OpenAI said it will eliminate non disclosure agreements in its data center deals and ensure residents don't pay for the electricity. The move lands following the Democrat midterm wins and scrutiny of AI data centers. In a nutshell, OpenAI is planning to work more closely with local communities.
Here's what Ray had to say about the current data center climate.
IBM, AMD and the Quantum Science Center at Oak Ridge National Laboratory (ORNL) announced a co-design platform for quantum error correction that combines quantum and high-performance computing.
According to IBM, the first deployment combines IBM's quantum computers with 120-qubit IBM Quantum Nighthawk processors and ORNL's high-performance system with AMD Instinct MI355X GPUs and 5th Gen AMD EPYC CPUs.
With the system, researchers will be able to evaluate the integration of HPC and quantum to improve error correction research.
Arm said its fiscal second quarter revenue was $1.44 billion, up 27% from a year ago, with net income of $130 million, or 12 cents a share. Non-GAAP earnings for the second quarter were 52 cents a share. The results topped estimates as did the company's outlook.
In a shareholder letter, Arm said:
"AI is driving unprecedented demand for compute across the cloud, devices and autonomous systems, with Arm being the compute platform of choice. Our business is now driven by two areas, both of which are showing rapid growth: The IP business, where partners increase their investment in Arm technology and deploy record numbers of Arm-based silicon, and our new silicon business, where demand for Arm AGI CPU is extremely strong. Both are built on the same Arm compute platform, leveraging a common software ecosystem.
As customers integrate increasingly powerful CPUs, GPUs and NPUs, into their designs, they face both growing system complexity and increasingly demanding power constraints. This is driving greater investment in Arm technology by our customers, contributing to 50% growth in license and other revenue. Strong licensing momentum is an important leading indicator of future royalty growth as these new designs enter production where we expect royalty revenue to accelerate."
Nice said it would cut its workforce by 5%. The company disclosed the cuts in its third quarter earnings report. the company reported earnings of $1.60 a share on revenue of $790.7 million, up 8%. Cloud revenue was $622.7 million, up 10.6%. Non-GAAP earnings were $2.84 and ahead of Wall Street estimates.
Dialpad said it is merging with Ada in a move that brings together two AI-driven customer experience vendors. According to a statement, the combined company will build "an agentic operating system for customer work."
CVS said it has decided to split up after years of trying to be an integrated health care provider. The company said it will split into two publicly traded entities. CVS Health will include Aetna, CVS Caremark, CVS Specialty, Oak Street Health and Signify Health. CVS Pharmacy will include its retail pharmacy and community healthcare operations as well as its Health100 technology services unit.
The split is expected in the first half of 2028. CVS Health CEO David Joyner argued that the split will accelerate the company’s strategy, but looks like a retreat in many respects. CVS, which also reported earnings, has attempted to create a healthcare data flywheel with mixed results, but appeared to be turning the corner.
Arista Networks' revenue growth in the third quarter was the best since its IPO. The company reported third quarter earnings of $1.22 a share on revenue of $3.66 billion, up 58.5% from a year ago. Non-GAAP earnings were $1.20 a share. Wall Street was expecting non-GAAP earnings of $1.08 a share.
The company projected fourth quarter revenue of $3.9 billion to $4 billion, well above the $3.57 billion estimate. Non-GAAP earnings will be $1.20 a share to $1.26 a share, well above the $1.15 a share estimate.
Jayshree Ullal, CEO of Arista, said:
"We are witnessing the migration from highly centralized training compute to disaggregated and distributed inference, prefill and decode, demanding much more intelligent networking and colocation of compute, storage and KV cache resources rather than simply focusing on raw feeds and speeds and flops of compute. A well-designed network is becoming a foundational cornerstone for optimal token efficiency."
Freshworks reported better-than-expected third quarter results as its strategy to target larger enterprises paid off. The company reported third quarter earnings of 7 cents a share on revenue of $245.4 million, up 14% from a year ago. Non-GAAP earnings were 22 cents a share, 4 cents ahead of estimates.
The company projected fourth quarter revenue of $253.5 million to $254.5 million, up 14% from a year ago. Non-GAAP earnings will be about 21 cents a share. For 2026, Freshworks projected revenue of $965 million to $966 million with non-GAAP earnings of 71 cents a share.
Dynatrace reported second quarter earnings of 23 cents a share on revenue of $580 million, up 17% from a year ago. Non-GAAP earnings were 54 cents a share. The company said its platform consumption was up more than 20%.
The second quarter non-GAAP earnings were 5 cents a share ahead of estimates.
Dynatrace also updated its outlook for fiscal 2027 and projected non-GAAP earnings of $1.88 a share to $1.90 a share with revenue of $2.33 billion to $2.34 billion.
Oracle said it has priced its $20 billion offering of stock and bonds designed to fund its AI infrastructure buildout. The offering of more than 86 billion shares were priced at $116. A series of notes with maturities ranging from 2028 to 2046 have interest rates between 7% and 8.65%.
The company's investor day featured an extensive walkthrough on how it is funding AI infrastructure. Wall Street analyst sentiment was generally positive. Here are the three models Oracle is working with.
OpenAI said it will hire Dan Driscoll, former US Army Secretary, to advise the company on national and cyber security efforts. Driscoll will be Senior Counselor for National Security Modernization. OpenAI said:
"In this newly created role, Dan will work with OpenAI teams and leaders across governments, industry, academia, and allied institutions to advance practical modernization initiatives that support the buildout of democratic AI. He will also help internal OpenAI teams understand the operational needs of global national security institutions."
