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Tech companies are firing everyone to "fund AI", spending money on each other

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Re: Tech companies are firing everyone to "fund AI", spending money on each other

#91

Post by tarsinge »

jonway wrote: post #57
scotty79 wrote: post #46

Earlier quoted context omitted.

Nvidia is basically allowing some of its clients to pay with partial ownership of their companies instead of with cash for the chips they want, because there's simply not enough cash in them for the lofty goals lots of people think are achievable.

God that sounds so crazy. Its giving me "sell our municipal water to Private Equity to buy a park, imagine the tax revenue!" vibes except its just diluting the shares. It feels like economics in the US is turning into FanDuel mobile gambling. Can we pass a law to disincentivize this garbage and make them start paying dividends again?

Isn’t the problem rooted in stock buybacks? Making it illegal could bring dividends and realign incentives.

Re: Tech companies are firing everyone to "fund AI", spending money on each other

#92

Post by [deleted] »

simonw wrote: post #19
lateforwork wrote: post #15

The "spending money on each other" part is untrue. It is mostly going in one direction, towards Nvidia, and that's the reason they crossed $5 Trillion in market cap recently.

I found John Gruber's roundup of tech company profits (not revenue) interesting: https://daringfireball.net/linked/2025/10/30/apple-q4-result... - Google (a.k.a. Alphabet): $35B - Microsoft: $27.7B - Apple: $27.5B - Nvidia: $26.4B - Amazon: $21.5B

[deleted]

Re: Tech companies are firing everyone to "fund AI", spending money on each other

#93

Post by soared »

sifar wrote: post #84
soared wrote: post #10

The poster is kind of missing the point. If I see a tool that could make a lot of my employees 20% more efficient today, and maybe more than that in the future, I’m going to bet big on it. Layoffs aren’t just to “fund AI” - layoffs (a) always happen and (b) likely genuinely make sense at some scale due to efficiency gain from AI. It’s not “cut employees, send they money in circles to prop up stock prices” it’s “cut e…

Curious, how do you deal with hallucinations for important stuff ?

We use llms more for finding the correct doc, and then actually reading the doc ourselves. It’s really just a very good search and summarization tool for when there are tens of thousands of potentially relevant docs

Re: Tech companies are firing everyone to "fund AI", spending money on each other

#94

Post by danaris »

mixmastamyk wrote: post #88
BerislavLopac wrote: post #80

Earlier quoted context omitted.

MANGA is the new FAANG.

Just use BigTech, then you don't have to keep shuffling letters nor inserting Netflix to prevent it becoming a slur. https://en.wikipedia.org/wiki/Big_Tech

I suspect they meant Nvidia, not Netflix; after all, the letters in MANGA are exactly the initials of the companies listed in the post they were replying to.

Re: Tech companies are firing everyone to "fund AI", spending money on each other

#96

Post by Jensson »

darth_avocado wrote: post #77
scotty79 wrote: post #46

Earlier quoted context omitted.

Nvidia is basically allowing some of its clients to pay with partial ownership of their companies instead of with cash for the chips they want, because there's simply not enough cash in them for the lofty goals lots of people think are achievable.

Nvidia can do that because what they sell has an insane markup. Nvidia is getting a billion dollars in equity for input spending of a hundred million. Nvidia is creating demand for it’s products and in turn getting ownership in companies for cheap. It’s like being a VC but your investments are chips and the chips also count as revenue for you.

But if there is a bubble Nvidia is making it worse this way and will get hit hard itself.

Re: Tech companies are firing everyone to "fund AI", spending money on each other

#97

Post by jonway »

tarsinge wrote: post #91
jonway wrote: post #57

Earlier quoted context omitted.

God that sounds so crazy. Its giving me "sell our municipal water to Private Equity to buy a park, imagine the tax revenue!" vibes except its just diluting the shares. It feels like economics in the US is turning into FanDuel mobile gambling. Can we pass a law to disincentivize this garbage and make them start paying dividends again?

Isn’t the problem rooted in stock buybacks? Making it illegal could bring dividends and realign incentives.

Please! Has Amazon ever paid out a dividend???

Re: Tech companies are firing everyone to "fund AI", spending money on each other

#98

Post by klipklop »

testdelacc1 wrote: post #25
cjonas wrote: post #20

Earlier quoted context omitted.

Then Nvidia is turning around and investing back in the AI companies so they can in turn buy Nvidia chips...

At least investing in companies that will buy Nvidia makes sense somewhat, even if it feels dodgy. What possible sense does it make for Nvidia to invest in a maker of telecom equipment (Nokia) with no public plan, and the value of the investment jumps 30% as soon as it’s announced? It’s not like call routing needs to be “AI enabled” or they’re putting Nvidia GPUs in their custom silicon. Feels like Nvidia has too muc…

There is a public plan (literal press releases) and it is to use Nvidia Grace chips in Nokia’s future RAN products. Seems to have cooling issues but seems to be a nice chip for the most part.

Nvidia quietly in the background is getting more interested in the network side of things and are hiring accordingly. This is an area I don’t really think you have all the details to have an opinion on imo.

Re: Tech companies are firing everyone to "fund AI", spending money on each other

#99

Post by ghaff »

mixmastamyk wrote: post #88
BerislavLopac wrote: post #80

Earlier quoted context omitted.

MANGA is the new FAANG.

Just use BigTech, then you don't have to keep shuffling letters nor inserting Netflix to prevent it becoming a slur. https://en.wikipedia.org/wiki/Big_Tech

The N was really Netflix originally when it was the poster child for AWS consumption before NVIDEA/AI was even in the conversation. But, yes, "Big Tech" is probably the best term these days to avoid debates about whether this company or that company really belongs in the category--especially given that certain companies have done very well in terms of stock relative to the the historical FAANGs.

Re: Tech companies are firing everyone to "fund AI", spending money on each other

#100

Post by sublinear »

GolfPopper wrote: post #50
firefoxd wrote: post #21

Most companies using AI are just paying for a subscription. They aren't actually building LLMs or other machine learning applications that take over a known task. You could easily replace the term AI with just subscription. When they say they are laying off workers, they are saying "we signed up for Cursor, and enabled some AI features on Jira and Salesforce" The layoff is just an excuse until they realize that just…

And keep in mind that while the company may care about its overall efficiency, its individual organs only care about their internal incentives. If the LLM gets the ticket out of someone's area of responsibility faster, why do they care if that makes it harder for someone else?

The AI doesn't make anything harder for the people downstream.

If anything it gives all the people downstream more power. The power to justifiably ignore the AI summary and do whatever they originally wanted as they see fit. This makes the people upstream even more obviously redundant than they already were before all the AI slop. The downstream people picking up the slack are effectively promoted.

This is pretty much the definition of a layoff. It's just a different and much more streamlined way this time to weed out the losers. The top AI users within an organization hang themselves by proving they're not needed. The system works.

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