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Mike Lynch, 59, is the founder of enterprise software firm Autonomy. He was acquitted of fraud charges in June after defending himself in a trial over allegations that he artificially inflated Autonomy’s value in an $11.7 billion sale to tech giant Hewlett Packard.

Chris Ratcliffe | Bloomberg | Getty Images

LONDON — British technology entrepreneur Mike Lynch has been found dead in the wreckage of his superyacht, which sank off the coast of Sicily earlier this week. He was 59 years old.

Just two months ago, Lynch won a stunning victory in a landmark U.S. trial over allegations from Hewlett Packard that he had artificially inflated the value of his company Autonomy when he sold it to the U.S. enterprise tech giant for $11.7 billion in 2011.

Fears for Lynch’s life swirled earlier this week when he was reported missing after the sinking of a yacht — later confirmed as owned by his wife Angela Bacares — off the coast of Porticello, a small fishing village in the province of Palermo in Italy.

Bacares was one of 15 people rescued rescued following the yacht’s collapse earlier this week.

The anchored vessel, a 56-meter (184 feet) sailing yacht named the Bayesian, was hit by a violent storm early Monday morning.

Witnesses told local media the anchored boat, which was carrying 10 crew members and 12 passengers, descended rapidly after its mast broke.

Lynch’s body was retrieved from the wreckage of the yacht Wednesday, a source familiar with the matter told CNBC Thursday. His daughter, Hannah, remains unaccounted for, according to the source, who asked not to be identified due to the sensitive nature of the situation. Sky News earlier reported the news.

‘Britain’s Bill Gates’

Born in Ilford, a large town in East London, to Irish parents in 1965, Lynch grew up near Chelmsford in the English county of Essex. His mother was a nurse and his father was a fireman.

Lynch had a modest upbringing but, at the age of 11, he was awarded a scholarship to attend Bancroft’s School, a private school in Woodford Green, East London.

Mike Lynch, founder of Autonomy, speaks at a Confederation of British Industry conference in London, U.K., in 2003.

Graham Barclay | Bloomberg | Getty Images

From Bancroft’s, he attended the University of Cambridge, where he studied natural sciences, focusing on areas including electronics, mathematics and biology.

After completing his undergraduate studies, Lynch completed a Ph.D. in signals processing and communications.

Toward the end of the 1980s, Lynch founded Lynett Systems Ltd., a firm which produced designs and audio products for the music industry.

A few years later, in the early 1990s, he founded a fingerprint recognition business called Cambridge Neurodynamics, which counted the South Yorkshire Police among its customers.

But his big break came in 1996 with Autonomy, which he co-founded with David Tabizel and Richard Gaunt as a spinoff from Cambridge Neurodynamics. The company scaled into one of Britain’s biggest tech firms.

Autonomy’s software, made up of pattern-matching algorithms, was touted as a solution that could help employees abstract meaning from unstructured data, including web pages, email, video, audio, and text.

These pattern recognition techniques were based on so-called Bayesian inference, a method of statistical inference named after a theorem developed by 18th century statistician Thomas Bayes.

Lynch’s luxury yacht, the Bayesian, was named after this mathematical model.

Autonomy founder Mike Lynch poses at the company’s then-offices near Cambridge, U.K, on Thursday, July 19, 2007.

Graham Barclay | Bloomberg | Getty Images

After the sale of his company to HP, Lynch became known by U.K. national media as “Britain’s Bill Gates,” serving as a rare example of a U.K. businessman who successfully built and scaled a globally significant tech business selling into various markets around the world.

Legal battle with HP

However, Lynch’s reputation would go on to take a hit after the deal with HP took a turn for the worse. In 2012, HP took an $8.8 billion write-down on the value of Autonomy — just a year after buying it.

Lynch soon became the target of a protracted legal battle with the U.S. tech giant, with HP suing Lynch for $5 billion in damages over accusations that Lynch had inflated Autonomy’s sales by about $700 million.

Lynch, who had long denied the allegations, was extradited from Britain to the U.S. in 2023 to stand trial over the HP allegations.

This came despite pressure on the U.K. government from Lynch’s supporters not to allow his extradition.

U.S. prosecutors had filed criminal charges including wire fraud and conspiracy for an alleged scheme to inflate Autonomy’s revenue starting in 2009, partly to entice a buyer.

However, in a stunning victory in June, Lynch was acquitted of fraud charges following trial. The trial lasted three months.

Mike Lynch leaves the Rolls Building in London following the civil case over his £8.4 billion sale of his software firm Autonomy to Hewlett-Packard in 2011. Picture date: Monday March 25, 2019.

Dominic Lipinski | PA Images | Getty Images

During the course of the trial, Lynch took the stand in his own defense. He denied wrongdoing and told jurors that HP botched Autonomy’s integration.

Prosecutors had alleged Lynch, along with Autonomy’s now-deceased finance executive Stephen Chamberlain, who also died in a tragic car crash Saturday, padded Autonomy’s finances in a number of ways.

These included back-dated agreements, concealing the firm’s loss-making business by reselling hardware, and intimidating or paying off individuals who had raised concerns.

However, Lynch told jurors he had focused on tech-related matters at Autonomy, not finances.

Accounting and money decisions were left to Autonomy’s then-chief financial officer, Sushovan Hussain, he said.

Hussain was separately convicted in the U.S. in 2018 on charges of conspiracy, wire fraud and securities fraud related to the HP deal. He was released from prison in January after serving a five-year sentence.

Lynch’s influence on UK tech

Publicly listed Darktrace, which had fended off similar allegations of inflating its revenue by U.S. short seller Quintessential Capital Management, earlier this year agreed to a deal to be bought out and taken private by U.S. private equity firm Thoma Bravo for $5.32 billion in cash.

Lynch was previously on the board of U.K. broadcaster BBC, and once also served as an advisor to the U.K. government on the Council for Science and Technology.

In 2014 and 2015, he made the Forbes’ billionaires list, with an estimate net worth of $1 billion. However, while facing legal costs amid his dispute with HP, he dropped off that list in 2016.

Legal struggles aside, Lynch had several hobbies to keep him busy, including keeping and caring for cattle and pigs at his home in Suffolk.

Mike Lynch, founder of software firm Autonomy, at the company’s headquarters in, Cambridge, U.K., Aug. 24,  2000.

Bryn Colton | Hulton Archive | Getty Images

“I keep rare breeds,” Lynch told LeadersIn in a 2016 interview. “I have cows that became defunct in the 1940s and pigs that no one has kept since the medieval times and none of them have any Apple products whatsoever.”

Prior to his passing, Lynch had reportedly returned to his farm in Suffolk, a county in the east of England, to recover from his U.S. legal battle, the local East Anglian Times newspaper reported.

Just weeks before he was reported missing, Lynch told The Times newspaper of how he feared dying in prison if found guilty over the HP allegations.

“‘If this had gone the wrong way, it would have been the end of my life as I have known it in any sense,” Lynch said in the interview with The Times.

“It’s bizarre, but now you have a second life – the question is, what do you want to do with it?” he added.

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Microsoft AI chief Suleyman sees advantage in building models ‘3 or 6 months behind’

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Microsoft AI chief Suleyman sees advantage in building models ‘3 or 6 months behind’

Microsoft owns lots of Nvidia graphics processing units, but it isn’t using them to develop state-of-the-art artificial intelligence models.

There are good reasons for that position, Mustafa Suleyman, the company’s CEO of AI, told CNBC’s Steve Kovach in an interview on Friday. Waiting to build models that are “three or six months behind” offers several advantages, including lower costs and the ability to concentrate on specific use cases, Suleyman said.

It’s “cheaper to give a specific answer once you’ve waited for the first three or six months for the frontier to go first. We call that off-frontier,” he said. “That’s actually our strategy, is to really play a very tight second, given the capital-intensiveness of these models.”

Suleyman made a name for himself as a co-founder of DeepMind, the AI lab that Google bought in 2014, reportedly for $400 million to $650 million. Suleyman arrived at Microsoft last year alongside other employees of the startup Inflection, where he had been CEO.

More than ever, Microsoft counts on relationships with other companies to grow.

It gets AI models from San Francisco startup OpenAI and supplemental computing power from newly public CoreWeave in New Jersey. Microsoft has repeatedly enriched Bing, Windows and other products with OpenAI’s latest systems for writing human-like language and generating images.

Microsoft’s Copilot will gain “memory” to retain key facts about people who repeatedly use the assistant, Suleyman said Friday at an event in Microsoft’s Redmond, Washington, headquarters to commemorate the company’s 50th birthday. That feature came first to OpenAI’s ChatGPT, which has 500 million weekly users.

Through ChatGPT, people can access top-flight large language models such as the o1 reasoning model that takes time before spitting out an answer. OpenAI introduced that capability in September — only weeks later did Microsoft bring a similar capability called Think Deeper to Copilot.

Microsoft occasionally releases open-source small-language models that can run on PCs. They don’t require powerful server GPUs, making them different from OpenAI’s o1.

OpenAI and Microsoft have held a tight relationship shortly after the startup launched its ChatGPT chatbot in late 2022, effectively kicking off the generative AI race. In total, Microsoft has invested $13.75 billion in the startup, but more recently, fissures in the relationship between the two companies have begun to show.

Microsoft added OpenAI to its list of competitors in July 2024, and OpenAI in January announced that it was working with rival cloud provider Oracle on the $500 billion Stargate project. That came after years of OpenAI exclusively relying on Microsoft’s Azure cloud. Despite OpenAI partnering with Oracle, Microsoft in a blog post announced that the startup had “recently made a new, large Azure commitment.”

“Look, it’s absolutely mission-critical that long-term, we are able to do AI self-sufficiently at Microsoft,” Suleyman said. “At the same time, I think about these things over five and 10 year periods. You know, until 2030 at least, we are deeply partnered with OpenAI, who have [had an] enormously successful relationship for us.

Microsoft is focused on building its own AI internally, but the company is not pushing itself to build the most cutting-edge models, Suleyman said.

“We have an incredibly strong AI team, huge amounts of compute, and it’s very important to us that, you know, maybe we don’t develop the absolute frontier, the best model in the world first,” he said. “That’s very, very expensive to do and unnecessary to cause that duplication.”

WATCH: Microsoft Copilot beginning of a seismic shift in AI integration, says Microsoft AI CEO Suleyman

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Former Microsoft CEO Steve Ballmer says, as shareholder, tariffs are ‘not good’

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Former Microsoft CEO Steve Ballmer says, as shareholder, tariffs are 'not good'

President Trump’s new tariffs on goods that the U.S. imports from over 100 countries will have an effect on consumers, former Microsoft CEO Steve Ballmer told CNBC on Friday. Investors will feel the pain, too.

Microsoft’s stock dropped almost 6% in the past two days, as the Nasdaq wrapped up its worst week in five years.

“As a Microsoft shareholder, this kind of thing is not good,” Ballmer said, in an interview with Andrew Ross Sorkin that was tied to Microsoft’s 50th anniversary celebration. “It creates opportunity to be a serious, long-term player.”

Ballmer was sandwiched in between Microsoft co-founder Bill Gates and current CEO Satya Nadella for the interview.

“I took just enough economics in college — that tariffs are actually going to bring some turmoil,” said Ballmer, who was succeeded by Nadella in 2014. Gates, Microsoft’s first CEO, convinced Ballmer to join the company in 1980.

Gates, Ballmer and Nadella attended proceedings at Microsoft’s Redmond, Washington, campus on Friday to celebrate its first half-century.

Between the tariffs and weak quarterly revenue guidance announced in January, Microsoft’s stock is on track for its fifth straight month of declines, which would be the worst stretch since 2009. But the company remains a leader in the PC operating system and productivity software markets, and its partnership with startup OpenAI has led to gains in cloud computing.

“I think that disruption is very hard on people, and so the decision to do something for which disruption was inevitable, that needs a lot of popular support, and nobody could game theorize exactly who is going to do what in response,” Ballmer said, regarding the tariffs. “So, I think citizens really like stability a lot. And I hope people — individuals who will feel this, because people are feeling it, not just the stock market, people are going to feel it.”

Ballmer, who owns the Los Angeles Clippers, is among Microsoft’s biggest fans. He said he’s the company’s largest investor. In 2014, shortly after he bought the basketball team for $2 billion, he held over 333 million shares of the stock, according to a regulatory filing.

“I’m not going to probably have 50 more years on the planet,” he said. “But whatever minutes I have, I’m gonna be a large Microsoft shareholder.” He said there’s a bright future for computing, storage and intelligence. Microsoft launched the first Azure services while Ballmer was CEO.

Earlier this week Bloomberg reported that Microsoft, which pledged to spend $80 billion on AI-enabled data center infrastructure in the current fiscal year, has stopped discussions or pushed back the opening of facilities in the U.S. and abroad.

JPMorgan Chase’s chief economist, Bruce Kasman, said in a Thursday note that the chance of a global recession will be 60% if Trump’s tariffs kick in as described. His previous estimate was 40%.

“Fifty years from now, or 25 years from now, what is the one thing you can be guaranteed of, is the world needs more compute,” Nadella said. “So I want to keep those two thoughts and then take one step at a time, and then whatever are the geopolitical or economic shifts, we’ll adjust to it.”

Gates, who along with co-founder Paul Allen, sought to build a software company rather than sell both software and hardware, said he wasn’t sure what the economic effects of the tariffs will be. Today, most of Microsoft’s revenue comes from software. It also sells Surface PCs and Xbox consoles.

“So far, it’s just on goods, but you know, will it eventually be on services? Who knows?” said Gates, who reportedly donated around $50 million to a nonprofit that supported Democratic nominee Kamala Harris’ losing campaign.

— CNBC’s Alex Harring contributed to this report.

WATCH: There will be many LLM winners, says infrastructure investor Morrison

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AppLovin can offer TikTok ‘much stronger bid than others,’ CEO says

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AppLovin can offer TikTok 'much stronger bid than others,' CEO says

Piotr Swat | Lightrocket | Getty Images

AppLovin CEO Adam Foroughi provided more clarity on the ad-tech company’s late-stage effort to acquire TikTok, calling his offer a “much stronger bid than others” on CNBC’s The Exchange Friday afternoon.

Foroughi said the company is proposing a merger between AppLovin and the entire global business of TikTok, characterizing the deal as a “partnership” where the Chinese could participate in the upside while AppLovin would run the app.

“If you pair our algorithm with the TikTok audience, the expansion on that platform for dollars spent will be through the roof,” Foroughi said.

The news comes as President Trump announced he would extend the deadline a second time for TikTok’s Chinese-owned parent company ByteDance to sell the U.S. subsidiary of TikTok to an American buyer or face an effective ban on U.S. app stores. The new deadline is now in June, which, as Foroughi described, “buys more time to put the pieces together” on AppLovin’s bid. 

“The president’s a great dealmaker — we’re proposing, essentially an enhancement to the deal that they’ve been working on, but a bigger version of all the deals contemplated,” he added.

AppLovin faces a crowded field of other interested U.S. backers, including Amazon, Oracle, billionaire Frank McCourt and his Project Liberty consortium, and numerous private equity firms. Some proposals reportedly structure the deal to give a U.S. buyer 50% ownership of the company, rather than a complete acquisition. The Chinese government will still need to approve the deal, and AppLovin’s interest in purchasing TikTok in “all markets outside of China” is “preliminary,” according to an April 3 SEC filing.

Correction: A prior version of this story incorrectly characterized China’s ongoing role in TikTok should AppLovin acquire the app.

WATCH: AppLovin CEO Adam Foroughi on its bid to buy TikTok

AppLovin CEO Adam Foroughi on its bid to buy TikTok

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