What's up: Microsoft announced plans to slash thousands of jobs; U.S. has scrapped the ‘AI Diffusion’ rule in revamp of Biden-era chip curbs; Apple is working on brain-computer interfaces.

Good morning, CIOs. Databricks has agreed to acquire database startup Neon in a deal valued at about $1 billion, a move the company hopes will make it more attractive to businesses that want to create their own artificial intelligence bots.

“Pretty much every customer we have is super excited and wants to leverage agents,” Ali Ghodsi, co-founder and chief executive of Databricks, tells the WSJ's Belle Lin.

Customers are not the only ones excited. With the Neon deal, Databricks joins the ranks of tech giants including Nvidia and OpenAI that have recently released their own platforms for customers to build AI agents—demonstrating tech vendors’ eagerness to win over customers in the AI agent race. Read the story.

The Department of Commerce said in a statement Tuesday that it was scrapping the "AI Diffusion Rule", which imposed caps on how many chips certain countries could buy. Tech companies including Microsoft and Oracle had spoken out against the rule, the WSJ reports. The change is a big win for countries previously limited from buying U.S. chips, including Saudi Arabia. More below. 

Tech CEOs joined President Trump in Saudi Arabia Tuesday, racking up deals as the desert kingdom spends its way towards becoming an AI powerhouse. 

• Cisco said it would partner with Saudi Arabia’s Humain AI initiative to boost AI development in the country, the WSJ reports. The company also announced Tuesday an extension of its partnership with Abu Dhabi-based AI firm G42.
• Nvidia CEO Jensen Huang said the company will supply AI chips, including some 18,000 of its GB300 Grace Blackwell chips for Humain’s planned “AI factories” in the country. Separately, rival AMD will provide technology for  data centers “stretching from the Kingdom of Saudi Arabia to the United States,” Bloomberg reports.
• U.S. chipmaker Groq was selected by Humain Humain to power AI inference work, Semafor reports.
• Google, together with local VC firm STV, launched a $100 million artificial intelligence fund, Bloomberg reports. 

Microsoft is laying off thousands of employees across various divisions around the world, driven, the company says, by efforts to become more streamlined and have fewer managers. Less than 3% of the software giant’s workforce would be eliminated, or fewer than 6,800 employees, the WSJ reports. The company had about 228,000 full-time workers worldwide as of June 30.

Apple is working with startup Synchron on new brain-computer interfaces that lets people control their iPhones with neural signals, a move that could make its devices more accessible to people who can’t use their hands because of severe spinal cord injuries or diseases such as amyotrophic lateral sclerosis, the WSJ reports.

Chinese internet giant Baidu has been in talks with Switzerland’s PostAuto, a unit of Swiss Post that provides public bus services, to launch its Apollo Go robotaxi service, marking its latest effort to expand overseas amid rising competition at home. 

Foxconn Technology Group reported strong first-quarter results but cut annual guidance as the world’s largest contract electronics manufacturer warned about tariff and currency headwinds. President Trump imposed a steep 32% levy on Taiwanese goods on April 2.

Republican lawmakers on Tuesday expressed national-security concerns over the proposed $400 million plane that the Qatari ruling family wants to give to the U.S. for use as Air Force One, offering rare GOP resistance to a venture backed by President Trump. (WSJ)

The Library of Congress—long a sleepy, noncontroversial staple of the nation’s capital—has become the latest battleground in President Trump’s power struggle between the branches of government. (WSJ)

Stocks are back in the black for 2025, with gloom over the trade war giving way to optimism about potential deals and U.S. economic resilience. (WSJ)

UnitedHealth’s Stephen Hemsley joins a long tradition of former chief executives returning to lead their companies through a crisis. The record of other “boomerang” CEOs suggests he faces a tricky challenge. (WSJ)

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.