Andrew here. We\u2019ve got an exclusive on Barry Diller\u2019s plan to overhaul IAC and change its name to People.<\/p>\n
We\u2019re also looking at whether the criminal case against Jay Powell is really over, and whether OpenAI has fallen behind its own expectations \u2014 and what that would mean for its race to go public. More below.<\/p>\n
Is OpenAI falling further behind?<\/p>\n
Until yesterday, the conversation around OpenAI was about Elon Musk\u2019s lawsuit<\/a> against the artificial intelligence giant.<\/p>\n But OpenAI may have bigger problems.<\/p>\n A new report raises questions about the ambitious spending plans of its C.E.O., Sam Altman, and the company\u2019s standing in the A.I. race.<\/p>\n OpenAI has missed its user and revenue targets, The Wall Street Journal reports<\/a>, citing anonymous sources. Internally, it had sought to hit one billion weekly active ChatGPT users by the end of 2025, a goal it still hasn\u2019t announced, and has seen users defect to rivals.<\/p>\n Sarah Friar, its C.F.O., has told fellow executives that she\u2019s worried about paying for future computing contracts at the current business trajectory, The Journal adds, while directors have been re-examining its data center plans.<\/p>\n Altman and Friar told The Journal that any suggestion that the company would pull back on computing power investments was \u201cridiculous.\u201d<\/p>\n The reporting amplifies worries that OpenAI is losing ground, as Google\u2019s Gemini and Anthropic\u2019s Claude take more market share, especially in the hugely important enterprise market.<\/p>\n The company last week introduced an A.I. model that it says outperforms on many benchmarks. And it has redoubled efforts to make its Codex A.I. coding tool more competitive against Anthropic\u2019s Claude Code.<\/p>\n Why that matters: Altman has embraced hugely expensive ambitions to expand the company\u2019s computing capacity. But OpenAI has had to pull back on building its own expansive data center clusters, given pushback from potential lenders.<\/p>\n If it\u2019s falling further behind on business goals, that could further constrain OpenAI\u2019s growth initiatives.<\/p>\n OpenAI is already taking a risk by revamping its relationship with Microsoft, historically its biggest backer. The two companies said on Monday<\/a> that OpenAI would now be free to provide its models on other cloud providers, but that it also would trim a key revenue-sharing arrangement with Microsoft.<\/p>\n OpenAI says it now has more business flexibility. But Martin Peers of The Information questioned that premise<\/a>, since it\u2019s unclear whether Amazon\u2019s AWS customers would be willing to switch over from Claude.<\/p>\n What about the I.P.O.? Remember that some executives want to take the company public by year end. Is that still possible? (Shares of companies linked to OpenAI, including SoftBank and Oracle, were down on The Journal\u2019s report<\/a>.)<\/p>\n HERE\u2019S WHAT\u2019S HAPPENING <\/p>\n A man accused in the White House correspondents\u2019 dinner attack is charged. Federal prosecutors formally accused Cole Tomas Allen of trying to assassinate President Trump<\/a>; a note that the authorities said had been written by him appeared to express anger about the administration. Some Republicans in Congress amplified Trump\u2019s claim<\/a> that the episode strengthened his desire for a White House ballroom.<\/p>\n Oil prices climb as Trump spurns Iran\u2019s latest offer. Brent crude, the international benchmark for oil, surpassed $111 on Tuesday after the president on Monday said he was unsatisfied with Tehran\u2019s proposal<\/a>, which called for resuming full ship traffic through the Strait of Hormuz \u2014 including the end of a U.S. blockade on Iranian ports \u2014 but left unresolved the fate of Iran\u2019s nuclear program, officials said.<\/p>\n Shares in Bayer fall after a setback at the Supreme Court. Some justices appeared skeptical<\/a> on Monday of the German conglomerate\u2019s argument, backed by the Trump administration, that state-level lawsuits over the safety of its Roundup weedkiller should be barred. The E.P.A. has ruled Roundup as safe; a Supreme Court ruling could complicate product safety regulations in the U.S.<\/p>\n Diller remakes his empire<\/p>\n Barry Diller is hitting the reset button. Again.<\/p>\n The media mogul plans to announce on Tuesday a broad overhaul of IAC, his digital media empire, DealBook is first to report. Its holding company will rename itself People, after its magazine empire, which will become a bigger focus of operations. And it will lean heavily into its 26 percent stake in MGM.<\/p>\n In the current evolution of the e-commerce market, Diller told DealBook in an interview, new opportunities in areas in which IAC has historically invested big \u2014 including online search and marketplaces \u2014 became few and far between.<\/p>\n Don\u2019t call this a sunset for Diller\u2019s empire. The media mogul pushed back against the idea that he\u2019s winding down the business. \u201cThat\u2019s exactly what they said the last time this happened,\u201d he said. \u201cI like that it\u2019s good clay.\u201d<\/p>\n In a memo to employees seen by DealBook, Diller summed up the company\u2019s evolution over about 30 years, from an owner of local TV stations to support the Home Shopping Network into what it is today:<\/p>\n I bought into little Silver King Communications in 1995. It had about $40 million in sales, and as it evolved over the next decades, we became HSN, then USA Networks and finally, in 2003, IAC\/Interactive Corp, and then even more simply, IAC Inc.<\/p>\n People, the company, will get leaner, as it shifts to a focused media conglomerate from a sprawling digital one:<\/p>\n It will cut 77 positions, and some high-level executives like its C.F.O., Christopher Halpin, and its chief legal officer, Kendall Handler, will depart. The company employs about 3,500 people.<\/p>\n The existing leadership team at its People division, led by Neil Vogel, will take the reins of the parent company.<\/p>\n The company expects to generate about $40 million in annual savings.<\/p>\n Diller is particularly excited about what he calls \u201cinversions,\u201d big investments People can make in branded products and services, based on its magazine titles. Instead of licensing brands to others, he sees an opportunity to build or buy businesses that take advantage of the authority of People\u2019s publications.<\/p>\n And while Diller-owned titles like People and Southern Living may not have the same sparkle as Cond\u00e9 Nast\u2019s magazines, they\u2019re significantly larger and more profitable.<\/p>\n The bottom line: Diller\u2019s management philosophy of \u201cgetting smaller to get bigger\u201d will be tested once more.<\/p>\n Powell and the Pirro factor <\/p>\n The criminal investigation trailing Jay Powell, the Fed chair, has been quieted \u2014 at least for now.<\/p>\n But will that be enough to end the succession drama hanging over the central bank? On that matter, Jeanine Pirro, the U.S. attorney in Washington, is worth watching, legal experts told Niko Gallogly.<\/p>\n Recap: On Friday, Pirro said the Justice Department would drop its investigation<\/a> into Powell over his handling of the $2.5 billion renovation of the central bank\u2019s headquarters.<\/p>\n The move mollified Senator Thom Tillis<\/a>, Republican of North Carolina, who has a key vote on the Senate Banking Committee. He had threatened to withhold support for the confirmation of Kevin Warsh, President Trump\u2019s pick to lead the Fed, until the investigation was closed.<\/p>\n What stands in the way of Pirro reopening an inquiry? Very little, legal experts say. \u201cA U.S. attorney has exceptionally broad discretion to open and close investigations,\u201d Jonathan Shaub, a professor at the University of Kentucky\u2019s law school, told DealBook. \u201cOnce they\u2019ve gotten the confirmation through, if they want to reopen it, she could do that.\u201d<\/p>\n Another factor: Pirro, a Trump loyalist, could continue the investigation in secrecy. \u201cPirro has the discretion to say whatever she wants on the record, but do the opposite behind the scenes,\u201d Jed Shugerman, a law professor at Boston University, told DealBook.<\/p>\n It\u2019s worth noting that Pirro has said she would \u201cnot hesitate\u201d to reopen the investigation. And Todd Blanche, the acting attorney general, signaled in an interview with NBC on \u201cMeet the Press\u201d on Sunday that the investigation remained active<\/a>, though, as he said, it will now be handled by the inspector general.<\/p>\n The big threat remains. Dropping the investigation \u201cgives cover\u201d to Tillis to advance Warsh\u2019s nomination, but it does little to stop the Trump administration\u2019s attacks on the Fed, Shugerman said. \u201cIn reality, President Trump\u2019s threats against Powell\u201d and the administration\u2019s attempt to fire Lisa Cook, a Fed governor, \u201care bells that cannot be unrung.\u201d<\/p>\n Central bank watchers fear that Trump\u2019s threats to Fed independence could weaken the institution. Now all eyes are on Powell, as Fed policymakers convene their two-day meeting on Tuesday. Will Powell stay, or will he go<\/a>?<\/p>\n Guyana\u2019s wartime oil boom <\/p>\n The energy shock wrought by the war in the Middle East has established winners and losers across the globe, and thrust some countries into an outsize role in international markets.<\/p>\n Tiny, oil-rich Guyana is one. The South American country has become a surprising power player amid the war\u2019s upheaval, Vivienne Walt reports.<\/p>\n The nation\u2019s president, Mohamed Irfaan Ali, has been courted by President Trump<\/a>, Prime Minister Narendra Modi<\/a> of India and Qatar\u2019s emir, Sheikh Tamim bin Hamad Al Thani<\/a>. On Friday, Wall Street will focus on how Guyana factors into Big Oil\u2019s profit push, when Exxon Mobil and Chevron report first-quarter results.<\/p>\n Exxon is so far the biggest winner in Guyana\u2019s bonanza. It made a giant discovery<\/a> in 2015 in the country\u2019s offshore Stabroek block, which holds an estimated 11 billion barrels of oil and gas<\/a> \u2014 enough to keep producing for decades. Exxon has a 45 percent controlling stake in the project, alongside Chevron (through its acquisition last year of Hess) and a Chinese producer, CNOOC.<\/p>\n As of late 2025, the consortium was producing more than 900,000 barrels of oil a day. Exxon forecasts capacity could expand to 1.7 million barrels per day<\/a> by 2030. <\/p>\n \u201cGuyana is going to be a very, very important part of Exxon\u2019s business in the region,\u201d Roxanna Vigil, a regional expert at the Council on Foreign Relations, told DealBook.<\/p>\n Others are muscling in. Guyana has asked Indian companies to bid on new drilling sites when they come up for auction this year. The country has made it clear that it wants closer ties<\/a> with New Delhi, which has helped build roads and a stadium for cricket-crazed Guyanese. Negotiations between the countries<\/a> to build Guyana\u2019s first refinery are underway.<\/p>\n Last decade, Exxon and Hess secured deals in which they pay the government of Guyana a relatively small royalty fee of 2 percent. It\u2019s unlikely that new partners, including India, will get similar terms. \u201cWe have learned from the mistake,\u201d Ali told DealBook<\/a> in a 2024 interview.<\/p>\n Another issue hanging over Guyana: Venezuela has a decades-old claim over about two-thirds of Guyana\u2019s territory, including some of Stabroek. That dispute is expected to go to trial<\/a> in the International Court of Justice next month.<\/p>\n The verdict will be widely watched, as it could determine control of some of the richest oil fields in the region \u2014 and which oil producers reap the profits.<\/p>\n THE SPEED READ <\/p>\n Deals<\/p>\n Shell agreed to buy ARC Resources<\/a>, a Canadian shale oil and gas producer, for $13.6 billion, the oil giant\u2019s biggest deal in more than a decade. (Bloomberg)<\/p>\n Silver Rock Capital Partners, a spinoff from Michael Milken\u2019s family office, has raised more than $4 billion<\/a> for a private credit fund. (FT)<\/p>\n Technology and artificial intelligence<\/p>\n Best of the rest<\/p>\n