This week proved pivotal for the tech and energy sectors as market dynamics and the regulatory landscape shifted.
Apple (NASDAQ:AAPL) made waves by signaling a foray into artificial intelligence (AI) search and challenging app store regulations, while OpenAI underwent a major restructuring amid legal battles with Elon Musk.
Meanwhile, legislation targeting AI chip tracking gained momentum, and the nuclear energy sector saw increased activity with Ontario Power Generation’s new reactor project and potential White House actions.
Earnings reports from major players like Palantir (NASDAQ:PLTR), AMD (NASDAQ:AMD), Arm Holdings (NASDAQ:ARM) and Super Micro Computer (NASDAQ:SMCI) painted a complex picture of growth and challenges in a turbulent economic environment.
The interplay of innovation, regulation and market forces played out against a backdrop of trade developments between the US and the UK, with optimism regarding forthcoming negotiations with China boosting sentiment toward the end of the week.
Read on to dive deeper into this week’s top stories.
1. Apple’s App Store appeal, AI search plans and chip news
Apple is formally contesting last week’s judicial ruling mandating a reduction in its App Store commission.
The company filed an appeal against the order that would compel it to lower the existing 27 percent fee imposed on businesses offering links within their apps to external payment processing alternatives.
In related news, Apple executive Eddy Cue revealed during federal court testimony that the tech giant is investigating the development of its own AI-powered search engine for the Safari web browser. The news had an immediate impact on Alphabet’s (NASDAQ:GOOGL) shares, resulting in a 9 percent decline on Wednesday (May 7) afternoon.
In other news, Apple is reportedly making advances in its in-house silicon development.
The company is designing new proprietary chips intended to serve as the main central processing units for a range of future Apple products. These include anticipated devices such as smart glasses, more powerful iterations of its Mac computer line and specialized AI servers.
Combined with this week’s macroeconomic and geopolitical developments, Apple’s share price experienced turbulence, ultimately closing 2.25 percent below Monday’s (May 5) opening price on Friday (May 9).
2. OpenAI announces restructuring, acquisition and leadership changes
In a notable week for AI giant OpenAI, CEO Sam Altman shared a reorganization strategy on Monday, announcing that its operational arm will transition into a new public benefit corporation, with its non-profit arm acting as the primary shareholder. The decision follows talks with civic leaders and state attorneys general.
A person familiar with the matter told Business Insider that the new plan will let the company receive the full US$30 billion investment from SoftBank (TSE:9984). Meanwhile, sources told Bloomberg on Monday that Microsoft (NASDAQ:MSFT) and OpenAI are still in negotiations regarding a restructuring plan. A later report from the Information reveals that OpenAI plans to slash its 20 percent revenue-sharing agreement with Microsoft to 10 percent by 2030.
Regarding the ongoing legal dispute between Sam Altman and Tesla (NADAQ:TSLA) CEO Musk, who alleges that the company has strayed from its founding mission, Musk’s attorney, Marc Toberoff, told Reuters on Monday that the team intends to proceed with the lawsuit. Toberoff also called the restructuring a “cosmetic” move that turns charitable assets into private wealth, adding that “the founding mission remains betrayed.”
In other news, OpenAI made its largest acquisition to date this week, agreeing to buy AI-assisted coding tool Windsurf for about US$3 billion, and named ex-Instacart (NASDAQ:CART) CEO Fidji Simo as its new head of applications.
According to reports, Simo will manage operations and report directly to Sam Altman, who will retain his title as CEO. Altman will shift his focus to research, safety efforts and advancing artificial general intelligence.
3. AI chip regulatory developments
US Representative Bill Foster is preparing to introduce legislation aimed at tracking the location of AI chips, such as those produced by NVIDIA (NASDAQ:NVDA), after they are sold.
The proposed bill, first reported by Reuters on Monday, would task US regulators with developing rules to monitor these chips, ensuring they remain in authorized locations under export control licenses.
It would also seek to prevent unlicensed chips from being activated outside of authorized locations.
In other chip-related news, NVIDIA shares rose following news that the Trump administration plans to eliminate the so-called “AI diffusion rule.” However, a spokesperson from the US Department of Commerce clarified upcoming plans in a statement to CNBC’s Kif Leswing on Wednesday, commenting:
“The Biden AI rule is overly complex, overly bureaucratic, and would stymie American innovation. We will be replacing it with a much simpler rule that unleashes American innovation and ensures American AI dominance.”
The announcement highlights the Trump administration’s intention to keep some guardrails in place to protect US interests, despite pushback from tech industry executives.
At a Congressional hearing on Thursday (May 8), OpenAI CEO Sam Altman emphasized the importance of maintaining US leadership in AI development. He cautioned against overregulation, warning that poorly designed rules could hinder America’s competitive edge, particularly against China.
4. Palantir, AMD, Arm and Super Micro share results
Palantir’s Q1 revenue rose 39 percent year-on-year to US$884 million, driven by demand for its data analytics software in the US. The company expects demand to continue, forecasting Q2 revenue between US$934 million and US$938 million. Palantir’s share price fell by 8 percent after hours as investors anticipated even stronger results. The company posted a loss of 5.6 percent for the week after a volatile week for tech stocks, as overvaluation concerns persist.
Advanced Micro Devices’ Q1 earnings report shows quarterly revenue of US$7.4 billion, an annual increase of 36 percent, with adjusted earnings per share of US$0.96. Despite an initial 7 percent stock surge following a positive quarterly report, AMD shares fell following the company’s announcement of a projected US$1.5 billion revenue decrease this year, attributed to US government limitations on the sale of AI chips to China.
Palantir, Super Micro, AMD and Arm performance, May 6 to 9, 2025.
Chart via Google Finance.
For Q4 2024, Arm Holdings reported quarterly revenue of more than US$1 billion for the first time in its history, but forecast revenue and profit for Q1 2025 below Wall Street estimates, resulting in a 4 percent slump on Thursday morning
Super Micro Computer’s net sales increased from US$3,85 billion in Q3 2024 to US$4.6 billion, while the company’s earnings per share fell year-on-year from US$0.66 to US$0.17.
The company lowered its full-year revenue guidance from US$23.5 billion to US$25 billion, down to US$21.8 billion to US$22.6 billion, with trade war-induced uncertainty and increasing competition cited as obstacles to growth. The company’s share price opened over 5 percent lower the next day and fell by over 3 percent this week.
5. Constellation shares jump, White House plans reactor push
Shares of Constellation Energy (NASDAQ:CEG) rose nearly 10 percent in two days ahead of the Tuesday (May 6) release of its Q1 earnings report, which revealed revenue that exceeded expectations by over 20 percent.
Later, during an earnings call, CEO Joe Dominguez said the company was close to inking multiple long-term deals to provide nuclear power to meet surging energy demands, further bolstering investors’ optimistic outlook.
In another significant development within the nuclear energy sector, Ontario Power Generation said it has secured the necessary approvals to commence construction on the first of four small modular reactors (SMR) designed by GE Verona (NYSE:GEV), which will be located at the company’s Darlington site near Toronto.
The Darlington project is anticipated to be the first deployment of this particular SMR technology within a G7 nation.
Separately, Axios reported on Tuesday that sources familiar with the matter say the White House is in the final stages of preparing executive actions intended to accelerate the deployment of nuclear reactors. These plans, reportedly under consideration for several weeks, could be officially announced imminently.
On Friday, NPR said its reporters have seen a draft of such an order. According to the report, the order instructs the Nuclear Regulatory Commission (NRC) to send new reactor safety guidelines to the White House for review and possible amendments. The draft also calls for a reduction of NRC’s staff and a “wholesale revision of its regulation” in coordination with the administration and the Department of Government Efficiency.
Securities Disclosure: I, Meagen Seatter, hold no direct investment interest in any company mentioned in this article.
