This Week in Tech (Week Ending May 3, 2025)
TL;DR - 🗓️Trump's first 100 days; 💸McRecession; 📣Earnings
Hey folks!
Happy Saturday - enjoy your weekend. Tech news below
TL;DR -
💸 McRecession - fast food sales reflect penny pinching.
📣Earnings across tech
What’s Italian Brain Rot?
🌎 Macro (Economic) and Trends
🗓️ Trump’s first 100 days: included more executive orders than any modern president; the dollar and market plunging and the decline of his popularity.
💸 McRecession: McDonald's comparable sales fell 3.6% at U.S. stores, its worst showing since the pandemic, in a sign that people are pinching pennies because of recession fears. The fast-food slowdown affected others - Starbucks saw comparable sales decline in Q1, and Domino's Pizza said customers are opting for cheaper carryout over delivery.
🤔 What’s happening with the job market for young, educated workers? Labor conditions for recent college graduates have “deteriorated noticeably” in the past few months, and the unemployment rate now stands at an unusually high 5.8 percent. The Atlantic writes of 3 possible explanations: 1️⃣ short term the labor market for young people never fully recovered from the coronavirus pandemic, 2️⃣ medium term College doesn’t confer the same labor advantages that it did 15 years ago, 3️⃣ long term the relatively weak labor market for college grads could be an early sign that artificial intelligence is starting to transform the economy. Historically, the “recent-grad gap”, the difference between the unemployment of young college graduates and the overall labor force, showed young college graduates almost always having a lower unemployment rate than the overall economy, because they are relatively cheap labor. But last month’s recent-grad gap hit an all-time low. That is, today’s college graduates are entering an economy that is relatively worse for young college grads than any month on record. Conclusions are still unclear but it’s a trend to watch.
📉Trending down - tech sentiment: Sentiment around how conditions for technology companies will fare over the next six months is the most pessimistic it has been since February 2023, according to surveys by The Information.
📈Trending up - creators: The number of people in the U.S. whose work as digital creators amount to full-time jobs 7.5x’d from 200,000 in 2020 to 1.5 million in 2024. Why it matters: Creators are now the largest and fastest-growing segment of the 28.4 million internet-dependent jobs in the U.S.
🔬 Micro (Tech Companies)
📣Earnings
Meta Platforms reported first-quarter revenue of $42.3 billion, up 16% from a year earlier. That exceeded its own forecast, showing the strength of its digital advertising business, but marked a slowdown from fourth-quarter growth of 21%. Zuck also shared that WhatsApp now has more than 3 billion monthly users up from 2bn back in 2020.
Spotify reported that its premium subscriber base grew by 5 million in the first quarter, to 268 million, marking a 12% year-over-year increase. The company also reported a record-high quarterly operating income.
Snap revenue rose 14% to $1.36 billion during the first three months of the year, but the company said it couldn’t provide financial guidance for the second quarter due to uncertain “macro economic conditions” which could hurt demand for advertising.
Microsoft reported that its revenue grew 13% in the three months ending in March, a slightly faster rate than the quarter prior. Meanwhile, its revenue in its Azure cloud computing unit grew 33%, slightly higher than the growth the company had forecasted.
Amazon reported revenue grew by 9% during its first quarter to $155.7 billion. Its profit was $17.1 billion. The figures topped Wall Street projections.
Apple reported 5% higher revenue of $95.4 billion for the March quarter, thanks to a 2% lift in iPhone revenues and a 12% increase in services revenue. Apple’s net income rose 5% to $24.78 billion.
Airbnb reported its slowest revenue growth since the start of 2021 as economic uncertainty prompted travelers to pull back on spending in the first quarter. Airbnb said it saw “softness in travel” from Canada to the U.S., as many Canadians vowed to boycott U.S. products and change travel plans in light of President Donald Trump’s comments about annexing the country.
Reddit’s stock surged more than 20% in after hours trading, as the company reported 61% increase in revenue to $392.4 million. Still, this was a slowdown in growth from last quarter, where revenue grew 71% year over-year-year.
A judge ruled Apple violated an antitrust ruling related to App Store restrictions and referred the matter to federal prosecutors for a criminal contempt investigation. “Apple willfully chose not to comply with this court’s injunction. It did so with the express intent to create new anticompetitive barriers.”
Alphabet CEO said that he could foresee people owning cars with Waymo’s self-driving car systems.
Palantir, the tech giant, is building a new tool to provide Immigration and Customs Enforcement with enhanced capabilities to support deportation efforts.
Apparently, Tesla’s board got serious last month about searching for Musk’s replacement as CEO. But the chair denied these reports.
Proton Mail was dealt a blow when a court in India directed the Indian government to ban it in the country. This directive follows a legal complaint from a local law firm that had inappropriate emails sent to its associates and no way to find out who sent them.
💩Word of the day: Lyft CEO David Risher used the word “enshittification” to describe how the rideshare experience has become worse than it was a decade ago. Thank you for calling that out sir 🫡.
Layoffs: United Parcel Service plans to cut about 20,000 jobs and close 73 facilities as the U.S. delivery firm handles fewer packages for Amazon. UPS has said for years that it wants to focus on higher margin customers, while Amazon has been sending a greater share of packages through its own delivery network.
🤖 AI News
😬Word of caution: A venture capitalist shared some of his anxieties about the current artificial intelligence funding boom. He drew a contrast between the funding boom for AI and the zero-interest-rate startup bonanza in 2021. This investing moment “is a lot more dangerous,” he said, because AI startups’ cash needs to go to chips and other infrastructure. In earlier days, money from investors would be spent on employees, which could be cut if the business faltered. Plus, revenue growth might not be real if customers are just experimenting w the technology. Despite these hesitations, the VC thinks we’re “going to see a couple trillion-dollar companies come out of this.”
Are you a scroller or a seeker? Reddit CEO Steve Huffman says there are two types of Reddit users: Scrollers, who come for community engagement, and Seekers, who want answers to specific questions. The latter is who the company built Reddit Answers, its AI chatbot, for, and it’s already seeing 1 million weekly active users.
Meta
Meta is rolling out a stand-alone AI app that could help it better compete with other AI companies like Anthropic or OpenAI.
Meta Platforms announced an application programming interface for developers to access and use its large language model Llama
Yikes: Meta’s AI bots has been found to engage in sexual discussions, even when users are underage or the bots are programmed to impersonate minors.
Microsoft is preparing to add Grok, the artificial intelligence model developed by Elon Musk’s xAI, as an option for customers of its Azure cloud computing platform. Microsoft has for years offered OpenAI’s models on Azure, but has more recently expanded its offerings to include models from a number of OpenAI competitors including Meta, Cohere, DeepSeek, and Microsoft’s own in-house models
No one likes a suck-up: OpenAI is working to fix an unexpected issue with its newly updated GPT-4o after users and tech leaders called out the AI's excessive flattery and tendency to agree with everything users say.
Gamma, an AI-powered way to make decks, websites and docs, just hit a huge milestone: 50 million users.
🛍️🤑This… should be interesting: Credit card giants Visa and Mastercard have both announced new products that would give AI agents the ability to shop online for customers. Mastercard claimed its agent could “proactively curate a selection of outfits and accessories from…online retailers” for a 30-year-old planning her birthday “based on her style, the venue’s ambience, and weather forecasts.
OpenAI is incorporating more shopping features into ChatGPT search results.
Alibaba Group released Qwen 3, a new generation of its open-source artificial intelligence foundation models. The company said the largest one among the new models outperforms competitors’ popular existing models like DeepSeek’s R1 and OpenAI’s o1 based on multiple industry benchmarks.
Freepik, an online graphic design platform, has released a new “open” AI image model that it says was trained exclusively on licensed, “safe-for-work” images
🤝 Select M&A, Fundraises, IPO, Partnerships
M&A
DoorDash has offered to buy London-based food delivery company Deliveroo for $2.40 a share. That offer, 29% higher than its Thursday closing share price, values the company at about $3.5 billion.
Roku is buying Frndly TV, a subscription video streaming service that offers live cable TV channels including A&E, Hallmark and Lifetime, for $185 million in cash.
Palo Alto Networks has agreed to buy Protect AI, a three-year-old startup that develops cybersecurity software for artificial intelligence applications.
Splice, a music start-up that uses artificial intelligence to blend audio samples, bought Spitfire Audio for its catalog of tracks and sounds. Spitfire Audio’s library includes sounds that have been used in shows like Netflix’s The Queen’s Gambit. Splice, founded in 2013, reached annual revenue of more than $100 million and is profitable.
Fundraising
Glean, a startup that builds search chatbots for businesses, is in advanced talks to raise a new financing round that would value the startup at about $7 billion.
XAI Holdings, the combination of xAI and X, is in talks to raise $20 billion at a valuation of more than $120 billion.
Butterfly Effect, the startup behind AI agent Manus, raised $75 million at a valuation of $500 million led by Benchmark.
Partnerships
Waymo and Toyota are exploring a partnership to develop an autonomous vehicle platform for personally owned vehicles
⚱️ Gold Panning - For those who reached the bottom
Trending - discerning tastebuds: How did we all become foodies? The NYT investigates and believes the COVID pandemic is a big reason for our indulgent tastes (all that time spent baking…). “More cultural, ethnic and specifically Asian flavors are doing really well. People want to experience the world without leaving home, basically.” In the age of hyperflavor, being a connoisseur of ingredients like lavender and hibiscus is a way to signal one’s sophistication and worldliness.
🇵🇦 🇮🇪 Travel recs: Panama for the wildlife; Ireland’s Blackwater Valley for the Old World romantics.
⚡️Another Marvel movie? Surprisingly, the reviews are positive for Thunderbolts starring Florence Pugh coming out this weekend. (Personally, I just can’t deal w the fake Russian accents).
🥒 Pickles have become Gen Z’s avocado. Brands are now pushing pickle-flavored everything — popcorn, seltzer, mayo, and even cocktails.
Labubu dolls, tiny fuzzy Nordic elves with mischievous grins, regularly sell out online.
Italian brain rot: Headsup - this trend will make you feel old af. A Tiktok trend involving AI characters like Ballerina Cappuccina is taking off. But first, some background: Last year, the Oxford University Press designated “brain rot” the word of the year - it refers to the deteriorating effect of scrolling through swathes of silly content online. The Italian brain rot subgenre emerged in Jan’25, when absurd characters generated by artificial intelligence started to show up in TikTok feeds. The characters melded animals or humans with inanimate objects, and many were tagged with the hashtag #italianbrainrot, which now has over 3bn views.
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