Christian Pfister, a 68-year-old retiree, walks his Great Pyrenees, Wally, each morning on the street in his quiet neighborhood—a compilation of old oak tree-lined streets for single-family homes, duplexes, and apartments in southeast Austin where he’s been living the last 26 years. It was about three weeks ago, on one of these morning strolls, that he spotted a white Tesla Y with a Texas manufacturer plate drive by, with a dark-colored Tesla closely trailing behind it.

He watched as the Tesla tandem conducted a left turn at a street up ahead of him, disappeared around the block for half a mile, then drove by him again—once, then twice, then again and again. 

“That’s all they did—around the same block over and over and over, all day long,” Pfister says in an interview.

Since Pfister’s spotting of the vehicles a few weeks ago, a handful of white Teslas (and some black and gray Teslas too) have frequented the streets of Pfister’s small neighborhood, driving the same routes and taking the same turns repeatedly—typically with drivers in the front seat, though two residents in the neighborhood that Fortune interviewed say they have seen some driverless vehicles with someone in the passenger seat. Another resident saw Teslas without anyone in them at all on multiple occasions.

Tesla is testing the vehicles in the neighborhood as it gears up for a long-anticipated launch of its self-driving taxi service in Austin by the end of this month. The EV company, which has been working on autonomous technology for more than a decade now, has said it is finally ready to go up against robotaxi competitors like Alphabet, whose subsidiary Waymo has already offered 10 million paid rides and is operating in four cities and planning to launch soon in several more. Elon Musk has assured investors that Tesla’s robotaxi service, which will initially start small with 10 to 20 vehicles, will expand to several other cities before the end of the year. But it all will start in Austin—and specifically in this small neighborhood—as Tesla proves its concept and irons out any kinks.

When the sightings of Tesla’s robotaxis began a few weeks ago, they raised alarm among some of the people who lived in the neighborhood. A couple of residents took to the community messaging platform Nextdoor to query their neighbors as to why white Teslas—with drivers—were parking in front of their houses for long stretches of time. “It’s freaking me out,” one woman posted.

Anastasia Maren, 24, who moved into the neighborhood last month, said she has seen Teslas drive by or park in front of her duplex repeatedly since she moved in, particularly when she is going on walks.

“They stare you down as if you’re in their way, or you’re the one who shouldn’t be here,” Maren says of the drivers. She says that while she has sometimes seen the vehicles driving around with only someone in the passenger seat—she often sees a person in the driver’s seat controlling the vehicles. “Sometimes I can see the person actually turning the wheel,” she says.

A 37-year-old Austin resident, Robert Yeats, who lives in an apartment complex further north in the neighborhood than Maren and Pfister, says he sees white Teslas line up in front of his apartment, parked and with their hazard lights on, often in groups of about four. In some cases, the Teslas were parked in the middle of the road with their hazard lights on, forcing other drivers to go around them. According to one resident, the tests have occurred as late as 10 p.m. None of the residents Fortune spoke to said they had received any notice or information from Tesla about the testing in their neighborhood.

Austin residents are used to seeing self-driving vehicles around town. Waymo’s cars started mapping the city in 2023 with safety drivers on board, and has since begun offering passenger service around the city without safety drivers in the vehicles. Pfister told Fortune he has seen Waymos parked overnight in front of empty lots in the same neighborhood. A few years ago, Cruise had released robotaxis on the streets of Austin, back before parent company General Motors stopped all rides, and later shut down the ride-hail service, after a high-profile accident in San Francisco.

But the Tesla sightings add to the questions that many industry observers have about the viability of the company’s technology and approach to autonomous driving. While other autonomous vehicle companies have needed to digitally map roads and neighborhoods before launch, Tesla claims that its camera-only system doesn’t require high-definition mapping, radar, or lidar technology. According to the company, its approach to autonomous driving is less expensive and more adaptable than the competition: instead of mapping an area for months, Tesla cars can figure out the terrain wherever they are.  But if that’s the case, why are Teslas driving around the same streets of one neighborhood over and over—and why do many of the vehicles have someone driving them?

“I thought, well, maybe they’re just in the driver’s seat, so that if something goes wrong, they can grab the steering wheel. But they are actually driving the car,” Pfister says, noting that he has seen the drivers with their hands on the steering wheel. “They are actually driving the car, so it’s not driverless. I don’t really understand.”

Tesla did not respond to a request for comment.

Tesla has also conducted testing in at least two other locations in Texas. There was a scheduled testing with emergency vehicles in a separate isolated street in Austin, as Fortune earlier reported. Tesla also did testing at a training facility in Florence, Tex., with the Texas Department of Public Safety’s crash reconstruction team. During that event, state agencies set up scenarios for Tesla’s robotaxis to operate, so that the company could collect information about how to respond to various encounters with emergency personnel and equipment, such as crash scenes or flashing lights and sirens, according to a spokesperson for the Texas Department of Public Safety.

But it’s along a few blocks of the neighborhood in southeast Austin where Tesla has been conducting its regular, real-world testing in the weeks before launch. There’s a Tesla Supercharger station just across a busy street—the only station for about two miles—as well as a Tesla collision center less than two miles down the road. The neighborhood itself features quiet streets, though Teslas will have to cross a busy road to get to the charging station. There aren’t sidewalks on the residential streets, so residents walk their dogs or push strollers on the street itself—giving the cars an opportunity to operate with obstacles in a controlled environment. The three residents tell Fortune that the cars appear to operate at speeds no greater than 25 miles per hour.

Tesla is nearing the end of the June deadline that Musk set for launch—with just three weeks until the end of the month. A Bloomberg report had suggested the company was aiming for a June 12 launch. But as of Tuesday, June 10, several important pre-launch checklist items appeared to be outstanding. Tesla had provided drafts, but not finalized emergency responder guides, nor had it conducted emergency responder trainings to the Austin Transportation and Works Department of the Austin Fire Department as of Tuesday, the agencies told Fortune. As Fortune earlier reported, the EV maker told city employees those items would be furnished before the company launches service. 

This story was originally featured on Fortune.com

Snapchat, long-known as a featherweight in the league of Big Tech giants, is hoping to best opponents Meta, Google and Apple by releasing its new augmented reality AI-enabled smart glasses months, maybe even years, before the big guys. 

Speaking at a conference on Tuesday, Snap CEO Evan Spiegel said the company would release a new version of its camera-equipped glasses next year that will incorporate an interactive, AI-enhanced digital screen within the lens. The 2026 release date would be ahead of Meta, which plans to release its AR “Orion” glasses in 2027, while Google has not attached a date to its Android XR glasses. 

“The tiny smartphone limited our imagination,” Spiegel said in his keynote at the Augmented World Expo conference in Long Beach, Calif. “It’s clear that today’s devices and user interfaces are woefully inadequate to realize the full potential of AI.” 

The new “Snapchat Specs” will be lightweight and AI-enhanced, Snap said. They will allow users to look at objects in the real world and leverage AI to access information, such as translating ingredients on a label from foreign languages. The glasses will also allow users to interact with the objects on the lens, Snap said, citing examples like playing video games with their eyeballs.

The company did not share photos of the Specs frames or provide information on pricing. As part of the Specs announcement, Snapchat shared that operating system partnerships with OpenAI and Google Gemini will extend into experiences for the glasses. 

If Snap follows through on the promise of 2026 launch, it would be the first Big Tech company to market with augmented reality glasses for mainstream consumers, claiming an early lead in the race to create the successor to the smartphone—a competition involving everyone from Meta, Google, and Apple, to ChatGPT maker OpenAI, which recently announced a partnership with former Apple design boss Jony Ive.   

A pioneer in the glasses form factor, Snap made waves with the release of its “Spectacles” in 2016. The funky looking glasses were equipped with a camera that allowed users to post photos and short video clips directly to their Snapchat feed. But in recent years, Snap’s Spectacles have been eclipsed by Meta, which partnered with EssilorLuxottica to release Ray-Ban smart glasses. Though Meta hasn’t shared financials around its Ray-Ban glasses, EssilorLuxottica noted that the companies have sold over 2 billion glasses since their 2023 debut. Luxottica plans to increase products of the co-branded glasses to 10 million units by 2026, suggesting that the companies are pleased with the results and potential of the glasses. 

That said, Meta’s glasses do not have AR capabilities; rather, the glasses have audio-based AI features as well as photo and video capability. Meta has said it will release its Orion AR glasses in 2027, with technology that will allow users to scan their Threads feeds with eye tracking hardware.  

Other tech giants have glasses in their sights, too. At its IO developer’s conference in May, Google announced that it would join the smart glasses market by partnering with Warby Parker. And Apple, whose $3,500 VisionPro headset has failed to catch on with consumers, is reported to release smart glasses next year that mimic the current version of Meta’s Ray Bans, while working on more advanced AR glasses that are still years away, according to Bloomberg.

The Specs announcement follows a turbulent financial period for Snapchat. After years of worrisome financials, Snapchat seems to have stabilized and increased free cash flow in the most recent quarter. The glasses are partially a revenue diversification effort as the company is propagated by ads to its social network.

Still, Snapchat did not share what the glasses will cost consumers. Meta’s Ray-Ban glasses, which do not have AR capabilities, cost between $239 and $303 so it’s reasonable to assume the Specs’ prices will be steeper due to the hardware requirements. 

The style and comfort of the glasses are also likely to be critical, with consumers having repeatedly demonstrated an aversion to bulky- or geeky-looking smart glasses and headsets. With its 2026 launch date, Snap has thrust itself back into the conversation, but success will rest on whether it can produce a product consumers actually want to wear.

This story was originally featured on Fortune.com

© JOEL SAGET / AFP) (Photo by JOEL SAGET/AFP via Getty Images

 President Donald Trump likes to say he’s bringing in trillions of dollars in investments from foreign countries, but a provision in his tax cuts bill could cause international companies to avoid expanding into the United States.

The House-passed version of the legislation would allow the federal government to impose taxes on foreign-parented companies and investors from countries judged as charging “unfair foreign taxes” on U.S. companies.

Known as Section 899, the measure could cause companies to avoid investing in the the U.S. out of concern they could face steep taxes. The fate of the measure rests with the Senate — setting off a debate about its prospects and impact.

A new analysis by the Global Business Alliance, a trade group representing international companies such as Toyota and Nestlé, estimates that the provision would cost the U.S. 360,000 jobs and $55 billion annually over 10 years in lost gross domestic product. The analysis estimates that the tax could cut a third off the economic growth anticipated from the overall tax cuts by Congress’ Joint Committee on Taxation.

“While proponents say this punitive tax hike is intended as a retaliatory measure against foreign governments, this report confirms that the real victims are American workers in states like North Carolina, South Carolina, Indiana, Tennessee and Texas,” said Jonathan Samford, president and CEO of the Global Business Alliance.

Republican Rep. Jason Smith of Missouri, chair of the House Ways and Means Committee, has defended the provision as protecting U.S. interests by giving the president a tool that can be used against countries with tax codes that, in the federal government’s opinion, put American companies at a disadvantage.

“If these countries withdraw these taxes and decide to behave, we will have achieved our goal,” Smith said in a statement last week. “It’s just common sense. I urge my colleagues in the Senate to move quickly to pass this bill and protect Americans from economic bad actors around the world.”

House Republicans have been looking into the issue for a long time and the bill provides the flexibility so that a president doesn’t have to levy taxes. There were concerns among GOP lawmakers during Joe Biden’s presidency that an agreement among countries on corporate tax codes could cause foreign governments to charge U.S. companies more.

The tax gets at a fundamental tension within Trump’s policy agenda: a contradiction in the broad strokes of Trump simultaneously trying to tax imports and foreign profits at higher rates while also seeking investments from companies headquartered abroad.

In late May, Trump defended his approach by saying that his tariffs were causing more countries to invest in the U.S. to avoid imports getting taxed. While some countries and companies have made announcements, there is not evidence of the investments pushing up spending on new factories as measured in the government’s monthly report on construction spending.

The Republican president said his tendency to impose steep tariffs, then retreat to lower rates, had succeeded.

“We have $14 trillion now invested, committed to investing,” Trump said then. “You know we have the hottest country anywhere in the world. I went to Saudi Arabia, the king told me, he said, you got the hottest — we have the hottest country in the world right now.”

The Global Business Alliance was among the groups that signed a letter on Monday warning of the consequences of Section 899 to Senate Majority Leader John Thune of South Dakota and Senate Finance Committee Chairman Mike Crapo of Idaho, both Republicans.

The Investment Company Institute, representing financial firms, said the provision “could limit foreign investment to the U.S. — a key driver of growth in American capital markets that ultimately benefits American families saving for their futures.”

The analysis performed by EY Quantitative Economics and Statistics notes there is a degree of uncertainty in how the taxes under Section 899 could be implemented and other countries would respond. But they could be charged against companies based in countries that tax digital services, as is the case in parts of Europe.

If the U.S. judged the taxes unfair, there would be a 30% tax rate on foreign companies’ profits and income. People working in the U.S. for the companies who are not citizens could also be taxed, among other provisions. Still, an exemption is in place so that the foreign holders of U.S. debt are not affected by the potential new taxes.

The possibility of the taxes and seemingly arbitrary nature by which they could be imposed is also a challenge, said Chye-Ching Huang, executive director of New York University’s Tax Law Center.

“Section 899 creates a game of political chicken with trade partners that risks harming businesses, consumers, and workers in the hopes of securing US multinationals the ability to shift more of their profits out of the US to tax havens,” Huang said in an email. “It’s a high-risk strategy that could expand the damage of the failed tariff war.”

There could also be political repercussions if key states in Trump’s political coalition from 2024 suffer layoffs or simply find job growth slowing. The Global Business Alliance finds job losses could amount to 44,200 in Florida, 27,700 in Pennsylvania, 24,500 in North Carolina and 23,500 in Michigan.

This story was originally featured on Fortune.com

© AP Photo/Evan Vucci

• The S&P 500 rose 0.55% on Tuesday as tech stocks, including Meta and Google, ticked upward.

Tariffs may be leaving a cloud over the stock market, but tech companies continue their upward climb, buoyed by investor excitement around artificial intelligence. On Tuesday, Meta’s share price rose 1.20% amid reports that Mark Zuckerberg’s social media giant planned to invest around $15 billion into the startup Scale AI.

Meta wasn’t the only tech company to receive a boost on Tuesday. Apple shares rose 0.61%, despite a lackluster performance at its annual developer conference, while Tesla rebounded 5.67% as the public spat between Elon Musk and President Donald Trump has become more muted. Overall, the S&P 500 rose 0.55%.

Despite markets remaining in the green, investors remain cautious as trade talks between the U.S. and China continued in London. Commerce Secretary Howard Lutnick told reporters on Tuesday that discussions with Chinese economic officials were going well. “We’re spending lots of time together,” he said.

AI buzz

Meta has retained its status as one of the topmost U.S. tech companies, despite high profile stumbles over the past few years. Those include its disastrous pivot to the metaverse, and its more recent scramble to keep pace in the AI arms race with competitors, including Google and OpenAI.

In its latest bid to shore up resources, Meta is building a new “superintelligence” AI research lab—a term for an AI system that would surpass the collective intelligence of humanity—that will likely be headed by the 28-year-old billionaire founder of Scale AI, Alexandr Wang. According to reports from Bloomberg and The Information, the deal to bring Wang on board would entail an investment into Scale AI totaling around $15 billion.

Though the move may not be enough for Meta to compete with other AI labs, the company’s stock still ticked up by 1.20%, bringing its monthly gain to 9.85%. Google rose by 1.29% on Tuesday.

As for Tesla, despite Tuesday’s bump, Tesla has still fallen by 5.55% over the past week. The company is planning to launch its long-anticipated self-driving taxi service in Austin by the end of the month.

Another red-hot tech stock, the stablecoin company Circle, maintained most of its massive gains from its initial public offering last week, hovering around $105, though it dropped 8.31% on the day. As Congress inches closer to passing landmark legislation that would establish regulation for stablecoins, a type of dollar-backed cryptocurrency, Circle had the largest two-day pop for an IPO that raised more than $500 million since 1980. Analysts said that Circle’s performance could encourage other fintech and crypto companies to go public, with the exchange Gemini announcing that it had confidentially filed for its IPO last week.

This story was originally featured on Fortune.com

© David Paul Morris—Getty Images

Marines and additional National Guard troops headed to Los Angeles on Tuesday, sent by President Donald Trump in response to four days of protests over immigration raids despite the strenuous objections of state and local leaders.

California Gov. Gavin Newsom, meanwhile, filed an emergency motion in federal court to block the Trump administration from using the Guard and Marines to assist with immigration raids in Los Angeles, saying the motion was in response to an apparent change in orders that had been issued for the Guard.

Trump’s deployment of roughly 4,000 National Guard members and 700 Marines to the country’s second-largest city came despite a relative calm to the Monday’s and Tuesday’s protests.

State officials sued Trump on Monday in an attempt to roll back the Guard deployment, saying the president had trampled on California’s sovereignty.

This appears to be the first time in decades that a state’s National Guard was activated without a request from its governor. Trump said in a social media post that the city would have been “completely obliterated” if he hadn’t sent Guard members to the city over the weekend.

Here are some things to know about the lawsuit, the protests and the troop deployments:

LA mayor blasts Trump

Mayor Karen Bass pinned the unrest at some protests squarely on the Trump administration, saying Tuesday that there was “nothing going on here that warranted the federal intervention.”

She also said she was mystified about why the Marines were sent.

“People have asked me what are the Marines going to do when they get here? That’s a good question. I have no idea,” she said at a news conference, emphasizing that violence and looting by protesters won’t be tolerated and that the city was considering imposing a curfew.

She also called out Trump for suggesting the National Guard, not local police, quelled the violence that did happen. She noted Trump made the claim in a Saturday night tweet, but that the National Guard troops didn’t arrive until Sunday.

“If you want to know what the National Guard is doing, drive by the federal building. They are stationary at the federal building protecting the building,” she said. “They are not out doing crowd control or anything like that. So I don’t know how he could say that the National Guard is who saved the day. Who saved the day was our local law enforcement agencies.”

Bass also suggested that the $134 million that the Pentagon said it was costing to deploy troops to LA would have better used to help the city prepare for next summer’s World Cup.

Newsom vs. Trump

The governor on Tuesday filed an emergency request seeking to block the Trump administration from using the Guard and Marines to assist with immigration raids.

The filing included a declaration from Paul Eck, deputy general counsel in the California Military Department. Eck said the department has been told that the Pentagon plans to direct the California National Guard to start providing support for immigration operations. That support would include holding secure perimeters around areas where raids are taking place and securing streets for immigration agents.

The Guard members were originally deployed to protect federal buildings.

Trump and Newsom have been feuding over the immigration raids and protests, with the president and his border czar, Tom Holman, trading taunts with the governor about the possibility of arresting Newsom if he interfered with federal immigration enforcement efforts.

“I would do it if I were Tom. I think it’s great,” Trump said.

Newsom responded in a post on X: “The President of the United States just called for the arrest of a sitting Governor. This is a day I hoped I would never see in America.”

The governor called the presence of troops on the streets of Los Angeles both “illegal and immoral,” writing: “This isn’t about public safety. It’s about stroking a dangerous President’s ego.”

In a post Monday, Newsom called the deployment of Marines “a blatant abuse of power” and said officials would sue to stop it.

“U.S. Marines serve a valuable purpose for this country — defending democracy. They are not political pawns,” Newsom wrote. “The Courts and Congress must act. Checks and balances are crumbling.”

What’s the mood in the city?

Downtown Los Angeles was fairly quiet Tuesday morning, with Guard members outnumbering protesters. Several Guard members were stationed in front of the Metropolitan Detention Center, a federal lockup where some immigrants are being held, with long guns and wooden bats slung over their shoulders. Passing drivers occasionally honked at or heckled them, drawing no response. News crews were stationed across the street, awaiting the possible arrival of the Marines, who had arrived in the area by late morning.

Otherwise, there were few signs of the tumult that gripped the city in recent nights, aside from the graffiti scrawled across several buildings — “Abolish ICE,” “Amerikkka,” and obscene slogans directed at Trump and federal law enforcement.

Monday’s demonstrations were less raucous than Sunday’s, with thousands peacefully attending a rally at City Hall to protest Friday’s arrest of union leader David Huerta, who was protesting the immigration raids, and hundreds rallying outside of the Metropolitan Detention Center. The protests have been driven by anger over Trump’s stepped-up enforcement of immigration laws that critics say are tearing apart migrant families.

What’s behind the demonstrations?

The protests were sparked by Trump’s immigration crackdown in the area. They started Friday in downtown Los Angeles before spreading on Saturday to Paramount and neighboring Compton.

Federal agents arrested immigrants in LA’s fashion district, in a Home Depot parking lot and at several other locations on Friday. The next day, they were staging at a Department of Homeland Security office near another Home Depot in Paramount, which drew out protesters who suspected another raid. Federal authorities later said there was no enforcement activity at that Home Depot.

Demonstrators attempted to block Border Patrol vehicles by hurling rocks and chunks of cement. In response, agents in riot gear unleashed tear gas, flash-bang explosives and pepper balls.

The weeklong tally of immigrant arrests in the LA area climbed above 100, federal authorities said. Many have also been arrested while protesting.

What’s happening elsewhere?

Protest over immigration raids have happening in major cities throughout the country, including on Tuesday, though none have reached the scale of those in Los Angeles.

Hundreds of protesters organized by the Austin, Texas, chapter of the Party for Socialism and Liberation gathered Monday near the state Capitol before moving toward the federal building that houses an Immigration and Customs Enforcement office.

Authorities appeared to use chemical irritants to disperse a crowd, and the city’s police chief said Tuesday that four officers were injured during the protests, including three who were struck by thrown rocks.

In Dallas, hundreds of people demonstrated on a city bridge for hours before police determined the rally to be “unlawful.” Police said one person was arrested and that charges were pending.

The demonstrations from Boston to Seattle have ranged from gatherings outside of federal office buildings or statehouses, and marches through downtown neighborhoods. “No Kings” rallies critical of Trump are planned nationwide Saturday to coincide with the president’s scheduled military parade in Washington, D.C.

___

Associated Press reporters Michael Casey in Boston, Jesse Bedayn in Denver, Jason Dearen in Los Angeles, Rio Yamat in Las Vegas, Maryclaire Dale in Philadelphia, Amy Taxin in Santa Ana, California, Martha Bellisle in Seattle, Kate Payne in Tallahassee, Florida, and Lolita C. Baldor in Washington contributed to this report.

This story was originally featured on Fortune.com

© AP Photo Damian Dovarganes

When Blackstone researches a company before a deal, it brings in not only financial experts but also HR mavens.  

Every company Blackstone considers investing in gets evaluated for its financial performance, growth potential and leadership—the personnel that should, in theory, be shepherding that company toward a brighter future and a higher multiple. 

“We think about succession planning day one,” Blackstone senior managing director Courtney della Cava said at Fortune’s COO Summit on Monday. 

Della Cava is an influential figure inside Blackstone, which is the world’s largest alternative asset manager with $1 trillion in assets under management. After 10 years at the consulting giant Bain & Company and a career in HR at the highest levels of corporate America, della Cava joined Blackstone in 2021 to lead hiring across its more than 250 portfolio companies. 

During her tenure she turned talent evaluation from an art that relied on gut feelings and intuition to a precise science. It was the exact sort of transformation that appeals to investors like Blackstone who are eager to quantify every aspect of businesses they evaluate. Human resources became just as critical, and carefully appraised, in an investment thesis as projected cash flows or market opportunity. 

When evaluating a deal, della Cava starts with imagining what kind of return on investment she’s like to see: “If this is the point of departure, when we sell it in 12 months or 18 months, what do we hope [the value] will be at the end?” she said. “And then we work backwards to the people.”

Della Cava focuses on two roles in particular: CEOs and board chairs. “Those are the two anchors for a deal,” she said.

One of the CEOs that della Cava and Blackstone recently selected to lead a portfolio company was Howard Hochhauser, CEO of Ancestry.com. Hochhauser stepped into the top job in February, after having served in a dual role as CFO and COO and a brief stint as interim CEO from October 2017 to May 2018. 

Even someone like Hochhauser, who was a veteran executive, said he was surprised by how all-encompassing the corner office could be. 

A CEO at a Blackstone portfolio company is tasked with running the business but also with planning for a future exit—whether that be an IPO or another sale—which adds another layer of consideration to their work. 

“Everybody wants a successful exit,” Hochhauser said. “To do that, you have to grow the company. And so now it’s spending 110% of my time on growth.”

The exit plan is never far off from Blackstone’s plans 

“We have opportunities to seize and also, ultimately, when we go to exit, they want a good, strong leadership team that’s going to sustain,” della Cava said. “So I wish it were just identifying a CEO—one and done. But what makes it fun is the end to end ecosystem.”

This story was originally featured on Fortune.com

© Kristy Walker/Fortune

An increasing number of mainstream companies are experimenting with blockchain technology, according to a new report. 

Around 60% of Fortune 500 executives say their companies are “working on blockchain initiatives,” according to a new survey published by crypto exchange Coinbase on Tuesday, in partnership with GLG Research. That’s a 4% increase from last year. Many of these crypto projects are related to the use of blockchain technology for payments and settlements, supply chain management, and blockchain infrastructure. 

GLG Research and Coinbase did not immediately respond to a request for comment from Fortune.

The latest data comes as a new political climate has made the idea of blockchain more interesting to mainstream U.S. corporations. President Donald Trump has supported the idea of a clear regulatory framework for crypto, and has been much more supportive of the industry than President Biden. 

The industry has also experienced a recent IPO boom. This month, Circle—a major company that issues a stablecoin called USDC, which is pegged to the value of the U.S. Dollar—went public with an $8 billion valuation. Other crypto companies have also recently filed to go public or are reportedly considering it, including crypto exchanges Gemini and Kraken.

Since the start of the year, a number of financial companies have announced that they are using or experimenting with stablecoins including asset manager Fidelity, global payments company Visa and fintech company Stripe. 

Other tech companies are jumping on the stablecoin trend as well. Social media platform X, AirBnB and Google are all in early conversations about integrating stablecoins into their business operations. And in May, Fortune reported that Mark Zuckerberg’s Meta—which has unsuccessfully experimented with blockchain technology in the past—has been in discussions with crypto companies to introduce the use of stablecoins for payouts. 

An increasing number of mainstream companies are experimenting with blockchain technology, according to a new report. 

Around 60% of Fortune 500 executives say their companies are “working on blockchain initiatives,” according to a new survey published by crypto exchange Coinbase on Tuesday, in partnership with GLG Research. That’s a 4% increase from last year. Many of these crypto projects are related to the use of blockchain technology for payments and settlements, supply chain management, and blockchain infrastructure. 

GLG Research and Coinbase did not immediately respond to a request for comment from Fortune.

The latest data comes as a new political climate has made the idea of blockchain more interesting to mainstream U.S. corporations. President Donald Trump has supported the idea of a clear regulatory framework for crypto, and has been much more supportive of the industry than President Biden. 

The industry has also experienced a recent IPO boom. This month, Circle—a major company that issues a stablecoin called USDC, which is pegged to the value of the U.S. Dollar—went public with an $8 billion valuation. Other crypto companies have also recently filed to go public or are reportedly considering it, including crypto exchanges Gemini and Kraken.

Since the start of the year, a number of financial companies have announced that they are using or experimenting with stablecoins including asset manager Fidelity, global payments company Visa and fintech company Stripe. 

Other tech companies are jumping on the stablecoin trend as well. Social media platform X, AirBnB and Google are all in early conversations about integrating stablecoins into their business operations. And in May, Fortune reported that Mark Zuckerberg’s Meta—which has unsuccessfully experimented with blockchain technology in the past—has been in discussions with crypto companies to introduce the use of stablecoins for payouts. 

This story was originally featured on Fortune.com

© Illustration by Fortune Staff

• Ohio State University is making AI literacy a requirement for all undergraduates starting in 2025. The university’s new “AI Fluency” initiative includes hands-on workshops and a dedicated course, aiming to equip students to use generative AI responsibly in their chosen fields.

Ohio State University is requiring all students to learn how to use AI. The university’s “AI Fluency” initiative, announced last week, aims to ensure all students graduate equipped to apply AI tools and applications in their fields.

“Through AI Fluency, Ohio State students will be ‘bilingual’ — fluent in both their major field of study and the application of AI in that area,” Ravi V. Bellamkonda, executive vice president and provost at Ohio State, said in a statement. “Grounded with a strong sense of responsibility and possibility, we will prepare Ohio State’s students to harness the power of AI and to lead in shaping the future of their area of study.”

Starting in fall 2025, hands-on experience with AI tools will become a core expectation for every undergraduate at the college, no matter their field of study.

Students will receive an introduction to generative AI in their first few weeks of college while further training will be threaded into the university’s First Year Success Series. These workshops will aim to give students early exposure to real-world applications of AI, and a broader slate of workshops will be available throughout the academic year.

“Ohio State’s faculty have long been pioneers in exploring the transformative potential of AI, driving innovation both in research and education,” said Peter Mohler, the university’s executive vice president for research, innovation, and knowledge. “Our university is leading the way in a multidisciplinary approach to harnessing AI’s benefits, significantly shaping the future of learning and discovery.”

Colleges are changing their view on AI

Colleges have been gradually changing their approach to AI use over the last year, with many beginning to incorporate the tech into classes. College campuses have been somewhat of a flashpoint for wider tensions around AI, as the tech has sparked some tensions between students and professors.

Students were some of the early adopters of the tech after they realized tools like OpenAI’s ChatGPT were capable of producing decent-quality essays in seconds. This prompted a rise in the number of students using AI to cheat on assignments, but also led to a few false accusations from professors in return.

Most U.S. colleges have been trying to define and allow for some “acceptable” use of AI among students and professors, but the guidance has sometimes struggled to keep pace with technological advances. Ohio State University’s recent initiative goes further than most colleges and makes the argument that students need to skill up in AI before entering the workforce.

Entry-level jobs, which are typically taken by recent graduates, are some of the most exposed to AI automation. Some have argued recently that we are already seeing these jobs disappear.

The university’s president, Walter “Ted” Carter Jr, said in a statement: “Ohio State has an opportunity and responsibility to prepare students to not just keep up, but lead in this workforce of the future.”

“Artificial intelligence is transforming the way we live, work, teach, and learn. In the not-so-distant future, every job, in every industry, is going to be [affected] in some way by AI,” he added.

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Today’s most advanced AI models are relatively useful for lots of things—writing software code, research, summarizing complex documents, writing business correspondence, editing, generating images and music, role-playing human interactions, the list goes on. But relatively is the key word here. As anyone who uses these models soon discovers, they remain frustratingly error-prone and erratic. So how could anyone think that these systems could be used to run critical infrastructure, such as electrical grids, air traffic control, communications networks, or transportation systems?

Yet that is exactly what a project funded by the U.K.’s Advanced Research and Invention Agency (ARIA) is hoping to do. ARIA was designed to be somewhat similar to the U.S. Defense Advanced Research Projects Agency (DARPA), with government funding for moonshot research that has potential governmental or strategic applications. The £59 million ($80 million) ARIA project, called The Safeguarded AI Program, aims to find a way to combine AI “world-models” with mathematical proofs that could guarantee that the system’s outputs were valid.

David Dalrymple, the machine learning researcher who is leading the ARIA effort, told me that the idea was to use advanced AI models to create a “production facility” that would churn out domain-specific control algorithms for critical infrastructure. These algorithms would be mathematically tested to ensure that they meet the required performance specifications. If the control algorithms pass this test, the controllers—but not the frontier AI models that developed them—would be deployed to help run critical infrastructure more efficiently.

Dalrymple (who is known by his social media handle Davidad) gives the example of the U.K.’s electricity grid. The grid’s operator currently acknowledges that if it could balance supply-and-demand on the grid more optimally, it could save £3 billion ($4 billion) that it spends each year essentially paying to have excess generation capacity up-and-running to avoid the possibility of a sudden blackout, he says. Better control algorithms could reduce those costs.

Besides the energy sector, ARIA is also looking at applications in supply chain logistics, biopharmaceutical manufacturing, self-driving vehicles, clinical trial design, and electric vehicle battery management.

AI to develop new control algorithms

Frontier AI models may be reaching the point now where they may be able to automate algorithmic research and development, Davidad says. “The idea is, let’s take that capability and turn it to narrow AI R&D,” he tells me. Narrow AI usually refers to AI systems that are designed to perform one particular, narrowly-defined task at superhuman levels, rather than an AI system that can perform many different kinds of tasks.

The challenge, even with these narrow AI systems, is then coming up with mathematical proofs to guarantee that their outputs will always meet the required technical specification. There’s an entire field known as “formal verification” that involves mathematically proving that software will always provide valid outputs under given conditions—but it’s notoriously difficult to apply to neural network-based AI systems. “Verifying even a narrow AI system is something that’s very labor intensive in terms of a cognitive effort required,” Davidad says. “And so it hasn’t been worthwhile historically to do that work of verifying except for really, really specialized applications like passenger aviation autopilots or nuclear power plant control.”

This kind of formally-verified software won’t fail because a bug causes an erroneous output. They can sometimes break down because they encounter conditions that fall outside their design specifications—for instance a load balancing algorithm for an electrical grid might not be able to handle an extreme solar storm that shorts out all of the grid’s transformers simultaneously. But even then, the software is usually designed to “fail safe” and revert back to manual control.

ARIA is hoping to show that frontier AI modes can be used to do the laborious formal verification of the narrow AI controller as well as develop the controller in the first place.

But will AI models cheat the verification tests?

But this raises another challenge. There’s a growing body of evidence that frontier AI models are very good at “reward hacking”—essentially finding ways to cheat to accomplish a goal—as well as at lying to their users about what they’ve actually done. The AI safety non-profit METR (short for Model Evaluation & Threat Research) recently published a blog on all the ways OpenAI’s o3 model tried to cheat on various tasks.

ARIA says it is hoping to find a way around this issue too. “The frontier model needs to submit a proof certificate, which is something that is written in a formal language that we’re defining in another part of the program,” Davidad says. This “new language for proofs will hopefully be easy for frontier models to generate and then also easy for a deterministic, human audited algorithm to check.” ARIA has already awarded grants for work on this formal verification process.

Models for how this might work are starting to come into view. Google DeepMind recently developed an AI model called AlphaEvolve that is trained to search for new algorithms for applications such as managing data centers, designing new computer chips, and even figuring out ways to optimize the training of frontier AI models. Google DeepMind has also developed a system called AlphaProof that is trained to develop mathematical proofs and write them in a coding language called Lean that won’t run if the answer to the proof is incorrect.

ARIA is currently accepting applications from teams that want to run the core “AI production facility,” with the winner the £18 million grant to be announced on October 1. The facility, the location of which is yet to be determined, is supposed to be running by January 2026. ARIA is asking those applying to propose a new legal entity and governance structure for this facility. Davidad says ARIA does not want an existing university or a private company to run it. But the new organization, which might be a nonprofit, would partner with private entities in areas like energy, pharmaceuticals, and healthcare on specific controller algorithms. He said that in addition to the initial ARIA grant, the production facility could fund itself by charging industry for its work developing domain-specific algorithms.

It’s not clear if this plan will work. For every transformational DARPA project, many more fail. But ARIA’s bold bet here looks like one worth watching.

With that, here’s more AI news…

Jeremy Kahn
[email protected]
@jeremyakahn

Want to know more about how to use AI to transform your business? Interested in what AI will mean for the fate of companies, and countries? Why not join me in Singapore on July 22 and 23 for Fortune Brainstorm AI Singapore. We will dive deep into the latest on AI agents, examine the data center build out in Asia, and talk to top leaders from government, board rooms, and academia in the region and beyond. You can apply to attend here.

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Brooks Running CEO Dan Sheridan filled many roles in his 27 years at the running shoe company—including chief operating officer—before he took the reins last year. One thing that’s helped him ascend is an ability to take a holistic view of the company’s needs.

COOs are typically brilliant at technical things but also need to understand how other functions play into a company’s overall success. So yes, a running shoe company has to nail supply-chain and e-commerce logistics, but it also has to get customers interested in its gear and make footwear that is competitive in today’s running shoe wars.

A COO is, of course, really in the thick of things operationally, helping him or her know a company intimately. A challenge for any aspiring CEO is being able to take a higher-level view without losing that deep knowledge of how the company runs, Sheridan told the Fortune COO Summit in Scottsdale on Monday. “I use this saying with my team: ‘Keep your head above the clouds, but keep your feet in the mud,’” he added.

“In that transition from COO to CEO you get your feet dirty at times, and you’re really trying to see above the clouds,” he added. He advised any COOs in the audience with CEO ambitions to try to envision their company’s needs from many perspectives, and shared leadership advice he was given by Berkshire Hathaway: “It’s understanding your biases and then really thinking long term as you move into the CEO role.”

As Sheridan steers Brooks through a period of enormous change, that long-term view is becoming ever more important. Brooks, which took in about $1.6 billion in revenue last year, could become a $4 billion brand, according to Sheridan.

Best known as a maker of shoes for serious runners, Brooks is far behind rivals like New Balance in offering more casual wear. Brooks also faces stiff competition, from newer sneaker brands like On and Hoka. What’s more, Brooks gets its sales primarily in North America.

“We’re mostly footwear, but we now have permission from the consumer to expand this brand,” he said.

All this change means Brooks operational prowess will be tested.

“We want to assort our brand wherever the greatest retailers are that are focused on running, and that creates complexity at an operational level, because we don’t own the systems of these retailers. We don’t own the distribution networks, the transportation networks,” he said. “So what we’ve had to do is build an operation that really taps with agility into all of these partners around the world.”

This story was originally featured on Fortune.com

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Federal and state government officials are axing public health funding—and justifying the cuts with appeals to fiscal responsibility.

But this slash-and-burn approach is enormously shortsighted. Every dollar “saved” now will cost us far more—in both dollars and lives—when the next health emergency inevitably hits.

Americans know the toll an infectious disease outbreak can take. We just lived through one. COVID-19 killed over 1 million Americans and cost our economy trillions. Government-funded initiatives—such as federally backed research into mRNA vaccines and “field team” deployments to local outbreaks—saved us from an even worse outcome.

Now those very systems are being torn apart. This year alone, over $1.8 billion in NIH research funding has been terminated. The CDC’s Healthcare Infection Control Practices Advisory Committee, which sets safety standards for hospitals, was just eliminated. The new federal budget could cut funding for the Department of Health and Human Services by over a quarter.

And it’s not just pandemic preparedness systems suffering from mass layoffs and budget cuts. Institutions designed to protect Americans from foodborne illnesses, antibiotic-resistant infections, and bioterrorism are being gutted as well.

Simply put, this is a catastrophic mistake—one that doesn’t merely threaten our health and economy, but also our national security.

Defense officials have long warned that pandemics, bioterrorism, and emerging infections are critical threats to U.S. stability. The Defense Department reported to Congress earlier this year on how it continually works to monitor and prevent infectious disease outbreaks, given that “a pandemic could potentially impact every component of the Department’s ability to perform its mission.”

The National Security Commission on Emerging Biotechnology also warned about the growing threat posed by biowarfare in a recent report. Because America’s biotech industry is falling behind China’s, in part due to the government’s dwindling support for research, we’re increasingly vulnerable to bioweapon attacks from adversaries, the report said.

The United States spends billions to prepare for military threats we hope never materialize. Our leaders need to fund disease prevention efforts with the same urgency we give to tanks and missiles. As we learned from COVID, infectious diseases can cause more death and destruction than even the most powerful conventional army.

COVID also showed us that pandemic preparedness pays dividends. Countries that invested more in limiting disease risks, such as Iceland and New Zealand, experienced lower mortality rates. By contrast, America suffered because we had allowed our public health infrastructure to erode for decades.

We cannot afford to repeat—or worse, deepen—that mistake. Policymakers can prevent that from happening by restoring funding for public health agencies and investing in resources, such as labs, vaccines, and rapid response teams, that serve as our first and last lines of defense.

Cutting public health funding may be politically expedient, but preventing infectious disease isn’t a partisan issue. Pathogens don’t check party affiliation, respect national borders, or stop at state lines.

We have a solemn duty—both to current citizens and to future generations of Americans—to strengthen the public health institutions that keep us safe. It’s time for our leaders to act like it.

Howard Dean is the former chair of the Democratic National Committee and former governor of Vermont.

The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.

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Sugar is the enemy. Right? Not always, as it turns out—at least according to a new study, which found it depends on how you consume it.

In analyzing data from over half a million people across multiple continents, researchers at Brigham Young University found something unexpected: that sugar consumed through drinks like soda—and even pure fruit juice, which is high in naturally occurring fructose—appeared to be more harmful than sugar that is eaten in foods.

“This is the first study to draw clear dose-response relationships between different sugar sources and Type 2 diabetes risk,” said Karen Della Corte, lead author and BYU nutritional science professor, in a news release. “It highlights why drinking your sugar—whether from soda or juice—is more problematic for health than eating it.”

Food sugar sources showed no such link and, in some cases, were even associated with a lower risk.

The findings, after correcting for body mass index and various lifestyle risk factors, include:

• Sugary drinks are risky. The risk for developing Type 2 diabetes (T2D) increased by 25% with each additional 12 oz daily serving of sugar-sweetened beverages—including soft drinks, energy drinks, and sports drinks.
• Fruit juice is also a problem. With each additional 8-oz serving of fruit juice per day—including 100% fruit juice, nectars, and juice drinks—the risk for developing T2D increased by 5%.
• Individual responses may vary. The above risks are “relative but not absolute,” note the researchers, and depend on a person’s baseline risk of developing T2D; for example, if the average person’s baseline risk of developing T2D is about 10%, four sodas a day could raise that to roughly 20%, not 100%.
• Sugary food is in a different category. Comparatively, an intake of 20 grams a day (about 1.6 tablespoons) of total sucrose (table sugar) and total sugar (the sum of all naturally occurring and added sugars in the diet) showed an inverse association with T2D, “hinting at a surprising protective association.”

Why is drinking sugar worse?

It may come down to the differing metabolic effects, explains the news release. 

“Sugar-sweetened beverages and fruit juice supply isolated sugars, leading to a greater glycemic impact that would overwhelm and disrupt liver metabolism thereby increasing liver fat and insulin resistance,” it notes.

But dietary sugars consumed in or added to nutrient-dense foods, such as whole fruits, dairy products, or whole grains, do not cause metabolic overload in the liver. “These embedded sugars,” says the release, “elicit slower blood glucose responses due to accompanying fiber, fats, proteins and other beneficial nutrients.”

A note about fruit juice

While it might be counterintuitive to think that fruit juice could be in the same relative category of harm as soda, the researchers explain why it makes sense. 

Compared to sugars from sugar-sweetened beverages (SSBs), which provide empty calories, fruit juice, the study says, “can contain beneficial nutrients such as vitamins and phytochemicals; however, our study found that sugar consumption from fruit juice was positively associated with T2D risk. The high sugar content and lack of fiber in fruit juice are similar to SSBs, making it a poor substitute for whole fruits, which provide higher fiber content to support better blood glucose regulation.”

But sugar-sweetened beverages are still worse than sugary foods, as they supply isolated sugars leading to a greater glycemic impact. “Whereas other sources of dietary sugars, particularly when consumed in nutrient-dense foods such as whole fruits, dairy products, or whole grains, may elicit slower blood glucose responses due to accompanying fiber, fats, or proteins,” the researchers note.

Finally, they point out that, while future research is still needed to evaluate the long-term impacts of sugar consumption, the findings suggest the importance of sugar type in determining the association of dietary sugar, “with higher liquid sugar intakes apparently linked to greater harm.”

More on sugar:

• Being obsessed with blood sugar might be a mistake for older adults, research shows
• It’s time to rethink your relationship with sugar. Here’s how
• How much ultraprocessed food is too much? The exact amount that raises your risk of heart disease and cancer

This story was originally featured on Fortune.com

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Meta’s decision to create an ambitious new “superintelligence” AI research lab headed by Scale AI’s Alexandr Wang is a bold bid for relevance in its fierce AI battle with OpenAI, Anthropic and Google. It is also far from a slam-dunk. 

While the pursuit of an ill-defined superintelligence—typically meant as an AI system that could surpass the collective intelligence of humanity–would have seemed a quixotic, sci-fi quest in the past, it has become an increasingly common way for top AI companies to attract talent and secure a competitive edge.

Tapping the 28-year-old Wang to lead the new superintelligence effort, while in talks to invest billions of dollars into Scale AI, as reported today by the New York Times, clearly shows Mark Zuckerberg’s confidence in Wang and Scale. The startup, which Wang co-founded in 2016, primarily focuses on providing high-quality training data, the “oil” that powers today’s most powerful AI models. Meta invested in Scale’s last funding round, and also recently partnered with Scale and the U.S. Department of Defense on “Defense Llama,” a military-grade LLM based on Meta’s Llama 3 model. 

Meta has struggled, however, with several reorganizations of its generative AI research and product teams over the past two years. And the high-stakes AI talent wars are tougher to win than ever. Meta has reportedly offered seven-to-nine figure compensation packages to dozens of top researchers, with some agreeing to join the new lab. But one VC posted on X that even with those offers on the table, he had heard of three instances in which Meta still lost candidates to OpenAI and Anthropic. 

Meta already has a long-standing advanced AI research lab, FAIR (Fundamental AI Research Lab), founded by Meta chief scientist Yann LeCun in 2013. But FAIR has never claimed to be pursuing superintelligence, and LeCun has even eschewed the term AGI (artificial general intelligence), which is often defined as an AI system that would be as intelligent as an individual person. LeCun has gone on record as being skeptical that current approaches to AI, built around large language models (LLMs), will ever get to human-level intelligence.

In April, LeCun  told Fortune that a spate of high-profile departures from FAIR, including that of former FAIR head Joelle Pineau, was not a sign of the lab’s “dying a slow death.” Instead, he said, it was a “new beginning” for FAIR, refocusing on the “ambitious and long-term goal of what we call AMI (advanced machine intelligence).” 

Aside from FAIR, Meta CEO Mark Zuckerberg has spent billions on generative AI development in a bid to catch up to OpenAI, following the launch of that company’s wildly popular ChatGPT in November 2022. Zuckerberg rebuilt the entire company around the technology and succeeded in creating highly-successful open source AI models, branded as Llama, in 2023 and 2024. The Llama models helped Meta recover from an underwhelming pivot to the metaverse. 

But Meta’s latest AI model, Llama 4, which was released in April 2025, was considered a flop. The model’s debut was attended by controversy around a perceived rushed release, lack of transparency, possibly inflated performance metrics, and indications that Meta was failing to keep pace with open-source AI rivals like China’s DeepSeek.

For the past year, Meta’s been hemorrhaging top AI talent. Three top Meta AI researchers–Devi Parikh, Abhishek Das and Dhruv Botra, left a year ago to found Yutori, a startup focused on AI agents. Damien Sereni, an engineering leader at Meta who led the team working on PyTorch, a framework underpinning most of today’s top LLMs, recently left the company. Boris Cherny is a software engineer who left Meta last year for Anthropic and created Claude Code. And Erik Meijer, a former Meta engineering leader, told Fortune recently that he has heard that several developers from PyTorch have recently left to join former OpenAI CTO Mira Murati’s Thinking Machine Labs.

Meta’s move to bring in Wang, along with a number of other Scale employees, while simultaneously investing in Scale, follows what has, over the past 18 months, become a standard playbook for big tech companies looking to grab AI know-how from startups. Microsoft used a similar deal structure, which stops short of a full acquisition yet still amasses talent and technical IP, to bring in Mustafa Suleyman from Inflection. Amazon then used the arrangement to hire key talent from Adept AI and Google used it to rehire Character AI cofounder Noam Shazeer. Because the deals are not structured as acquisitions, it is more difficult for antitrust regulators to block them.

It remains unclear whether Meta will be able to declare the Scale deal as a big win. It’s also not yet certain whether Yann LeCun will find himself marginalized within the Meta research ecosystem. But one big rising power player is undeniable: Alexandr Wang.

Wang became a billionaire with Scale by providing a global army of contractors that could label the data that companies including Meta and OpenAI use to train and improve their AI models. While it went on to help companies make custom AI applications, its core data business remains its biggest moneymaker. When Fortune spoke to Wang a year ago, he said that data was far from being commoditized for AI.  “It’s a pivotal moment for the industry,” he said. “I think we are now entering a phase where further improvements and further gains from the models are not going to be won easily. They’re going to require increasing investments and are gonna require innovations and computation and efficient algorithms, innovations, and data. Our leg of that school is to ensure that we continue innovating on data.” 

Now, with a potential Meta investment,Wang’s efforts are paying off big time. Zuckerberg can only hope the deal works as well for him as it has for Wang.

This story was originally featured on Fortune.com

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AI is transforming how enterprise software gets bought—not by replacing users, but by becoming one. 

The debate around AI and the workplace often centers on labor displacement: Will it replace workers? Where will it fall short? And indeed, some “AI-first” experiments have produced mixed results—Klarna reversed course on customer service automation, while Duolingo faced public backlash for an AI-focused growth strategy. 

These outcomes complicate our understanding of Microsoft’s recent efficiency-driven layoffs. Unlike a premature overcommitment to automation (à la Klarna), Microsoft is restructuring to operate as “customer zero” for its own enterprise AI tools, fundamentally changing how the computing giant writes code, ships products, and supports clients. It’s a strategic shot in the arm—a painful one—that reveals what’s coming next: AI agents built not just to automate outcomes, but to make decisions about the tools, processes, and infrastructure used along the way. 

AI agent as orchestrator

In the past, enterprise software was chosen through a familiar dance: evaluation, demos, stakeholder alignment, and procurement. But today, AI agents are building applications, provisioning infrastructure, and selecting tools—autonomously, and at scale. Ask an agent to spin up a customer feedback portal, and it might choose Next.js for the frontend, Neon for the cloud database, Vercel for hosting, and Clerk for authentication as a service. No human has to Google options, compare vendors, or meet with salespeople. The agent simply acts.

Internal telemetry from Neon shows that AI agents now create databases at 4 times the rate of human developers. And that pattern is extending beyond engineering. Agents will soon assemble sales pipelines, orchestrate onboarding flows, manage IT operations—and, along the way, select the tools that work. 

Microsoft’s sales team re-org further hints at how this procurement will occur in the future. Corporate customers now have a single point of contact at Microsoft, rather than several salespeople for different products. In part, this may be because agentic AI tools will select vendors on their own—and copilots don’t need five sales reps. The agent won’t pause to ask, “Do you have a preferred vendor?” It will reason about the task at hand and continue on its code path, hurtling toward an answer.

Human-in-the-loop AI

This evolution from executor to decision-maker is powered by the human-in-the-loop (HITL) approach to AI model training.

For years, enterprise AI has been limited by expensive labeling processes, fragile automation, and underutilized human expertise, leading to failure in nuanced, high-stakes environments like finance, customer service, and health care.

HITL systems change that by embedding AI directly into the workforce. During real-time work, agents observe GUI-level interactions—clicks, edits, approvals—capturing rich signals from natural behavior. These human corrections serve as high-quality validation points, boosting operational accuracy to ~99% without interrupting the workflow. The result is a continuous learning loop where agents don’t just follow instructions, they learn how the work gets done. This also creates dynamic, living datasets tailored to real business processes within the organization.

This shift offers entirely new market opportunities. 

On the development front, traditional supervised learning models are giving way to embedded learning systems that harvest real-world interaction signals, enabling cheaper, faster, more adaptive AI. This further offers a massive new training set for agentic AI systems without incurring the cost of hiring human knowledge workers to shepherd the AI. With lower development costs, high fidelity, and better dynamism, the next generation of copilots will blend automation with real-time human judgment, dominating verticals like customer service, security, sales, and internal operations. 

Accordingly, these tools will require infrastructure for real-time monitoring, GUI-level interaction capture, dynamic labeling, and automated retraining—creating further platform opportunities.

Microsoft’s sense of urgency

While the internet abounds with zippy coverage of savvy employees “AI hacking” their workflows, the reality is most workers lack that kind of product-development acumen. (And same for their bosses.) Save for a small subset of the business world possessing rare tech fluency, most corporate outfits will see greater value in buying AI tools—those built, customized, and serviced by world-class talent to solve specific workflows.

Microsoft’s sense of urgency comes from its understanding that the question of “build or buy” is changing quickly. This “eureka” moment, technologically speaking, is what’s catalyzing an operator pivot at enterprise AI outfits. HITL represents a move away from read/write data integrations toward a richer, more dynamic GUI-interaction-based intelligence layer—one that mirrors how work actually gets done in the enterprise. 

We’re seeing the beginning of a race toward enterprise AI dominance among the goliaths of the tech world. Signals like OpenAI’s investments into application-layer experiences (shopping agents, its acquisition of agentic developer Windsurf) highlight a clear trend: Mastering human-application-interaction capture is becoming the foundation for scalable agentic automation. As companies like Microsoft, OpenAI, and others absorb critical data environments and restructure themselves to serve as “customer zero,” they’re treating AI as the new chief procurement officer of their own ecosystems. These companies see the value of selling shovels in a gold rush—and know AI is finally sharp enough to start digging.

Tomasz Tunguz is the founder and general manager of Theory Ventures. He served as managing partner at Redpoint Ventures for 14 years.

The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.

Read more:

• ‘Sovereign AI’ is political branding. The reality is closer to digital colonialism
• Trump has inadvertently shown Europe it needs to build a full-stack AI industry—and avoid a risky reliance
• The AI cost collapse is changing what’s possible—with massive implications for tech startups
• When AI builds AI: The next great inventors might not be human

This story was originally featured on Fortune.com

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• After running interest rates near zero for a decade and a half, the Federal Reserve has turned cautious and is unlikely to cut anytime soon, according to Jeff Klingelhofer, a managing director and portfolio manager for Aristotle Pacific Capital. That’s because the central bank is concerned about social stability and inequality following its brush with record-high inflation—and low rates make inequality worse.

Most everyone knows about the Federal Reserve’s dual mandate. Set by Congress, the charge for the U.S. central bank is twofold: Create the conditions for stable prices (i.e., low inflation) and maximum employment. (The third mandate—to moderate long-term interest rates—flows naturally out of keeping inflation steady.) 

Increasingly, though, the third mandate is changing, according to Jeff Klingelhofer, a managing director and portfolio manager for Aristotle Pacific Capital, an investment advisory. And that new task is social cohesion.

It’s a tough call for an entity that has seemed somewhat battered in recent years, bruised by its failure to catch COVID-era inflation in time and, increasingly, in a fight with the president of the United States, who is pressing on the Fed’s nominally independent head to lower interest rates. 

“It’s out with the old—financial stability—and in with the new: social stability,” Klingelhofer told Fortune. 

Klingelhofer notes that, before the 2007-2009 Global Financial Crisis, the Fed used to be very proactive in raising interest rates, hiking them well before any sign of inflation. Post-crisis, when unemployment was stubbornly slow to fall, critics accused the Fed of hiking rates too quickly and stymieing the recovery. (The Fed’s first rate cut came in late 2015, with unemployment at 5% and the Fed’s preferred measure of inflation at just 1%.) Inflation didn’t come close to hitting the Fed’s 2% target for seven years after the hike. Years later, two Fed governors admitted they got the balance wrong and should have kept rates lower for longer.

In 2020, that shifted. The Fed, by keeping rates low, “learned the biggest wage gains went to the lowest earners,” Klingelhofer said. “Coming out of COVID, the third mandate was social stability, compression of the wage gap.” 

But the central bank also got burned with its prediction inflation would be “transitory.” That miss, coupled with the fastest and steepest rate-hiking cycle in modern history, has made the central bank loath to move too quickly on cutting rates this time. 

This shift is evident in the tenor of Chair Jerome Powell’s speeches, starting at Jackson Hole, Wyo., in 2022. 

“Without price stability, the economy does not work for anyone,” Powell said in 2022, adding the Fed was “taking forceful and rapid steps to moderate demand… and to keep inflation expectations anchored.” 

“We will keep at it until we are confident the job is done,” he said.

That experience has pushed the Fed from proactive to reactive, Klingelhofer said. “They’ll need to see inflation below 2%, and think it’ll stay there.”

If a recession hits, “I don’t think the Fed will step in as they have in the past,” he added. “Maybe if it’s a deep recession, with high unemployment, and inflation falls below 2% dramatically—maybe.” 

Low rates inflate assets

Historically low interest rates had another effect—they redistributed wealth upward by encouraging asset bubbles. In this way, as a recent body of economic research has shown, low rates have contributed to skyrocketing wealth inequality. 

Low interest rates tend to juice stock-market appreciation, benefiting the 10% of the population that owns more than 90% of stock, and encourage investors to create novel assets as they chase bigger returns. These benefits accrue most to those who have the biggest financial assets—i.e., the wealthiest—while doing little for the poor. 

And while low rates encourage higher employment, “the 1% of Americans who own 40% of all the assets just get tremendous gains before that first job is created for the middle class,” said Christopher Leonard, who criticized the Fed’s ultra-low-rate policies in The Lords of Easy Money, a 2022 book describing this dynamic. In this way, he said, the Fed exacerbates the gap between the ultra-rich and the rest of us, which he called “the defining economic dysfunction of our time.”

It’s another argument against cutting rates, in addition to the risk of reigniting inflation—whose burdens, as Powell repeatedly notes, “falls heaviest on those who are least able to bear them.”

“The alchemy of low interest rates is over,” Klingelhofer says. He isn’t convinced the Fed has that much influence on rates like the 10-year Treasury, which closely influences mortgage rates. These bonds trade in international markets where investors buy or sell them based on how they perceive the risks of U.S. debt. 

“Where should 10-year Treasuries be? With inflation at 3%, and the government running 6-7% deficits, 4.5% feels roughly correct,” he said. 

In fact, some economists say the Fed’s cutting rates would be perceived as a recession indicator—and would have the opposite effect, sending bond yields and interest rates soaring.

As Redfin economics research head Chen Zhao told Fortune previously, “the Fed only controls that one Fed funds rate. Everything else is determined by markets.”

This story was originally featured on Fortune.com

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• Starbucks is hiring two “global coffee creators” to travel the world and make TikToks—and it’s music to the ears of social-media-obsessed Gen Z. The role pays up to $136,000 annually, is completely remote, and doesn’t require a college degree or years of work experience. It’s a perfect match for young workers who could use the financial security, and value flexible schedules above all else. 

Gen Z’s dream job is being actualized in real time—working remotely to travel the world and make fun TikToks, while loading up on coffee and a six-figure salary. Starbucks is looking to hire two “global coffee creators” to jet-set on planes and enhance its social media storytelling. But only one position is up for grabs to the public.

“For one epic year, you’ll travel the world—think Milan, Tokyo, Colombia, Dubai, Costa Rica—and more, capturing the vibes, culture, and people behind every Starbucks experience,” the job listing says.

The $111 billion coffee chain unveiled the job posting late last month, hoping to lock in two “coffee-obsessed” creators for the next year. Interested applicants should shoot their shot soon—the posting is set to expire on June 13, and is sure to attract a strong pool of talent vying for the gig.

Annual pay ranges anywhere from between $80,100 and $136,000, and the role is eligible for a bonus. Since the global coffee creators will be jet-setting to 10 to 15 Starbucks locations across the world—paid for by the coffee giant—it’s a chance to explore creatively on a comfy budget. There are a few qualifications needed to get the job, but a huge part of it is bringing the vibes. 

“Your mission? Help us show the world why Starbucks coffee hits different,” the posting reads. “If storytelling, travel, and coffee fuel your soul, this is your dream gig.”

What it takes to be Starbucks’ global coffee creator

Becoming a Starbucks global coffee creator doesn’t require a master’s degree or a huge social media following. 

The coffee business has a few general requirements for the job. Applicants must be 18 years or older with a high school diploma or equivalent experience—no work experience or college degree required. They also must be U.S. residents with a valid passport for the duration of the gig: August 2025 to July 2026. 

The strongest candidates will also have a bit of physical strength. Traveling internationally will require a lot of legwork—whether that be getting their steps in while in Milan, or navigating the lush landscape of Costa Rica. Candidates need to be able to bend, lift, and carry their content equipment while they’re on the road for the next year. They also need to understand TikTok trends and adapt accordingly. 

The job posting notes that there are a few pluses that will stand out in applications: talent with strong interpersonal and cross-cultural skills, who can work independently and create their own schedules. 

The candidate also needs to be comfortable on camera and have strong storytelling skills to capture the local culture and community of international Starbucks locations. On a technical level, applicants should also be familiar with TikTok and Instagram creation alongside editing tools like Photoshop, InDesign, Premier, and Final Cut Pro. 

Why it’s the perfect job for Gen Z 

Starbucks has been on a hiring spree, posting high-paying roles like that of airplane pilot. But becoming a global coffee creator may be the better route for Gen Z to score a six-figure role straight out of high school.

Plus, because the job requires workers to jet-set from Milan to Tokyo, working in-office is out of the question. The gig is fully remote, which is music to the ears of Gen Z; after all, 40% of the young generation would suffer a pay cut in exchange for flexible schedules. 

Starbucks’ new posting also values the exact thing young people are criticized for: being chronically online. Gen Z is turning to TikTok influencers as their voice of reason over experts, and they’re so addicted to the social media app that nearly half wish it didn’t exist. Becoming a TikToker is even the second most sought-after career for the bright young minds of tomorrow. This is a rare opportunity to turn a time-sucking habit into a six-figure job with benefits.

This story was originally featured on Fortune.com

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The arrest of a high-profile union leader during ICE protests last week has prompted an outcry across labor organizations across the U.S., and could mark the beginning of a new escalation between organized labor and President Donald Trump in the war over immigration. 

David Huerta, the president of the Service Employees International Union of California (SEIU), was taken to the hospital on Friday where he was treated for injuries sustained during his arrest by ICE, according to a statement from the SEIU. He was released from federal custody on Monday, on a $50,000 bond, and charged with conspiracy to impede an officer. If convicted, he could face six years in prison. 

The SEIU did not immediately respond to Fortune’s request for comment. 

Huerta’s arrest took place during protests against ICE, when demonstrators in Los Angeles took to the streets to protest the immigration raids of garment workers. The Trump administration has long promised lofty deportation goals, and has set a quota in May of arresting 3,000 immigrants a day. The ICE raids in California are part of that new push. In response to the protests, President Donald Trump has ordered up to 4,000 National Guard troops and another 700 Marines to the city, over the objections of state officials. California has sued over the move, saying it violates state sovereignty. 

Huerta’s arrest has prompted several unions across the U.S. to condemn the administration’s actions, and may prove to be a turning point in the relationship between organized labor and the Trump administration. In his campaign last year, the president made inroads when it came to winning the support of union members, if not the unions themselves, and major unions like the Brotherhood of Teamsters chose not to endorse any candidate. But the actions of ICE in Los Angeles, and Huerta’s arrest, have prompted an outpouring of support from organized labor.    

SEIU President April Verrett released a statement after Huerta’s release on June 9, condemning his arrest by ICE, their immigration crackdown in Los Angeles, and Trump’s decision to send in the National Guard. “[T]his struggle is about much more than just one man. Thousands of workers remain unjustly detained and separated from their families,” she wrote. “At this very moment, immigrant communities are being terrorized by heavily militarized armed forces. The Trump regime calling in the National Guard is a dangerous escalation to target people who disagree with them. It is a threat to our democracy.”

The AFL-CIO, the largest federation of unions in the country, wrote in a statement on June 7: “As the Trump administration’s mass deportation agenda has unnecessarily targeted our hard-working immigrant brothers and sisters, David was exercising his constitutional rights and conducting legal observation of ICE activity in his community.”

After Huerta’s arrest, the American Federal of State, County and Municipal Employees wrote on June 8: “This is yet another example of the reckless and dangerous way deportations are being carried out, targeting hard-working community members. They are now trying to silence union leaders who dare to speak up.”

Several California unions came out in support of Huerta, including the California Teachers Association and SAG-AFTRA. 

Huerta’s arrest and the ICE raids in Los Angeles have also counter demonstrations across the country over the past few eays. “Make no mistake, history is being written right now,” said Abel Fuaau, a district representative for the International Union of Operating Engineers, Local 39, at a rally in San Francisco on Monday, KQED reported. “And as the old Union hymn goes, which side are you on? Who are you with?”

At another rally in New York City, Manny Pastreich, president of SEIU’s 32BJ chapter, told the assembled crowd: “We must fight back. We reject these attacks on our communities and demand the immediate release of our union brother David Huerta.”

This story was originally featured on Fortune.com

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• Lawmakers were active stock traders in the days following Trump’s Liberation Day tariff announcement. A study of trades shows House lawmakers (or their families) made 1,865 trades in April. This comes amid calls for reform that would prevent lawmakers from trading individual stocks.

While the debate on whether to ban members of Congress from trading individual stocks rages on, lawmakers were particularly active in April amid the announcement of Donald Trump’s tariffs.

A study by The Wall Street Journal found that House lawmakers reported 1,865 trades by them or their families in April, the highest number, by far, since January 2024. From the period between April 2, when Trump announced the tariffs, to April 8, when he paused them, over a dozen members of the House and their family reported over 700 trades.

And the most transactions, the paper says, were made by Reps. Ro Khanna (D., Calif.) and Rob Bresnahan (R., Pa.), who have previously called for stock-trading bans. Both said their trades were made by outside financial advisors.

Lawmakers weren’t the only ones selling and buying stocks during that period, of course. The S&P 500 fell more than 4.5% for two consecutive sessions after the so-called Liberation Day announcements. And after the pause, the Nasdaq index saw its biggest gain in 24 years, a 12% increase.

Because of the vague nature of disclosure rules for members of the House, it’s not possible to determine if the lawmakers made or lost money in those trades.

Two lawmakers seemed well-positioned to have profited, however. Marjorie Taylor Greene (R., Ga.) and Jared Moskowitz (D., Fla.) both bought in early April, so were likely to see those investments gain value after the market rebounded. Greene spend roughly $28,000 on FedEx, Amazon.com, Lululemon Athletica and Palantir Technologies. Moskowitz made 23 stock purchases of at least $1,000 each in companies such as Amazon, Nvidia and Visa.

Both said financial advisors made the trades.

This story was originally featured on Fortune.com

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• Paramount Global is laying off 3.5% of its staff, impacting hundreds of employees. The entertainment giant laid off roughly 2,000 workers last year. It’s in the process of trying to get approval for its merger with Skydance Media.

Paramount Global is downsizing its staff once again.

The entertainment giant, which owns CBS, Comedy Central, MTV, and more channels and properties, announced plans to reduce its U.S. headcount by 3.5%, which will impact hundreds of jobs. The company blamed the economy and decline in traditional pay-television revenues for the action.

“We recognize how difficult this is and are very thankful for everyone’s hard work and contributions,” the company wrote in a memo to staff. ”These changes are necessary to address the environment we are operating in and best position Paramount for success.”

Paramount, as of December, had 18,600 full- and part-time employees globally. (The company does not break that number down between domestic and international workers.)

This is the second (or third, depending on how you count) round of layoffs for the company in the past year. Last August, Paramount announced plans to cut 15% of its workforce, which impacted approximately 2,000 workers. The following month, the second round of those cuts occurred.

The company also laid off 800 workers last February, the day after it saw record Super Bowl ratings.

The cuts come as Paramount is seeking regulatory approval for its proposed merger with Skydance Media. The company has also made a controversial $15 million offer to settle a lawsuit Donald Trump filed last year over perceived “illegal” edits to a 60 Minutes interview with former Vice President Kamala Harris. Trump is seeking $20 billion in a suit that most legal experts have said he had no chance of winning.

Paramount’s decision to attempt to settle the case led to the departures of Bill Owens, longtime 60 Minutes executive producer; and Wendy McMahon, president of CBS News and Stations.

This story was originally featured on Fortune.com

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The spectacular breakup of Donald Trump and Elon Musk could soon get far worse for the Tesla CEO—while doing little good for the U.S. president.

Some political pundits have portrayed last week’s blowup as merely yet another exit by a disgruntled Trump ally. But the president’s anger toward Musk seems worse than his temper tantrums following the departures of other hand-picked loyalists, such as Vice President Mike Pence, Attorneys General Jeff Sessions and Bill Barr, Secretaries of State Rex Tillerson and Mike Pompeo, or Secretaries of Defense James Mattis and Mark Esper.

And it’s not a faux morality play about business leaders facing punishment for straying outside their lane. Musk, given his stature, is different than other CEOs who have taken pro-Trump or anti-Trump stances, whether from Papa John’s, Goya Foods, MyPillow, Coca-Cola, Delta, or Amazon. And this is not about Musk taking a principled stand on the soaring national debt or any other political issue. Instead, the blowup reflects two unrestrained top-down leaders fighting it out in a struggle for supremacy. 

‘First buddy’

Musk’s biggest mistake was about the nature of his role—as an advisor to Trump, not the primary character he believed himself to be. Even now, he continues to overestimate his own importance and indispensability. 

Trump, who relies on a hub-and-spokes model of leadership—where all power is centralized in himself while he divides and conquers his warring subordinates—has always been deeply resentful of consiglieres who try to outmaneuver or constrain him. Trump will never tolerate business leaders who believe they are bigger than the big boss. 

Musk apparently believed that his money and largesse insulated him and entitled him to a greater role as “first buddy.” But that was misguided if not delusional.

Consider advisors with grandiosity who threatened to undermine sovereign bosses, including the Russian mystic Grigori Rasputin, who engineered creeping control over Czar Nicholas II; Mark Hanna, portrayed in his time as the grand puppeteer controlling President William McKinley; and President Woodrow Wilson’s close advisor Colonel Edward House, who undermined Wilson’s Versailles negotiations after World War I. All these audacious advisors found their presumption punctured by icing out or even execution.  

Lessons from Russia

A look at recent Russian history is illustrative here. Consider Yukos boss Mikhail Khodorkovsky and Wagner chief Yevgeny Prigozhin after they dared challenge the power of Vladimir Putin, a strongman Trump has expressed admiration for.

We hosted Mikhail Khodorkovsky at our Yale CEO summits during the height of his power at Yukos in the early 2000s, when he controlled virtually all of Russia’s oil and gas reserves. He didn’t hesitate to criticize Putin at our events, openly presenting a different path for Russia’s future. When he started bringing his show on the road within Russia—thinking that Putin needed his money and support too much to whack him—he learned his money didn’t buy him the protection he thought it did. Putin quickly moved to nationalize Khodorkovsky’s assets, forming an alliance with his business rivals to divvy up his once-great wealth. 

More recently, Wagner boss Prigozhin believed his mercenary group had become so indispensable—thanks to its battlefield triumphs, raw military might, and global wealth—that he could challenge the authority of Putin’s top lieutenants, blasting them in videos posted on Telegram for mishandling the Urkaine invasion. When Prigozhin failed to sway them with this bullying, he thought he could get away with marching on Moscow with his forces and starting an insurrection within Russia against Putin’s rule. The full delusion of this folly was revealed when little of the domestic support Prigozhin expected materialized. Not long after he died when his plane plunged out of the skies, the victim of sabotage—one wonders by who. 

Prigozhin was among at least 60 prominent Russians who have met suspicious deaths since the start of Putin’s invasion of Ukraine in 2022. USA Today documented around 40 such cases prior to then as well, and the actual number is likely to be even higher. 

Musk’s vulnerability

Musk and his defenders, emboldened by his status as the world’s wealthiest person, apparently have either forgotten such lessons or don’t think they apply to Musk. Last week, Musk taunted on X, “Trump has 3.5 years left as president, but I will be around for 40+ years.” He also called for Trump’s impeachment and accused him of being illicitly connected to the late pedophile and accused rapist Jeffrey Epstein. 

Musk did all this despite his companies depending on government support in one way or another. That includes Tesla via EV tax credits, SpaceX via contracts, and Neuralink and the Boring Company via regulatory clearances. Given that Trump held up regulatory clearances of the AT&T-TimeWarner deal—which involved less personal animus than his feud with Musk—one wonders how long he could gum up the works for Musk now. Musk might be well served to remember the lessons embodied by Khodorkovsky and Prigozhin, however different the contexts.  

Meanwhile, with Trump insinuating Musk’s government interest is motivated by commercial self-gain and Musk accusing Trump of entanglement with Epstein—and having the resources to fund an anti-Trump counterrevolution—the news media might be a better investment than AI or cryptocurrency.

Jeffrey Sonnenfeld is the Lester Crown Professor in Management Practice and president and founder of the Yale Chief Executive Leadership Institute. Steven Tian is the director of research at the Yale Chief Executive Leadership Institute.

The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.

Read more:

• Tesla could lose billions in revenue as Trump administration weighs eliminating a key regulatory credit loophole
• JD Vance says the ‘blood feud’ between Trump and Musk is ‘not going to be good for Elon’ but admits he ‘suffered a lot’ for the White House 
• What Elon Musk’s feud with Trump means for Tesla shareholders

This story was originally featured on Fortune.com

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