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In 2012, Amazon founder Jeff Bezos was asked by TV host Charlie Rose whether his e-commerce company would ever venture into brick-and-mortar stores. Bezos said shoppers were well-served by existing physical retailers and that Amazon wasn’t interested in launching a “me-too” product.

“We want to do something that’s uniquely Amazon,” Bezos said. “If we can find that idea, and we haven’t found it yet, but if we can find that idea, we would love to open physical stores.”

Six years later, Amazon landed on a revolutionary retail concept that it hoped would transform how people shop in brick-and-mortar stores. The company launched its first Amazon Go convenience store featuring a new kind of technology, called “Just Walk Out.”

In practice, customers would be able to load up their cart and exit the store without standing in a checkout line. Amazon soon brought cashierless checkout to its Fresh supermarkets and two Whole Foods locations. In 2020, the company began licensing Just Walk Out technology to third parties, signing on retailers in stadiums, airports and hospitals. 

But the company has since taken a sideways turn.

In April, Amazon announced it was removing cashierless checkout from its U.S. Fresh stores and Whole Foods locations, a move that coincided with CEO Andy Jassy’s efforts to rein in costs to meet rapidly changing macro conditions.

As part of that effort, Amazon also reevaluated its retail plans. The company discontinued some of its retail chains, closed eight Amazon Go stores, and hit pause on new Fresh store openings. It’s launched a handful of new Fresh stores in recent months.

In place of Just Walk Out, which typically requires ceiling-mounted cameras, shelf sensors and gated entry points, Amazon Fresh stores and Whole Foods supermarkets will feature Dash Carts. The carts track and tally up items as shoppers place them in bags, enabling people to skip the checkout line. Amazon continues to use Just Walk Out in its grab-and-go marts and UK Fresh stores. 

A woman uses a dash cart during her grocery-shopping at a Whole Foods store as Amazon launches smart shopping carts at Whole Foods stores in San Mateo, California, United States on February 25, 2024. The smart shopping cart makes grocery shopping quicker by allowing customers to scan products right into their cart as they shop and then skip the checkout line.

Tayfun Coskun | Anadolu | Getty Images

The main challenge for Amazon and other startups working on autonomous checkout is the need to scale it to enough locations and retail categories that it becomes a natural part of in-store shopping, said Jordan Berke, founder and CEO of retail consulting firm Tomorrow.

“Until that’s the case, it’s an uphill battle,” Berke said. “These technology providers, Amazon included, are going to have to subsidize and continue to invest to train the retailer, train the consumer, train the market, that this is a mainstream experience that we can all trust and not need to think about as we walk in and out of a store.”

‘The hardest problem to solve’

At one point Amazon saw Just Walk Out becoming a core part of the experience of shopping in its physical stores. The company in 2018 planned to open as many as 3,000 Amazon Go stores within a few years, Bloomberg reported at the time, citing people familiar with the plans. 

Bezos had assigned top talent from across the company, including a longtime Amazon executive who built the original Kindle e-reader, to work on cashierless checkout. The technology was considered a key ingredient in Amazon’s long-running pursuit to become a giant in the $1.6 trillion U.S. grocery market. 

When Amazon debuted Just Walk Out in January 2018, it was a “quake moment” for the industry, causing Walmart and “almost every other retailer” to leap into action and consider developing their own vision-based checkout systems, said Berke, who previously led Walmart’s e-commerce business in China.

Amazon and other retailers soon learned that automating the checkout process is “the hardest problem to solve,” Berke said. Cashierless checkout systems require a hefty upfront investment to blanket a store with overhead cameras and hire staff to label and review shopping data.   

“It meant a store had to dramatically increase its sales in order to pay off that investment,” Berke said. 

Walmart teams found as part of a cost analysis in early 2019 that it would run a retailer between $10 million and $15 million to create a similar computer vision-based checkout system for a 40,000 square foot supermarket, Berke said.

Just Walk Out became an expensive project for Amazon, too. In 2019 and 2020, the company shelled out roughly $1 billion per year, including research and development costs and capital expenditures, to “learn and scale” the technology, Berke said. He said those figures are based on discussions with a former Just Walk Out executive who left Amazon to join Walmart. Amazon didn’t provide a comment on the figures.

Many retailers have since moved on from computer vision in favor of simpler methods like mobile checkout through an app, Berke said. 

Walmart uses a self-checkout app in its stores, while supermarket chain Kroger has been experimenting with Instacart’s Caper connected shopping carts at some locations. Retailers like Target and Dollar General are rethinking self-checkout entirely due to concerns of rising theft in their stores, and have added more traditional checkout lanes.

While it’s no longer featuring Just Walk Out as prominently in its own stores, Amazon says it has inked deals with a growing list of customers. More than 200 third-party stores have paid Amazon to install the cashierless system. The company expects to double the number of third-party Just Walk Out stores this year, Jon Jenkins, who previously served as vice president of Amazon’s Just Walk Out technology, said in a recent interview. Jenkins departed Amazon in late September to become technology chief of electric bike and scooter startup Lime, according to his LinkedIn page.

Jon Jenkins, Amazon’s former vice president of Just Walk Out technology, gives a tour of the mock convenience store where the company tests its cashierless checkout system in Seattle, Washington, on August 22, 2024.

CNBC

Jenkins disputed characterizations that Amazon’s phasing out of Just Walk Out from its own supermarkets represents a setback or a sign of the technology’s demise. He said Amazon proved through tests in its own grocery stores that the technology is “incredibly capable,” noting it deployed the system in large supermarkets with “600 people in the store at the same time.”

Other startups such as AiFi and Grabango have developed autonomous systems for supermarkets, convenience stores and other retailers, but widespread adoption has been slow, as the technology remains costly and challenging to operate in large store formats. 

Inside the lab

Amazon is still fine-tuning its Just Walk Out technology.

In August, CNBC got the first on-camera look at a mock convenience store where Amazon tests the system before deploying it in third party retailers and its own stores. 

The testing lab, which it calls “beverage base camp,” is located in Amazon’s Seattle headquarters. It has faux gates that mimic the experience of scanning your smartphone or credit card to enter a Just Walk Out store. The walls are lined with shelves of typical grab-and-go products like Milky Way bars, pita chips and gum, and there are coolers stocked with Coke cans and other beverages.

Amazon sets up Just Walk Out stores by first creating a 3D scan using LiDAR machines or iPads that help it determine where to place cameras so they have the clearest view.

“The goal is to have the fewest number of cameras possible, so we optimize the camera placement so that we can get enough coverage on each fixture to see what is happening in the store,” Jenkins said.

The system determines what shoppers purchased using several inputs, including the 3D scans, a catalog of product images, the video footage, and weight sensors on the shelves. Amazon in July updated the AI system behind its Just Walk Out technology to handle all the inputs in a store simultaneously.

The new “multi-modal” system can generate receipts faster by more accurately predicting which items shoppers have picked up and put back on shelves. The company said these changes should make it “faster, easier to deploy and more efficient” for retailers who install the system in their stores.

Amazon’s “primary focus” is selling the technology to third-party businesses and deploying it in small to medium-sized store formats, where the system “tends to generate a little better [return on investment],” Jenkins said. Earlier this year, Amazon also began selling its connected grocery carts to third parties. 

Amazon in September announced several new third-party Just Walk Out stores at universities and sports stadiums.

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At one Just Walk Out store, inside Seattle’s Lumen Field, home to the NFL’s Seahawks, the company said it boosted sales by 112% last season, with 85% more transactions during the course of a game.

“It was awesome that we had our own stores as the laboratory to sort of build and launch this,” Jenkins said. “But over time, like many things at Amazon, the success of this project and the product will depend on third parties adopting the technology. There will always be more third-party stores in the world than there will be first-party stores.”

Amazon has used a similar playbook in in the past. Amazon Web Services, the company’s wildly successful cloud-computing unit, originated from the company’s need for IT infrastructure to support its fast-growing online retail business. And in recent years, Amazon has leveraged its logistics and fulfillment network to provide services for third parties. 

With Just Walk Out, Amazon faces the challenge of convincing retailers that they can trust one of their biggest competitors with handling valuable shopper data. 

In 2022, Amazon moved the team behind Just Walk Out from its retail organization to AWS. It marked one of the clearest signals yet that Amazon is serious about selling the technology to other retailers, and could help ease some fears among rivals. 

“They’re clearly in sales mode,” said Sucharita Kodali, retail analyst at Forrester Research, in an interview. 

Kodali said Amazon still has a “long way to go” before the technology is ubiquitous. Getting there will require patience from Amazon investors and data that shows both retailers and shoppers are embracing the technology. 

“There’s almost a viral effect that will occur over time,” she said. “It’s just going to take a long time because you’ve got to cycle through everybody in America having this experience, and for the most part, it’s just Amazon fighting this fight right now.”

Watch the video for a behind-the-scenes look at Just Walk Out: https://www.cnbc.com/video/2024/10/02/amazon-is-making-a-big-bet-on-selling-cashierless-tech-to-outsiders.html

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Peter Thiel-backed cryptocurrency exchange Bullish files to go public on NYSE

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Peter Thiel-backed cryptocurrency exchange Bullish files to go public on NYSE

Peter Thiel, co-founder of PayPal, Palantir Technologies, and Founders Fund, holds hundred dollar bills as he speaks during the Bitcoin 2022 Conference at Miami Beach Convention Center on April 7, 2022 in Miami, Florida.

Marco Bello | Getty Images

The Peter Thiel-backed cryptocurrency exchange Bullish filed for an IPO on Friday, the latest digital asset firm to head for the public market.

The company, led by CEO Tom Farley, a veteran of the finance industry and former president of the New York Stock Exchange, said it plans to trade on the NYSE under the ticker symbol “BLSH.”

A spinout of Block.one, Bullish started with an initial investment from backers including Thiel’s Founders Fund and Thiel Capital, along with Nomura, Mike Novogratz and others. Bullish acquired crypto news site CoinDesk in 2023.

“In the first quarter of 2025, Bullish exchange executed over $2.5 billion in average daily volume, ranking in the top five exchanges by spot volume for Bitcoin and Ether,” the company said on its website. The prospectus listed top competitors as Binance, Coinbase and Kraken.

The IPO filing says that as of March 31, the total trading volume since launch has exceeded $1.25 trillion.

Read more CNBC tech news

The filing is another significant step for the cryptocurrency industry, which has fought for years to convince institutions to embrace digital assets as legitimate investments.

It’s already been a big year on the market for crypto offerings, highlighted by stablecoin issuer Circle, which has jumped more than sevenfold since its IPO in June. Etoro, an online trading platform that includes services for crypto investors, debuted in May.

Novogratz‘s crypto firm Galaxy Digital started trading on the Nasdaq in May, moving its listing from the Toronto Stock Exchange. And in June, Gemini, the cryptocurrency exchange and custodian founded by Cameron and Tyler Winklevoss, confidentially filed for an IPO in the U.S.

Meanwhile, investors continue to flock to bitcoin. The digital currency is trading at over $117,000, up from about $94,000 at the start of the year.

President Donald Trump, on Friday, signed the GENIUS Act into law — a set of regulations that establish some initial consumer protections around stablecoins, which are tied to assets like the U.S. dollar with the intent of reducing price volatility associated with many cryptocurrencies.

In its filing with the SEC, Bullish says its mission is partly to “drive the adoption of stablecoins, digital assets, and blockchain technology.”

Crypto industry players, including Thiel, Elon Musk, and President Trump’s AI and Crypto czar David Sacks spent heavily to re-elect Trump and have pushed for legislation that legitimizes digital assets and exchanges.

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Microsoft stops relying on Chinese engineers for Pentagon cloud support

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Microsoft stops relying on Chinese engineers for Pentagon cloud support

Microsoft Chairman and Chief Executive Officer Satya Nadella (L) returns to the stage after a pre-recorded interview during the Microsoft Build conference opening keynote in Seattle, Washington on May 19, 2025.

Jason Redmond | AFP | Getty Images

Microsoft on Friday revised its practices to ensure that engineers in China no longer provide technical support to U.S. defense clients using the company’s cloud services.

The company implemented the changes in an effort to reduce national security and cybersecurity risks stemming from its cloud work with a major customer. The announcement came days after ProPublica published an extensive report describing the Defense Department’s dependence on Microsoft software engineers in China.

“In response to concerns raised earlier this week about US-supervised foreign engineers, Microsoft has made changes to our support for US Government customers to assure that no China-based engineering teams are providing technical assistance for DoD Government cloud and related services,” Frank Shaw, the Microsoft’s chief communications officer, wrote in a Friday X post.

The change impacts the work of Microsoft’s Azure cloud services division, which analysts estimate now generates more than 25% of the company’s revenue. That makes Azure bigger than Google Cloud but smaller than Amazon Web Services. Microsoft receives “substantial revenue from government contracts,” according to its most recent quarterly earnings statement, and more than half of the company’s $70 billion in first-quarter revenue came from customers based in the U.S.

In 2019, Microsoft won a $10 billion cloud-related defense contract, but the Pentagon wound up canceling it in 2021 after a legal battle. In 2022, the department gave cloud contracts worth up to $9 billion in total to Amazon, Google, Oracle and Microsoft.

ProPublica reported that the work of Microsoft’s Chinese Azure engineers is overseen by “digital escorts” in the U.S., who typically have less technical prowess than the employees they manage overseas. The report detailed how the “digital escort” arrangement might leave the U.S. vulnerable to a cyberattack from China.

“This is obviously unacceptable, especially in today’s digital threat environment,” Defense Secretary Pete Hegseth said in a video posted to X on Friday. He described the architecture as “a legacy system created over a decade ago, during the Obama administration.” The Defense Department will review its systems in search for similar activity, Hegseth said.

Microsoft originally told ProPublica that its employees and contractors were adhering to U.S. government rules.

“We remain committed to providing the most secure services possible to the US government, including working with our national security partners to evaluate and adjust our security protocols as needed,” Shaw wrote.

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The investor behind Opendoor’s 190% run nearly shut down his fund

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The investor behind Opendoor's 190% run nearly shut down his fund

Courtesy: Opendoor

On June 6, online real estate service Opendoor was so desperate to get its beaten-down stock price back over $1 and stay listed on the Nasdaq that management proposed a reverse split, potentially lifting the price of each share by as much as 50 times.

The stock inched its way up over the next five weeks.

Then Eric Jackson started cheerleading.

Jackson, a hedge fund manager who was bullish on Opendoor years earlier when the company appeared to be thriving and was worth roughly $20 billion, wrote on X on Monday that his firm, EMJ Capital, was back in the stock.

“@EMJCapital has taken a position in $OPEN — and we believe it could be a 100-bagger over the next few years,” Jackson wrote. He added later in the thread that the stock could get to $82.

It’s a long, long way from that mark.

Opendoor shares soared 189% this week, by far their best weekly performance since the company’s public market debut in late 2020. The stock closed on Friday at $2.25. The stock’s highest-volume trading days on record were Wednesday, Thursday and Friday of this week.

Jackson said in an interview on Thursday that the bulk of his firm’s Opendoor purchases came when the stock was in the 70s and 80s, meaning cents, and he’s bought options as well for his portfolio.

Nothing has fundamentally improved for the company since Jackson’s purchases. Opendoor remains a cash-burning, low-margin business with meager near-term growth prospects.

What has changed dramatically is Jackson’s online influence and the size of his following. The more he posts, the higher the stock goes.

“There’s a real hunger for buying the next big thing,” Jackson told CNBC, adding that investors like to find the “downtrodden.”

It’s something Jackson’s firm, based in Toronto, has in common with Opendoor.

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When Opendoor went public through a special purpose acquisition company in 2020, it was riding a SPAC wave and broader gains driven by low interest rates and Covid-era market euphoria. Investors pumped money into the riskiest assets, lifting money-losing tech upstarts to astronomical valuations.

Opendoor’s business involved using technology to buy and sell homes, pocketing the gains. Zillow tried and failed to compete.

Opendoor shares peaked at over $39 in Feb. 2021 for a market cap just above $22.5 billion. But by the end of that year, the shares were trading below $15, before collapsing 92% in 2022 to end the year at $1.16.

Rising interest rates hammered the whole tech sector, hitting Opendoor particularly hard as increased borrowing costs reduced demand for homes.

Jackson, similarly, had a miserable 2022, coinciding with the worst year for the Nasdaq since 2008. Jackson said his key client withdrew its money at the end of the year, and “I’ve been small ever since.”

‘Epic comeback’

While his assets under management remain minimal, Jackson’s reputation for getting in early to a rebound story was burnished by the performance of Carvana.

The automotive e-commerce platform lost 98% of its value in 2022 as investors weighed the likelihood of bankruptcy. In the middle of that year, with Carvana still far from bottoming out, Jackson expressed his bullishness. He told CNBC that April that he liked the stock, and then promoted its recovery on a podcast in June. He also said he liked Opendoor at the time.

Investors willing to stomach further losses in 2022 were rewarded with a 1,000% gain in 2023, and a lot more upside from there. The stock closed on Friday at $347.52, up from a low of $3.72 in Dec. 2022, and almost triple its price at the time of Jackson’s appearance on CNBC in April of that year.

After Carvana’s 2022 slide, “then obviously began an epic comeback,” Jackson said. Opendoor, meanwhile, “continued to roll down the mountain,” he said.

Jackson said that the fallout of 2022 led him to pursue a different method of stockpicking. He started hiring a small team of developers, which is now four people, to build out artificial intelligence models. The firm has experimented with several models —some have worked and some haven’t — but he said the focus now is using what he’s learned from Carvana to find “100x” opportunities.

In addition to Opendoor, Jackson has been promoting IREN, a provider of power for bitcoin mining and AI workloads, and Cipher Mining, which is in a similar space. He’s seen his following on Elon Musk‘s social media site X, which he said was stuck for years between 32,000 and 34,000, swell to almost 50,000. And after a lengthy lull, investors are reaching out to him to try and put money into his fund, he said.

Jackson has a lot riding on Opendoor, a company that saw revenue and number of homes sold slip in the first quarter from a year earlier, and racked up almost $370 million in losses over the past four quarters.

In early June, Opendoor announced plans for a reverse split — ranging from 1 for 10 to 1 for 50 — to “give us optionality in preserving our listing on Nasdaq.” With the stock now well over $1, such a move appears less necessary, as shareholders prepare to vote on the proposal on July 28.

“I think it’s a terrible idea,” said Jackson. “Those things usually further cement a company’s move into oblivion rather than hail some big revival.”

Opendoor didn’t respond to a request for comment.

Banking on growth

Analysts are projecting a more than 5% drop in revenue this year, followed by 20% growth in 2026 and 12% expansion in 2017, according to LSEG. Losses are expected to narrow over that stretch.

Jackson said his analysis factors in projections of $11.5 billion in revenue for 2029, which would be well over double the company’s expected sales for this year. He looked at the multiples of companies like Zillow and Carvana, which he said trade for 4 to 7 times forward revenue. Opendoor’s forward price-to-sales ratio is currently well below 1.

With Zillow and Redfin having exited the instant-buying home market, Opendoor faces little competition in allowing homeowners to sell their property online for cash, rather than going through an extended bidding, sales and closing process.

Jackson is banking on revenue growth and increased market share to lead to a profitable business that will push investors to value the company with a multiple somewhere between Zillow and Carvana. At $82, Opendoor would be worth about $60 billion, which is roughly 5 times projected 2029 revenue.

Jackson said his model assumes that “like Carvana, Opendoor can prove that it can permanently turn the tide and get to sustained profitability” so that the “market multiple would get reassessed.”

In the meantime, he’ll keep posting on X.

On Friday, Jackson wrote a thread consisting of 11 posts, recounting the challenge of having “99.5% of my AUM” disappear overnight after his primary investor pulled out in 2022.

“Translation: he fired me for losing him too much money,” Jackson wrote. He said he almost shut down the fund, and was even encouraged to do so by his wife and accountant.

Now, Jackson is using his recent momentum on social media to try and attract investor money, while still reminding prospects that he could lose it.

“All I have is my reputation,” he wrote, “and, unless I keep picking good stocks, it will be gone.”

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