TheChek News Flow

The chart shows how most companies made progress in one or more areas of the AI stack.

• For as much as we and others write about the intense competition among companies on this list, they are as interconnected as ever.
• Google was already the most well-rounded of the bunch when we published our chart in 2024, and that’s still true in the 2025 version. During the past year, Google’s prowess in AI server chips jumped. Anthropic put in a $20 billion order for Google tensor processing chips and Meta Platforms is seeking to sign a deal to use Google TPUs as well. Google has taken steps to sell TPUs to other cloud providers for the first time. It’s also become clear that these chips help Google save a lot of money in powering its AI, according to employees of rivals such as OpenAI.
• The only other notable progress in server chips came from Microsoft, which continues to develop its Maia chips, though it remains behind most rivals.
• In the 2024 chart, we had already considered Google’s large language models to be state-of-the-art. The company proved it again in 2025 with Gemini 3, which like Google’s other models was trained on TPUs.
• Meta made gains in developing AI-powered devices with its Meta glasses, and it’s far ahead of rivals such as Apple, albeit in a tiny market.
• xAI made gains in both LLM quality and with its Nvidia-powered training clusters, though its LLMs still lag behind Google, OpenAI and Anthropic by most real-world measures.
• We also showed gains for xAI in consumer AI apps. XAI’s Grok powers key features for the X app and has improved the experience for many users—especially in deciphering posts on X that would otherwise make no sense to half the people reading them. Grok also appears to have made inroads with people who want to use a chatbot for adult content.
• Elon Musk’s other company, Tesla, appears to be in the lead in humanoids among the biggest AI firms on our list, though the “hands problem” and other issues persist with its Optimus machines.
• Anthropic’s products have been booming, according to its unreleased financials, and our chart reflects its progress with both businesses and individual customers.

• Meta has lagged in developing its own state-of-the-art models, as Llama 4 failed to deliver big performance gains and compete against AI model incumbents. The company spent much of the year paying up to acquire talent to turn things around, so we expect it to improve in this regard in 2026.
• Nvidia stepped back from competing head-on with Amazon Web Services, Google Cloud and Microsoft Azure through a recent reorganization, though it hasn’t completely left the market.

For as much as we and others write about the intense competition among companies on this list, they are as interconnected as ever, as this chart shows.

OpenAI’s focus in 2025 was to expand its cloud relationships far beyond Microsoft, which has been its primary provider. For instance, Amazon struck a deal to provide $38 billion worth of servers, and possibly lots of cash, to OpenAI, while OpenAI plans to work with Amazon on commerce initiatives. (OpenAI announced even bigger cloud deals with Microsoft Azure and Oracle Cloud.)

Microsoft, meanwhile, struck a major deal to rent out Nvidia servers to Anthropic. Meanwhile, it is also buying Anthropic models for its products, such as Office 365 Copilot, even though it can get OpenAI models for free through its multifaceted partnership with the ChatGPT maker.

As the chart shows, Google is now a tech provider to at least five companies it also competes with. In 2025, Google struck a deal to power Siri queries for its longtime business partner Apple. (That effectively replaces the role currently held by OpenAI, but it appears to have had little effect on OpenAI’s business.) Google had previously rented out TPUs and other cloud servers to Apple developers, which is why we didn’t highlight that box in the chart as a new entry.

Google is also working on a deal to provide TPUs to Meta, another longtime business partner. And Google in 2025 started providing Nvidia-powered servers to OpenAI in a big way, leaving open the possibility it will someday sell or rent out TPUs to OpenAI too.

Billionaire family lays out almost €200mn on three properties, among top prices paid in French capital over past year

The billionaire Arnault family has splurged almost €200mn on a trio of Parisian properties in little over a year, providing a boost to the sluggish luxury housing market in the French capital.

The purchases include two properties in the chic seventh arrondissement: a €58mn townhouse in December 2024 and a 17th-century mansion for €97.5mn in March 2025.

The family, spearheaded by LVMH chief executive and patriarch Bernard Arnault, also acquired a €44mn triplex apartment in the affluent 16th arrondissement in May 2025. A listing for the property details a luxurious reception room with marble fireplace, boiserie wall panelling and large French doors leading to a 1,425 square-metre garden.

The transactions were among the top prices paid in Paris over the past year, according to a person familiar with the matter. A €62.5mn property purchased by music producer Pharrell Williams, who is also men’s creative director at Louis Vuitton, was also near the top of the list.

High-value transactions have helped boost a luxury housing market staging a gradual recovery from the impact of higher interest rates, which dented sales in 2023 and 2024, multiple Paris property agents told the Financial Times.

“In 2025, after two very complex years, finally we are seeing the slope of interest rates returning in the other direction . . . which is making quite a number of buyers come back to the market,” said Laurent Demeure, chief executive of luxury property agency Coldwell Banker Europa.

However, several luxury estate agents said French political uncertainty and the threat of new wealth taxes was deterring some would-be buyers.

“We have quite a number of well-off Parisian clients who have decided to put their property on sale in order to leave,” said Richard Tzipine, chief executive for France of the Barnes property agency. “I don’t know if they will really leave, but in any case it’s true that there are sales listings.”

The Arnaults’ total €199.5mn outlay, confirmed by documents seen by the Financial Times, comes as industry leader LVMH makes a tentative recovery after a significant slowdown in sales across the luxury market over the past few years.

The Arnaults remain one of the world’s wealthiest families despite a dip in the share price of the luxury group they control since a pandemic-era boom in demand for luxury goods. LVMH’s shares staged a partial recovery in 2025 as the outlook for the sector has brightened.

The purchases add to the Arnaults’ already substantial Parisian property portfolio, which includes more than 10 other town houses and apartments.

LVMH and the Arnault family declined to comment.

The Italian Senate passed the 2026 “Budget Act,” which introduces a new levy on extra-EU parcels valued at less than 150 euros coming into the country.

MILAN — Italy has made its first official step to curb the impact of ultra-fast fashion, targeting platforms such as Shein and Temu.

On Tuesday, the Senate passed the “Legge di Bilancio 2026,” or “Budget Act 2026,” which introduces a measure that imposes a levy of 2 euros on all parcels valued at less than 150 euros coming into Italy from extra-European Union countries. Until before the new bill, low-value goods were duty free.

The bill still needs to be approved by the Italian Parliament’s Lower House. Per Italian law, the Lower House does not have any capacity to change the bill, which must be passed by the end of the year.

The move is seen answering the ongoing requests of fashion industry associations including Confindustria Moda, Confindustria Accessori Moda and Camera Nazionale della Moda Italiana, among others, to take aim at the unregulated influx of low-cost, low-quality goods into the country.

Camera della Moda estimated that about 1 million parcels from extra-EU countries circulated in Italy last year. According to the most recent figures provided by the fashion association, imports of fashion goods from China jumped 11.8 percent in the eight months to Aug. 31, amounting to 4.5 billion euros.

The Italian bill anticipates the EU’s decision to move up its timeline to close the loophole that has fueled the rapid rise of ultra-fast fashion companies in recent years.

As reported, last November European finance ministers from the 27-country bloc approved a similar agreement to abolish the exemption on packages valued at less than 150 euros, to be implemented as early as the first quarter of 2026 — two years ahead of schedule.

The new rules will also see parcels subject to additional handling and import charges, which is the formal attribution provided in the Italian bill for the new levy.

Both moves echo the U.S. decision to roll back its own de minimis allowance, aimed at curbing the flow of ultra-cheap Chinese imports, which went into effect in May.

Meanwhile, France has been particularly vocal in its fight against platforms like Shein and Temu, lobbying the EU to move toward stricter regulation.

As reported, last week Shein dodged a temporary ban in France after a Paris judicial court deemed the government’s request “disproportionate” following the platform’s voluntary removal of illicit products.

The government had sought to block the website due to illegal items listed on its marketplace, following intense scrutiny after opening its first physical store in Paris in November.

In November, a dozen French retail federations, joined by leading domestic brands, initiated legal action against Shein’s Ireland-based European subsidiary, Infinite Styles Service Co. Ltd., citing unfair competition and breaches of European product safety standards.

At a broader European level, France has called for sanctions through the European Commission, which has requested information from Shein but has yet to open a formal investigation.

Unfunded projects include construction of new barracks, munitions factories and spending on naval hubs

The UK government will need to mobilise more than £800bn of new funding for defence projects and wider strategic infrastructure by 2040 if it is to meet ambitious Nato-related targets set after pressure from Donald Trump, analysis shows.

The UK has promised to lift defence spending to 3.5 per cent of GDP by the middle of the next decade, with an extra 1.5 per cent due to be spent on wider security-related needs, as the US president pushes allies to contribute more to their own defence. 

Meeting that 5 per cent target implies the government will need to mobilise a cumulative £804bn by 2040 to pay for projects that currently have not been allocated funding, according to EY Parthenon, a consultancy. That would represent 41 per cent of total unfunded capital projects by the end of the next decade.

The report is based on an assessment of the UK’s pipeline of more than 1,000 capital projects that are scheduled to start or be completed by 2040, ranging from health programmes and transport schemes to energy infrastructure. 

It tallies up the government investments that are not yet formally allocated funding in official plans, or where only some of the necessary funding has been allocated. The government’s June spending review has laid out detailed capital spending plans, but these only run until 2029-30.

The unfunded defence pipeline includes construction of new barracks, the development of new autonomous systems, munitions factories and spending on naval hubs. Further investments will be needed in road and rail to enhance military mobility, supply chain resilience and strategically critical technologies.

Nato allies promised at a summit in The Hague in June to spend 5 per cent of their GDP annually on defence requirements and security-related spending by 2035. Of this, at least 3.5 per cent of GDP will be based on the agreed definition of Nato defence expenditure. 

The governments agreed to submit annual plans showing a credible, incremental path to reach this goal. But senior figures in the UK military have called on Prime Minister Sir Keir Starmer to harden his ambitions to raise defence spending, amid concerns that tough choices are being deferred. 

Labour has mapped out raising core defence spending to 2.5 per cent of GDP by 2027 — up from around 2.3 per cent when it took office — by reallocating money from overseas aid. 

However a commitment to raise defence spending to 3 per cent of GDP in the next parliament and 3.5 per cent by 2035 is not yet laid out in financial forecasts.  

Factoring in other unfunded projects in areas such as energy, health and transport, the UK will need to mobilise a total of £1.96tn of funding for capital projects between now and 2040, EY said, with defence the biggest slice, assuming the 5 per cent target is met.

If the UK meets only a 3 per cent defence spending benchmark, the total value of unfunded programmes will still be £1.7tn over the period.

Using historic patterns of government spending, EY estimates that about £1.1tn of the total investment gap covering all sectors including defence will ultimately be covered by rising government spending by 2040. But this leaves a further shortfall of £817bn that it will need to close.

“New defence priorities are reshaping the country’s capital agenda,” said Mats Persson, EY’s UK macro and geostrategy leader. He added that the UK faces rising funding requirements in the coming 15 years because of “simultaneous transitions” across energy, infrastructure, health and defence.

A Treasury spokesperson said: “At the Budget, the Chancellor protected additional capital spending worth over £120bn compared to the previous Government’s spending plans and previously changed the fiscal rules so we can invest in our long-term future, alongside the private sector.

“We have already provided additional funding of £5bn for defence in 2025-26 and our ambition is to spend 3 per cent of GDP on defence next parliament when economic and fiscal conditions allow.”

When Kevin Hartz’s security system failed to alert him as an intruder rang his doorbell and tried to enter his San Francisco home late one night, the serial entrepreneur decided existing solutions weren’t good enough. His co-founder Jack Abraham had experienced similar frustrations at his Miami Beach residence.

In 2024, they launched Sauron — named after the sinister, all-seeing eye from “The Lord of the Rings” — to build what they envisioned as a military-grade home security system for tech elites. The concept resonated in Bay Area circles, where crime had become a constant topic during and after the pandemic, despite San Francisco Police Department statistics showing property crime and homicide rates declining last year.

The startup raised $18 million from executives behind Flock Safety and Palantir, defense tech investors including 8VC, Abraham’s startup lab Atomic, and Hartz’s investment firm A*. It came out of stealth exactly a year ago, promising to launch in the first quarter of 2025 with a system combining AI-driven intelligence, advanced sensors like LiDAR and thermal imaging, and 24/7 human monitoring by former military and law enforcement personnel.

But a year later, Sauron is still very much in development mode — a reality that its new CEO, Maxime “Max” Bouvat-Merlin, acknowledged candidly in a recent interview with TechCrunch.

After nearly nine years at Sonos, including a stint as chief product officer, Bouvat-Merlin took the helm of Sauron just last month. He’s spending his first days on the job finalizing fundamental questions: which sensors to use, how exactly the deterrence system will work, and when the company can realistically get products into customers’ homes.

The answer to that last question? Later in 2026 at the earliest — a significant delay from the original timeline.

“We’re in the development phase,” Bouvat-Merlin said. “You’ll see a phased approach where we get our solution to market as a stepping stone. All the different components — our concierge service, our AI software running on servers, our smart cameras — are building blocks coming together in a plan we just put in place very recently.”

Still, Bouvat-Merlin sees striking parallels between Sauron and Sonos, which both target wealthy customers first, rely on word-of-mouth growth, and combine complex hardware with sophisticated software. “I had lunch with John MacFarlane, the founder of Sonos, a few weeks ago,” Bouvat-Merlin said. “All the topics he was thinking about when starting Sonos were exactly the same topics we’re discussing at Sauron.”

Both companies faced the same strategic questions: Start with super-premium customers or mass premium? Professional installation or DIY? Build everything in-house or partner with an ecosystem? “We might make different decisions, but the questions are very similar,” he said.

Bouvat-Merlin says he was drawn to Sauron by both the mission and an opportunity to solve a real customer problem. “Securing people’s homes is important, but I also like the deterrence aspect — changing people’s minds before they make a bad decision and get into trouble,” he said.

His research showed that market leaders in premium home security have small market shares and negative Net Promoter Scores. “People are not happy with their solutions today,” he said. “There are so many false positives that when law enforcement is called, they don’t respond because they assume it’s a false alarm.”

The company is targeting customers “where safety and security is a major concern” — people like Hartz. The plan is to start with this premium segment, establish a reputation for supporting demanding clients, then expand to what Bouvat-Merlin calls “mass premium.”

So what exactly is Sauron building? The answer is still evolving. The offering starts with camera pods containing multiple sensors — “40 cameras and different types of sensors, potentially LiDAR and radar, potentially thermal,” Bouvat-Merlin said. These pods connect to servers running machine learning software for computer vision, all linked to a 24/7 concierge service staffed by former military and law enforcement personnel.

“Those people understand patterns,” he said. “They’re good at helping us mature our machine learning solution and train our system to detect weird behaviors.”

The deterrence system remains somewhat vague. Options being considered include loudspeakers, flashing lights, and other methods. But Bouvat-Merlin emphasized that deterrence should begin before someone enters a property, detecting when homes are being surveilled, noticing cars circling neighborhoods multiple times, and identifying threats at each stage.

“The more upfront we are with deterrence, the more we can convince people this is the wrong house to rob and the wrong decision to make,” he said.

As for the drones mentioned when Sauron first took the wraps off its plans last year, Bouvat-Merlin declined to say much. “These are roadmap conversations. I don’t want to go too deep at this point because there are so many things we could do, but we’re such a small company,” he said. He added that, bigger picture, the focus is on growing the ecosystem through partnerships rather than reinventing the wheel.

With fewer than 40 employees, Sauron plans to hire just 10 to 12 more in 2026. The company will also begin working with early adopters later in 2026, with a Series A fundraise planned for mid-year.

“Raising a Series A is not about raising because we have to — it’s because we want to,” Bouvat-Merlin said. “I want to make sure we’re showing progress and explaining how we’ll use extra funds to accelerate growth, [including to] launch our first end-to-end product, drive customer adoption, and accelerate the roadmap.”

The company has already attracted a significant list of prospective clients, he said, thanks to work by Sauron’s three founders, which include roboticist and engineer Vasumathi Raman. “We expect the strategy initially to be word of mouth, then grow differently over time.”

But Bouvat-Merlin is cautious about growth. “I want to make sure we grow sustainably and keep the experience and service premium over time,” he said. “I want to manage growing pains as much as possible while driving profitability.”

Facial recognition and privacy concerns loom large for a surveillance-heavy product. Bouvat-Merlin outlined one approach: a trust-based system where homeowners grant access to specific people. “I granted you access to my house, so now you’re in the trusted group. When you come, I detect it’s you and you’re allowed in. Everyone else is an unknown person,” he said, painting a picture of a likely scenario.

License plate detection is also being considered for identifying cars circling neighborhoods multiple times. “How do we assess if that’s a threat? The ex-military and ex-law enforcement team will be really good at helping mature our machine learning solution,” he said.

Either way, Bouvat-Merlin is confident in the opportunity ahead because of Sauron’s approach. “A lot of companies started as traditional security companies and are trying to add tech,” Bouvat-Merlin said. “We’re looking at it from the opposite angle — we’re a tech startup in San Francisco bringing technology to this market.”

Sauron is also appearing on the scene as concerns rise about crime among the most wealthy. Recent high-profile incidents include a November armed robbery at the home of tech investors Lachy Groom and Joshua Buckley in San Francisco’s Mission District, where $11 million in cryptocurrency was stolen during a 90-minute ordeal involving torture and threats.

“We see people who are wealthy attracting criminals,” Bouvat-Merlin said. “We’ve seen a lot of robberies in San Francisco and other major U.S. cities, sometimes at gunpoint. I don’t think the world is getting safer — there are probably more disparities between people at the top and bottom of the wealth spectrum. We see anxiety from prospective clients who are eager to get their homes secured.”

Still, much remains uncertain about Sauron’s path. The company must finalize everything from sensor configurations to manufacturing locations. (Bouvat-Merlin mentioned potentially starting in the U.S. for proximity and control, then moving to more affordable locations as volume grows.)

It must also determine how to serve customers in different settings, from estates with perimeters to dense urban residences, while maintaining premium service quality.

For now, Bouvat-Merlin says he’s focused on listening to his team, building credibility, and finalizing the strategy he’s putting in place. “I don’t demand that people trust me — I want to show them why they should.”

The company expects to share more details about its products later next year.

By inserting tiny imperfections into the stones, scientists open up possibilities in computing, encryption and sensors

The mining company De Beers declared almost 80 years ago that “a diamond is forever” — and now the marketing slogan has a twist for the quantum age.

The durability that made the stone sought-after in jewellery for millennia is being exploited to turn it one day into a state-of-the-art sensor allowing us to read brainwaves, navigate without satellites and diagnose diseases faster and more effectively.

This dawning era for diamonds relies on an inversion of the qualities of regularity that have long made it prized for its beauty. By introducing tiny imperfections into its highly ordered crystalline structure, scientists can make it an extraordinarily sensitive detector of subatomic quantum phenomena.

Diamonds’ dazzling new uses are part of a wider leap forward in high-specification sensing capabilities based on the curious realm of quantum mechanics.

Exactly a century after German scientist Werner Heisenberg built a mathematical framework for explaining quantum physics, the world is launching into what scientists call a “second quantum revolution”.

The first revolution was in the understanding of quantum behaviour, underpinning the industrial age of electronics, lasers and superconductors. The second is about accurately controlling those quantum processes, to open up profound new applications in areas such as computing, encryption and sensing. 

For diamonds, their own quantum revolution is arriving at a time when the wider industry is in crisis. Sales of natural diamond jewellery have been plummeting since the Covid-19 pandemic, largely due to competition from cheap synthetic stones made in China. Against this dire backdrop, some in the industry see “technology diamonds”, such as the quantum diamonds made in a laboratory, as a potential vehicle for growth.

Much excitement over quantum technologies has focused on the pursuit of computers that promise attributes beyond even the most advanced existing machines. But while quantum computers that are useful over a broad range of tasks remain a way off, quantum sensors are closer at hand. They are already being applied in areas from medical imaging to ultra-accurate clocks and navigation.

“Lasers, semiconductors and superconductors are all part of that first quantum revolution and it’s been pretty transformative,” says Sir Peter Knight, a quantum physicist and chair of the strategic advisory board to the UK National Quantum Technologies Programme. 

“The second revolution is the ability to gain information at the quantum level from atomic matter to process it — and it will give us new sensors, new timing and new abilities to communicate data,” adds Knight, who is also chair of the Quantum Metrology Institute at the UK National Physical Laboratory.

The idea of the “quantum leap” has long been used as a cliché to describe an extraordinary jump in technological capabilities. But the power of quantum technologies in sensing lies in their ability to measure very tiny changes, rather than very large ones. 

The concept of quanta in physics initially referred to the specific amounts — or discrete “packets” — of energy transferred by shining light or other forms of radiation on objects. Depending on the size of the energy quantum, this input can change measurable properties in atoms, such as their rotations, vibrations and the behaviour of their electrons. 

In this submicroscopic realm, we see quantum effects that at times seem bizarre compared with the behaviour of objects in the world as we experience it.

The Nobel Prizes awarded on December 10 are a case in point. This year’s physics honour relates to a quantum mechanical effect known as “tunnelling”. It refers to how quantum particles seem sometimes not to be blocked by physical barriers, but can appear on the other side of them. The analogy in human experience would be if a tennis ball thrown against a wall went straight through it — without leaving a hole.

“Quantum mechanics is counterintuitive,” Michel Devoret, one of the physics Nobel co-winners, observed wryly in Stockholm a couple of days before receiving his award. “Its logic is very different from the logic we experience in our everyday life.” 

These processes are fragile and quickly break down under interference from external environmental factors such as vibrations or magnetic fields. This means they need a sturdy host material that can protect them — and contributes minimal noise itself.

This is where the diamond — the hardest naturally occurring substance on Earth — comes in. It is resistant to vibration because of its rigid crystal lattice of carbon atoms, linked by strong chemical bonds. Most of the carbon atoms have properties intrinsic to their nuclei that make for a magnetically “quiet” environment for quantum effects to take place.

The quantum properties of diamonds were uncovered in part by a chance discovery 20 years ago. A natural pink stone mined in Siberia, dubbed the “magic Russian”, was carved up and sent to laboratories around the world. It sparked a flurry of scientific papers on its unusual ability to maintain a quantum state at room temperature.

Efforts to find another “magic diamond” through mining led nowhere, but eventually scientists gained the ability to build quantum diamonds in laboratories.

One such stone can be found in the Harwell science campus in Oxfordshire, in a laboratory run by industrial diamond maker Element Six. It is a tiny pink cube, smaller than a fingertip, embedded in a black plastic sensor.

Inside this synthetic diamond is a so-called nitrogen-vacancy centre. This means adjacent locations in the crystal normally occupied by two carbon atoms instead host a nitrogen atom and an empty space where neither element is present.  

The quantum action takes place in the nitrogen-vacancy centre and relates to electrons there and a variable property they possess known as quantum spin. This spin takes on different states depending on externally applied electromagnetic or magnetic fields, a bit like the way bar magnets in school physics experiments move in response to each other. 

“Think of the nitrogen-vacancy centre like a compass; effectively that compass is a sensor of magnetic force,” says scientist Daniel Twitchen, chief technologist at Element Six.

Changes are detectable because they cause the nitrogen-vacancy centre to emit brighter or darker light, depending on the electron spin states. This makes quantum diamonds well suited to detecting minute changes. It is so sensitive to changes in magnetic field that it can detect a car driving down the street outside the building a hundred metres away, Twitchen says.

These quantum diamonds have been nano-engineered by adding nitrogen during the growing process, creating the nitrogen-vacancy centres. “To produce this quantum diamond requires you to change one molecule in every million,” Twitchen says.

Element Six, so named because carbon is the sixth element in the periodic table, is among a handful of commercial companies that are at the forefront of the revolution in quantum sensing. 

Although it made its first quantum diamond more than 15 years ago, it is only recently that the process has improved enough to produce them reliably and affordably (a quantum diamond can be purchased today for a few thousand pounds). And the technology needed to embed the quantum diamond inside an electronic “reader” has also come a long way.

“Up until now a lot of it has been about the diamond science,” says Twitchen. “The key thing now is, how do I get that diamond into the system, and the electronics around it?”

The company makes about $300mn in revenue a year from selling industrial diamonds, which are primarily used for grinding, polishing and drill bits. And it is betting that “technology diamonds”, including quantum diamonds as well as those used in lasers and semiconductors, will be its future. 

“We are coming into a new synthetic diamond era,” says Siobhán Duffy, chief executive of Element Six. “We see huge opportunities going forward.”

Big questions remain over whether quantum sensing will be as useful in real life as it is in the laboratory — and how soon the technology will become commercially viable. Other materials can produce useful measurable quantum effects, too. These include graphene — which, like diamond, is a form of carbon — as well as silicon-containing materials.

But a great advantage of diamond is that it can be used at room temperature and atmospheric pressure with off-the-shelf equipment, says the physicist Knight. “Being a solid-state device with no moving parts makes for the ruggedness necessary for scalable products,” he says.

“Diamonds are difficult to make, but once made, [are] stable and resilient,” says Louis Barson, director of science, business and education at the UK’s Institute of Physics. “The downside is they are hard to interconnect with silicon electronics . . . This makes them inherently better suited for sensing applications than for large-scale quantum computing, but there is promising research addressing these barriers.”

Element Six is mostly owned by De Beers, which is part of mining company Anglo American (Belgian group Umicore has a 40 per cent stake in its abrasives unit) and is the most advanced western company making quantum diamonds, according to researchers. Other companies in the field include Australia-based Quantum Brilliance, which opened a quantum diamond foundry last month, and German start-up QuantumDiamonds, which makes testing tools for the semiconductor industry.

As with other areas of frontier science, it’s not quite clear yet where the first commercial breakthrough for quantum diamonds will be. 

Katrin Kobe, chief executive of Bosch Quantum Sensing, a subsidiary of the German engineering group Robert Bosch, says her team came up with more than 100 possible applications when the quantum group was launched three years ago.

She recalls how in 2022 the quantum diamond sensors took up “half a room and cost as much as one family home”. Today they are just the size of a smartphone, and costs have come down.

One potential market is aeroplane navigation, where quantum sensors could one day replace the current reliance on Global Positioning System satellites, which can be easily spoofed or jammed.

“We have started a pilot project in the area of aeroplane navigation, to navigate using the Earth’s magnetic field,” says Kobe, adding that this can complement today’s satellite-based navigation.

Doing so will require drawing up a magnetic map of the Earth, as well as getting approval from aviation authorities, she notes. But the application could be a game-changer, particularly at a time of rising global concern about the reliability and vulnerability of GPS.

Geologic exploration of the Earth’s crust is another early use case for the technology: quantum sensors will be able to read tiny changes in the magnetic field, which indicate mineral deposits.

In the longer term, Kobe believes quantum diamond sensors will be valuable for the brain-computer interface, which she estimates could be a $5bn market one day. “Our vision is that we have a sensor that is so small and so sensitive that it can measure brain signals, and convert it into action,” she says. “That you can control a machine by your thoughts.”

But the main focus of early applications of the technology is medicine. One of the first potential uses, currently in testing, could replace the electrocardiogram (ECG), a routine procedure performed by sticking multiple sensors to a patient’s chest to measure their heart’s output. A quantum sensing medical device could get the same information just from being placed near the patient’s heart, with no sticky electrodes involved.

Another promising area is using nitrogen-vacancy diamonds to spot the viruses that cause diseases such as Covid-19 and HIV/Aids at an earlier stage than existing tests do. 

Scientists have found that quantum nanodiamonds work better than materials such as the gold nanoparticles used in so-called rapid antigen tests. The best known of these are the lateral flow kits familiar from the Covid pandemic. 

A nanodiamond-based test showed about 1,000 times greater analytic sensitivity than existing kits, according to research published in Nature Communications in October. That meant it could detect much lower viral concentrations, allowing earlier diagnosis that could be crucial both for treating patients and curbing disease spread.

Researchers are busy examining other potential use cases. The UK’s Nottingham University has a Diamond Quantum Sensing Research Hub exploring applications including tracking hazardous chemical reactions and monitoring carbon capture and storage. It says the technology could be useful for many crucial sectors, including healthcare, food security and defence.

All these efforts are at the forefront of extraordinary advances in the field of sensing. The aesthetic delight of a diamond may still be forever — but a quantum diamond can work its own magic in a tiny fraction of a second. 

“The last 70 years have been about diamonds shaping things” by cutting and drilling, says Twitchen. But over the next 70 years, he says, diamond will be the “component” as the next quantum revolution unfolds.

Markets have been calm despite concerns about a less independent, more divided central bank

Investors anticipate a Federal Reserve marked by division and a potentially weaker chair, with concerns about its independence.

A less independent Fed could threaten the economy and markets, potentially driving borrowing costs up despite rate cuts.

The Fed has already lowered its benchmark federal-funds rate to 3.5% to 3.75% from 5.25% to 5.5% over 15 months.

Investors are preparing for a very different Federal Reserve in the year ahead.

President Trump has signaled that he is closing in on a pick to be the next central-bank chair. He has also doubled down on his demand for lower interest rates and recently told The Wall Street Journal that he expects the new leader to be on board with his agenda.

So far, markets have shown few signs of significant concern that the Fed would completely surrender its independence. But investors are still bracing for a central bank marked by unusual division, a potentially weaker chair and the lingering threat of more radical change.

Here is a look at how they are assessing the different paths that the Fed could take:

Analysts warn that a less independent Fed would pose a major threat to the economy and markets.

Although the Fed controls short-term interest rates, borrowing costs in the U.S. are heavily influenced by yields on longer-term U.S. government bonds. And those are determined by investors’ expectations for short-term rates in the future, rather than where they are now.

If the central bank cuts rates aggressively when the economy is still in decent shape, worries about inflation and higher rates could drive yields and borrowing costs up rather than down. A sharp climb in yields could also rattle stocks.

Moves have been muted so far. One reason: Fed chairs have historically wielded outsize influence over the 12-person Federal Open Market Committee that votes on interest rates, but they don’t have the power to set rates on their own. So a lot would be required for Trump to gain clear control over the central bank.

Some on Wall Street still see that as possible. The FOMC consists of seven Fed governors appointed by the president and five regional bank presidents selected by the boards of those banks and confirmed by the Fed governors. A Trump-appointed majority could try to dismiss any Fed president seen as standing in the way of rate cuts.

Right now, three Fed governors are Trump appointees, including two from his first term, when Trump wasn’t as committed to finding loyalists. Earlier this month, all three joined the other governors in unanimously reappointing Fed presidents.

Trump, though, could have more opportunities to pick governors in the coming months, potentially altering the central bank’s balance of power.

One would come if Jerome Powell resigns from the Fed after his term as chair expires in May—a move that would follow historical precedent, even if it isn’t required (his term as governor extends into 2028). Another would arrive if the Supreme Court rules in Trump’s favor and allows him to push out Fed governor Lisa Cook, whom the administration has accused of lying in mortgage paperwork—a charge she denies.

At that point, three governors would be second-term Trump appointees—on top of the two from his first term—and the chances of removing Fed presidents would go up enough to likely spook markets, said Blake Gwinn, head of U.S. rates strategy at RBC Capital Markets.

If Trump could replace both Powell and Cook, “that gets a lot more interesting,” he said.

Even if that doesn’t play out, many investors warn that a more divided Fed would be enough to cause problems in markets. Some even expect situations whereby the central-bank chair is pushing for lower rates, yet getting outvoted by other officials.

In some other countries, including the United Kingdom, a central-bank leader dissenting from an interest-rate decision isn’t unheard of. But it would mark a major change in the U.S.

The views of each FOMC member would carry more weight, potentially creating more uncertainty about the path of rates and therefore more volatility in the bond market, said John Briggs, head of U.S. rates strategy at Natixis Corporate and Investment Banking.

That in turn could lead to higher Treasury yields, because “if you’re adding volatility uncertainty, you should be able to receive more yield,” he said.

In recent weeks, the gap between yields on short-term and long-term Treasurys has increased. Some view that as a sign that investors are growing more worried about the Fed’s independence, because it suggests they expect rates to be lower in the short term, but not necessarily over the longer run.

Many investors, though, say they already expect the Fed to keep cutting rates early next year, even before the arrival of a new chair.

Stocks have betrayed little concern, with the prospect of more rate cuts buoying sectors that could benefit most, including banks and industrial companies.

One popular view on Wall Street holds that a weaker economy will mitigate divisions at the central bank and create consensus for additional cuts.

The Fed, over the course of 15 months, has already lowered its benchmark federal-funds rate to 3.5% to 3.75% from 5.25% to 5.5%.

Although Trump has said that he thinks rates should be 1% or lower a year from now, many investors are confident that a new Fed chair can get away politically with more modest cuts, ones justified by the economic data.

“By the time that person’s in the seat and they start to have their first meeting, they’re going to have a lot more information [and] probably more backing to lower the rate,” said Bryan Whalen, chief investment officer of TCW’s fixed-income group.

Some argue that style also matters: Investors will be less unnerved by a Fed chair who can make a reasonable economic case for much lower rates than one who just echoes Trump’s arguments, even if the target is the same.

If a new Fed chair is “thoughtful in the way they communicate, that would not only help their chances of moving the consensus toward their view, but also create stability in not doing anything to damage the impact that the Fed may have on the economy,” said Michael Lorizio, head of U.S. rates trading at Manulife Investment Management.

Nestlé’s new CEO is shaking up the Nescafé maker’s clubby culture and has signaled potential brand sales

An office romance at Nestlé NESN -0.26%decrease; red down pointing triangle cost the chief executive his job. Now it’s giving way to an overhaul at the food-and-drink maker under new boss Philipp Navratil.

The Nescafé and Purina maker fired Laurent Freixe in September after an investigation found an undisclosed relationship broke its code of conduct. Tensions from the affair had distracted Nestlé’s upper management for much of Freixe’s 12 months in charge, according to people familiar with the matter, and tore a chunk out of its top ranks.

The affair also put a spotlight on Nestlé’s culture and drew attention to the Swiss company’s struggle to make its 2,000-plus brands relevant at a time of changing consumer tastes, inflation and trade tensions.

Now, new CEO Navratil is tasked with a turnaround. The 49-year-old immediately laid out plans in October to cut 16,000 jobs and to tie pay more tightly to performance—moves that analysts saw as a strike at the company’s sometimes cozy practices.

Navratil said his approach would be to bypass nostalgia and consider any brand for disposal.

In recent meetings with investors, Navratil has acknowledged the 159-year-old company needs to change to adapt to shifting habits. He has also said he wants to invest more than his predecessors in developing new blockbusters.

Investors said Nestlé is overdue a shake-up and should also sharpen its governance after two chaotic CEO changes in a year. The company’s share price is down more than 20% over the past five years. Rivals specializing in fewer products or sectors, meanwhile, often outperformed.

“In every crisis there is opportunity. Nestlé has been in a crisis of governance,” said Christopher Rossbach, chief investment officer of longtime Nestlé shareholder J. Stern & Co.

Navratil, a Swiss-Austrian mountain-sports enthusiast, has been at Nestlé since 2001 but rose from outside an old guard that dominated the company’s leadership this century. Overseeing him now as chairman is Pablo Isla, a former CEO of Zara owner Inditex, who took over from Paul Bulcke in October. It was a rare appointment from outside company ranks.

“Trust has been eroded with some of the events we have seen recently. Some of our making,” Navratil said in a recent podcast for employees.

He said it was good that he and Isla were starting from scratch. “We can question everything.”

The CEO before Navratil, Freixe, also took over suddenly. Freixe’s predecessor was ousted for being the wrong cultural fit, after growth during his seven-year tenure fizzled out. Bulcke, Nestlé’s chairman at the time, said Freixe understood Nestlé’s values.

A main rival for the top job was Nestlé’s leader in the U.S., Steve Presley, a Floridian who had first run a Virginia beverage factory. The consolation prize was a larger role for Presley. He took over a team Freixe had been managing from Switzerland as head of Latin America, combining the regions.

Freixe’s downfall started when he recommended promoting a marketing executive from his old team to a job under Presley, people familiar with the matter said. Colleagues began to suspect Freixe’s support for the executive, a woman who had joined Nestlé as a management trainee 20 years earlier, was more than professional.

Presley favored other candidates for the role, a prominent assignment covering almost all of Nestlé’s marketing in the U.S., Canada and Latin America. But he promoted the marketing executive at Freixe’s request, catching the attention of other senior managers because of her relative inexperience.

In the team shuffle, a colleague discovered that someone had boosted the marketing executive’s pay, a person familiar with the matter said. It was a surprise to Presley, her new boss. Another person familiar with the matter said the marketing executive’s pay had been too low for the job and was adjusted.

Presley and other members of his team suspected the marketing executive was briefing Freixe about their meetings, according to a person familiar with the matter. After a session on how their division could up its game, Presley got a call from Freixe, complaining that Presley was trying to create a subculture within Nestlé.

In April, Freixe summoned Presley to headquarters. They agreed their relationship had broken down, and Presley should resign. Nestlé in a press release said Presley would leave in five days, after nearly 30 years.

Freixe temporarily took over Presley’s job, making him the marketing executive’s boss again. In May, Nestlé received anonymous complaints alleging improper favoritism.

An internal investigation didn’t substantiate the claims, Nestlé said in late July. But a law firm conducted a second probe when complaints kept coming, and Freixe was fired without pay in September. Nestlé said Freixe broke its code of conduct by not disclosing the relationship with a direct report. The company hasn’t said how it confirmed the relationship.

Bulcke left earlier than planned in October, after being criticized publicly by some investors over Freixe’s short tenure. Bulcke said at the time that it was the right moment to step aside. He was named honorary chairman.

The same day Nestlé’s board fired Freixe, Sept. 1, it met several candidates to replace him. Navratil, then head of Nespresso, was already seen as a potential leader, having added billions in sales from new drinks and a partnership with Starbucks while in charge of coffee brands.

Navratil later told analysts he’d pitched himself as an insider who could see the company like an outsider, having spent 16 years in Latin America running Nestlé operations.

In a bid to boost competitiveness, he has said he wants to scrap company dogma and the practice of “not taking decisions because we don’t take decisions.”

Navratil has said the company’s core businesses—including coffee and pet food—remain strong with potential to grow, but indicated some brands could go. Product lines like KitKat, Nespresso and Purina pet food rake in billions of dollars of sales a year, but Nestlé also owns a raft of smaller earners such as Hot Pockets and vitamins.

Navratil is set to flesh out how he plans to reinvigorate the company at an investor day in February.

Nestlé has already flagged that its water division, including Perrier and Sanpellegrino, is looking for an investment partner, and that some vitamin brands could be sold. Blue Bottle coffee shops may be on the chopping block too, according to analysts.

One potential big move could be to sell chunks or even the entirety of the $50 billion stake that Nestlé holds in L’Oréal, which some investors want to see cashed out.

In the recent private meetings, some analysts urged Navratil to turn over the top managers he’d leapfrogged to take the top job.

In an interview with Switzerland’s Finanz und Wirtschaft published last week, Navratil said Freixe’s departure was a shock within the company. “But I’m looking ahead, and I don’t believe we have a culture problem,” he said.

Nestlé watchers said the new CEO and chairman represent a step forward, after fiefs built up over the years around an elite cadre of managers.

“It’s a good thing there is new leadership,” said Rossbach, the investor at J. Stern. “Nestlé has too often been a college of cardinals.”

Big Tech’s huge investment in artificial intelligence is making investors nervous. But the technology continues to advance, buoying the bulls.

Andrew here. If there is one question that has been asked more than any other this year in the business world, it is this: Are we in an artificial intelligence bubble? DealBook’s managing editor, Brian O’Keefe, takes a look at all the arguments for and against that possibility — so you can make up your own mind.

Also: There’s a delicious story in The New Yorker that we highlight in Best of the Rest about a unique phenomenon: Apparently, millennials love getting prenups.

It’s the burning question that everyone from Wall Street traders to retail investors is asking right now: Are we in an artificial intelligence bubble?

James van Geelen, a market analyst who spends a lot of time thinking about A.I.’s potential as a disruptive force in markets and business, gets the question a lot. And he’s quick to answer: “If we’re not, we’re going to be,” van Geelen, the founder and C.E.O. of Citrini Research, which specializes in megatrend investing ideas, told DealBook.

“Show me an instance over the past 300 years of a truly transformative technology that didn’t result in an asset bubble — railroads, steam engines, radio, airplanes, the internet,” he said. “When capital floods into a technology because everyone realizes that it’s transformative, eventually you get a bubble.”

If OpenAI’s launch of ChatGPT in November 2022 was the watershed moment that brought A.I. to the masses and launched a global race to dominate the technology, then 2025 was the year that the technology transformed markets and the global economy in newly powerful ways.

Investment in A.I. may have accounted for as much as half of U.S. G.D.P. growth in the first half of 2025. President Trump has taken notice. From the start of his second term, the president has made A.I. superiority a pillar of his business agenda. And he has put state regulators on notice that they’re not to slow down the sector.

That economic firepower (and a policy embrace from the White House) has been reflected in the stock market. In mid-December, the so-called Magnificent 7 tech giants — Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia and Tesla — made up 34 percent of the value of the S&P 500.

In late October, Nvidia, whose semiconductors power much of the world’s biggest A.I. models, became the first company in history to hit $5 trillion in market valuation. (It’s a mere $4.5 trillion today.) And the Morningstar Global Next Generation Artificial Intelligence index was up roughly 40 percent in 2025 through mid-December, doubling the tech-heavy Nasdaq Composite index.

It’s that outsize performance that has many investors fretting about a bubble.

In Deutsche Bank Research’s annual survey of global asset managers, 57 percent of respondents picked waning enthusiasm for A.I. and a drop in tech valuations as the biggest threat to the bull market rally, easily outpacing concerns about Fed policy.

“I think it is misleading to try to encapsulate everything in the idea of one bubble, because there are at least three bubbles worth talking about in terms of valuations, investment and technology,” Adrian Cox, thematic strategist at Deutsche Bank Research, told DealBook. “And in each of those, I think there is evidence that there is some inflation going on which could at some point become a bubble, which could at some point burst. But at the moment, it still feels as though we’re in the early stages of that process.”

Van Geelen of Citrini Research sees the technology becoming a transformative productivity tool for businesses in the near future. He singles out A.I. in robotics and agentic A.I. — autonomous systems that can plan, research and work toward goals with limited human supervision — as potential game changers.

“People were talking about this last year, but the technology just wasn’t there,” he said. “And now it really is.”

But to get there requires a lot of data centers. That need has unleashed a construction boom for the ages, one that has put serious strain on local resources and has unleashed a torrent of debt-fueled spending.

Electricity consumption at U.S. data centers is projected to more than double last year’s total by 2030, according to the International Energy Agency. That thirst for power is contributing to rising costs for everyday Americas, and could become a major issue in next year’s midterm elections.

In the latest example of this dash to secure electricity supplies, Google’s parent, Alphabet, agreed on Monday to acquire the clean energy developer Intersect Power in a $4.75 billion all-cash deal, with an eye toward powering Google’s data centers.

The sheer volume of investment needed to fund this boom has spooked some on Wall Street. According to Bloomberg, tech giants including Microsoft and Meta have agreed to spend some $500 billion total to lease data centers over the next several years. Oracle alone has committed to $248 billion on such leases — news that caused its stock to tumble earlier this month. More optimistic observers argue that the Mag 7 companies funding much of the build-out have the cash flow to do so without taking on onerous debt loads.

Brian Colello, a senior analyst at Morningstar, doesn’t see any major red flags. In fact, he believes some of the A.I. build-out’s inherent challenges will help keep the industry from moving too fast. The sheer cost of the chips required to run sophisticated A.I. models, he contends, as well as the fact that they become obsolete after a few years, means that companies are less likely to overspend for computing power they don’t need. (Contrast that with the dot-com bubble, when billions flowed into laying more fiber-optic cable than the market demanded.) That, and the electricity constraints, could slow the infrastructure build-out. But, ultimately, it won’t slow down the sector.

“We would argue there is no A.I. bubble to date, and we think it’s unlikely there will be one in 2026 as well,” Colello told DealBook. “We’re seeing A.I. demand still exceed supply. We’re seeing the hyperscalers increase their capital spending plans, and we’re seeing an A.I. supply chain doing everything it can to meet this booming demand.”

If any one company encapsulates the wild enthusiasm for — and deep skepticism about — A.I. right now, it’s OpenAI. ChatGPT has some 800 million active users. But just a small fraction are paying customers. Sam Altman, OpenAI’s C.E.O., recently said it was trending toward an annualized revenue run rate of $20 billion by the end of this year. But it’s also planning to spend gargantuan sums on infrastructure: It has committed $1.4 trillion to building data centers over the next eight years.

Despite that accounting disconnect, the start-up continues to raise money at eye-watering valuations. In March, SoftBank led a funding round that valued the company at $300 billion. And its most recent financing round, in October, put a $500 billion value on OpenAI. Last week, it was reported that OpenAI is in talks to raise a $100 billion round that would value the company at $830 billion. There’s also buzz about an I.P.O. in 2027.

Even as OpenAI seeks to monetize its enormous user base, the competition is getting tougher. Google’s Gemini 3, which debuted in November, was recently ranked above ChatGPT in industry benchmark performance testing.

Anthropic, the rival start-up founded by former OpenAI executives, has focused on enterprise applications. The newest version of its Claude chatbot can work autonomously with little oversight for 30 hours. (When The Wall Street Journal let Claude run a vending machine in its office, however, it lost hundreds of dollars.)

Then there are open-source A.I. models, like that of the Chinese start-up DeepSeek and Alibaba’s Qwen, which are attracting a wave of start-ups to build with their architecture.

Van Geelen believes there’s room for multiple models. And he cautions that what may look like slow progress now in integrating A.I.-powered tools into everyday business operations could change rapidly.

“Technology progresses at an exponential rate,” he said, “and humans adopt technology at a linear rate.”

But humans are going to need to move faster, because van Geelen thinks that 2026 is the year when A.I. will begin replacing people in certain jobs, and companies outside Silicon Valley will start reaping the rewards of improved efficiency.

By this time next year, we may be pondering a new question altogether: How big can the bubble get?