Elon Musk announced his new company xAI which he says has the goal to understand the true nature of the universe.
Jaap Arriens | Nurphoto | Getty Images
Meet Grok, the first technology out of Elon Musk’s new AI company, xAI.
Grok, the company said, is modeled on “The Hitchhiker’s Guide to the Galaxy.” It is supposed to have “a bit of wit,” “a rebellious streak” and it should answer the “spicy questions” that other AI might dodge, according to a Saturday statement from xAI.
Leading up to the release, Musk posted on X, formerly Twitter, an example of Grok responding to a request for a step-by-step cocaine recipe.
“Oh sure!” Grok responded. “Just a moment while I pull up the recipe for homemade cocaine. You know, because I’m totally going to help you with that.”
Grok also has access to data from X, which xAI said will give it a leg-up. Musk, on Sunday, posted a side-by-side comparison of Grok answering a question versus another AI bot, which he said had less current information.
Still, xAI hedged in its statement, as with any Large Language Model, or LLM, Grok “can still generate false or contradictory information.”
The prototype is in its early beta phase, only two months in training and is available to a select number of users to test out before the company releases it more widely. Users can sign up for a waitlist for a chance to use the bot. Eventually, Musk said on X, Grok will be a feature of X Premium+, which costs $16 per month.
The Tesla and Space X CEO appears to be positioning xAI as a challenger to companies like OpenAI, Inflection and Anthropic.
On an initial round of tests based on middle school math problems and Python coding tasks, the company said that Grok surpassed “all other models in its compute class, including ChatGPT-3.5 and Inflection-1.” It was outperformed by bots with larger data troves.
“In some important respects, it is the best that currently exists,” Musk said in an X post on Friday leading up to the Grok announcement.
Grok is a term coined by Robert A. Heinlein in his 1961 science fiction novel “Stranger in a Strange Land.” In the book, ‘grok’ is a Martian term with no direct Earthling translation. Critics have debated the word’s exact definition but have settled on some version of having very deep empathy or intuition with something. Merriam-Webster defines it simply as a transitive verb that means “to understand profoundly and intuitively.”
xAI launched in July with a team stacked with former employees of OpenAI, DeepMind and more. It is still hiring for several roles.
The company’s self-stated mandate is to build artificial intelligence “to advance our collective understanding of the universe.” Musk has previously said that he believes today’s AI makers are bending too far toward “politically correct” systems. xAI’s mission, it said, is to create AI for people of all backgrounds and political views.
Grok is said to be a means of testing that AI approach “in public.”
Matt Garman, CEO of Amazon Web Services, speaks during The Wall Street Journal’s Tech Live conference in Laguna Beach, California, on Oct. 21, 2024.
Frederic J. Brown | AFP | Getty Images
Amazon said revenue in its cloud unit increased 19% in the third quarter, just missing analyst estimates.
Revenue at Amazon Web Services totaled $27.45 billion, according to a statement Thursday, while Wall Street was expecting $27.52 billion, based on StreetAccount estimates. Year-over-year growth has accelerated for five consecutive quarters.
The artificial intelligence portion of AWS is in the billions of dollars in annualized revenue, more than doubling year over year, Amazon CEO Andy Jassy, who previously led AWS, said on a call with analysts.
“I believe we have more demand than we could fulfill if we had even more capacity today,” Jassy said. “I think pretty much everyone today has less capacity than they have demand for, and it’s really primarily chips that are the area where companies could use more supply.”
AWS leads the cloud infrastructure market over Google and Microsoft and is an important source of profit for Amazon.
On Tuesday, Google parent Alphabet said revenue from Google Cloud, which includes cloud applications as well as infrastructure, totaled $11.35 billion, up 35%. Microsoft said Wednesday that revenue from Azure and other cloud services grew 33%.
AWS recorded $10.45 billion in operating income, representing 60% of its parent’s profit. Analysts expected $9.15 billion.
The unit’s operating margin came in at 38%, the widest for AWS since at least 2014. Google Cloud reported an operating margin of 17%.
“We’re being very measured in our hiring,” Brian Olsavsky, Amazon’s finance chief, said on the call.
“If this is successful, we would love to find more pieces of their application stack that could run well in AWS and help customers do that,” AWS CEO Matt Garman told CNBC in a September interview.
Also in the quarter, AWS announced plans to discontinue some services, including code-repository tool CodeCommit. Garman told TechCrunch that AWS “can’t invest in everything.”
Amazon’s online advertising business brought in $14.3 billion in the third quarter, up 19% year over year, in line with analysts’ estimates of $14.3 billion.
The Seattle tech giant revealed the financial results of its growing advertising unit as part of its latest earnings report Thursday. Amazon’s overall third-quarter sales were $158.9 billion, ahead of analysts’ estimates of $157.2 billion.
Amazon’s online advertising business is still a fraction of the company’s overall business, but its growth over the years has made it a major competitor to Alphabet and Meta, which lead the digital advertising market. Alphabet’s Google currently represents 27.7% of the worldwide digital advertising market, followed by Meta at 22.8% and Amazon with 8.8%, according to data provided to CNBC by Emarketer.
Meta’s third-quarter advertising revenue came in at $39.9 billion, which was up 19% compared with the year prior. That was slightly ahead of analysts’ expectations of $39.49 billion, according to StreetAccount. Ads accounted for 98.3% of Meta’s overall third-quarter revenue.
Alphabet generated $65.85 billion in third-quarter ad revenue, the company reported Tuesday. That was up 10% from $59.65 billion the year prior. Additionally, advertising sales for the company’s YouTube unit rose 12% year over year to $8.92 billion.
Intel CEO Pat Gelsinger holds an artificial intelligence processor as he speaks during the Computex conference in Taipei, Taiwan, on June 4, 2024.
Annabelle Chih | Bloomberg | Getty Images
Intel shares rose 9% in extended trading on Thursday after the chipmaker reported better-than-expected revenue and issued quarterly guidance that topped estimates.
Here’s how the company did in comparison with LSEG consensus:
Earnings per share: Loss of 46 cents adjusted
Revenue: $13.28 billion vs. $13.02 billion expected
Intel’s revenue declined 6% year over year in the quarter, which ended on Sept. 28, according to a statement. The company registered a net loss of $16.99 billion, or $3.88 per share, compared with net earnings of $310 million, or 7 cents per share, in the same quarter a year ago.
As part of its cost reduction plan, Intel recognized $2.8 billion in restructuring charges during the quarter. There were also $15.9 billion in impairment charges.
Intel has been mired in an extended slump due to market share losses in its core businesses and an inability to crack artificial intelligence. CEO Pat Gelsinger revealed plans during the quarter to turn the company’s foundry business into an independent subsidiary, a move that would enable outside funding options.
CNBC reported that Intel had engaged advisors to defend itself against activist investors. In late September, news surfaced that Qualcomm reached out to Intel about a possible takeover.
The Client Computing Group that sells PC chips recorded $7.33 billion in revenue, down about 7% from a year earlier and below the $7.39 billion consensus among analysts surveyed by StreetAccount.
Revenue from the Data Center and AI segment came to $3.35 billion, which was up about 9% and more than the $3.17 billion consensus from StreetAccount.
Intel called for fiscal third-quarter adjusted earnings of 12 cents per share and revenue between $13.3 billion and $14.3 billion. Analysts had expected 8 cents in adjusted earnings per share and $13.66 billion in revenue.
During the quarter, Intel announced the launch of Xeon 6 server processors and Gaudi artificial intelligence accelerators.
As of Thursday’s close, Intel shares were down about 57% in 2024, while the S&P 500 index had gained 20%.
Executives will discuss the results with analysts on a conference call starting at 5 p.m. ET.
This is breaking news. Please check back for updates.