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(Reuters) -Meta has struck a $27 billion financing deal with Blue Owl Capital to fund its biggest data center project globally, as large technology companies race to build out the infrastructure needed to power their artificial intelligence ambitions. Tuesday's announcement marks Meta's largest-ever private capital deal. Under the agreement, Meta will retain about 20% equity in the Louisiana project, with the majority owned by funds that alternative asset manager Blue Owl Capital manages. Blue Owl contributed roughly $7 billion in cash to the joint venture, with Meta receiving a one-time payout of about $3 billion. The planned data center in Richland Parish, Louisiana, known as Hyperion, is projected to deliver more than 2 gigawatts of compute capacity to support training of large language models, the technology behind tools such as ChatGPT and Google Gemini. Doug Ostrover and Marc Lipschultz, Co-CEOs of Blue Owl, called Hyperion "an ambitious project that reflects the scale and speed required to power the next generation of AI infrastructure." Major tech companies, including Alphabet, Amazon.com, Meta, Microsoft and CoreWeave, are on track to spend $400 billion on AI infrastructure this year, Morgan Stanley estimates. OpenAI, the startup at the heart of the AI boom, recently signed multiple deals that may cost over $1 trillion to secure about 26 gigawatts of computing capacity, enough to power roughly 20 million U.S. homes. Meta's finance chief, Susan Li, called Tuesday's deal "a bold step forward." The company has signed leases for the facility with a four-year initial term with an option to extend and expects the project to create more than 500 jobs once it goes online. Meta reorganized its AI efforts under Superintelligence Labs in June after senior staff departures and a poor reception for its open-source Llama 4 model. Chief Executive Mark Zuckerberg said in July that Meta would spend hundreds of billions of dollars to build several massive AI data centers for Superintelligence. (Reporting by Jaspreet Singh and Aditya Soni in Bengaluru; Editing by Tasim Zahid and Alan Barona)

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(Reuters) -Meta has struck a $27 billion financing deal with Blue Owl Capital to fund its biggest data center project globally, as large technology companies race to build out the infrastructure needed to power their artificial intelligence ambitions. Tuesday's announcement marks Meta's largest-ever private capital deal. Under the agreement, Meta will retain about 20% equity in the Louisiana project, with the majority owned by funds that alternative asset manager Blue Owl Capital manages. Blue Owl contributed roughly $7 billion in cash to the joint venture, with Meta receiving a one-time payout of about $3 billion. The planned data center in Richland Parish, Louisiana, known as Hyperion, is projected to deliver more than 2 gigawatts of compute capacity to support training of large language models, the technology behind tools such as ChatGPT and Google Gemini. Doug Ostrover and Marc Lipschultz, Co-CEOs of Blue Owl, called Hyperion "an ambitious project that reflects the scale and speed required to power the next generation of AI infrastructure." Major tech companies, including Alphabet, Amazon.com, Meta, Microsoft and CoreWeave, are on track to spend $400 billion on AI infrastructure this year, Morgan Stanley estimates. OpenAI, the startup at the heart of the AI boom, recently signed multiple deals that may cost over $1 trillion to secure about 26 gigawatts of computing capacity, enough to power roughly 20 million U.S. homes. Meta's finance chief, Susan Li, called Tuesday's deal "a bold step forward." The company has signed leases for the facility with a four-year initial term with an option to extend and expects the project to create more than 500 jobs once it goes online. Meta reorganized its AI efforts under Superintelligence Labs in June after senior staff departures and a poor reception for its open-source Llama 4 model. Chief Executive Mark Zuckerberg said in July that Meta would spend hundreds of billions of dollars to build several massive AI data centers for Superintelligence. (Reporting by Jaspreet Singh and Aditya Soni in Bengaluru; Editing by Tasim Zahid and Alan Barona)

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By Lisa Richwine LOS ANGELES (Reuters) -Netflix missed Wall Street's third-quarter earnings targets because of an unexpected expense from a dispute with Brazilian tax authorities while it offered a forecast a touch ahead of Wall Street projections for the rest of the year. The report failed to impress investors accustomed to fast-paced growth from the streaming video pioneer. Shares of Netflix, which had risen 39% this year ahead of the earnings report, fell 6.3% to $1,163.80 in after-hours trading on Tuesday.   Netflix posted net income of $2.5 billion and diluted earnings-per-share of $5.87 for July through September, a period when the animated "K-Pop Demon Hunters" became the most-watched movie in Netflix history. Analysts had expected $3.0 billion and $6.97, respectively, according to LSEG. Revenue was even with forecasts, at $11.5 billion. Netflix is seeking growth from new areas such as advertising and video games after attracting more than 300 million customers around the world. It faces competition from YouTube, Amazon's Prime Video, Disney+ and others. The media business is facing major changes including the potential sale of industry titan Warner Bros Discovery and the rise of generative artificial intelligence with the ability to produce short-form video. Netflix reported an operating margin of 28% for the third quarter. Without the Brazilian tax expense of roughly $619 million, the margin would have exceeded the company's guidance of 31.5%, it said, adding that it did not expect the matter to have a material impact on future results. PP Foresight analyst Paolo Pescatore said he believed the tax issue weighed on Netflix shares. "All things considered, this was another robust quarter, despite a blip due to an unforeseen expense," Pescatore said. For the fourth quarter, Netflix forecast revenue of $11.96 billion, compared with Wall Street's projection of $11.90 billion. It projected diluted earnings-per-share a penny ahead of analysts' targets, at $5.45. For the third quarter, Netflix said it recorded its best ad sales quarter in history but did not disclose a number. "This gives the impression that the sustained revenue growth achieved this quarter, and forecasted for next quarter, will predominantly continue to come from subscription fees," eMarketer analyst Ross Benes said. Netflix will release the final season of one of its biggest hits, "Stranger Things," in November and December and stream two live National Football League games on Christmas. "We're finishing the year with good momentum and have an exciting Q4 slate," Netflix said in its quarterly letter to shareholders. Earlier this year, Netflix stopped reporting subscriber numbers and urged investors to focus on revenue and profit. It has expanded into video games and advertising, two areas that have contributed little to revenue so far, according to analysts and investors.  (Reporting by Lisa Richwine; Editing by Richard Chang)

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(Reuters) -Japan's financial regulator is mulling allowing members of banking groups to launch cryptocurrency trading services, in a move to expand market access and foster competition, the Nikkei reported on Wednesday. Japan's Financial Services Agency (FSA) is also considering lifting a ban on banks from buying and holding cryptocurrencies for investment. Banking group subsidiaries are not currently permitted to register with the regulator for crypto asset services under the Banking Act. The regulator did not immediately respond to a Reuters request for comment. The FSA aims to revise regulations so that securities subsidiaries of banking groups can provide crypto asset services, a move designed to expand market access and let them compete on equal terms with peers under securities company groups, the report said. The current space is mostly dominated by affiliates of securities groups such as Rakuten Wallet, an affiliate of Rakuten Securities, and a unit of SBI Holdings . Given the sharp volatility in cryptocurrencies and the potential for heavy losses, the FSA will mandate that bank-affiliated securities firms provide clear explanations of these risks to retail investors, Nikkei added. (Reporting by Rishav Chatterjee in Bengaluru; Editing by Anil D'Silva)

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By Lisa Richwine LOS ANGELES (Reuters) -Netflix missed Wall Street third-quarter earnings targets because of an unexpected expense from a dispute with Brazilian tax authorities and it offered a forecast a touch ahead of Wall Street projections for the rest of the year. Shares of Netflix fell 4% to $1,186.82 in after-hours trading on Tuesday.   The streaming service posted net income of $2.5 billion and diluted earnings-per-share of $5.87 for July through September, a period when the animated "K-Pop Demon Hunters" became the most-watched movie in Netflix history. Analysts had expected $3.0 billion and $6.97, according to LSEG. Revenue was even with forecasts, at $11.5 billion. Netflix is searching for growth from new areas such as advertising and video games after attracting more than 300 million customers around the world. It faces competition from YouTube, Amazon's Prime Video, Disney+ and others. Netflix said its operating margin for the third quarter came in at 28%. Without the Brazilian tax expense of roughly $619 million, operating margin would have exceeded the company's guidance of 31.5%, the company said.  "We don't expect this matter to have a material impact on future results," Netflix said in its quarterly letter to shareholders. For the fourth quarter, Netflix forecast revenue of $11.96 billion, compared with Wall Street's projection of $11.90 billion. It projected diluted earnings-per-share a penny ahead of analysts' targets, at $5.45. The company will release the final season of one of its biggest hits, "Stranger Things," in November and December and will stream two live National Football League games on Christmas. "We're finishing the year with good momentum and have an exciting Q4 slate," Netflix said in its letter. Earlier this year, Netflix stopped reporting subscriber numbers and urged investors to focus on revenue and profit. It has expanded into video games and advertising, two areas that have contributed little to revenue so far, according to analysts and investors.  (Reporting by Lisa Richwine; Editing by Richard Chang)

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By Juby Babu and Krystal Hu (Reuters) -OpenAI on Tuesday unveiled ChatGPT Atlas, a long-anticipated artificial intelligence-powered web browser built around its popular chatbot, in a direct challenge to Google Chrome’s dominance. The launch marks OpenAI’s latest move to capitalize on 800 million weekly active ChatGPT users, as it expands into more aspects of users' online lives by collecting data about consumers' browser behavior. It could accelerate a broader shift toward AI-driven search, as users increasingly turn to conversational tools that synthesize information instead of relying on traditional keyword-based results from Google — intensifying competition between OpenAI and Google. Shares of Alphabet, which owns the Chrome browser, were down 1.8% in afternoon trading. Reuters earlier reported on OpenAI’s planned browser launch. It is the latest entrant in a crowded field of AI browsers, which includes Perplexity’s Comet, Brave Browser and Opera’s Neon, as companies race to weave in tools that can summarize pages, fill out forms and draft code to attract users. Atlas lets users open a ChatGPT sidebar in any window to summarize content, compare products or analyze data from any site. In “agent mode,” now available to paid users, ChatGPT can interact with websites on their behalf — completing tasks from start to finish, such as researching and shopping for a trip. In a demo on Tuesday, OpenAI developers showcased how ChatGPT could find an online recipe and then automatically purchase all the ingredients. The agent navigated to the Instacart website and added the necessary groceries to the cart — a task that took several minutes to complete. The browser is now available globally on Apple’s macOS. Versions for Windows, iOS and Android will be released later. Led by Sam Altman, OpenAI upended the tech industry with the launch of ChatGPT in late 2022. Following its initial success, the company has faced stiff competition from Google and startup Anthropic and has been seeking new areas of growth.  Google, meanwhile, has been developing ways to adapt to shifting search behaviors since ChatGPT’s debut. Depending on the query, each Google search result can now display an AI overview, or AI Mode, alongside traditional links, offering a chatbot-like experience. Last month, Google integrated its Gemini AI model into Chrome for U.S. users, with plans to bring Gemini to the iOS Chrome app as well. In a win for Google, a federal judge in September ruled that Google won't have to sell the Chrome browser. Judge Amit Mehta said Google can continue paying partners to promote its search engine, noting that heavy investment in generative AI by Big Tech and startups alike now threatens traditional search, making such payments more acceptable. Despite increasing competition, Google Chrome has held its dominance, with 71.9% market share in the global browser market in September, according to StatCounter. Still, analysts say a new browser from OpenAI could introduce fresh competition for ad dollars. “Integrating chat into a browser is a precursor for OpenAI starting to sell ads, which it has yet to do so far. Once OpenAI starts selling ads that could take away a significant part of search advertising share from Google, which has around 90% of that spend category,” said Gil Luria, analyst at D.A. Davidson. (Reporting by Juby Babu in Mexico City and Krystal Hu in San Francisco; Additional reporting by Anhata Rooprai; Editing by Leroy Leo, Alan Barona and Lisa Shumaker)

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By Svea Herbst-Bayliss NEW YORK (Reuters) -Activist investor Engaged Capital has built a sizable stake in Cognex and is urging the maker of machine vision systems to cut costs and use cost consultants, arguing this could help the stock price nearly double in the next two years. "This is an AI company without the AI valuation," Engaged's founder and chief investment officer Glenn Welling said on Tuesday at the 13D Monitor Active-Passive Investment Summit in New York. Welling did not disclose the size of Engaged's stake in Cognex but called it one of the hedge fund's biggest positions. A recent regulatory filing showed that Engaged had roughly $700 million in assets. Cognex's smart cameras and bar code readers are used by customers including retailer Amazon and car maker BMW for purposes such as spotting defects in packaging or scratches in doors. The company, which has a market valuation of $7.7 billion, has seen its stock price tumble some 50% from its all-time high four years ago. Now with new management at the helm – CEO Matt Moschner was appointed earlier this year and CFO Dennis Fehr was named to the position in 2024 – Welling said he is confident significant improvements can be made to drive revenue, profit and ultimately the share price higher. Cognex's share price traded at $47.64 at the start of the week. Last year, the company reported margins of 17% but Welling said those could be closer to 40% with changes to the company's overall spending, particularly on its research and development side where it could cut back on projects with low returns. Cognex's main competitor, Japanese company Keyence, boasts margins of 53%. The company has also reengineered some products and with the help of artificial intelligence they are easier to install and operate, opening up a new potential field of customers, he said. Welling said Engaged has had constructive discussions with Cognex and introduced the management to cost-cutting consultants who have been involved with other Engaged target companies. (Reporting by Svea Herbst-Bayliss; Editing by Nia Williams)

(The article has been published through a syndicated feed. Except for the headline, the content has been published verbatim. Liability lies with original publisher.)

By Svea Herbst-Bayliss NEW YORK (Reuters) -Activist investor Engaged Capital has built a sizable stake in Cognex and is urging the maker of machine vision systems to cut costs and use cost consultants, arguing this could help the stock price nearly double in the next two years. "This is an AI company without the AI valuation," Engaged's founder and chief investment officer Glenn Welling said on Tuesday at the 13D Monitor Active-Passive Investment Summit in New York. Welling did not disclose the size of Engaged's stake in Cognex but called it one of the hedge fund's biggest positions. A recent regulatory filing showed that Engaged had roughly $700 million in assets. Cognex's smart cameras and bar code readers are used by customers including retailer Amazon and car maker BMW for purposes such as spotting defects in packaging or scratches in doors. The company, which has a market valuation of $7.7 billion, has seen its stock price tumble some 50% from its all-time high four years ago. Now with new management at the helm – CEO Matt Moschner was appointed earlier this year and CFO Dennis Fehr was named to the position in 2024 – Welling said he is confident significant improvements can be made to drive revenue, profit and ultimately the share price higher. Cognex's share price traded at $47.64 at the start of the week. Last year, the company reported margins of 17% but Welling said those could be closer to 40% with changes to the company's overall spending, particularly on its research and development side where it could cut back on projects with low returns. Cognex's main competitor, Japanese company Keyence, boasts margins of 53%. The company has also reengineered some products and with the help of artificial intelligence they are easier to install and operate, opening up a new potential field of customers, he said. Welling said Engaged has had constructive discussions with Cognex and introduced the management to cost-cutting consultants who have been involved with other Engaged target companies. (Reporting by Svea Herbst-Bayliss; Editing by Nia Williams)

(The article has been published through a syndicated feed. Except for the headline, the content has been published verbatim. Liability lies with original publisher.)

By Svea Herbst-Bayliss NEW YORK (Reuters) -Activist investor Engaged Capital has built a sizable stake in Cognex and is urging the maker of machine vision systems to cut costs and use cost consultants, arguing this could help the stock price nearly double in the next two years. "This is an AI company without the AI valuation," Engaged's founder and chief investment officer Glenn Welling said on Tuesday at the 13D Monitor Active-Passive Investment Summit in New York. Welling did not disclose the size of Engaged's stake in Cognex but called it one of the hedge fund's biggest positions. A recent regulatory filing showed that Engaged had roughly $700 million in assets. Cognex's smart cameras and bar code readers are used by customers including retailer Amazon and car maker BMW for purposes such as spotting defects in packaging or scratches in doors. The company, which has a market valuation of $7.7 billion, has seen its stock price tumble some 50% from its all-time high four years ago. Now with new management at the helm – CEO Matt Moschner was appointed earlier this year and CFO Dennis Fehr was named to the position in 2024 – Welling said he is confident significant improvements can be made to drive revenue, profit and ultimately the share price higher. Cognex's share price traded at $47.64 at the start of the week. Last year, the company reported margins of 17% but Welling said those could be closer to 40% with changes to the company's overall spending, particularly on its research and development side where it could cut back on projects with low returns. Cognex's main competitor, Japanese company Keyence, boasts margins of 53%. The company has also reengineered some products and with the help of artificial intelligence they are easier to install and operate, opening up a new potential field of customers, he said. Welling said Engaged has had constructive discussions with Cognex and introduced the management to cost-cutting consultants who have been involved with other Engaged target companies. (Reporting by Svea Herbst-Bayliss; Editing by Nia Williams)

(The article has been published through a syndicated feed. Except for the headline, the content has been published verbatim. Liability lies with original publisher.)

By Svea Herbst-Bayliss NEW YORK (Reuters) -Activist investor Engaged Capital has built a sizable stake in Cognex and is urging the maker of machine vision systems to cut costs and use cost consultants, arguing this could help the stock price nearly double in the next two years. "This is an AI company without the AI valuation," Engaged's founder and chief investment officer Glenn Welling said on Tuesday at the 13D Monitor Active-Passive Investment Summit in New York. Welling did not disclose the size of Engaged's stake in Cognex but called it one of the hedge fund's biggest positions. A recent regulatory filing showed that Engaged had roughly $700 million in assets. Cognex's smart cameras and bar code readers are used by customers including retailer Amazon and car maker BMW for purposes such as spotting defects in packaging or scratches in doors. The company, which has a market valuation of $7.7 billion, has seen its stock price tumble some 50% from its all-time high four years ago. Now with new management at the helm – CEO Matt Moschner was appointed earlier this year and CFO Dennis Fehr was named to the position in 2024 – Welling said he is confident significant improvements can be made to drive revenue, profit and ultimately the share price higher. Cognex's share price traded at $47.64 at the start of the week. Last year, the company reported margins of 17% but Welling said those could be closer to 40% with changes to the company's overall spending, particularly on its research and development side where it could cut back on projects with low returns. Cognex's main competitor, Japanese company Keyence, boasts margins of 53%. The company has also reengineered some products and with the help of artificial intelligence they are easier to install and operate, opening up a new potential field of customers, he said. Welling said Engaged has had constructive discussions with Cognex and introduced the management to cost-cutting consultants who have been involved with other Engaged target companies. (Reporting by Svea Herbst-Bayliss; Editing by Nia Williams)

(The article has been published through a syndicated feed. Except for the headline, the content has been published verbatim. Liability lies with original publisher.)