Tag: AI

The Forces That Defined Markets in 2025

Posted on by scott.hodges

The U.S. stock market closed out 2025 on a strong note, delivering gains for investors while showcasing the powerful influence of artificial intelligence on the economy. Major indexes like the S&P 500 and Nasdaq finished the year with double-digit returns, reflecting renewed confidence in corporate earnings, innovation, and a resilient economic backdrop. Wall Street’s overall performance during the year was marked by steady growth and record levels, even amid periodic volatility and broader macroeconomic uncertainties. 

A major driver of market performance in 2025 was the remarkable interest in AI-related companies and technologies. Companies leading in AI infrastructure, software development, and advanced computing drew investor attention as they reported robust revenue growth and increased capital spending. This enthusiasm helped fuel stock gains and encouraged broader investment in tech-driven sectors.

At the same time, the speed and scale of investor interest prompted debate about whether optimism had outpaced fundamentals. Valuations in certain AI-linked stocks climbed to levels that invited comparison with past technology cycles. Analysts differed on what those signals meant, with some pointing to early signs of excess and others arguing that long-term productivity gains could support elevated prices.

By the end of the year, the conversation had shifted away from labeling the cycle and more toward execution and results. The market’s performance suggested an ongoing recalibration rather than a decisive break. For U.S. companies, the focus now turns to converting technological investment into consistent profit growth. For investors, the challenge lies in distinguishing durable business models from momentum trades as artificial intelligence moves from promise to performance.

Pediatric Cancer Policy Turns to Artificial Intelligence

Posted on by scott.hodges

President Donald Trump recently signed an executive order directing an additional $50 million to childhood cancer research. The goal is to strengthen the use of artificial intelligence in diagnosis, treatment selection, and data management. The new funding builds on the National Cancer Institute’s Childhood Cancer Data Initiative launched under his prior administration. 

Childhood cancer is the leading chronic disease-related cause of death among American children. Since 1975, incidence has climbed by more than 40 percent. While survival rates have improved, many survivors deal with long-term health challenges. Better precision in treatment could reduce both mortality and long tail costs of care.

Under the executive order, existing data will be expanded and made more accessible. Research teams will compete for grants that require build-out of AI models using clinical and genomic datasets. These models are expected to forecast therapy responses, flag side effect risks, and help optimize drug development pathways. The goal is to speed up innovation while directing resources toward the most effective trials.

The policy also encourages partnerships across federal agencies and private firms. Tech companies can contribute analytics platforms and infrastructure. The order signals a federal pivot toward targeted investments that combine health outcomes with data economics.

If implementation leads to better outcomes, pediatric cancer research may become a case study in how government capital applied to AI can reshape both disease science and long-term healthcare costs.

Amazon and The New York Times Ink Landmark AI Licensing Deal

Posted on by scott.hodges

Amazon has agreed to a multiyear content licensing deal with The New York Times, under which it will pay between $20 million and $25 million annually to access material from the Times’s news section, cooking site, and sports property, The Athletic. Amazon will use this content to train its AI models and to deliver real‑time summaries and excerpts via products like Alexa—marking the first AI licensing agreement for both companies.

The payments represent roughly 1 percent of the Times’s total revenue for 2024, underscoring the rising value attributed to high‑quality journalistic content in the rapidly evolving AI industry. This arrangement provides a clear example of how publishers are beginning to monetize content strategically in a landscape where AI increasingly drives traffic and user engagement.

For Amazon, the deal serves to strengthen its AI capabilities and enhance its customer offerings. Licensed NYT content will feed into its foundation models, enriching responses to queries and helping Alexa provide more authoritative, timely insights. At the same time, the Times gains a sizable, stable revenue stream, reinforcing its longstanding principle that quality journalism merits fair compensation.

The licensed content will be integrated into Amazon’s Alexa ecosystem and broader generative AI applications. Users may encounter Times-sourced material in summarized news briefings, interactive recipe walkthroughs, or real-time sports updates. This usage aims to provide added utility for consumers while maintaining transparency around attribution and licensing.

This partnership highlights an evolving approach within the media industry. While The New York Times is engaged in ongoing legal efforts to clarify how its content is used by some AI firms, it is also embracing collaborative opportunities—such as this agreement with Amazon—to establish clear licensing frameworks with trusted partners.

As AI platforms become more prevalent, this deal may establish a precedent for future collaborations between media companies and tech firms. It demonstrates that publishers can negotiate meaningful value for their content—and that AI companies are willing to compensate for access to reputable sources.

Microsoft Plans $80 Billion AI Infrastructure Investment in 2025

Posted on by scott.hodges

Microsoft will invest $80 billion in AI infrastructure during fiscal year 2025, focusing on data centers designed to process AI workloads. The company plans to allocate more than half of these funds to U.S.-based operations, supporting its aim to maintain American leadership in AI development. This investment follows the widespread adoption of AI tools after OpenAI’s release of ChatGPT in late 2022.

Microsoft’s investment extends beyond its existing $13 billion partnership with OpenAI. The company has already integrated AI capabilities across its products, including Windows, Teams, and Azure. In the first quarter of fiscal 2025, the company’s revenue from Azure and other cloud services increased 33% compared to the previous year, with AI services contributing significantly to this performance. CFO Amy Hood has signaled that capital expenditures will continue to rise in the fiscal second quarter.

The $80 billion investment aligns with broader U.S. goals to establish American AI technology as the preferred choice globally. The planned data centers will not only support AI model training and deployment but also strengthen the country’s ability to export AI technologies to international partners. This infrastructure expansion comes at a crucial time as the U.S. seeks to maintain its technological edge through international regulatory cooperation and strategic partnerships.

The United States currently holds a leading position in global AI development, with U.S. companies responsible for 73% of large language model development, compared to China’s 15%. In private investment as well, the U.S. attracts $67.2 billion in AI-related capital in 2023, outpacing China’s $7.8 billion. American companies like OpenAI, Anthropic, Google, and Microsoft drive technological innovation in both civilian and military applications, while also emphasizing ethical AI development and cybersecurity. The U.S. maintains its advantage through a strong talent pool, with 57% of elite AI researchers working in the country, though competition for this talent remains intense.

Brad Smith, Microsoft’s Vice Chair and President, emphasizes that private capital and innovation are essential to maintaining the U.S.’s leadership position in the global AI landscape. Against the backdrop of China’s expanding influence in AI development, Smith has called on the incoming U.S. administration to enhance AI education and promote American AI technologies internationally. This push for educational investment and global outreach, supported by Microsoft’s infrastructure expansion, is part of a comprehensive approach to achieving U.S. goals in the rapidly evolving field of artificial intelligence.