Microsoft-owned LinkedIn lays off nearly 700 employees — read the memo here
The recent wave of white-collar layoffs may have employees and job seekers rattled, but according to New York University Stern School of Business professor Robert Seamans, his current class of MBA students isn’t worried.
“I don’t get a huge sense that they’re dreading the job market or that they think there are going to be dramatic changes,” Seamans told a gathering of technology executives at last week’s CNBC Technology Executive Council Summit in New York City. “These students have been in the job market already before coming back to school and they’re used to the ups and downs of being in the workforce.”
Seamans said his focus in the classroom is making sure students have the skills they need when they graduate, and that includes generative AI and more generally, machine learning. Running experiments using AI in group settings is one way he gets students used to the technology, its advantages, and its limits.
For instance, he recently asked students to write a short paper on whether return-to-office mandates are good or bad for the workforce. He then had them select a large language model of their choosing to strengthen their argument. The second part of the assignment had students writing another paper, but this time asking the LLM to respond in an adversarial way with critical feedback — what Seamans calls a “black sheep” approach.
“I’m trying to get them to understand that they can interact with AI in a variety of ways,” Seamans said. He added that in his experiment, many of his students preferred the more adversarial way, perhaps because it more closely modeled the variety of opinions and thoughts in an actual workplace. “We don’t know what all the best practices are yet, but that’s why I want them to keep trying different things,” he said.
AI ‘as a tool and not a crutch’
Earlier in the day at the TEC Summit, a group of students in high school and college spoke to CNBC’s Contessa Brewer about how they’re being exposed to AI (or not) in the classroom. Their responses show that despite the enthusiasm for the technology in the workplace, students are being advised to go slow.
Aarnav Sathish, a high school senior, said his teachers strictly discourage AI in the classroom. Outside of school, however, the 17-year-old uses ChatGPT for help with assignment busywork, quickly adding that he wants to use AI “as a tool and not a crutch.”
Ezinne Okonkwo, a 19-year-old undergraduate at Columbia University, said her professors also discourage students from using AI, instead preferring that they develop the subject matter skills needed for each class. However, like Sathish, she uses AI outside the classroom for tasks that feel repetitive or that she already knows how to do. “If I have to write a bunch of emails that all feel the same, I’ll use it to make them sound a little different,” Okonkwo said. “I won’t use it for coding if I don’t already know how to do it in that coding language.”
Siblings Carson and Andrew Boyer both attend Georgia Tech, yet are having different experiences with AI. Carson, 19, a freshman, is studying engineering and said his professors allow AI in moderation. He finds it most useful for his Mandarin classes when he can use ChatGPT to practice having a conversation. “It’s like having a Chinese tutor,” he said.
Andrew, 21, a senior, says his professors encourage AI usage, but they “don’t want us to copy and paste in AI work.” He was recently surprised when during a midterm exam for an information security class the teacher allowed students to use the internet and AI. While at first that seemed like a good thing, he soon realized that his professors set up the exam so that AI couldn’t complete a lot of the more nuanced and visual questions.
“I think the class average was like a 60,” Andrew said. “At Georgia Tech, they are evolving and upping the work to be more high-level concepts that we have to be able to understand and do on our own.”
If there was one thing that NYU’s Seamans wanted the room of tech executives to take away about the young people coming into their organizations, it’s that despite the focus on AI, ultimately employers are dealing with humans that require empathy and understanding.
“Everyone coming into your companies all have their own human skill set,” he said. “Some are good speakers or group leaders, others are great at finance. What they all want is a chance to work with this technology and become a contributing member to whatever team they’re on. AI is going to change, so what you really want is a workforce made up of active and engaged minds and a workplace where this kind of thinking is encouraged.”
Thomas Fuller | Lightrocket | Getty Images
Spotify on Tuesday reported strong third-quarter results that topped Wall Street expectations and saw total revenue climb 12% year over year, but issued weak guidance for revenue and subscribers for the current quarter.
Shares of Spotify fell 2% on Tuesday.
Here’s what Spotify reported compared with LSEG estimates:
- Earnings per share: 3.28 euros vs. 1.97 euros expected.
- Revenue: 4.27 billion euros vs. 4.23 billion euros expected.
The streaming platform increased premium subscribers by 12% to 281 million, coming in just below StreetAccount expectations of 281.24 million.
Spotify hiked subscription prices in August to 11.99 euros from 10.99 euros in multiple markets, including South Asia, the Middle East, Africa, Europe, Latin America and the Asia-Pacific region.
Premium revenue for Q3 grew 9%, or 13% on a constant currency basis, but 446 million euros in ad-supported revenue was down 6% from last year, which was flat on a constant currency basis.
StreetAccount expected 467.7 million euros in ad-supported revenue for the quarter.
“The business is healthy,” CEO Daniel Ek said in a release. “We’re shipping faster than ever. And we have the tools we need – pricing, product innovation, operational leverage, and eventually the ads turnaround – to deliver both revenue growth and profit expansion.”
Spotify announced in September that Ek will step down at the beginning of January and transition to the position of executive chairman. Longtime executives and co-presidents Gustav Söderström and Alex Norström are set to replace him.
The Swedish company forecasted fourth-quarter revenue of 4.5 billion euros, below the StreetAccount expectation of 4.56 billion euros. The streamer expects total premium subcribers to reach 289 million in the fourth quarter, short of the StreetAccount expectation for 291.1 million.
The streaming giant expects fourth-quarter operating income of 620 million euros and MAU of 745 million. Both were ahead of StreetAccount expectations of 610.2 million euros and 739.5 million MAU.
The company’s total monthly active users for the third quarter rose 11% to 713 million from the same period last year, surpassing its prior guidance and LSEG analysts’ expectations of 710 million.
Spotify attributed the growth to multiple enhancements in its mobile free tier added in September, including the ability to pick, play, and share any song. Free users previously had to listen to shuffled playlists with limited skips.
The company is also leaning into artificial intelligence, launching the service on ChatGPT in October. Users are now able to receive personalized music and podcast recommendations from the chatbot based on written prompts.
Later that month, Spotify also announced that it would partner with Sony Music Group, Universal Music Group, Warner Music Group, and other music agencies to develop AI products.
The company received backlash in June after Ek led a 600-million-euro funding round for defense technology startup Helsing, leading many musicians to remove their catalogs in protest.
Technology
Palantir stock drops 6% on valuation concerns as CEO Karp rips short seller ‘market manipulation’
Palantir‘s stock fell 6% on Tuesday as Wall Street analysts raised concerns about the company’s elevated valuation and “Big Short” investor Michael Burry revealed a short position in the software company.
During an interview with CNBC’s “Squawk Box” on Tuesday, CEO Alex Karp ripped into short sellers, calling their moves “market manipulation.”
Karp called the positions “super triggering” and said they are “shorting one of the great businesses of the world.”
“Honestly, I think what is going on here is market manipulation,” Karp said. “We delivered the best results everyone, anyone’s ever seen.”
The stock move overshadowed the company’s top-and-bottom-line beat and stronger-than-expected guidance. Revenues also topped $1 billion for a second straight quarter and Palantir lifted its full-year guidance.
“The more muted stock reaction after hours is in the context of high expectations (recall last quarter, Palantir beat revenue by 7%) and significant outperformance (+175% YTD),” wrote Goldman Sachs analyst Gabriela Borges in a note to clients.
The company’s results also coincided with a reset in the overall market as Wall Street weighs concerns about a potential artificial intelligence bubble.
Analysts have long raised concerns about Palantir’s valuation, which trades at a steeper multiple relative to bigger tech firms with greater revenues. To justify that multiple, many investors want the company to continue heavily boosting guidance.
The company’s current forward price-to-earnings ratio is 254. Nvidia, the most valuable company in the world, has a forward P/E of 35.
Jefferies analyst Brent Thill said the firm is “fundamental fans” of the company, but the risk-reward appears more favorable in AI software names such as Microsoft and Snowflake.
Analysts at Mizuho called the risk-reward a “big challenge” despite another strong quarter, while D.A. Davidson’s Gil Luria reiterated his neutral rating on valuation concerns and said the company is “raising the bar even higher.”
“Overall, Palantir continues to execute around AIP commercialization, but we believe growth remains narrowly supported by U.S. enterprise demand and front-loaded Al transformation spend,” wrote analysts at RBC.
Palantir one day stock chart.
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