Andrew here. Forget about A.I. processors. Memory chips are the new market winner, with Micron and the South Korean giant SK Hynix becoming the latest trillion-dollar companies.
Also, some businesses are starting to publicly acknowledge that they are not seeing enough productivity growth to justify their spending on A.I. tokens. What does this mean long term? And we’ve got details on the first fully A.I.-generated film, about Iran, that will be shown at the Tribeca Festival. More below.
Memory mammoths
The artificial intelligence rally has minted two new trillion-dollar companies in the past 24 hours, Micron and the South Korean firm SK Hynix, as investor fervor for chipmakers goes into overdrive.
Worries about a bubble have weighed on tech stocks for the past year. But robust demand for processors for data centers, and more recently a “supercycle” surge in high-bandwidth memory chips for advanced A.I., has flipped the narrative.
Goldman Sachs just raised its year-end target for the S&P 500 to 8,000 from 7,600, citing an A.I.-driven profit boom for semiconductor specialists.
A few companies dominate the memory chip supply chain, including Micron, SK Hynix and Samsung, which also joined the $1 trillion club this month.
The Trump administration has embraced Micron. Last week, Jamieson Greer, the U.S. trade representative, attended a ceremony at the company’s plant in Virginia. He told reporters that the administration was weighing a new tariff on chips to help bolster domestic production, which could help Micron cement its market dominance.
At a rally in New York on Friday, President Trump called Micron “great,” citing the company’s pledge to invest up to $100 billion in the U.S.
Investors see the companies’ strategic importance, too. Just look at these eye-popping numbers:
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After Tuesday’s 20 percent rally, Micron shares have risen roughly threefold this year.
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SK Hynix is up over 1,000 percent over the past year.
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The PHLX semiconductor index, which includes Micron, Intel and chip giants like Nvidia, has set record after record, lifting the wider S&P 500.
But geopolitics may crash the party. China is investing heavily to close the gap with South Korea in chip manufacturing, analysts warn, amid surging demand for memory processors to train A.I. models.
And Samsung narrowly averted a potential global supply chain crisis this month after workers threatened to strike. It involved paying up: Employees in the company’s chip division agreed on Wednesday to a deal that will pay them a piece of the company’s A.I. chips profits. That means a bonus of roughly $400,000 per person on average.
HERE’S WHAT’S HAPPENING
U.S. consumer confidence falls on inflation fears. An index released on Tuesday by the Conference Board showed a decline in April, particularly among younger and lower-income Americans. It’s the latest sign of worries about rising prices, as well as a split-screen contrast between the stock market and oil prices.
SpaceX is said to have sharply raised Starlink prices for the Pentagon. Elon Musk’s company recently argued to Defense Department officials that the U.S. government should be paying significantly more for access to the satellite internet service, according to Reuters, which reported that the Pentagon ended up paying a higher rate. It’s a sign of SpaceX’s business strength as the company prepares to go public.
The official fund for President Trump’s Board of Peace reportedly has no money. Months after Trump unveiled the organization as one of the “most consequential” international groups ever created, its formal pot, set up by the World Bank, has gotten no cash from donors, The Financial Times reports, citing unnamed sources. Instead, an affiliated account at JPMorgan Chase with no transparency requirements has received money.
Execs look beyond “tokenmaxxing”
Uber’s chief technology officer, Praveen Neppalli Naga, made a stir when he admitted last month that his engineers had “blown away” their artificial intelligence budget for the year in just a few months.
But Uber is hardly alone.
As agentic coding tools like Anthropic’s Claude Code and OpenAI’s Codex gobble huge amounts of tokens, the atomic unit of data processed by A.I. models, more companies are dealing with A.I. sticker shock. That’s forced them to cut costs and, in some cases, seek alternative models, Niko Gallogly reports.
A.I. spending has soared in the past year. Companies’ average A.I. token spend has increased 13 times since January 2025, according to an index of 50,000 customers tracked by the financial start-up Ramp. Those A.I. costs are still small as a portion of total spend, hovering at 1 to 2 percent, but are “growing so quickly that it is now incumbent on firms to find ways to control that cost,” Ara Kharazian, Ramp’s lead economist, told DealBook.
Eye-popping A.I. bills are an unsurprising feature of “tokenmaxxing,” in which engineers compete to use the most tokens. Some A.I. leaders have encouraged the trend — one that they stand to benefit from. Jensen Huang of Nvidia, for example, has said he expects an engineer at his company with a $500,000 salary to spend at least $250,000 on tokens a year.
As A.I. costs climb, tokenmaxxing’s days may be numbered. “We want people experimenting, but not ripping tokens for the sake of doing so,” Karan Parekh, the C.F.O. at the A.I. start-up Clay, told DealBook.
Clay’s A.I. spend is growing faster than almost any other line item and in many months is growing faster than revenue, Parekh said. So far it hasn’t hurt the bottom line, but Parekh added that he carefully managed the company’s A.I. spend, including by requiring employees to get approval to surpass a certain token spend.
While Anthropic and OpenAI have dominated A.I. enterprise adoption, more companies are “opting to cheaper models where possible,” Kharazian said. Those include free-to-use open-source models and Google’s Gemini (whose most advanced model costs less than half per token compared with similar offerings from Anthropic or OpenAI).
Others are using tools like OpenRouter, which allows companies to easily switch between higher- and lower-end models.
The high price tag is weighing on tech giants, too. This month Microsoft announced it was canceling most of its Claude Code licenses in part because of financial concerns, The Verge reported, as it urged its engineers to use Microsoft’s own coding tool, GitHub Copilot CLI.
“I dispute entirely the characterization of my conduct, and I will not allow a false narrative to go unchallenged.”
— Albert Manifold, who was ousted on Tuesday as the chairman of BP. News outlets reported that Manifold was accused of being controlling and clashing with Meg O’Neill, whom he had helped recruit as the oil giant’s C.E.O.
Caruso’s next big bet
Rick Caruso, the billionaire real estate mogul behind Los Angeles properties like the Grove and Palisades Village, has a new project: remaking the golf experience.
Caruso acquired Sherwood Lake Club, the Jack Nicklaus-designed par-3 golf course in Los Angeles, after David Murdock, its owner and the former C.E.O. of the Dole Food Company, died last year.
The deal closed in February, and Caruso is set to reopen the club this fall with a new vision, Lauren Hirsch reports.
Golf clubs are a booming business. As the number of Americans hitting the links climbs — 48.1 million did so last year, up 41 percent from 2019 — initiation fees have skyrocketed.
“We’re reinventing the whole experience of golf,” Caruso told DealBook, saying the club’s “premium experience” will include high-quality food, a fitness center, tennis courts and more. It builds on an approach he took at Miramar Club, his take on the beach club, which opened in Montecito, Calif., in 2019.
Sherwood, which sits near Westlake Village, is already known as a hot spot for celebrities like Kevin Hart and LeBron James.
It’s one of Caruso’s first big endeavors since he ran for mayor of Los Angeles in 2022. Speaking of the mayoral election, “It’s going to be an interesting June 2,” he said when asked about the surprising ascendancy of Spencer Pratt’s candidacy.
“I really have stayed on the sidelines very intentionally on this,” he added, “and I’m going to remain on it.”
A.I. comes to the Tribeca Festival
Two defining narratives in the world today are the war with Iran and artificial intelligence. Now they’re converging in the form of a new movie that could ignite a debate about the role of generative A.I. in creating original entertainment and provoke fresh fears about job losses in Hollywood.
On Wednesday, Fountain 0, a start-up focused on creating A.I.-generated movies and TV, is announcing that its debut film will make its world premiere on June 10 at the Tribeca Festival in New York.
The movie, “Dreams of Violets,” is the first full-length, live-action feature created entirely with A.I. to be accepted at a major film festival.
The Tribeca Festival, celebrating its 25th anniversary this year, was co-founded by Robert De Niro and Jane Rosenthal in the wake of Sept. 11. Lupa Systems, the investment firm of James Murdoch, bought a controlling stake in the festival’s parent company in 2019.
Set in Iran in January 2026, “Dreams of Violets” is a fictional docudrama that follows five strangers who end up in a Tehran alley on the day that the Iranian government imposed an internet blackout amid a brutal crackdown in which thousands of protesters were killed.
It was made without actors, cameras or sets.
Passion project: The movie’s creators, Ash and Pooya Koosha, are brothers and first-time filmmakers who grew up in Iran but were forced to leave the country in 2009 and settled in London. They are the co-founders of Claigrid, an agentic A.I. start-up, and Fountain 0.
Ash Koosha made the movie alone in just a couple of months, with a budget of $2,000 for generative A.I. tools. He primarily used Kling AI, a platform developed by the Chinese tech company Kuaishou, for video generation.
“The film industry is going to be transformed by A.I.,” Tom Rogers, Fountain 0’s executive chairman, who founded CNBC and previously ran TiVo, told DealBook. Rogers said “Dreams of Violets” showed that “great independent films can be made without big studio financial backing.”
But he acknowledged that there would also be “a lot of consternation” about job displacement, given how A.I. fears drove several major strikes in the entertainment industry in recent years.
Tribeca’s decision to screen an A.I.-created movie may add to the consternation. “The Tribeca Festival has long championed artists who push the boundaries of storytelling and explore new creative frontiers,” a Tribeca spokesperson said in a statement.
THE SPEED READ
Deals
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Shares in AkzoNobel, the Dutch paint giant, jumped after the company said it had rejected a takeover bid of 12.5 billion euros ($14.6 billion) by Nippon Paint and Sherwin-Williams. (WSJ)
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The C.E.O. of Bolloré Group, the largest shareholder in Universal Music Group, said that a takeover bid for the music label by Bill Ackman’s investment firm was too low. (Bloomberg)
Politics, policy and regulation
Best of the rest
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A lawyer for Chirayu Rana, a former JPMorgan Chase employee who is suing the bank and a former colleague over sexual assault allegations, is said to have resigned. (WSJ)
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“Xi Jinping Quit Smoking. China Still Cannot.” (NYT)
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