AI: Weekly Summary. RTZ #701

1. Google reports strong AI driven metrics: Alphabet/Google reported strong Q1 2025 results, with the stock responding positively. AI driven metrics across its various businesses all showed positive momentum. Of note were Google’s effective ad monetization of ‘AI Overview and AI More’ results relative to traditional Google Search results. This has been an issue of investor concerns for months relative to OpenAI and other LLM AI companies Also notable were YouTube overall results and metrics, which crossed its 20th anniversary this week. More here.

   

2. OpenAI Scales up Business Model: New details on OpenAI’s financial model projections into 2029 model strong growth across the company’s existing and future products. OpenAI expects “expects combined sales from agents and other new products to exceed its popular chatbot, lifting total sales to $125 billion in 2029 and $174 billion the next year”, according to the Information. That compares to 2024 ‘s $3.7 billion in revenues, 4x 2023. Costs also grow in the near term given the variable cost nature of the Compute and AI Capex Infrastructure investments ahead. Lots of relative growth and investment implications for AI peers both in the US and China. More here.

   

3. New Pros and Cons of latest AI releases: Despite the relentless improvements and innovations in Scaling AI chatbot, reasoning and agentic products and services this year, latest releases are also showing a rise in hallucinations and reliability. This underlines the early state of AI technologies just emerging from research labs, and the ongoing challenges of productizing the innovations for use at scale in businesses and with end users worldwide. This is something we’ve seen in prior tech waves, but not at this scale and cost this early in the AI Tech Wave. More here.

   

4. Industry lessons from Amazon AWS’s Anthropic API Scaling issues: New reports on scaling challenges at Amazon AWS on its partner Anthropic’s models are notable both for the strong enterprise demand, and the challenges of ramping up the AI compute and infrastructure today. It’s a challenge shared by other AI peers, and also highlight the technical challenges of scaling the APIs in particular. This has impacted Google, OpenAI, and others as well as customer demand has been stronger than expected. The challenges have both known and unknown solutions, and the industry will be able to meet them in due time and investment. More here.

   

5. Opportunities ahead from exploding AI content: Growing concern with the rising explosion of AI driven content, that will need to get digested by both mainstream users and businesses as AI reasoning and agents scale. OpenAI for example saw hundreds of millions of new ChatGPT users with the introduction of image processing via ChatGPT in recent weeks. That content was criticized both for copyright and ‘AI Slop’ concerns. Meta, Google YouTube, Apple with Apple Intelligence, and others have similar plans to ramp up AI Generated content.This issue is notable both for its pros and cons. Especially in terms of regulatory concerns as well in various jurisdictions. More here.

   

Other AI Readings for weekend:

1. Challenges of managing ‘AI Virtual Agent Employees’ ahead. More here.

   

2. Lessons for AI Tech Wave leaders like OpenAI vs Google, from PC Tech Wave Antitrust actions. More here.

   

Up next, the Sunday ‘The Bigger Picture’ tomorrow. Stay tuned.

(NOTE: The discussions here are for information purposes only, and not meant as investment advice at any time. Thanks for joining us here)