AI is getting very popular among students and teachers, very quickly
Hyoung Chang | Denver Post | Getty Images
The American public as a whole remains on the fence with artificial intelligence, according to many polls, but in education, adoption among teachers and students is rapidly rising.
In a little over a year, the percentage of teachers who say they are familiar with ChatGPT — the breakthrough generative AI chatbot from Microsoft-backed OpenAI, which is next headed to the Apple iPhone — rose from 55% to 79%, while among K-12 students, it rose from 37% to 75%, according to a new poll conducted in May by Impact Research for the Walton Family Foundation, in conjunction with the Learning Engineering Virtual Institute‘s AI Lab.
When it comes to actual usage, a similar spike occurred, with 46% of teachers and 48% of students saying they use ChatGPT at least weekly, with student usage up 27 percentage points over last year.
Maybe most notable, the reviews from students are broadly positive. Seventy percent of K-12 students had a favorable view of AI chatbots. Among undergraduates, that rises to 75%. And among parents, 68% held favorable views of AI chatbots
“It is a lot more positive data than I expected,” said Ethan Mollick, professor at the University of Pennsylvania’s Wharton School, and an expert and author on AI who reviewed the polling data.
The polling data lines up with the experience of Khan Academy and its founder Sal Khan, who has been working with Newark, New Jersey’s school district, among others, to test the use of a customized ChatGPT for education, Khanmigo, over the past year. Khan recently told CNBC that its AI tool will expand from 65,000 students to one million students next year. It also recently announced that Microsoft is paying so that AI can be offered to teachers across the U.S. free of charge. (School districts pay per student for usage, which has recently been in the range of $35 per user, though Khan says as the technology scales, it will be possible to bring that price down to as low as a $10-$20 range.)
“Unlike most things in technology and education in the past where this is a ‘nice-to-have,’ I think this is a ‘must-have’ for a lot of teachers,” Khan, founder and CEO of Khan Academy, recently told CNBC’s “Squawk Box.”
While Khan Academy is best known for its educational videos, its interactive exercise platform was one which OpenAI’s top executives, Sam Altman and Greg Brockman, zeroed in on early when they were looking for a partner to pilot ChatGPT with that offered socially positive use cases.
The adoption rates in education are higher than currently occurring in the world of work, and it is students, who have a high incentive to get help, who are “dragging teachers along for the ride,” Mollick said.
In fact, teachers were the only demographic polled where year-over-year favorability declined, though a majority (59%) still have a positive view of AI chatbots.
Older teachers and parents (those over 45) were less likely to have confidence in their ability to use AI effectively, but Khan said one of the reasons why Microsoft and his nonprofit wanted to get AI access to every educator in the U.S. is because of the time its use is saving teachers.
Khan recently told CNBC that often, in the past, teachers have been told “If only you learned this one extra thing …” and that becomes a burden for an already overworked educator. “Teachers are already spread thin. Especially with these teacher tools, it is one more thing to learn,” he said. But Khan’s research with school districts to date has saved teachers 5-10 hours per week. “This is the first time in the journey of tech that we can tell teachers, ‘This will be fewer things for you to do. Yes, there’s a little bit of a learning curve, but it will save you time.'”
Only 25% of teachers polled said they have received any training on AI chatbots, and roughly one-third (32%) say that lack of training and professional development are major reasons why they have not used AI. Teachers said they have used AI to generate ideas for classes (37%); for lesson plans and preparation of teaching materials (32%); for student worksheets or examples (32%); and to create quizzes or tests (31%).
Mollick described himself as bullish on AI in education over the long term, but in the short term, he said these results are relatively high compared to past polling related to the introduction of new technology. “I was sort of surprised to see the numbers look as good as they do. I was surprised by how positive the feelings were among every group,” he said. “It’s not universally loved, but we’re not seeing the strong negatives we usually see,” he said.
It is early. Khan noted in his recent CNBC interview that the prime directive should be to never put technology in front of the use case. He said there are cases over past the 15 years where school districts have been able to “pretty dramatically accelerate outcomes because of technology, but many other cases where they bought the iPads and laptops and they are collecting dust.”
The new data also indicates significant equity in AI usage in education. Minority groups are adopting AI for education at higher rates, including the teachers and parents who are using AI to help children. Black and Hispanic K-12 students and undergraduates were more likely to use AI for school. Among parents, 47% of those polled want AI chatbots to be used more in schools, compared to 36% who want it to be used less. Parental support for AI use in education is higher among Black (57%) and Hispanic parents (55%).
Mollick said it is too early to attempt to piece together the economic and equity data conclusively — private school students were the most likely to use AI both personally and at school — but he added it’s worth taking a deeper dive into the data to ask whether AI could be filling existing gaps in the school system. “Now people have access to an AI tutor and now they don’t have to pay for a tutor,” he said.
Khan said AI for the classroom is a scaling of the personalization that matches the founding story of his organization — when he personally provided tutoring to his cousin Nadia. AI could “get us that much closer to this ideal, in conjunction with everything else we’ve been doing over the years, of being able to emulate what a great tutor would do,” he recently told CNBC. “In my mind, it passes the Turing Test,” Khan said, referencing famed British mathematician and AI pioneer Alan Turing’s goal of computer intelligence being equal to human intelligence and humans being unable to identify one versus the other. “This is indistinguishable from when I went to text Nadia back in 2004.”
AI and cheating
The results pose plenty of questions for educators and parents.
The value of in-class lectures is uncertain when a student can get all of the information from an AI, Mollick said, but the accuracy of an AI compared to a teacher, while generally good, remains an open question. “We need to be cautious about leaping all the way in,” he said.
Nearly 20% of teachers polled said ChatGPT had a negative impact, up from 7% last year.
There is no way to discuss AI in education without including its use in cheating, even though online cheating is nothing new. “Students are highly incentivized to cheat,” Mollick said, with too much work to do and not enough time to complete it. Historically, homework has been proven to increase student grades, but since the rise of online cheating, that link has deteriorated and AI could further degrade the value of homework.
K-12 students polled said they are most likely to have used AI chatbots to write essays and other assignments (56%), followed by studying for tests and quizzes (52%).
Khan recently told CNBC that the way its gen AI tutoring system works is to keep a student within its walls, so to speak, while, for example, writing an essay, and the AI is able to identify whether progress in the work can be attributed to the student, and flag to the teacher any sign of cheating.
New monitoring systems will present their own set of issues, Mollick said — and new ways for students to figure out how to get around the checks.
Alex Karp, CEO of Palantir Technologies speaks during the Digital X event on September 07, 2021 in Cologne, Germany.
Andreas Rentz | Getty Images
Palantir shares continued their torrid run on Friday, soaring as much as 9% to a record, after the developer of software for the military announced plans to transfer its listing to the Nasdaq from the New York Stock Exchange.
The stock jumped past $64.50 in afternoon trading, lifting the company’s market cap to $147 billion. The shares are now up more than 50% since Palantir’s better-than-expected earnings report last week and have almost quadrupled in value this year.
Palantir said late Thursday that it expects to begin trading on the Nasdaq on Nov. 26, under its existing ticker symbol “PLTR.” While changing listing sites does nothing to alter a company’s fundamentals, board member Alexander Moore, a partner at venture firm 8VC, suggested in a post on X that the move could be a win for retail investors because “it will force” billions of dollars in purchases by exchange-traded funds.
“Everything we do is to reward and support our retail diamondhands following,” Moore wrote, referring to a term popularized in the crypto community for long-term believers.
Moore appears to have subsequently deleted his X account. His firm, 8VC, didn’t immediately respond to a request for comment.
Last Monday after market close, Palantir reported third-quarter earnings and revenue that topped estimates and issued a fourth-quarter forecast that was also ahead of Wall Street’s expectations. CEO Alex Karp wrote in the earnings release that the company “absolutely eviscerated this quarter,” driven by demand for artificial intelligence technologies.
U.S. government revenue increased 40% from a year earlier to $320 million, while U.S. commercial revenue rose 54% to $179 million. On the earnings call, the company highlighted a five-year contract to expand its Maven technology across the U.S. military. Palantir established Maven in 2017 to provide AI tools to the Department of Defense.
The post-earnings rally coincides with the period following last week’s presidential election. Palantir is seen as a potential beneficiary given the company’s ties to the Trump camp. Co-founder and Chairman Peter Thiel was a major booster of Donald Trump’s first victorious campaign, though he had a public falling out with Trump in the ensuing years.
When asked in June about his position on the 2024 election, Thiel said, “If you hold a gun to my head I’ll vote for Trump.”
Thiel’s Palantir holdings have increased in value by about $3.2 billion since the earnings report and $2 billion since the election.
In September, S&P Global announced Palantir would join the S&P 500 stock index.
Analysts at Argus Research say the rally has pushed the stock too high given the current financials and growth projections. The analysts still have a long-term buy rating on the stock and said in a report last week that the company had a “stellar” quarter, but they downgraded their 12-month recommendation to a hold.
The stock “may be getting ahead of what the company fundamentals can support,” the analysts wrote.
Charles Liang, chief executive officer of Super Micro Computer Inc., during the Computex conference in Taipei, Taiwan, on Wednesday, June 5, 2024. The trade show runs through June 7.
Annabelle Chih | Bloomberg | Getty Images
Super Micro Computer could be headed down a path to getting kicked off the Nasdaq as soon as Monday.
That’s the potential fate for the server company if it fails to file a viable plan for becoming compliant with Nasdaq regulations. Super Micro is late in filing its 2024 year-end report with the SEC, and has yet to replace its accounting firm. Many investors were expecting clarity from Super Micro when the company reported preliminary quarterly results last week. But they didn’t get it.
The primary component of that plan is how and when Super Micro will file its 2024 year-end report with the Securities and Exchange Commission, and why it was late. That report is something many expected would be filed alongside the company’s June fourth-quarter earnings but was not.
The Nasdaq delisting process represents a crossroads for Super Micro, which has been one of the primary beneficiaries of the artificial intelligence boom due to its longstanding relationship with Nvidia and surging demand for the chipmaker’s graphics processing units.
The one-time AI darling is reeling after a stretch of bad news. After Super Micro failed to file its annual report over the summer, activist short seller Hindenburg Research targeted the company in August, alleging accounting fraud and export control issues. The company’s auditor, Ernst & Young, stepped down in October, and Super Micro said last week that it was still trying to find a new one.
The stock is getting hammered. After the shares soared more than 14-fold from the end of 2022 to their peak in March of this year, they’ve since plummeted by 85%. Super Micro’s stock is now equal to where it was trading in May 2022, after falling another 11% on Thursday.
Getting delisted from the Nasdaq could be next if Super Micro doesn’t file a compliance plan by the Monday deadline or if the exchange rejects the company’s submission. Super Micro could also get an extension from the Nasdaq, giving it months to come into compliance. The company said Thursday that it would provide a plan to the Nasdaq in time.
A spokesperson told CNBC the company “intends to take all necessary steps to achieve compliance with the Nasdaq continued listing requirements as soon as possible.”
While the delisting issue mainly affects the stock, it could also hurt Super Micro’s reputation and standing with its customers, who may prefer to simply avoid the drama and buy AI servers from rivals such as Dell or HPE.
“Given that Super Micro’s accounting concerns have become more acute since Super Micro’s quarter ended, its weakness could ultimately benefit Dell more in the coming quarter,” Bernstein analyst Toni Sacconaghi wrote in a note this week.
A representative for the Nasdaq said the exchange doesn’t comment on the delisting process for individual companies, but the rules suggest the process could take about a year before a final decision.
A plan of compliance
The Nasdaq warned Super Micro on Sept. 17 that it was at risk of being delisted. That gave the company 60 days to submit a plan of compliance to the exchange, and because the deadline falls on a Sunday, the effective date for the submission is Monday.
If Super Micro’s plan is acceptable to Nasdaq staff, the company is eligible for an extension of up to 180 days to file its year-end report. The Nasdaq wants to see if Super Micro’s board of directors has investigated the company’s accounting problem, what the exact reason for the late filing was and a timeline of actions taken by the board.
The Nasdaq says it looks at several factors when evaluating a plan of compliance, including the reasons for the late filing, upcoming corporate events, the overall financial status of the company and the likelihood of a company filing an audited report within 180 days. The review can also look at information provided by outside auditors, the SEC or other regulators.
Last week, Super Micro said it was doing everything it could to remain listed on the Nasdaq, and said a special committee of its board had investigated and found no wrongdoing. Super Micro CEO Charles Liang said the company would receive the board committee’s report as soon as last week. A company spokesperson didn’t respond when asked by CNBC if that report had been received.
If the Nasdaq rejects Super Micro’s compliance plan, the company can request a hearing from the exchange’s Hearings Panel to review the decision. Super Micro won’t be immediately kicked off the exchange – the hearing panel request starts a 15-day stay for delisting, and the panel can decide to extend the deadline for up to 180 days.
If the panel rejects that request or if Super Micro gets an extension and fails to file the updated financials, the company can still appeal the decision to another Nasdaq body called the Listing Council, which can grant an exception.
Ultimately, the Nasdaq says the extensions have a limit: 360 days from when the company’s first late filing was due.
A poor track record
There’s one factor at play that could hurt Super Micro’s chances of an extension. The exchange considers whether the company has any history of being out of compliance with SEC regulations.
Between 2015 and 2017, Super Micro misstated financials and published key filings late, according to the SEC. It was delisted from the Nasdaq in 2017 and was relisted two years later.
Super Micro “might have a more difficult time obtaining extensions as the Nasdaq’s literature indicates it will in part ‘consider the company’s specific circumstances, including the company’s past compliance history’ when determining whether an extension is warranted,” Wedbush analyst Matt Bryson wrote in a note earlier this month. He has a neutral rating on the stock.
History also reveals just how long the delisting process can take.
Charles Liang, chief executive officer of Super Micro Computer Inc., right, and Jensen Huang, co-founder and chief executive officer of Nvidia Corp., during the Computex conference in Taipei, Taiwan, on Wednesday, June 5, 2024.
Annabelle Chih | Bloomberg | Getty Images
Super Micro missed an annual report filing deadline in June 2017, got an extension to December and finally got a hearing in May 2018, which gave it another extension to August of that year. It was only when it missed that deadline that the stock was delisted.
In the short term, the bigger worry for Super Micro is whether customers and suppliers start to bail.
Aside from the compliance problems, Super Micro is a fast-growing company making one of the most in-demand products in the technology industry. Sales more than doubled last year to nearly $15 billion, according to unaudited financial reports, and the company has ample cash on its balance sheet, analysts say. Wall Street is expecting even more growth to about $25 billion in sales in its fiscal 2025, according to FactSet.
Super Micro said last week that the filing delay has “had a bit of an impact to orders.” In its unaudited September quarter results reported last week, the company showed growth that was slower than Wall Street expected. It also provided light guidance.
The company said one reason for its weak results was that it hadn’t yet obtained enough supply of Nvidia’s next-generation chip, called Blackwell, raising questions about Super Micro’s relationship with its most important supplier.
“We don’t believe that Super Micro’s issues are a big deal for Nvidia, although it could move some sales around in the near term from one quarter to the next as customers direct orders toward Dell and others,” wrote Melius Research analyst Ben Reitzes in a note this week.
Super Micro’s head of corporate development, Michael Staiger, told investors on a call last week that “we’ve spoken to Nvidia and they’ve confirmed they’ve made no changes to allocations. We maintain a strong relationship with them.”
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