Sam Altman

To keep pushing the frontier, we need to build these new types of AI infrastructure hardware at scale, and I'm excited for that to happen in the US and with Foxconn.

We'll share insight into emerging hardware needs across the AI industry, and Foxconn will use that to design and prototype new equipment that can be manufactured in America.

Hey, good morning.

Thanks for having me.

So yeah, Oracle is really sort of the focus when people are starting to pay attention to the debt that is being issued by all of these tech companies.

I think the five big spenders on AI, which is Microsoft, Alphabet, Amazon Meta, and Oracle,

Together, they have raised more than $100 billion in debt this year.

That is more than three times the average over the past decade or so.

Oracle, in particular, because they are seen as having one of the weaker balance sheets of them, they're going to have negative cash flow this year that's expected to deepen in the coming years as they invest aggressively into their cloud business, which has been a big beneficiary of AI.

But if you look at their credit default swaps for the next five years, which is really being used as a kind of proxy for AI risk, those have skyrocketed over the past couple of months.

I think they're around 44 basis points in September.

They're over 100 now.

So this just shows you how people are growing concerned about all of this capex.

When is it going to pay off?

What is this doing to the balance sheets of all these big tech companies?

And really, how should that impact the way we are valuing them?

That's a great question.

I think this kind of gets to the bigger picture concerns right now about just all of this spending, how it's being done.

We've seen so much these circular financing deals.

You've seen this off balance sheet debt, all of these things.