FT : UBS chair warns of ‘looming systemic risk’ from private credit ratings

UBS chair warns of ‘looming systemic risk’ from private credit ratings
Colm Kelleher says insurers are shopping for grades as banks did before 2008 financial crisis

Insurers shopping for better ratings on their private credit assets are creating a “looming systemic risk” to global finance, the chair of UBS has warned.

Speaking at the Hong Kong Monetary Authority’s Global Financial Leaders’ Investment Summit on Tuesday, Colm Kelleher said the insurance industry, especially in the US, was engaging in “ratings arbitrage” akin to what banks and other institutions did with subprime loans before the 2008 financial crisis.

Kelleher joins a growing chorus of voices pointing to risks in the multitrillion dollar insurance industry, including its holdings of illiquid private credit loans and opaque disclosures.

“What you’re seeing now is a massive growth in small rating agencies ticking the box for compliance of investment,” said Kelleher, who stressed that regulators were failing to get a handle on the industry even as they were pushing for faster economic growth.

“If you look at the insurance business there is a looming systemic risk coming through because of lack of effective regulation,” he said.

The Bank for International Settlements last month said ratings on private credit assets held by US insurers might have been inflated and warned of the risk of fire sales during periods of financial stress.

Smaller rating agencies have captured market share in private credit by providing so-called private letter ratings, which are typically only visible to an issuer and select investors.

US life insurers, which must hold a certain amount of capital in investment-grade assets, have been among the biggest buyers of private credit and private letter rating services.

The ratings have come under additional scrutiny following the high-profile bankruptcies of subprime automotive lender Tricolor and car parts company First Brands, which led to broader concerns about the opacity of the fast-growing industry.

“In 2007 subprime [lending] was all about rating agency arbitrage,” Kelleher said.

The UBS chair also launched a broadside against Switzerland, saying the country was “losing its lustre” because of competition in wealth management from Hong Kong and Singapore and the damage that its pharmaceutical industry had sustained from Donald Trump’s trade war and higher US tariffs.

“Switzerland is facing a crossroads here because it’s facing some major challenges,” he said.

The Trump administration slapped Switzerland with an unexpectedly high tariff of 39 per cent in August, one of the highest levels for a western country, dealing a blow to watchmakers, pharmaceutical producers and other exporters.

Kelleher also criticised the Swiss government for its banking regulation, in the latest volley as UBS looks to resist regulatory attempts to impose stricter capital requirements following its absorption of rival Credit Suisse.

“Switzerland is having an identity crisis about its role in the world of banking,” he said.

FT : Private equity investor body sounds alarm over rush of retail money

Private equity investor body sounds alarm over rush of retail money
Popularity of evergreen vehicles with wealthy individuals could ‘fundamentally alter the landscape of private equity’

An influential group representing some of the private equity industry’s largest backers has sounded the alarm about the risks to institutional investors from a rush of retail money into the sector.

The number of deals needed to deploy wealthy individuals’ cash could pull managers’ attention away from investing the capital of pension plans and endowments, the Institutional Limited Partners Association warned. 

Fees on offer from evergreen funds, a newly popular type of vehicle suited to retail investors, could encourage buyout firms to prioritise them instead of the traditional funds backed by institutions, ILPA said in a new report.

Billions of dollars are flowing into evergreen funds, and institutional investors have expressed fears privately that this influx of new cash could undermine their standing as the sector’s top clients.

The flood of retail money could “fundamentally alter the landscape of private equity”, said Neal Prunier, managing director of industry affairs at ILPA.

He added that while private equity had historically “outperformed” other asset classes, institutional investors were concerned that “might not continue to the same degree given the types . . . and the volume of investments that are needed to satisfy the retail capital space”.

Evergreen vehicles have no end date and allow investors to redeem their money at regular intervals, while institutions largely lock their capital into closed-end funds for about a decade.

By June, more than €88bn had been invested in evergreen funds in Europe alone, over double the amount in early 2024, according to consultants Novantigo.

ILPA warned that where a private equity group had both a retail vehicle and an institutional fund, those interests might not align and the institutional investors could be the ones to lose out.

“Investment decisions related to individual deals . . . may be influenced by the needs of the retail vehicle, which may conflict with the interests of the institutional fund,” ILPA said.

This was because evergreen vehicles tend to have different incentive structures, the report said, such as paying performance fees based on the total value of holdings rather than on realised investments as in closed-end funds. 

Unlike in traditional funds, which take commitments and call cash when a deal arises, evergreen funds take cash on day one and must deploy it quickly to avoid hurting returns.

ILPA, which counts many large Canadian and US pension funds as well as top sovereign wealth funds as members, said the “greater deal flow” required to satisfy this need could lead to lower quality investments.

The body also suggested that “potentially unlimited” cash from evergreen vehicles for buyout firms to invest alongside traditional funds in deals could leave institutional investors with no insight as to what size or type of deal the fund would do.

ILPA added that institutions could also lose some of their opportunities to invest directly — and traditionally fee-free — in portfolio companies alongside the private equity funds they back, since buyout firms had a fee-paying source of such capital.

FT : Eli Lilly calls on Europe to ditch clawback taxes on drugmakers

Eli Lilly calls on Europe to ditch clawback taxes on drugmakers
US pharma group says region’s use of ‘one-way insurance system’ to keep down prices is not fair on the industry

Eli Lilly has called on European nations to scrap clawback taxes on drug sales, as the pharmaceutical industry puts pressure on governments to pay more for drugs or risk losing access to new medicines.

The US drugmaker, best known for its obesity and diabetes drugs, announced plans on Monday to build a new €2.6bn factory in the Netherlands, expanding its capacity to produce oral medicines including a weight loss pill for which it hopes to win approval next year.

But as the Trump administration pushes for a “most favoured nation” policy under which historically high drug prices in the US would now match the cheapest levels in other developed nations, Lilly chief executive David Ricks said the company would equalise prices by lowering them in the US and raising them in Europe.

The pharma industry has been battling the UK’s clawback tax, under which a percentage of revenues above a certain cap must be paid back to the government, after the rate soared this year — but Ricks said the system should not exist in any country. 

Roughly two-thirds of European governments use clawback taxes to reduce the cost of medicines for their healthcare systems, according to industry lobby group the European Federation of Pharmaceutical Industries and Associations.

Ricks told the Financial Times the taxes were unfair, describing them as a “one-way insurance system” to protect healthcare systems and taxpayers. He warned that the industry would not be able to introduce new medicines in Europe if the taxes persisted. 

“Let’s off-ramp this system — it’s well past time — and let’s focus spending on medicines, on things that are breakthroughs, but reward them, and then go through the hard work of compressing budgets in the part of the healthcare systems that are now obsolete because we have breakthroughs and cures,” he said.

Ricks said that if healthcare systems invested more in obesity drugs, they could quickly find savings by paying less for services such as diabetes clinics or treating fewer patients suffering cardiac arrests.  

Lilly is one of many drugmakers that recently scrapped or paused investment in the UK, as the industry tries to press the government to pay more for drugs. Ricks said in September the UK was “probably the worst country in Europe” for drug prices. 

He said the UK government had now taken the issue “beyond lip service”, and that its proposed 25 per cent rise in the price threshold at which drugs that add a year of healthy life to a patient are deemed cost-effective was a “positive step forward but not sufficient”. He added that drugmakers wanted a higher increase in the measure along with a commitment that it would continue to rise with inflation.

Lilly plans to invest $27bn in the US across four new manufacturing sites as drugmakers try to minimise the impact of tariffs on the sector. Ricks said the US sites would provide for all US demand, with the new European site, along with existing ones in France, Ireland, Italy and Spain, supplying Europe, the Middle East and Africa.

FT : Liechtenstein’s ‘zombie trust’ woes spread to Caribbean

Liechtenstein’s ‘zombie trust’ woes spread to Caribbean
Service providers in British Virgin Islands, Bahamas and Cayman Islands warn of unpaid fees and stranded assets

Liechtenstein’s crackdown on Russia-linked trusts has begun to spill into the offshore wealth system, leaving service providers fearing unpaid fees and stranded assets in the British Virgin Islands, Bahamas and the Cayman Islands.

The Alpine principality, a hub for foundations and trusts, triggered mass resignations by fiduciary and directors this year as it attempted to enforce western sanctions on Russia.

This left hundreds of “zombie trusts” — structures that hold everything from cash to superyachts linked to Russia — with no one authorised to manage assets or basic functions.

The paralysis has now spread problems to other jurisdictions where the trusts were active, according to experts.


Offshore corporate agents and financial advisers including in the Cayman Islands, Bahamas and BVI — where many Liechtenstein trusts hold subsidiaries — warn that companies will soon fall behind on annual registration fees and suffer from an inability to make investment or governance decisions.

A Liechtenstein trust is often the main shareholder of an entity in a location such as the BVI, which can then own another entity somewhere such as the Bahamas, avoiding various levies such as on capital gains and VAT.

Many of these assets cannot be run on their own and rely on instructions from fiduciaries in Liechtenstein to pay employees, insurance costs and other management services decisions.

“There is a domino effect due to the multilayer structure of these trusts. The mismanagement of these orphaned structures will have repercussions beyond Liechtenstein — it is not only about getting paid, it is also being able to speak to people for investment decisions on assets,” said Johannes Gasser, partner at Gasser Partner, one of Liechtenstein’s biggest law firms.

“Liechtenstein has a lot at stake for how it handles and resolves this.”

One financial adviser with direct knowledge of the situation in the BVI said that if entities were unable to pay annual fees, and were struck off, the assets would vest in that local government. In the BVI that would put them under British jurisdiction until the company was reinstated through a court process.

Liechtenstein took tougher action against the trusts after the US Treasury pursued a stricter sanctions regime than the EU, threatening secondary sanctions if a trustee serviced a listed person or entity.

Liechtenstein’s Financial Market Authority last year advised fiduciaries — a person or entity legally authorised to manage assets on behalf of others — to terminate relationships with potentially exposed clients, even if they were not sanctioned.

Officials in Vaduz say the problem is contained.

A government statement this month put the number of Russian-linked legal entities at 218, of which 71 are considered “orphaned” — incapable of acting because trustees or directors have resigned. It said the remaining 147 trusts remained under investigation.

But lawyers contacted by the Financial Times have estimated that up to 800 entities could have a Russian connection and be affected.

The government of Liechtenstein did not immediately respond to a request for comment.

Two lawyers in contact with offshore entities in Caymans and BVI said there had been attempts to find ways to absorb some of the assets of the ungoverned structures in Liechtenstein and find legal means to take them over and head off the problem, but had so far been unsuccessful.

Another Liechtenstein-based lawyer said they had been contacted by an adviser in Bahamas about the issue this month. “The person is worried that if their Liechtenstein trust is liquidated, the Bahamas entity it ultimately owns would just be floating — because nobody can act for it.”

The situation has worsened since the Liechtenstein Bar Association in September instructed lawyers not to represent anyone listed by the US, according to two lawyers involved. The guidance, intended to shield practitioners from secondary sanctions, has in effect deprived some clients of legal representation.

“Things are becoming tighter in Liechtenstein. This sweeping approach means we just can’t have any Russian clients anymore — even if they are not listed or designated persons,” said one of the lawyers. “This is becoming a global problem.”

FT : UniCredit’s M&A failings make it an accidental role model

UniCredit’s M&A failings make it an accidental role model
Building up financial exposure to a business you don’t control can be risky, but buying minority stakes does offer advantages

Even Andrea Orcel admits his recent M&A efforts haven’t quite gone to plan. The chief executive of Italian lender UniCredit, who is perhaps the best-known dealmaker in European banking, has repeatedly run into opposition in his attempts to take control of Germany’s Commerzbank and smaller Italian bank Banco BPM.

One might assume that rivals would be debating how best to avoid ending up in Orcel’s position. Certainly, there have been mistakes they could learn from: for example, don’t underestimate the importance of getting the support of politicians when seeking to do deals in a sensitive sector such as banking.

And yet UniCredit has done surprisingly well out of its muddle. The bank says its minority stakes in Commerzbank and Greece’s Alpha Bank have generated roughly 20 per cent returns on investment, even deprived of the benefits that could have come from full combinations. That compares with an 11 per cent return on its share buyback programme at current prices. Snapping up minority stakes in undervalued rivals has helped propel UniCredit’s stock up almost 70 per cent in the year to date to trade at a 50 per cent premium to tangible book value.


There may be a takeaway for Orcel’s rivals here. After years of improving their core businesses, many European banks have more capital than they can organically use. The obvious options would be to spend the excess on acquisitions or share buybacks. But as UniCredit and others such as BBVA have shown, large acquisitions are hard to get over the line. Meanwhile, share prices are around their highest levels in more than a decade, which reduces the relative appeal of a buyback.

Given all that, Mediobanca argues that taking minority stakes can be a “temporary substitute for consolidation”. It reckons investments in less richly valued rivals or areas such as payments technology could increase earnings per share much further than buybacks. Buying minority stakes has another advantage, too. Should conditions become more amenable for a full merger a few years from now, UniCredit would have a head start in buying up the rest, just as HSBC recently bought out minority shareholders in Hong Kong lender Hang Seng.

Of course, building up financial exposure to a business that you don’t control can be a risky process. Commerzbank hasn’t exactly welcomed Unicredit’s overtures, and even friendly combinations can be difficult — look how UK bank Lloyds recently decided to take full control of its wealth management joint venture with Schroders. 

One area where Orcel was definitely correct was his prediction that conditions for European banks are getting tougher. Rising interest rates lifted all boats over the past few years, but with rates on the way back down, executives will have to get more inventive to drive further gains. Minority investments will not always be the perfect answer, but at least Orcel is prompting some good questions.

>>> Denny's to be acquired by TriArtisan Capital Advisors, Treville Capital Grou

Denny's to be acquired by TriArtisan Capital Advisors, Treville Capital Group and Yadav enterprises in $620 million transaction
  • Under the terms of the agreement, which was unanimously approved by the Denny's Board of Directors, Denny's stockholders will receive $6.25 per share in cash for each share of Denny's common stock they own.
  • The purchase price represents a 52.1% premium to Denny's' closing stock price on Monday, November 3, 2025, the last full trading day prior to the transaction announcement, and a 36.8% premium to the Company's 90-day volume-weighted average share price for the period ended November 3, 2025.
  • The transaction is expected to close in the first quarter of 2026, subject to customary closing conditions, including approval by the Company's stockholders and satisfaction of regulatory approvals.
  • Upon completion of the transaction, Denny's common stock will no longer be listed on the Nasdaq.
  • Co cancels third quarter 2025 earnings conference call.

>>> US After Hours Summary: FN +9.8%, HIMS +5.4% higher on earnings; DENN +47.4%

After Hours Summary: FN +9.8%, HIMS +5.4% higher on earnings; DENN +47.4% surging on news it's to be acquired by TriArtisan Capital; SRPT -39.1% under pressure after earnings; PLTR -2% heading lower on earnings

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: TCMD +24.7%, SGHC +21.2%, UPWK +14.5%, KFRC +14.4%, INVX +13.5%, SANM +12.6%, PAY +11.6%, FN +9.8%, EXAS +9%, EVER +7.1%, HIMS +5.4%, SEI +5.3%, GTM +4%, STRL +3.6%, JBTM +3.6%, CLX +3.4%, GT +3.2% (also completes divestiture of Goodyear Chemical business), IIPR +3.1%, ORA +2.9%, CRBG +2.7%, BCC +2.2%, VVX +1.9%, NMFC +1.1%, VNO +1%, LSCC +0.9%, VOYG +0.9%, PCH +0.8%, HLIT +0.8%, SPG +0.7%, CRK +0.7%, CSWC +0.6%, ENSG +0.6%, INSP +0.5%, HOLX +0.3%, FNV +0.3%, UFPT +0.2%, VTS +0.1%

Companies trading higher in after hours in reaction to news: DENN +47.4% (to be acquired by TriArtisan Capital Advisors), MSBI +2.1% (authorizes new $25 mln share repurchase program), GVA +2% (awarded $70 mln contract by the Tucson Airport Authority), CODI +1.1% (secured lender group extends due date for CODI's restated financial results), HLIT +0.8% (expands partnership with Spectrum), SBUX +0.6% (to form joint venture with Boyu Capital for Starbucks retail in China), CIGI +0.4% (acquires Greenhill Engineers Pty), KURA +0.3% (second $30 mln payment in AML Menin inhibitor program), GTE +0.3% (announces normal course issuer bid and automatic share purchase plan), PLOW +0.2% (completes acquisition of assets of Venco Venturo Industries), KIM +0.1% (files mixed securities shelf offering)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: SRPT -39.1%, NSP -28.3%, ICHR -20.3%, NVTS -14.1%, JELD -12.9% (also workforce reductions and strategic actions), IAC -9.3%, CBT -6.4%, MYGN -6.2%, XENE -5.6% (also appoints CFO), BWXT -4.6%, SLDB -4.6%, RNG -3.9%, VRTX -3.8%, TDUP -3.4%, AMRC -3.3%, NSA -2.9%, WMB -2.7%, CTRA -2.4%, PRIM -2.3%, VTLE -2.2% (also provides merger update), PLTR -2%, OGS -2%, QRVO -1.7%, VNOM -1.6%, EMN -1.5%, NOVT -1.4%, HALO -1.1% (also announces CFO transition plan), ADUS -0.8%, RHP -0.6%, TNC -0.4%, AL -0.3%, SNDX -0.1%, O -0.1%, HLIO -0.1%

Companies trading lower in after hours in reaction to news: HGTY -27.5% (new partnership with Liberty Mutual Insurance), ICHR -20.3% (names new CEO), AESI -15% (suspends quarterly dividend; also places order of 240 MW power generation equipment), MX -5.6% (concludes agreement with Hyundai (HYMLF) Mobis Company Limited), RNG -3.9% (announces agentic voice AI suite), HURA -3.2% (files for $250 mln mixed shelf offering; also stock offering by selling shareholders, relates to warrants), RPD -1.9% (expanded partnership with Microsoft (MSFT)), FANG -1.5% (issues letter to shareholders), EBC -1.2% (completes HarborOne (HONE) acquisition), SITC -1.2% (sale of Parker Pavilions for $8.4 mln), IR -1% (announces acquisition of Transvac Systems), ARDX -1% (files mixed securities shelf offering), FAST -0.8% (appoints new CFO), MSTR -0.7% (intends to conduct initial public offering), PLX -0.6% (seeks re-examination for Elfabrio), CBAN -0.5% (files $150 mln mixed shelf offering), ALM -0.3% (commences large-scale drilling program at Panasqueira Mine)

SCMP : China reaches energy independence milestone by ‘breeding’ uranium from th

China reaches energy independence milestone by ‘breeding’ uranium from thorium
Chinese research institute confirms success of fission-based innovation that is poised to reshape clean, sustainable nuclear power

An experimental reactor developed in the Gobi Desert by the Chinese Academy of Sciences’ Shanghai Institute of Applied Physics has achieved thorium-to-uranium fuel conversion, paving the way for an almost endless supply of nuclear energy.
The achievement makes the 2 megawatt liquid-fuelled thorium-based molten salt reactor (TMSR) the only operating example of the technology in the world to have successfully loaded and used thorium fuel.

According to the academy, the experiment has provided initial proof of the technical feasibility of using thorium resources in molten salt reactor systems and represents a major leap forward for the technology.

It is the first time in the world that scientists have been able to acquire experimental data on thorium operations from inside a molten salt reactor, according to a report by Science and Technology Daily.

The article, published on Saturday, was China’s first official confirmation of its success in the development of TMSR technology, an innovation that is poised to reshape the future of clean sustainable nuclear energy.

Li Qingnuan, Communist Party secretary and deputy director at the Shanghai Institute of Applied Physics, told the newspaper that “since achieving first criticality on October 11, 2023, the thorium molten salt reactor has been steadily generating heat through nuclear fission”.

Thorium is much more abundant and accessible than uranium and has enormous energy potential. One mine tailings site in Inner Mongolia is estimated to hold enough of the element to power China entirely for more than 1,000 years.

At the heart of the breakthrough is a process known as in-core thorium-to-uranium conversion that transforms naturally occurring thorium-232 into uranium-233 – a fissile isotope capable of sustaining nuclear chain reactions.

This transformation occurs through a precise sequence of nuclear reactions. The thorium-232 absorbs a neutron to become thorium-233, which decays into protactinium-233 and then further decays into the final product – a powerful nuclear fuel.

Critically, the entire process takes place inside the reactor core, eliminating the need for external fuel fabrication.

Thorium is dissolved in a fluoride salt into a high-temperature molten mixture which serves as both fuel and coolant. Neutrons from a small initial charge of fissile material, such as enriched uranium-235 or plutonium-239, initiate the chain reaction.

Throughout the operation, thorium-232 continuously captures neutrons and transforms into uranium-233, which then releases energy through nuclear fission to create a self-sustaining “burn while breeding” cycle – one of the technology’s defining advantages.

Unlike conventional pressurised water reactors, which must be shut down periodically to open the pressure vessel and replace solid fuel rods, the TMSR’s liquid fuel – a homogeneous mixture of fissile material dissolved in molten salt circulates continuously, allowing for on-the-fly refuelling without interrupting operations.

“This design not only dramatically improves fuel utilisation but also significantly reduces the volume of long-lived radioactive waste,” Li said. “It’s one of the key advantages that sets thorium molten salt reactors apart.”

Another advantage of the TMSR is that it requires no water at all, in sharp contrast to conventional nuclear power plants that are usually built near coastlines because of their massive cooling needs.

The constraint has limited deployment of nuclear reactors in arid or inland regions but is no impediment to a TMSR system which uses high-temperature molten fluoride salts instead of water as both the fuel carrier and coolant.

Because the salts efficiently transfer heat at atmospheric pressure and extreme temperatures, the technology is opening the door to safe, efficient nuclear power plants deep inland – and even on mobile platforms such as large ships, according to the report.

The Chinese Academy of Sciences launched the TMSR nuclear energy system in 2011 as a strategic priority research programme aimed at addressing national goals in sustainable energy and carbon reduction.

The move was in recognition of the potential for China’s rich thorium reserves to achieve true energy independence using this next-generation technology, along with vast commercial and strategic possibilities.

After nearly 15 years of research and development, a team led by Xu Hongjie, former director of the Shanghai institute, overcame formidable challenges to establish a solid scientific and industrial foundation for China’s advanced nuclear energy industry chain.

Their hard work – ranging from assembling expert teams and building specialised research platforms to developing new materials and core technologies – culminated at 11.08am on October 11, 2023, when the 2MW liquid-fuelled TMSR achieved first criticality.

On June 17, 2024, another milestone was reached when the TMSR achieved full power operation. A few months later in October, the team conducted the world’s first experiment that involved adding thorium to a molten salt reactor.

The achievement by Xu and his colleagues meant that China was home to the only operational thorium-fuelled molten salt reactor in the world – a comprehensive experimental platform for next-generation nuclear research.

Safety remains the top concern with any nuclear technology. As a fourth-generation advanced reactor, the thorium molten salt reactor boasts inherent safety features, according to its developers.

The system operates at atmospheric pressure, eliminating the risk of high-pressure explosions. It is built underground with full radiation shielding and the chemically stable molten salts can also effectively trap radioactive materials.

In the unlikely event of a leak, the molten salt would flow into a passive safety drain tank, solidifying as it cooled and effectively containing any release.

A complete industrial ecosystem for TMSR technology is taking shape in China, according to the academy, with nearly 100 research institutions collaborating on reactor design, materials science and other key challenges.

Crucially, all core components of the experimental reactor are 100 per cent domestically produced, ensuring full supply chain autonomy and technological self-reliance, the academy said.

China is building a 100MW demonstration reactor in the Gobi Desert with the goal of proving the technology’s viability for large-scale commercial deployment by around 2035, according to the latest official timeline.

The Information : What Ilya Saw: Mira Murati’s Screenshots About Sam Altman

What Ilya Saw: Mira Murati’s Screenshots About Sam Altman

Before we get to today’s column, OpenAI is continuing its trend of diversifying its cloud compute providers away from Microsoft. Monday morning, the ChatGPT maker announced that it has signed a seven-year, $38 billion cloud deal with Amazon Web Services.

OpenAI will immediately start using compute from AWS, with the goal to deploy all capacity before the end of next year, with the option to use even more compute into 2027 and beyond. That's good news for AWS, bringing it into line with its smaller cloud firms Microsoft and Google, both of which are already dealing with OpenAI.

On to today’s column…

It’s tempting to file away the events of November 2023—l’affaire Altman—into the bowels of ancient history, given everything that has transpired since then.

But all of the main characters in the firing and rehiring of OpenAI CEO Sam Altman are still very much around and in positions of power. They’re also still providing new information about what, exactly, happened in those frenetic days—and that information sometimes runs counter to the recollections of the other characters.

For instance, Rocket on Friday reported on an October deposition of OpenAI co-founder Ilya Sutskever, who was on the OpenAI board and led the firing of Altman but has been mum about the episode ever since. Sutskever is now CEO of his own AI developer, which is worth about $32 billion on paper, and he likely also is a billionaire on paper from his OpenAI stake alone.

The phrase “what Ilya saw” has been a running meme on X since Sutskever pushed out Altman, with people in and around the artificial intelligence field speculating that Sustekver saw the beginnings of sentient AI and that it prompted him to act against Altman. I also reported at the time that Sutskever was instrumental in a secret breakthrough, Q*—later called Strawberry and now simply known as “reasoning”—which added fuel to the speculative Ilya meme.

If there’s one thing Sutskever made clear to lawyers representing Elon Musk in the deposition, however, it’s that much of the evidence he presented to the board to push out Altman came from OpenAI’s then-chief technology officer, Mira Murati.

Specifically, he said he used a number of screenshots from Murati to produce a memo to OpenAI’s independent directors to convince them to fire Altman. (The three independent directors had asked him to pull together the memo to present evidence about Altman after they spoke to him about the issue and his own distrust of Altman, he said.)

The screenshots and other information from Murati included allegations that Altman consistently lied to colleagues, undermined executives and pitted them against each other.

There’s also a reference to Murati’s allegation that Altman retaliated against her in “subtle” ways for giving him critical feedback.

“I fully believed the information that Mira was giving me,” Sutskever said.

Interestingly, Murati, in a note to OpenAI staff in March 2024, tried to distance herself from the firing, writing, “I never reached out to the board to give feedback about Sam” and that she only did so when “individual board members reached out directly to me for feedback about Sam.”

OK, but Sutskever’s comments suggest he might not have acted against Altman without Murati, though he had been thinking about the right time to push out Altman for an entire year before going to the board, he said.

Upon Altman’s firing, Murati took the interim CEO title only to backtrack and support Altman about a day later, which seems to have left the board scratching its head. (She abruptly left OpenAI in September 2024 and now has her own AI firm, worth $10 billion on paper, and hired a number of OpenAI researchers.)

In another notable moment from the deposition, Sutskever mused about what kind of person should be in charge of artificial general intelligence that can handle most of the world’s economic work.

Sutskever said he’s come around to the view that it “would be like choosing between different politicians.”

He added: “That‘s how the world seems to work. I think it’s very—I think it‘s not impossible, but I think it’s very hard for someone who would be described as a saint to make it.” He added, without elaborating: “I think it's worth trying.” (Sutskever also said the board’s firing process was “rushed.”)

Since his firing, Altman has indeed shown he is a gifted politician and leader, managing AI talent battles, deals with rival firms such as Nvidia and AMD, and settling a longtime tussle with Microsoft, which last week agreed to let OpenAI restructure itself so it can go public.

As for Musk, the xAI CEO’s lawsuit against OpenAI produced the Sutskever deposition. Musk, like Altman and Sutskever, also co-founded OpenAI and Musk funded it when it was only a nonprofit. His suit claims Altman and other OpenAI leaders betrayed him by starting a for-profit unit controlled by the nonprofit board where Altman and Sutskever (but not Musk) were directors.

The case could go to trial early next year. Selfishly, we hope it produces even more revelations about what went down in 2023. According to court documents, Murati was scheduled to sit down for her own deposition with Musk’s lawyers Sunday.

OpenAI’s Altman: Go Ahead, Short Our Stock!
OpenAI CEO Sam Altman sounded exasperated when Altimeter Capital founder—and OpenAI shareholder—Brad Gerstner asked him the question that Gerstner said was “hanging over the market”: how a company generating $13 billion in revenue this year would pay for the $1.4 trillion in computing capacity that Altman has said the company is on the hook for.

“Brad, if you want to sell shares, I’ll find you a buyer…I just—enough,” Altman said on Gerstner’s podcast.

“There are not many times that I want to be a public company, but one of the rare times it’s appealing is when those people are writing these ridiculous, ‘OpenAI is about to go out of business,’” Altman said. “I would love to tell them they could just short the stock and I would love to see them get burned on that.”

That’s an unusual reason to want to go public, a prospect Altman said he assumed “would happen someday,” though he dismissed a recent Reuters report that it could take place in 2026 or 2027.

Altman, in goading short-sellers, is keeping company with his frequent antagonist Elon Musk. The Tesla CEO has openly mocked investors who bet that stock in the electric car maker would plunge. At one point Musk even sold red satin “short shorts.”

The OpenAI CEO said the naysayers had it wrong because OpenAI is “doing well more revenue” than $13 billion and he suggested it could even get to $100 billion in revenue in 2027.

The revenue pace indicates the startup will hit its own projections of $13 billion in total revenue this year—and could move up by a year its expectations for hitting $100 billion in revenue, which we’ve previously reported it anticipated reaching in 2028. (For context, it hit $12 billion in annualized revenue, or the last month’s revenue times 12, in July, up from $6 billion in January.)

Altman acknowledged one attraction to an IPO would be to give individual investors a chance to own shares in the company. It could also raise a lot of money to pay for its computing needs.

But “it would be better to fund the company with revenue growth,” he said.—Laura Mandaro

WWD : Brooks Running Continues to Rack Up Market Share Gains

Brooks Running Continues to Rack Up Market Share Gains
Brooks Running CEO Dan Sheridan said the brand is "central" to people's health and wellness goals as more are choosing an active lifestyle.

Brooks saw strong third quarter demand in performance running footwear, particularly the training and running categories.

Brooks Running said it achieved No. 1 market share at national retail, according to data from Circana.

The same data set from its U.S. retail tracking service for adult running footwear (in dollar sales) from July to September 2025 also indicates that Brooks held three of the top six adult performance footwear styles sold at U.S. national retail, more than any other brand. A spokewoman for Circana said it tracks brick-and-mortar channels and shoe chains, both online and in-stores, such as Macy’s, Target, Amazon.com. Famous Footwear, Academy Sports, Dick’s, and REI, to name a few examples.

Brooks said third quarter revenue rose by 17 percent in the third quarter, helping the brand achieve its ninth consecutive quarter of year-over-year growth. The company said all regions and channels delivered double-digit gains.

In addition, Brooks accelerated global expansion efforts, growing year-to-date revenue by 23 percent in EMEA (Europe, Middle East and Africa)and 82 percent in APLA (Asia Pacific and Latin America) when compared with year-ago levels.
The brand’s growth in France and Germany, up 15 percent and 29 percent, respectively, outpaced third quarter running footwear growth of 9 percent in France and 23 percent in Germany.

“Our entire global team wakes up every day thinking about the runner — how they move, what they feel, the experience they desire and expect from their Brooks gear,” Brooks Running CEO Dan Sheridan said. “I am super proud of the way Brooks is executing, even against a backdrop of continued economic impacts and uncertainty.”

In an interview with Yahoo Finance’s Opening Bid, Sheridan said the brand could see price increases of 2 percent to 3 percent in 2026 due to the impact of tariffs. He didn’t provide a timetable for when the increases might start.


While brands such as Nike Inc. had selectively raised prices in June, many other brands have been absorbing additional production and tariff costs heading into the holiday season. But the Footwear Distributors and Retailers of America (FDRA) noted that most brands have already sold out of front-loaded inventory, and that new footwear that’s arriving are already reflecting the high duties that are paid.

In the latest data check from the FDRA, overall retail prices of footwear climbed 1.3 percent last month, with women’s shoes leading the uptick.
“Retail footwear prices now have climbed year-over-year for three straight months. We look for this streak to lengthen as surging duties on footwear imports permeate the footwear supply chain all the way to the checkout register,” Gary Raines, FDRA’s chief economist, told Footwear News.

For Brooks, the brand has benefited from growth in the global running market. “More people around the world are running and choosing an active lifestyle and Brooks is central to their health and wellness goals,” Sheridan said.
Growth in particular was driven by strong demand for performance running footwear, especially in the training and racing categories.

Brooks said it introduced five footwear styles in the third quarter in three core performance categories: cushion, trail and speed. It also previewed the new Cascadia Elite, a shoe that helped the brand’s elite trail athletes achieve 12 first place finishes and 30 podiums this season, Brooks said. It noted that core franchises continued to post gains with Adrenaline GTS up 20 percent and Glycerin up 29 percent, while full-price products grew 21 percent.

The brand also said that its Brooks x RSVP Gallery Caldera 8 collaboration, a new addition to Brooks’ lifestyle collection, received strong interest from both new and existing customers. RSVP Gallery is cofounded by designer and streetwear visionary Don C.

Brooks’ ongoing relationship with runDisney saw the launch of limited-edition product at the Disneyland Halloween Half Marathon Weekend in September, where the Ghost 17 runDisney Halloween sold out at the race expo. The brand also maintained a presence in the global running community through immersive experiences at iconic running events. Those events include opening signature Hyperion Houses in Tokyo and Berlin where runners could try on new products and experience the brand in real life, and as sponsor of England’s AJ Bell Great North Run, the largest half marathon in the world with more than 60,000 participants.