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OpenAI Responds to Elon Musk’s Takeover Bid, Claims It Conflicts with His Lawsuit

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Elon Musk’s recent bid to purchase OpenAI, valued at $97.4 billion, has raised significant legal and ethical concerns, according to a letter the company submitted to a federal court on Wednesday. The bid, led by Musk and a consortium of investors, aims to acquire the assets of OpenAI’s nonprofit arm. However, this offer directly contradicts Musk’s own lawsuit filed earlier this year, in which he argues that OpenAI’s assets should not be privately acquired or used for personal gain. OpenAI’s response highlights the inconsistency between Musk’s legal actions and his current acquisition proposal.

In August, Musk filed a lawsuit against OpenAI CEO Sam Altman and other company executives, seeking to block the nonprofit’s transition to a for-profit model. Musk contends that OpenAI’s resources and intellectual property should remain within a charitable trust and be used solely for the public good. However, in a twist, his takeover bid appears to be aimed at transferring those very assets into private hands, raising questions about his true intentions regarding OpenAI’s future.

The letter submitted by OpenAI accuses Musk of hypocrisy, suggesting that his bid is an attempt to weaken a competitor under the guise of acquiring it. OpenAI argues that Musk’s move is contradictory, as it seeks to secure private control over the company’s valuable assets despite his public stance against such privatization. The company further emphasized that Musk’s actions appear to be part of an ongoing strategy to influence the AI sector, especially in light of his prior legal battles with OpenAI.

At the time of writing, Musk’s representatives had not responded to requests for comment regarding OpenAI’s letter or the broader legal implications of his acquisition attempt. The situation remains fluid, as the court will soon have to address the complex issues raised by Musk’s contradictory actions. This conflict between Musk’s legal pursuits and business interests is set to be a key point of contention in the ongoing saga surrounding OpenAI’s future direction.

Reddit Misses Daily Visitor Estimates Due to Google Algorithm Change, Shares Drop

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Reddit (RDDT.N) fell short of market expectations for daily active unique visitors in the fourth quarter, impacted by a change in Google’s search algorithm that reduced its visibility in search results. This announcement sent Reddit’s shares tumbling 15% in after-hours trading on Wednesday.

The San Francisco-based company, which launched its IPO in March 2024, saw its stock surge nearly five-fold last year. However, volatility with Google search at the end of the fourth quarter affected traffic from “logged-out users”—those who browse without signing in, CEO Steve Huffman said in a letter to shareholders. Despite the setback, Huffman noted that traffic from Google search has since recovered in the first quarter of 2025.

Reddit’s daily active unique visitors grew by 39% to 101.7 million for the quarter ending December 31, but this fell short of analysts’ average estimate of 103.3 million, according to LSEG data. Growth has also slowed sequentially.

“Reddit shares are down due to missed expectations on daily active users, but it’s not a reason to lose faith in the company,” said Jeremy Goldman, senior director of briefings at eMarketer. He added that Reddit’s international expansion and AI advancements could help it become a digital advertising powerhouse.

Reddit has been leveraging AI deals with Alphabet’s Google and Microsoft-backed OpenAI, as well as conversation placement ads—where brands can advertise directly within subreddit discussions. These factors have helped Reddit forecast first-quarter revenue between $360 million and $370 million, surpassing analysts’ average estimate of $358.1 million.

The company reported fourth-quarter revenue of $427.7 million, beating the $405.3 million estimate, largely driven by holiday season ad spending. Profit per share came in at 36 cents, surpassing the 25-cent estimate. Reddit’s global average revenue per user increased by 23% to $4.21.

Additionally, Huffman mentioned ongoing discussions for data licensing deals with major industry players.

Google has yet to respond to inquiries about its algorithm changes.

Anduril to Take Over Microsoft’s $22 Billion US Army Headset Program

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Anduril, a defense technology startup founded by Palmer Luckey, will assume control over the development and production of Microsoft’s $22 billion Integrated Visual Augmentation System (IVAS) program for the U.S. Army, the companies confirmed on Tuesday. Under the new agreement, Anduril will manage production, future hardware and software development, and oversee delivery timelines for the project.

The IVAS program aims to equip soldiers with a mixed-reality headset that combines augmented reality (AR) and virtual reality (VR) to enhance situational awareness and support the command of unmanned systems. As part of the deal, Microsoft Azure will serve as Anduril’s preferred hyperscale cloud platform for all workloads related to IVAS and Anduril’s AI technologies.

Microsoft initially developed its HoloLens technology for use in military headsets in collaboration with the U.S. Army, but Anduril will now take the lead in its execution. The agreement is still awaiting approval from the U.S. Department of Defense.

Luckey, who previously founded Oculus VR, which was acquired by Facebook in 2014 for $2.3 billion, is no stranger to the defense sector. Anduril has also formed partnerships with OpenAI and Palantir to leverage defense data for artificial intelligence training, further strengthening its position in the military tech space. The news comes as Anduril is reportedly in talks for a new funding round that could push the company’s valuation to $28 billion.