, Databricks last announced funding during the boom market of 2021, at a $38 billion valuation. Since then, cloud software stocks have plummeted, with rival Snowflake losing 45% of its value. However, unlike fellow software IPO candidates Canva and Stripe, Databricks has managed to maintain its share price.

In the latest round, shares were sold at $73.50 a piece, roughly equal to where they were priced in 2021. The $5 billion increase in valuation is the result of new shares that CEO Ali Ghodsi said have gone to the 3,500 employees the company has hired in the past two years, as well as to investors. Headcount now sits at around 6,000.

While high interest rates and economic concerns continue to weigh on the tech market, particularly on companies that are burning cash, Databricks is capitalizing on a surge of momentum in artificial intelligence. In July, Databricks acquired MosaicML, a startup with software for efficiently running large language models that can spit out natural-sounding text, for $1.3 billion.

Nvidia is a new investor in Databricks, a notable addition as the chipmaker has been pouring cash into a host of AI infrastructure startups. Hugging Face, Cohere and CoreWeave are a few of the companies that Nvidia has backed at multibillion-dollar valuations.

Snowflake CEO Frank Slootman: AI will become a million times what 'search' is

Ghodsi said that he started talking to Nvidia CEO Jensen Huang “a while back,” and that a strategic tie-up has become more important with both companies going deeper into AI. Databricks spends a lot of money on Nvidia’s graphics processing units, largely through various public clouds, and even more now that his company owns Mosaic. He added that Nvidia and Mosaic had been in talks about a partnership before the acquisition.

“It made sense to partner more closely,” Ghodsi said. “At the core, we’re in complementary markets.”

Equally notable is the participation of Capital One’s venture arm as an investor for the first time. That’s because the bank is Snowflake’s largest customer. Snowflake finance chief Mike Scarpelli said at an investor event in August 2022 that Capital One was spending almost $50 million annually with Snowflake, and in November he said that the firm is its top customer and that it’s “taken them 5.3 years to get where we are now.”

Capital One is also a Databricks customer and uses the technology partly for fraud detection, according to a 2021 blog post.

Existing investor T. Rowe Price led Databricks’ latest round, and was joined by Andreessen Horowitz, Baillie Gifford, Fidelity, Morgan Stanley’s Counterpoint Global and Tiger Global, among others.

Ghodsi said that when the company started talking to investors about a potential financing round a couple of months ago, his “original guidance was no more than $100 million.” That number ultimately swelled fivefold as more investors wanted to join, he said.

As for a potential initial public offering, Ghodsi said that’s still on the road map, and that this funding doesn’t change the company’s plans. He didn’t say when an IPO might happen.

Databricks will get to see how much demand there is for new tech opportunities in the coming weeks. Chip designer Arm is returning to the public market on Thursday after getting taken private in 2016. Grocery delivery company Instacart and software vendor Klaviyo filed their prospectuses last month. There hasn’t been a notable venture-backed tech IPO in the U.S. since late 2021.

Many enterprise software makers have been trying to limit spending while growth rates slow because the uncertain economy has led big customers to reduce their purchasing. Databricks has stayed in growth mode and hasn’t announced any layoffs.

Ghodsi said much of the cost cutting he’s pursued was in his company’s use of technology, particularly software subscriptions.

“We spent $30 million on 300 pieces of SaaS software,” Ghodsi said, referring to software as a service. “I said, ‘Let’s halve that.'”

In the quarter that ended in July, Databricks said it reached a $1.5 billion annual revenue run rate, with sales growing 50% year over year. Snowflake, whose shares debuted on the New York Stock Exchange in 2020, reported 36% growth in the latest quarter to $674 million in revenue.

WATCH: MosaicML acquisition will allow us to democratize A.I. for startups

MosaicML acquisition will allow us to democratize A.I. for startups, says Databricks CEO Ali Ghodsi

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UK loses bid to keep Apple appeal against demand for iPhone ‘backdoor’ a secret

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UK loses bid to keep Apple appeal against demand for iPhone 'backdoor' a secret

Chief Executive of Apple, Tim Cook gives a thumb’s up during a tour the Apple Headquarters on December 12, 2024 in London, England. 

Chris Jackson | Getty Images

Apple has triumphed over an effort from the U.K. government to keep details secret of its appeal against an order to create a “backdoor” to iPhone users’ data.

The U.K.’s Investigatory Powers Tribunal on Monday published a ruling dismissing the government’s attempt to prevent details from a hearing on the appeal from being made public. The government had tried to keep the information secret on the grounds it posed risks to national security.

Judges Rabinder Singh and Judge Jeremy Johnson said in their ruling that the U.K. government’s request to keep details of the hearing private “would be the most fundamental interference with the principle of open justice.”

“It would have been a truly extraordinary step to conduct a hearing entirely in secret without any public revelation of the fact that a hearing was taking place,” they said.

Britain’s Home Office was not immediately available for comment when contacted by CNBC.

‘Backdoor’ to encrypted data

The ruling relates to an appeal made by Apple against a demand from the U.K. government to allow officials to access iPhone users’ encrypted data via a technical “backdoor.”

This backdoor would allow the government to access information secured by Apple’s Advanced Data Protection (ADP) system, which applies end-to-end encryption to a wide range of iCloud data.

Governments in the U.S., U.K. and EU have long expressed dissatisfaction with end-to-end encryption, arguing it enables criminals, terrorists and sex offenders to conceal illicit activity.

In the U.K., the Investigatory Powers Act of 2016 empowers the government to compel tech companies to weaken their encryption technologies through so-called “backdoors” — a heavily controversial policy for both the tech industry and privacy campaigners.

Apple — which is known for its pro-privacy stance — has pushed back on efforts to weaken its encryption tools, saying this would undermine its security and put users at risk.

As a result of the government’s order, Apple withdrew its ADP system for U.K. users in February. In a blog post at the time, the tech giant said it has “never built a backdoor or master key to any of our products or services and we never will.”

“We are deeply disappointed that our customers in the UK will no longer have the option to enable Advanced Data Protection (ADP), especially given the continuing rise of data breaches and other threats to customer privacy,” Apple said in the post.

“Apple remains committed to offering our users the highest level of security for their personal data and we are hopeful that we will be able to do so in the future in the United Kingdom.”

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Tech stocks whipsaw in volatile trading session as Trump stands by tariffs

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Tech stocks whipsaw in volatile trading session as Trump stands by tariffs

U.S. President Donald Trump’s adviser Elon Musk reacts on the day of a rally in support of a conservative state Supreme Court candidate of an April 1 election in Green Bay, Wisconsin, U.S. March 30, 2025. 

Vincent Alban | Reuters

Technology stocks teetered in volatile trading Monday as President Donald Trump stood by his sweeping global tariff plans following last week’s devastating selloff.

The Magnificent Seven stocks — Nvidia, Apple, Meta Platforms, Amazon, Microsoft and Alphabet — were largely lower after briefly rallying amid a short-lived broader market attempt to stage a rebound. Stocks temporarily jumped on speculation of a possibly delay in the tariffs, but the White House later dismissed talk of a pause.

The technology sector is coming off a brutal week. The Magnificent Seven stocks collectively shed more than $1.8 trillion in market value during a two-day market selloff, while the Nasdaq Composite recorded its worst week since the onslaught of the pandemic and entered a bear market.

Read more CNBC tech news

Trump held firm on his aggressive global tariffs plans over the weekend, with an initial unilateral 10% tariff going into effect Saturday. Wall Street hoped for progress on negotiations between the administration and other countries or news of a possible delay in reciprocal tariffs slated for April 9.

The plan has already received widespread backlash in corporate America. JPMorgan Chase CEO Jamie Dimon said Monday that the new levies will hike prices on domestic and imported goods and pressure the slowing U.S. economy. Many car companies have already announced a pause in shipments, price hikes and other measures. Trade groups have also warned of higher prices at the grocery store and hikes on electronics such as personal computers.

“I don’t want anything to go down, but sometimes you have to take medicine to fix something,” Trump told reporters aboard Air Force One on Sunday night, downplaying the recent market meltdown.

Other technology stocks also looked to build on last week’s pain. Oracle and Palantir Technologies declined more than 2% each.

Some semiconductor stocks also struggled as investors fretted over potential demand destruction stemming from the tariffs. Advanced Micro Devices was last down about 4% each, while Intel declined more than 2%.

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Nintendo President Doug Bowser on the new Switch 2, tariffs and what’s next for the gaming giant

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Nintendo President Doug Bowser on the new Switch 2, tariffs and what's next for the gaming giant

Nintendo on Wednesday unveiled details for the Switch 2. It’ll include a bigger screen and controllers and is a faster version than its predecessor, which sold more than 150 million units since its 2017 release.

The Switch 2 will hit store shelves on June 5 for $449.99, up from $300 for the original Switch. Like the first Switch, gamers will be able to use the Switch 2 as both a handheld console and hook it up to a television. Nintendo on Friday said it would delay preorders for the device following President Donald Trump’s “reciprocal tariffs.”

The device will launch with the game “Mario Kart World.” Other games coming for the Switch 2 include “Donkey Kong Bananza,” “Street Fighter 6,” “The Duskbloods” and “Kirby Air Riders.”

Nintendo of America President Doug Bowser sat down with technology correspondent Steve Kovach in a CNBC exclusive interview after unveiling the new console’s details. Bowser touched on the technology boosts in the Switch 2, upcoming games, the future of Nintendo’s efforts in film and entertainment beyond video games, and what Trump’s new tariffs mean for console prices in the U.S.

Watch the video for the full interview.

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