What's new: Intel agrees to 10% U.S. stake; Silicon Valley launches pro-AI PACs; Inside Hyundai’s sprawling complex in Georgia populated by people and robots.

Good morning. There’s growing concern that the rally in Big Tech stocks might not run forever. OpenAI CEO Sam Altman has reportedly said that investors have become overexcited about AI, its importance notwithstanding, and as CNBC notes, he seems to have compared the current moment to the dot-com era.

The dot-com bust that began in early 2000 was a debt crisis as much as anything. Equity valuations were stretched in both the private and public markets, but those companies had also raised inordinate amounts of debt, and that created exposure for banks and other lenders, which created a systemic problem. It wasn’t just dot-com companies, either. Telecommunications startups of that period went particularly heavy on debt. Dot-com and telecom startups alike often suffered from marginal revenue and business models.

The bull market in tech and AI is largely associated with high public valuations for Big Tech, and nine-figure valuations for venture-capital backed startups. But today’s AI companies have taken on their share of debt, too. Earlier this year, OpenAI announced an $11.6 billion funding, a combination of equity and debt. And before that, Altman unveiled a $500 billion infrastructure project called Stargate with SoftBank and Oracle, which “has struggled to get off the ground.” Last year, CoreWeave raised $7.5 billion in a massive private-debt financing.

One encouraging note is that cloud companies report that they can barely keep up with demand for AI. CoreWeave said earlier this month that second-quarter revenue more than tripled from last year, given high demand.

There are many reasons to believe that AI’s  promise will be fulfilled, even if that takes longer than some expected and there are painful corrections along the way. But it’s crucial to pay attention to the sector’s mounting debt, and who holds it.

Nvidia. The AI chip maker's earnings are this week's main event with investors keen for new insight into how the $4 trillion company at the heart of the artificial-intelligence boom is faring. 

Interest rates. Highlighting job market worries, Fed Chair Jerome Powell last week signaled officials are prepared to cut interest rates at their next meeting next month. “The balance of risks appears to be shifting,” Powell said. While labor markets appear to be stable, “it is a curious kind of balance that results from a marked slowing in both the supply of and demand for workers.”

Jobs. The pace of hiring has slowed markedly, WSJ reports. In June, the hires rate—the number of hires as a share of overall U.S. employment—was just 3.3%, according to the Labor Department, much less than the 4.6% registered in November 2021, when the job market was surging back.

President Trump said the government is taking a nearly 10% stake in Intel, capping a two-week frenzy in Washington that started when the president called on Chief Executive Lip-Bu Tan to resign over his past ties to China.

Coughing up Chips Act funds. As part of the deal, the government won’t be on the board or play a major role in the company’s governance, Commerce Secretary Howard Lutnick said in a CNBC interview earlier this week. Intel has about $8 billion in grants from the Chips Act that could be converted to part of the 9.9% equity stake.

Some analysts tell the WSJ that Intel won't be in a much better position. It needs new commitments from customers, they say. Without that, converting government grants to stock will only leave the company in a worse financial shape by diluting shareholders. In response, the president could lean on other tech companies to work with Intel.

Friday's move drew outrage, praise from both sides of the aisle. Sen. Rand Paul (R., Ky.) likened the move Friday to socialism. “Today it’s Intel, tomorrow it could be any industry,” 

Sen. Bernie Sanders (I., Vt.) had other thoughts, urging the administration to go still further. “Taxpayers should not be providing billions of dollars in corporate welfare to large, profitable corporations like Intel without getting anything in return.” 

Once the world's most valuable semiconductor company, Intel now is losing about $1 billion a month and needs customers or deals for its chip design and manufacturing businesses to get back on track, industry analysts say.

Taking a page from a cryptocurrency-focused super-PAC network that helped swing last year’s election results, Silicon Valley is pouring millions into a network of political-action committees aimed at fighting strict artificial-intelligence regulations, WSJ reports. 

Among the goals of the super-PAC network, Leading the Future, is to push back against a movement backed by some other tech titans that focuses on regulating AI models before they get too powerful. Venture-capital firm Andreessen Horowitz and OpenAI President Greg Brockman are among those behind the launch.

The organization plans to start work in four states seen as key AI-policy battlegrounds: New York, California, Illinois and Ohio.

With delays plaguing Apple’s AI-powered Siri upgrade and its AI team a target for competitors (see below), the company  is now talking with Google about using a custom version of its Gemini AI system to power its voice assistant, Bloomberg reports.

News that Meta Platforms was slowing its AI hiring after a flurry of headline-grabbing job offers did not deter the company from snagging one more hire. Bloomberg reports that Frank Chu, who led Apple AI’s team on cloud infrastructure, training and search will join Meta Superintelligence Labs. Chu, who also worked to develop search features on Siri (see above) is the sixth Apple AI expert to join Meta the social media giant kicked off its hiring spree in July. 

As Apple tries to work out its AI strategy, the company is leaning into what it does best: hardware. Bloomberg reports that Apole has three years of iPhone redesigns in the works, starting with the slimmer iPhone Air this September followed by its first foldable iPhone in 2026 and a curved-glass iPhone in 2027.

What could the future of work look like? A Hyundai factory which opened near Savannah, Ga., late last year illustrates one possible timeline.  Here about 1,450 people work alongside some 750 robots that do the dangerous, repetitive or physically demanding tasks, WSJ reports. 

People at the Hyundai plant hold primary responsibility for quality control, both along the assembly line and after a vehicle is finished. 

Elon Musk tried to enlist Meta Platforms Chief Executive Mark Zuckerberg as part of his unsolicited $97.4 billion bid to takeover OpenAI earlier this year, according to court filings. A consortium of investors led by Musk offered to buy the nonprofit that controls OpenAI in February as part of Musk's ongoing legal battle with the company he co-founded alongside Sam Altman in 2015. Neither Zuckerberg nor Meta  signed a letter of intent or participated in the bid, according to the filing.

A former software developer was sentenced to four years in prison for deploying malware at his employer, Beachwood, Ohio-based Eaton Corporation, after his responsibilities were cut, New York Times reports.

Waymo’s robo-taxi service will start testing vehicles in Manhattan and Brooklyn through late September in the city’s first self-driving testing launch, CNBC reports.

With a flood of new rules that prohibit kids under 18 from engaging in certain online activities, companies are evaluating technologies and processes to make sure they meet compliance. Nothing is perfect. Age-verification technology—much of it outsourced to third-party providers—isn’t always accurate and photo and even video IDs can be manipulated through AI.  

In mid-August, Google started to use AI to figure out a user’s age based on signals they are sending to the platform. Meta also says it uses technology to estimate age based on activity.

Keurig Dr Pepper has struck a deal to buy Peet’s Coffee owner JDE Peet’s for $18 billion, a prelude to spinning off its coffee brands into a separate public company. (WSJ)

The Pentagon has for months been blocking Ukraine’s use of long-range missiles to strike inside Russia, U.S. officials said, limiting Kyiv from employing a powerful weapon in its fight against Moscow’s invasion. (WSJ)

President Trump escalated a feud with Democratic Maryland Gov. Wes Moore, a possible 2028 presidential contender, as the two traded barbs over law enforcement in Baltimore and the president’s Vietnam War-era draft deferment. (WSJ)

This September, The WSJ Technology Council will convene senior technology leaders to examine how AI is reshaping organizations—redefining teams and workflows, elevating technology’s role in business strategy, and transforming products and services. Conversations will also delve into AI’s evolving security risks and other fast-emerging trends shaping the future.

Select speakers include:

Carolina Dybeck Happe, COO, Microsoft
Severin Hacker, CTO, Duolingo
Yang Lu, CIO, Tapestry
Tilak Mandadi, CTO, CVS Health
Helen Riley, CFO, X, Google's Moonshot Factory

September 15-16 | New York, NY
Request an invitation | Participants and program

The WSJ CIO Journal Team is Steven Rosenbush, Isabelle Bousquette and Belle Lin.

The editor, Tom Loftus, can be reached at thomas.loftus@wsj.com.