Flo Crivello’s expenses were out of whack, and there was only one way to get them under control. 

Earlier this month, the 34-year-old CEO of AI startup Lindy switched his company off of Anthropic’s Claude models, moving 100% of its traffic to DeepSeek, a Chinese company that makes cheaper, open-weight alternatives. 

“We did it, and you could see that cost curve go down, like, crash to the ground,” Crivello said in an interview from his company’s San Francisco headquarters. He said the decision will save Lindy millions of dollars within months, though he still expects the roughly 25-person company to spend more on AI than payroll.

“It’s a matter of survival for the business,” Crivello said. “That’s all it is.”

Crivello, who previously spent almost five years at Uber, is among a growing crop of founders and executives across the U.S. trying to rein in artificial intelligence spending. Bills for AI have ballooned – sometimes into the billions of dollars – since OpenAI first captivated Wall Street with its ChatGPT chatbot in 2022, kickstarting a rush by businesses to deploy the technology across areas like customer support, marketing and finance.

In particular, costs ramped up in the realm of AI-assisted coding, as developers pumped tokens into the creation of new tools and services that previously would have required teams of coders. That led to the era of so-called tokenmaxxing and AI leaderboards, where employers have incentivized developers to use as much AI as possible without worrying about the results.

The crackdown is underway. Uber said this month it had implemented a series of spending tiers on some AI tools, starting at a base level of $1,500 per month, though employees could request access to higher levels. In April, Uber CTO Praveen Neppalli Naga revealed to The Information that the ride-sharing company blew through its entire annual AI budget in just four months.

OpenAI and Anthropic have been the principal beneficiaries of the spend-at-all-cost mentality, which has fueled their exponential growth rates and pushed both of the AI model leaders to valuations approaching $1 trillion.

Now, as they gear up for potentially historic IPOs — both filed confidentially in early June — the mood around AI is shifting, and business leaders like Crivello are no longer willing to throw money at Anthropic or OpenAI without a clear picture of a return on their investment.

“Current growth rates for Anthropic and OpenAI are the fastest they will ever be, which is mostly a matter of basic math,” Gil Luria, an equity analyst covering tech companies at D.A. Davidson, told CNBC. “That is a good reason to go public now, as is the concern that some of their largest enterprise customers may start limiting…

Hello, this is Katie Foley writing to you from London. Welcome to today’s edition of the Daily Open newsletter.

This week is shaping up as a reality check for some of the market’s biggest convictions.

Investors who piled into AI trades seem to be reassessing growth expectations, crypto bulls are confronting a wave of ETF outflows, and SpaceX enthusiasts are learning that even the world’s most anticipated IPO can’t bend every rule.

S&P Global has said it is not changing the requirements for entry into its major indices, dealing a setback to Elon Musk’s SpaceX by effectively ruling out a swift entry for the world’s biggest-ever IPO into the benchmark S&P 500 index.

That stands in contrast to the Nasdaq, which has already moved to fast-track SpaceX’s inclusion in the Nasdaq 100 index, leading to concerns that new retail investors could become the cash cow of exit liquidity for legacy SpaceX shareholders.

Tech stocks are getting rumbled for a second day, after a downbeat earnings report from Broadcom sparked a rotation out of artificial intelligence-linked names into more defensive sectors. South Korea’s Kospi is bearing the brunt of the selling, with heavyweights Samsung Electronics and SK Hynix deeply in the red.

On the bright side, Nvidia CEO Jensen Huang has arrived in South Korea, where the interest in his four-day visit has reached levels one might expect of a global celebrity. A website named “Jensen Huang’s Footprints” in Korean shows a map and timeline of his expected locations and meetings. Meals of smoky Korean barbecue and soju drinking sessions are anticipated.

Back in markets, Bitcoin is bruised – on pace for its worst week since February amid a record streak of bitcoin ETF outflows as the crypto market breaks from its dominant narratives.

On the geopolitical front, U.S. President Donald Trump has said he would be “honored” to meet Iranian Supreme Leader Ayatollah Mojtaba Khamenei if a deal is reached to end the U.S.-Iran war. The conflict will cross the 100-day mark over the weekend.

And the May jobs report will be released today, with economists expecting nonfarm payrolls to show that just 80,000 jobs were added, marking a step down from the average of 150,000 over the prior two months.

— Katie Foley

The World Cup will boost these hospitality stocks, Deutsche and Goldman say

The world’s biggest sporting event kicks off in North America next week. Deutsche Bank and Goldman Sachs have listed the sectors and stocks they see getting a boost from the 2026 FIFA World Cup, hosted by the U.S., Mexico, and Canada.

“Our analysts in leisure, restaurants and beverages, media, tech, and gaming see names in their coverage…

This report is from this week’s CNBC’s UK Exchange newsletter. Like what you see? You can subscribe here.

Next month will mark a decade since Britain voted to leave the European Union but, as last week’s local elections demonstrate, the vote continues to cast a long shadow.

The results highlighted the extent to which the governing Labour Party’s support has fractured along lines echoing the referendum.

Labour’s younger voters, chiefly in London and university cities, defected in many cases to the pro-EU Green Party.

But even larger numbers of socially conservative white working-class voters in Wales, Scotland and northern England — the traditional bedrock of Labour’s support — switched to Reform, the insurgent party founded by Nigel Farage, the renowned Brexit campaigner.

Prime Minister Keir Starmer, as he battles to save his premiership, is promising to set a “new direction for Britain” at his summit with the EU in July.

“The last government was defined by breaking our relationship with Europe,” he said. “This Labour government will be defined by rebuilding our relationship with Europe by putting Britain at the heart of Europe so that we are stronger on the economy, stronger on trade, stronger on defense.”

That doesn’t sound like the kind of pitch to entice a former Labour voter in Sunderland, St Helens or Barnsley — all former Labour-run councils that fell to Reform — back.

The bigger question, for businesses and investors, is what Starmer meant by rebuilding the relationship.

In his speech, he cited rejoining Erasmus, the EU program funding international placements in education and training, picturing “an ambitious youth experience scheme to be at the heart of our new arrangement with the EU … so that our young people can work and study and live in Europe”.

Notably, though, Starmer did nothing to suggest he will drop manifesto commitments ruling out freedom of movement between Britain and the EU or rejoining either the EU’s single market or customs union.

That is more cautious than many in his party would like. Sadiq Khan, mayor of London, wants to rejoin the EU. So does Andy Burnham, mayor of Greater Manchester, who is seen as a leading contender to succeed Starmer despite not currently being an MP.

There are also hopes of reviving talks to exempt British businesses from paying the EU’s new Carbon Border Adjustment Mechanism (CBAM), which has not proved possible to date.

In addition, the government has agreed to negotiate British participation in the EU’s electricity market.

The King’s Speech today is widely expected to include…

After multiple warnings against the “speculative” and “one-sided” currency moves, Japan’s Ministry of Finance appears to have put its money where its mouth is and intervened in the yen during the country’s Golden Week holiday. 

The first intervention, reportedly on April 30, came after the yen weakened past the politically sensitive 160 yen level, marking the first yen-buying operation since July 2024. The yen surged by as much as 3% on that day, according to LSEG data.

The yen appreciated sharply again Wednesday, fuelling market speculation that Tokyo had stepped into the currency market for a second time in recent days. The currency strengthened to as much as 155.02 per dollar from Tuesday’s close of 157.87, a gain of almost 2%.

While a stronger yen typically erodes the profit margins for Japanese exporters and makes their goods less price-competitive, a weaker yen raises the cost of energy, food, and raw materials, which the East Asian country is heavily reliant on.

Japan’s finance ministry may have spent as much as 5.48 trillion yen ($35 billion) to support the currency on April 30, just shy of the $36.8 billion last spent in July 2024, according to Reuters.

Authorities typically refrain from immediately confirming currency interventions, but they usually issue warnings beforehand — an intentional, strategic ambiguity that keeps the element of surprise to maximize market impact.

Analysts told CNBC the timing and scale of the yen’s move suggested official action on April 6.

“Price action that appears to suggest intervention has been observed,” said Hirofumi Suzuki, chief FX strategist & head of research at Sumitomo Mitsui Banking Corporation, on May 6. This showed that authorities are determined to defend the yen, even on a holiday, he added.

Nikos Tzabouras, senior market analyst at trading platform Tradu, noted that the intervention was timely.

“Although it is not known if such action has actually occurred, the timing is opportune — thin liquidity from closed Japanese markets and a dollar already on the back foot amid renewed U.S.-Iran deal hopes could amplify its impact,” he said.

Japan held $1.16 trillion in foreign exchange reserves at the end of March, which means if every intervention is at the reported $34.5 billion, it can intervene about 32 more times, said Francis Tan, Indosuez Wealth Management’s chief Asia strategist.

“So, it seems that there is still some room for reserves not to be a big issue. Japan has plenty,” he added.

However, just because it can, does not mean Tokyo will….

Novartis‘ CEO warned Tuesday that the U.S. drug pricing policy under President Donald Trump poses a “very difficult situation” and the reality will soon catch up with both drugmakers and patients.

“The longer-term implications are significant,” CEO Vas Narasimhan told CNBC’s Carolin Roth. “The reality of MFN is going to set in in the next 18 months.”

Novartis is focused on getting European and Japanese governments to quickly change how they reward innovation, he said, adding that if this doesn’t happen, then novel medicines might see delayed entry into these markets and patients won’t have access to the drugs.

The most favored nation drug pricing policy, or MFN, implemented by Trump last year means that prices in the big and lucrative U.S. market are tied to prices in comparably wealthy countries. Trump has made lower drug prices for Americans a priority and has long criticized what he calls “foreign nations freeloading on American-financed innovation.”

Narasimhan’s comments echo other drugmakers who have lamented Europe’s fragmented markets, red tape, and pricing policies.

Roche and AstraZeneca are among the companies that have recently flagged risks to European countries of missing out on new drugs unless they address the lower spending on medicines and unfavorable policies.

MFN’s effect on Novartis top and bottom line is still limited as it currently mainly impacts about 5-10% of sales in the Medicaid segment, Narasimhan told CNBC.

While there are “good early discussions” with European governments, there is still not enough action being taken, he added. “There’s awareness, but I still think there’s not a realization of the level of impact that’s coming.”

Earlier this month, Germany announced a proposal to cut costs in its national health system to tackle a looming multi-billion-euro funding gap, including by introducing steeper discounts on patented drugs.

“We’ve seen recent moves, for instance, by the German government, who actually go in the wrong direction. And so that is very concerning,” said Narasimhan.

“These governments are going to have to now really take this seriously, because the [MFN] policy is set, and I don’t see it disappearing in the United States.”

Meta is laying off several hundred employees on Wednesday, CNBC confirmed.

The cuts are happening across several different organizations within the company, including Facebook, global operations, recruiting, sales and its virtual reality division Reality Labs, according to a source familiar with the company’s plans who asked not to be named because they are confidential.

Some impacted employees are being offered new roles within the company, the person said. In some cases, those new positions will require relocation.

“Teams across Meta regularly restructure or implement changes to ensure they’re in the best position to achieve their goals. Where possible, we are finding other opportunities for employees whose positions may be impacted,” a Meta spokesperson said in a statement.

The layoffs come as Meta has been refocusing its efforts and pouring billions of dollars into artificial intelligence, where the social media giant has been racing to catch up to rivals like OpenAI, Anthropic and Google.

The Information was first to report the cuts.

In January, Meta cut employees focused within its Reality Labs division and shut down a number of studios that were working on VR titles, CNBC previously reported. Those layoffs hit more than 1,000 jobs and would impact about 10% of that unit, which makes Quest VR headsets, and the Horizon Worlds virtual social network.

Meta shares rose nearly 3% earlier in March after Reuters reported that the company could slash over 20% of its workforce. A Meta spokesperson said at the time that “This is a speculative report about theoretical approaches.”

Meanwhile, Meta has also been continuing to bulk up on talent specializing in generative AI and related AI agents, which has become the company’s new area of focus.

The company’s latest effort included a licensing arrangement with the startup Dreamer, whose staff will join Meta Superintelligence Labs company’s AI technology. As a result, Dreamer co-founder Hugo Barra will return to Meta, having previously helped lead the company’s virtual reality efforts from 2017 through 2021.

Meta declined to comment on the terms of the deal.

The company revealed Tuesday evening in corporate filings that its top executives like finance head Susan Li, technology chief Andrew Bosworth, Chief Product Officer Christopher Cox and operating chief Javier Olivan will be recipients of a new stock option incentive program. The program is intended as a retaining tool for Meta’s top leaders while it continues heavily investing into artificial intelligence.

“This is a big bet,” a Meta spokesperson said in a statement. “These pay packages will not be realized unless Meta achieves massive future success, benefiting all of our shareholders. As with…

Billionaire Elon Musk has put humanoid robots in the spotlight this year, positioning them as central to Tesla‘s valuation, which he thinks could hit tens of trillions of dollars. But Tesla is yet to sell its flagship humanoid robot Optimus.

Instead, it’s likely a slew of Chinese companies that will beat Tesla to the punch and begin ramping up production of robots in 2026, as Beijing puts the technology at the center of its strategic plans.

“China currently leads the United States in the early commercialization of humanoid robots,” Andreas Brauchle, partner at consultancy Horváth, told CNBC by email. “While both countries are expected to build similarly large markets over time, China is scaling more rapidly in this initial phase.”

Humanoid robots are designed to be shaped and move like a human. Artificial intelligence algorithms power their abilities along with complex hardware like semiconductors. Proponents say they could be used across various settings, from factories to hospitality and even in the home.

Meanwhile, China is locked in an ongoing tech race with the U.S. across multiple sectors. Robotics, seen as a real-world application of AI, could become a new battleground in 2026. Politico reported this month that Commerce Secretary Howard Lutnick has been meeting with the CEOs of robotics companies to form a plan to accelerate the industry. Washington is considering issuing an executive order on robotics next year, Politico reported, citing people familiar with the matter.