Plus: Zuckerberg Squandered His AI Talent. Now He’s Spending Billions To Replace It. |
Good morning,
American Eagle’s recent ad campaign touting Sydney Sweeney’s “great jeans” isn’t just drawing ire online, the backlash may be translating to business losses.Data shows foot traffic at American Eagle stores fell 9% year-over-year for the week beginning August 3, and while competitors like Abercrombie & Fitch and H&M also saw a decline, none were as steep. In the controversial ad, Sweeney makes a pun on the words “genes” and “jeans,” which critics say evoked eugenics. More than any seasonal or economic trend, when a “brand sees momentum stall so sharply, it often reflects a reputational or cultural factor cutting through to consumers,” says James Ewen, vice president of marketing for retail data company Pass_by.
Let’s get into the headlines, |
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One of the main budget air travel options is on the verge of collapse, according to Spirit Airlines' quarterly filing, which suggests the airline may not survive another year. The carrier, which emerged from bankruptcy five months ago and recently furloughed pilots, hasn’t turned a profit since 2019, and its stock plummeted 41% Tuesday.
Inflation rose by less than expected last month despite President Donald Trump’s tariffs, welcome news for investors hoping for the Federal Reserve to slash interest rates. Though core consumer prices, which exclude the more volatile food and energy categories, were still higher than projected, markets ended the day in the green. |
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 | | matt mcclain/getty images |
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| Meta was teeming with top AI talent, until it wasn’t. Years before Mark Zuckerberg’s high-profile shopping spree, the company employed researchers and engineers that would ultimately depart to start major AI companies: founders of Perplexity, Mistral, Fireworks AI and World Labs all hailed from the Facebook parent’s AI lab. And as the AI boom has spurred ever more capable models, others have decamped to rivals like OpenAI, Anthropic and Google. The brain drain of the last few years has been tough, three former Meta AI employees told Forbes. And even as Zuckerberg makes jawdropping offers for top tier AI researchers, the social media giant continues to lose those that are left. Today, when it comes to recruiting high-caliber AI researchers, Meta is often an afterthought. Insiders at some of Silicon Valley’s biggest AI companies said that before the fresh hiring of the last few months, Meta’s talent largely didn’t meet their hiring bar. This has lent an air of desperation to Zuckerberg’s attempts to raid the likes of OpenAI and Thinking Machine Labs, with nine-figure offers and promises of near-unlimited compute. In at least two cases, the Meta CEO has offered pay packages worth over $1 billion spread across multiple years, according to The Wall Street Journal. He reportedly poached at least 18 OpenAI researchers, but many have also turned him down. Meta strongly denied that it has had issues with AI talent and retention. “Meta is the Washington Commanders of tech companies,” one AI founder told Forbes, referring to the NFL team in its pursuit of free agents. “They massively overpay for okay-ish AI scientists and then civilians think those are the best AI scientists in the world because they are paid so much.” |
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| An August report from VC firm SignalFire that focused broadly on engineering talent noted that Meta is aggressively hiring engineers across the company twice as fast as it is losing them. “Some outbound movement helps explain why Meta is investing so heavily in rebuilding and expanding its technical bench,” said Jarod Reyes, SignalFire’s head of developer community. “It reflects the intensity of competition for senior AI talent and the pressure even top companies feel to backfill experience while scaling new initiatives.” |
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In what would be the biggest shakeup in U.S. housing finance since the 2008 crisis, the Trump Administration is teeing up IPOs for Fannie Mae and Freddie Mac, which could value the government-backed mortgage giants at a combined $500 billion. But the institutions’ profitability is largely cushioned by an implicit government guarantee, which Trump has said would remain. Without the guarantee, mortgage rates could climb by 0.6 to 0.9 percentage points, a brief published this year found.
AI firm Perplexity is offering $34.5 billion to purchase Google Chrome, as Google may be forced to spin off the browser after a judge determined it had a search market monopoly. The unsolicited offer is well over Perplexity’s latest valuation of $18 billion, and is backed by several unnamed investors “including large venture-capital funds,” according to The Wall Street Journal, which first reported on the bid. |
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| As Toronto-based self-driving startup Waabi prepares to start hauling loads in fully autonomous semis, it has hired Lior Ron, the top executive at Uber’s trucking business. Ron, who has headed Uber Freight since 2016, will help scale its relations with shipping customers, as the shortage of human drivers in the $900 billion trucking industry has driven demand for automation. |
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President Donald Trump is considering a lawsuit against Federal Reserve Chair Jerome Powell over the independent agency’s renovation at its Washington headquarters, the latest in the president’s feud with Powell. According to the central bank, the renovations have cost around $600 million more than its initial estimate, and Trump has threatened to fire Powell, though it’s unclear if he has the legal authority to do so.
A federal judge ordered the Trump administration to restore a portion of the University of California, Los Angeles’ federal research grants it had suspended late last month, a week after the White House said it was seeking a $1 billion settlement from the school. According to the ruling, research projects across the UC system lost more than $324 million in grant funding as a result of the White House’s cuts. |
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| Jump, a startup whose founders include MLB legend Alex Rodriguez and e-commerce billionaire Marc Lore, aims to be the Shopify for sports fans, creating a one-stop shop for tickets, merchandise, concessions and more. The company said Tuesday it had raised $23 million, bringing its valuation over $100 million, and so far, four professional franchises have signed up for its services. |
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| President Donald Trump claimed that his tariffs are bringing in trillions in revenue for the U.S.—but that’s what economists project they could generate over the next decade. In reality, the U.S. has collected $142 billion from tariff revenue this fiscal year, though Trump didn’t mention that U.S. companies pay the levies to import goods from abroad, and eventually the cost is passed down to consumers. |
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| As consumers worry about rising food prices, the cost of one fridge staple—butter—is surging around the world. Butter prices in the U.S. reached their highest level in over a year in June: |
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$4.80 | The cost of butter per pound, according to St. Louis Fed data, is an increase of 4% year-over-year | |
| 70% | How much of the butter exported around the world comes from major exporters like New Zealand and parts of Europe, and saw historically low stockpiles earlier this year | |
| 90% | The share of Americans concerned about increasing inflation, per a Reuters/Ipsos survey |
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| Collaboration and teamwork happen naturally in sports, and while it may seem like just a fun activity at first, fantasy football can help foster bonding in the workplace, too. It can give people something in common to talk about, especially in an era where water cooler conversations aren’t as natural with remote work. And a fantasy football league can become an office tradition beyond the standard retreat or pizza party. |
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