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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

#31

Post by Atreiden »

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…

Nokia had some of the best mobile hardware (and software!) in the game until they were bought by Microsoft and promptly killed.

I've been patiently waiting for their resurgence. Building embedded/mobile devices is their forte, which is also coincidentally the hardware space where AI is most poised to shine. Nvidia made a move in the same direction when they tried to acquire ARM. That got antitrusted (fairly so) but investing in a now-decimated telecom company isn't likely to ruffle any feathers this way.

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

#32

Post by dmoy »

verzali wrote: post #23
simonw wrote: post #19

Earlier quoted context omitted.

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

Is it a coincidence that 3 of 5 are so close?

Pretty much coincidence, yes

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

#33

Post by alephnerd »

shermantanktop wrote: post #24
alephnerd wrote: post #11

Doesn't pass the smell test as someone who has been on boards that made these decisions. This would be like saying cloud spend was circular because F1000 tech companies represent the majority of cloud spend from a revenue perspective, but tend to sell or partner with those same organizations. For example, AWS and Zscaler, or GCP and Broadcom. Reality is, a lot of product lines were formed or overhired with little-to-…

Agree with a lot of this. But on the last point, that’s the “blame middle management” theory. And I have seen outrageous, florid displays of exactly that behavior in those ranks. But the CEOs have been there all along, doing the math on ZIRP and getting caught up in FOMO. They could have tightened their belts at any time, or demanded better justifications for investments. Why didn’t they?

> But the CEOs have been there all along, doing the math on ZIRP and getting caught up in FOMO. They could have tightened their belts at any time, or demanded better justifications for investments. Why didn’t they?

Because the job of a CEO is not to micromanage. The whole point of hiring middle management is to keep CEOs out of micromanaging decisions.

The job of C-suite is to

1. Be the arbitrator between different orgs

2. Be the primary salesperson - a large portion of corporations will not purchase without a CEO or CTO being in the same room and giving the same promises

3. Manage investor and board relations

We (c-suite, boards) give middle management significant autonomy to shape roadmaps and organizational structure explicitly because we assume they are adults as well. Some amount of lossage and BS is expected, but the kind of financial slack that existed a couple years ago to cushion these blows doesn't exist anymore.

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

#34

Post by immibis »

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 think the actual reason market caps got so high is money printing. Because there are trillions more dollars, stock markets are trillions of dollars higher. Might be a conspiracy theory though.

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

#35

Post by mjr00 »

CharlieDigital wrote: post #22

I rarely post comments on LinkedIn, but I saw some of the dumbest content today and felt compelled to leave a response: > Just met a founder who fired his entire team because he was able to individually beat their entire productivity with Claude Code My only thought when I read this is that this absolutely embarrassing...for founder who wasted dozens of hours recruiting, qualifiying, interviewing, onboarding, and tra…

> It just came across as some of the most small-brain thinking that anyone would then "Like" this content and not see it for what it is: idiotic management and leadership and just complete lack of basic foresight.

It's not even that. It's just straight up lying. The most generous interpretation is that his "team" was Fiverr contractors who were working part-time for $10/hour. More likely is he never had a team to begin with.

You can just say things. You can just say that you've unlocked 1000x productivity gains with AI and "agentic processes" and investors and AI boosters are so eager to believe this nobody will bother fact checking it.

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

#36

Post by ailegalbeagle »

cjonas wrote: post #20
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.

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

Which is perfectly legal, correct?

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

#37

Post by silisili »

CharlieDigital wrote: post #22

I rarely post comments on LinkedIn, but I saw some of the dumbest content today and felt compelled to leave a response: > Just met a founder who fired his entire team because he was able to individually beat their entire productivity with Claude Code My only thought when I read this is that this absolutely embarrassing...for founder who wasted dozens of hours recruiting, qualifiying, interviewing, onboarding, and tra…

What's weird to me is that they say 'well, with AI we need less people for the same output.'

Why is the conversation rarely framed 'with AI we will move faster and have more output'?

It feels like companies would be well served to expand their product teams and roadmaps to go bigger, but instead choose to hold the pace now with less headcount.

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

#38

Post by peacebeard »

alephnerd wrote: post #11

Doesn't pass the smell test as someone who has been on boards that made these decisions. This would be like saying cloud spend was circular because F1000 tech companies represent the majority of cloud spend from a revenue perspective, but tend to sell or partner with those same organizations. For example, AWS and Zscaler, or GCP and Broadcom. Reality is, a lot of product lines were formed or overhired with little-to-…

> If you want to blame someone, blame EMs, PMs, Principal SWEs, and VPs who decided to launch product lines and features for their resume instead of for business justification.

And the people in charge had no say in the matter.

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

#39

Post by tapland »

CharlieDigital wrote: post #22

I rarely post comments on LinkedIn, but I saw some of the dumbest content today and felt compelled to leave a response: > Just met a founder who fired his entire team because he was able to individually beat their entire productivity with Claude Code My only thought when I read this is that this absolutely embarrassing...for founder who wasted dozens of hours recruiting, qualifiying, interviewing, onboarding, and tra…

Probably just trying to save face after having to close down/scale back the startup to zero.

You too can be a 1 man startup founder.

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

#40

Post by BeFlatXIII »

alephnerd wrote: post #11

Doesn't pass the smell test as someone who has been on boards that made these decisions. This would be like saying cloud spend was circular because F1000 tech companies represent the majority of cloud spend from a revenue perspective, but tend to sell or partner with those same organizations. For example, AWS and Zscaler, or GCP and Broadcom. Reality is, a lot of product lines were formed or overhired with little-to-…

> If you want to blame someone, blame EMs, PMs, Principal SWEs, and VPs who decided to launch product lines and features for their resume instead of for business justification.

Arguably, thank them. The alternate is more likely that those jobs never would've existed, not that they'd have the same jobs with same TC but somehow in profitable business units. Enjoy having milked the job while it lasted instead of being stuck in a lower-paying career the entire time.

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