Sam Altman rejoins OpenAI board of directors as investigation into his ouster comes to a close

Published

1 year ago

March 8, 2024

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OpenAI on Friday announced its new board and the wrap-up of an internal investigation by U.S. law firm WilmerHale into the events leading up to OpenAI CEO Sam Altman’s ouster.

Sam Altman will also rejoin OpenAI’s board.

The new board members are:

Dr. Sue Desmond-Hellmann, former CEO of the Bill and Melinda Gates Foundation, who is also on the Board of Directors at Pfizer and on the President’s Council of Advisors on Science and Technology.
Nicole Seligman, former EVP and Global General Counsel of Sony and President of Sony Entertainment, who is also on the Board of Directors at Paramount Global, Meira GTx and Intuitive Machines, Inc.
Fidji Simo, CEO and Chair of Instacart, who is also on the Board of Directors at Shopify.

The three new members will “work closely with current board members Adam D’Angelo, Larry Summers and Bret Taylor as well as Greg, Sam, and OpenAI’s senior management,” according to a release.

OpenAI will continue to expand the board moving forward, according to a Zoom call with reporters.

OpenAI did not publish the investigation report but provided a summary of the findings.

“The review concluded there was a significant breakdown of trust between the prior board and Sam and Greg,” Taylor said, adding that the review also “concluded the board acted in good faith… [and] did not anticipate some of the instability that led afterwards.”

Taylor also said the board’s concerns did not arise regarding concerns over product safety and security, OpenAI’s finances or statements to customers or business partners, that it was “simply a breakdown in trust between the board and Mr. Altman.”

WilmerHale’s investigation began in December, and the lawyers submitted their report today, which included dozens of interviews with OpenAI’s prior board members and advisors, current executives and other witnesses. The investigation also involved reviewing more than 30,000 documents, according to a release.

“We have unanimously concluded that Sam and Greg are the right leaders for OpenAI,” Bret Taylor, chair of OpenAI’s board, said in a release.

“I am very grateful to Bret and Larry and WilmerHale,” Altman said on the Zoom call with reporters. He added, speaking of CTO Mira Murati, “Mira in particular is incremental to OpenAI all the time … but through that period in November, she has done an amazing job helping to lead the company.”

He added that he is “excited to be moving forward here” and for the situation to be “over.” He also mentioned he wished he had acted differently regarding differences in opinion with the board.

In November, OpenAI’s board ousted Altman, prompting resignations – or threats of resignations – including an open letter signed by virtually all of OpenAI’s employees, and uproar from investors, including Microsoft. Within a week, Altman was back at the company, and board members Helen Toner, Tasha McCauley and Ilya Sutskever, who had voted to oust Altman, were out. Adam D’Angelo, who had also voted to oust Altman, stayed on the board.

When Altman was asked about Sutskever’s status on the Zoom call with reporters, he said there were no updates to share.

“I love Ilya… I hope we work together for the rest of our careers, my career, whatever,” Altman said. “Nothing to announce today.”

Since then, OpenAI has announced new board members, including former Salesforce co-CEO Bret Taylor and former Treasury Secretary Larry Summers. Microsoft obtained a nonvoting board observer position.

After ChatGPT’s launch in November 2022, it broke records at the time as the fastest-growing consumer app in history, and now has about 100 million weekly active users, along with more than 92% of Fortune 500 companies using the platform, according to OpenAI. Last year, Microsoft invested an additional $10 billion in the company, making it the biggest AI investment of the year, according to PitchBook, and OpenAI has reportedly closed a deal that will allow employees to sell shares at an $86 billion valuation, though the deal reportedly took longer to close than expected due to the events surrounding Altman’s ouster.

The rollercoaster couple of weeks at the company are still affecting it months later.

This month, billionaire tech magnate Elon Musk sued OpenAI co-founders Sam Altman and Greg Brockman for breach of contract and breach of fiduciary duty, court filings revealed on Thursday.

In his complaint, Musk and his attorneys allege that the ChatGPT maker “has been transformed into a closed-source de facto subsidiary of the largest technology company in the world: Microsoft.” They also argue that this arrangement goes against a founding agreement and 2015 certification of incorporation that OpenAI established with Musk, who was a pivotal donor to a cofounder of OpenAI in its early years.

As part of Microsoft’s contract with OpenAI, the tech giant only has rights to OpenAI’s “pre-AGI” technology, and it is up to OpenAI’s board to determine whether the company has reached that milestone. Musk argued in his filing that since the OpenAI board shuffle in November – when Toner, McCauley and Sutskever were removed – the new board is “ill-equipped” to independently determine whether OpenAI has reached AGI and therefore whether its technology is outside the scope of the exclusivity deal with Microsoft.

Lawyers told CNBC that they had doubts about the legal viability of Musk’s case, and OpenAI has said it plans to file a motion to dismiss all of Musk’s claims.

In response to the high-profile lawsuit, OpenAI reproduced old emails from Musk in which the Tesla and SpaceX CEO encouraged the rising startup to raise at least $1 billion in funding, and agreed that it should “start being less open” over time and “not share” the company’s science with the public.

Musk’s lawsuit also follows some controversy over Altman’s previous chip endeavors and investments.

Just before Altman’s brief ouster, he was reportedly seeking billions for a new and not-yet-formed chip venture code-named “Tigris” to eventually compete with Nvidia, traveling to the Middle East to raise money from investors.

In 2018, Altman personally invested in an AI chip startup called Rain Neuromorphics, based near OpenAI’s San Francisco headquarters, and in 2019, OpenAI signed a letter of intent to spend $51 million on Rain’s chips. In December, the U.S. compelled a Saudi Aramco-backed venture capital firm to sell its shares in Rain.

Technology

Alphabet expects ‘slight headwind’ to ads business this year, executives say

Published

2 hours ago

April 24, 2025

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Alphabet expects 'slight headwind' to ads business this year, executives say

President Donald Trump’s trade policies will have a negative impact on Google parent Alphabet‘s core advertising business, an executive from the company said Thursday.

Alphabet, which reported stronger-than-expected revenue in its first quarter of the year, faces an online ads market that’s on edge due to concerns about how Trump’s tariffs will affect the economy and business spending. While the word “tariff” was never mentioned on Alphabet’s investor call Thursday, “macro” was mentioned several times as investors peppered company executives with questions about forward looking economic impacts amid new trade policies.

Several strategists increased their odds of a recession after Trump on April 2 announced tariffs for imports of goods into the U.S. from dozens of countries. On April 9, Trump lowered tariffs on many countries to 10% for three months.

Alphabet will likely be impacted by materials needed for technical infrastructure like data centers that it uses to power efforts in artificial intelligence. It could also see second-hand effects on advertising pull-back from budget constraints.

In Thursday’s investor call, Alphabet executives said it’s too early to tell just how much it will be impacted, but they said that there would likely be headwinds to its advertising business, particularly from the Asia–Pacific region of the world, or APAC.

“Any other factors you’re seeing in advertising verticals or regions or categories that could be showing any signs of weakness?” asked Brian Nowak of Morgan Stanley.

“We wouldn’t want to speculate about potential impacts beyond noting that the changes to the de minimis exemption will obviously cause a slight headwind to our ads business in 2025, primarily from APAC-based retailers,” said Philipp Schindler, Google’s chief business officer.

Earlier this month, Trump signed an executive order that will impose a duty representing 30% of the value or $25 per item on shipments worth less than $800 that enter the U.S., starting May 2. The duty jumps to $50 per item on June 1. In February, Trump undid a loophole that since the 1930s had allowed such packages to be imported duty-free. The change brought logistical challenges that resulted in a delay of the implementation of the policy.

Retail, which Schindler said was among the top contributors to its advertising growth in the first quarter, represents at least 21% of Google ad revenue, according to estimates by Oppenheimer & Co. Chinese discount e-commerce apps Temu and Shein, which have been big advertisers in the U.S. in recent years, are of notable concern, and Temu has already pulled way back on spending.

“We’re obviously not immune to the macro environment,” Schindler added.

“Are they starting to react to some of these macro jitters that were we’re all experiencing?” asked Ross Sandler from Barclays about brands that advertise on YouTube.

Schindler said “it’s still too early in the second quarter to have a more specific view of things.” He added that Google has “a lot of experience in managing through uncertain times.”

“If macro weakens and we see more of a slowdown, would you expect to find additional opportunities to cut back more on costs?” asked Doug Anmuth from JPMorgan.

Alphabet CFO Anat Ashkenazi said the company is still looking at spending $75 billion in capital expenditures in 2025 but stipulated “the investment level may fluctuate from quarter to quarter due to the impact of changes in the timing of deliveries and construction schedules.”

Expenditures will go toward technical infrastructure, primarily for servers, followed by data centers and networking, executives said in February.

The company is still focused on “driving efficiency and productivity throughout the organization,” Ashkenazi said on Thursday’s call, pointing to her 2024 comments, where she said the organization can “always push a little further” when it comes to cost cutting, which has included cuts to headcount and real estate.

Alphabet CEO Sundar Pichai also mentioned “efficiency” as a means of trying to keep a lean-enough company to weather potential macro storms.

“If the macro environment were to change and become more downwardly volatile, how should investors think about the investments that are must-make this year, almost fixed in nature, versus where there might be more flexibility?” asked Eric Sheridan from Goldman Sachs.

Pichai responded that the company plans to continue consolidating teams and cutting back on costs elsewhere, which he said “should help us have a more resilient organization, irrespective of macroeconomic conditions.”

— CNBC’s Jordan Novet contributed to this report.

WATCH: Google earnings: What investors are looking for

Technology

Intel CFO says tariffs increase chance for economic slowdown, recession getting likelier

Published

3 hours ago

April 24, 2025

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Intel CFO says tariffs increase chance for economic slowdown, recession getting likelier

The Intel headquarters in Santa Clara, California, US, on Wednesday, April 23, 2025. Intel Corp. is scheduled to release earnings figures on April 24.

David Paul Morris | Bloomberg | Getty Images

Intel CFO David Zinsner said President Donald Trump’s tariffs and retaliation from other countries has increased the likelihood of a recession.

“The very fluid trade policies in the U.S. and beyond, as well as regulatory risks, have increased the chance of an economic slowdown, with the probability of a recession growing,” Zinsner said on the company’s quarterly earnings call on Thursday.

Intel reported better-than-expected first-quarter results, partially because some customers stockpiled chips ahead of tariffs, the company said. However, guidance for revenue and profit was below expectations, pushing the chipmaker’s stock down more than 5% in extended trading.

Intel’s forecast for the current quarter is $11.2 billion to $12.4 billion. Zinsner said the range is “wider than normal” due to uncertainty caused by tariffs.

The company’s outlook underscores how sensitive manufacturers are to trade restrictions, even for companies that are committed to building products in the U.S. While Intel manufactures some of its advanced processors domestically, it also partners with Taiwan Semiconductor Manufacturing Company and Samsung in Korea to manufacture chips, and imports chipmaking machinery from ASML in Europe. The company also needs parts and materials that come from China.

Zinsner said the tariff environment makes it harder for Intel to predict its performance for the quarter and the year, and added that it’s now anticipating that the total market for its chips could shrink, especially if consumers stop buying new computers.

“The biggest risk we see is the impact of a potential pullback in investment and spending, as businesses and consumers react to higher costs and the uncertain economic backdrop,” Zinsner said.

Although Intel has enough production in disparate places around the world to mitigate some of the tariffs, the company “will certainly see costs increase,” he added.

One possibility is that consumers may opt for laptops and other computers based around older-generation chips, which are less expensive, said Michelle Johnston Holthaus, CEO of Intel Products.

“The macroeconomic concerns and tariffs have everybody kind of hedging their bets in what they need to have from an inventory perspective,” Holthaus said on the earnings call.

Beyond tariffs, Intel faces efforts by the U.S. government to require licenses to ship advanced chips for artificial intelligence to countries like China.

Intel’s earnings report on Thursday was its first under CEO Lip-Bu Tan, who was appointed to the job last month. Tan said he planned to cut Intel’s operational and capital expenses in order to make the company more efficient.

WATCH: Intel is dead money in its current strategic form, says Susquehanna Roland

Technology

Waymo reports 250,000 paid robotaxi rides per week in U.S.

Published

4 hours ago

April 24, 2025

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Waymo reports 250,000 paid robotaxi rides per week in U.S.

A Waymo rider-only robotaxi is seen during a test ride in San Francisco, California, U.S., December 9, 2022.

Paresh Dave | Reuters

Alphabet reported Thursday that Waymo, its autonomous vehicle unit, is now delivering more than 250,000 paid robotaxi rides per week in the U.S.

CEO Sundar Pichai said Waymo has options in terms of “business models across geographies,” and the robotaxi company is building partnerships with ride-hailing app Uber, automakers and operations and maintenance businesses that tend to its vehicle fleets.

“We can’t possibly do it all ourselves,” said Pichai on a call with analysts for Alphabet’s first-quarter earnings.

Pichai noted that Waymo has not entirely defined its long-term business model, and there is “future optionality around personal ownership” of vehicles equipped with Waymo’s self-driving technology. The company is also exploring the ways it can scale up its operations, he said.

The 250,000 paid rides per week are up from 200,000 in February, before Waymo opened in Austin and expanded in the San Francisco Bay Area in March.

Waymo, which is part of Alphabet’s Other Bets segment, is already running its commercial, driverless ride-hailing services in the San Francisco, Los Angeles, Phoenix and Austin regions.

Earlier this month, Waymo and its partner Uber, began allowing interested riders to sign up to try the robotaxi service in Atlanta when it opens this summer.

The early pioneer in self-driving technology, Waymo has managed to beat Elon Musk-led Tesla and a myriad of now-defunct autonomous vehicle startups to the U.S. market.

Tesla is promising that it will be able to turn its Model Y SUVs into robotaxis by the end of June for a driverless ride-hailing service it plans to launch in Austin.

After about a decade of promises and missed deadlines, Tesla still does not offer a vehicle that’s safe to use without a human at the wheel ready to steer or brake at all times.

Musk criticized Waymo’s approach to driverless tech on his company’s first-quarter earnings call on Tuesday. Musk said Waymo autonomous vehicles are “very expensive” and made in only “low volume.” Tesla’s partially automated driving systems rely mostly on cameras to navigate, while Waymo’s driverless systems rely on lidar technology, other sensors and cameras.

Would-be competitors to Waymo also include Amazon-owned Zoox, Mobileye, May Mobility and international autonomous vehicle companies such as WeRide and Baidu’s Apollo Go.

WATCH: Tesla vs. Waymo: Musk casts doubt on Google’s robotaxi strategy