How CEOs, economists are looking towards the future of AI: Morning Brief

Yahoo Finance Live discusses how CEOs of top brands such as Wendy's, Duolingo, and Nextdoor are integrating AI into a variety of different services.

Video transcript

MYLES UDLAND: Today's Morning Brief is on, you guessed it, artificial intelligence. The title, the market's obsession with AI is not the right magnitude. Yahoo Finance's Miles Udland writes with the seemingly endless discussion of artificial intelligence and its potential across industries. The level of conversation happening about it is not right.

Either we're talking about it way too much or way too little. Here's what some of our guests had to say on the space, the artificial intelligence space. This week, starting with Builder.ai, which just got a big investment from OpenAI backer, Microsoft. Here's CEO Sachin Duggal.

SACHIN DUGGAL: When we think about what's happening in the world at large, and this is before ChatGPT and what we're seeing with OpenAI, we've seen a rapid push towards digital transformation. Whether it's a small business, it's entrepreneurs that are trying to build ideas and they need to be digitally native.

And companies like ours are using AI to accelerate the productivity for them to get to that end point, right? So they don't have to become software experts. They can simply talk about their idea. We can recommend the right set of features depending on which region in the world they're in, what kind of features they're building.

Broadly speaking, I think where you're starting to see this play out into everyday life is productivity applications. You think about things like copilot, they're going to help us do a lot more with a lot less. And that means that if we think about the aggregate amount of demand for work that even comes into a startup like builder and the aggregate amount of supply we have, whether it's our expert network or it's our own teams doing internal work. This actually helps us level the playing field and brings back some balance for a lot of folks.

JULIE HYMAN: And education tech group, Duolingo, is no stranger to the technology. CFO Matt Skaruppa joined us after its first quarter earnings beat expectations. The business has been outspoken on how AI can help scale education.

MATT SKARUPPA: AI for us is a really integrated experience. So long-time users have told us that they wanted to interact with our product and what AI does is it's a really quick-- or the generative AI, is a really quick response mechanism. So we're able to integrate much more tutor-like conversational response times into our product.

So it's just-- it's a really natural fit for us, and it's something that in our early testing of this new tier we do see demand for it. So we're excited about it. How big it can go? We're not sure yet. I mean, it's early days. So we're going to keep testing and rolling it out over the course of the rest of the year. But we're very excited about it.

BRAD SMITH: Ohio's finest also getting into the space. Wendy's making a big push and integrating AI into its all important drive throughs. CEO Todd Penegor caught up on its plans. Here on Yahoo Finance.

TODD PENEGOR: So what you're going to see today is basically just taking out the traditional order taker. You won't even know that it's AI taking your order. But you'll be talking to the voice of Wendy's, be it a consistent voice, it may upsell you along the way today.

BRIAN SOZZI: Todd, is it your voice? Is it your voice?

TODD PENEGOR: It's not mine.

BRIAN SOZZI: OK, just want to check.

TODD PENEGOR: God help us, Brian, but no, we'll have a consistent voice out there. But what we'll have on the digital menu boards is a confirmation. So you know that your order was taken right. You'll get to see it real time, and then ultimately we'll get you through the restaurant very quick.

So when you think about different languages, different dialects will be able to quickly make sure that nothing gets lost in translation, both from a customer or an employee perspective, but over time. As you start to think about how do you take a digital menu board? How do you make it a smarter digital menu board? How do you connect the voice AI, the digital menu board ultimately to our loyalty program?

How do we make sure that we got a more personalized, customized menu to support what Brian wants when he comes to the restaurant? And how do we trade you up when you come into that restaurant in the future? Those are all opportunities, a little further off, obviously, but you got to start laying the pipework in the platforms today to really bring all of that to life.

JULIE HYMAN: And Nextdoor also jumping on the AI train. The company looking at ways that generative AI can enhance the way neighbors communicate with one another. CEO Sarah Fryer joined us yesterday to talk about it.

SARAH FRIAR: Yeah, you just can't get left behind when these huge technology shifts happen. So you're right. If you look at Nextdoor, we've held our operating expenses about flat for the last three quarters. But if you look at what's been going on effectively under the hood, we have been hiring up a big AI Team. We started that investment back really in 2021, going into 2022.

It's not just about generative AI, right? AI has been underpinning platforms like Nextdoor for many, many years now. We use that data to do things like a better notification. The right notification to the right neighbor at the right time brings them back to the platform. It's the way we personalize the news feeds. So the things that work for me may not work for you, Brian, but we try to make sure your feed is personalized for you.

So we do have to keep investing here. We have to stay really out in front, and we wanted to move fast on the generative AI front because we wanted to let anyone, any neighbor in the world that's on Nextdoor gets to see what this technology is like, gets to benefit from it. And we think that's an important part of really democratizing a whole new wave of technology.

BRAD SMITH: So everyone seems to have an opinion on the AI space these days, from companies to policymakers and academics. We caught up with Danny Blanchflower, who is the former Bank of England policymaker and now Economics Professor at Dartmouth College. He didn't really mince his words.

DAVID BLANCHFLOWER: The Luddites thought that technology was going to be job destroying, but if you look back over let's say the last 25 years, actually lots of new jobs have been created around technology. When you have your dishwasher repair, the plumber doesn't come. The computer guy comes to deal with the computer that's in every one of your machines.

I mean, yesterday, my coffee maker, it's blocked, and I got a message on my phone saying there's a problem with your coffee maker. I think that's the first thing. I mean, job-- this is job generating, it's just job different. And I think in a sense your question is something I've thought about endlessly.

But if you think, let's say I was to go back each 10-year period and you say to me, so what do you think's coming? What are the new jobs over the next decade going to look like? And the answer is, I had it wrong. It would have been very hard to work out that be an Apple store and I'd be talking to Yahoo Finance on my Zoom.

So I think the answer is, it's hard to know. But I think there's change, big change is coming. Obviously, we're seeing this technology impact, I think Zoom's a big deal. And we're seeing evidence that the inner city is in decline. So if you look at things like beeps of funds in downtown, in San Francisco, it's about 25% of what it was. In Boston, it's 50%.

The character of working has changed, but jobs have changed, and we're just seeing-- we're seeing rapid change around this technology. In many senses, it may well be job enhancing, not just job destroying.

JULIE HYMAN: I love that Danny got a message on his phone that his coffeemaker was not operational. And I also liked the point that our Myles Udland made in the Morning Brief. Is that this is either going to be a blockchain technology, a metaverse, something that was extremely discussed, that was not world changing.

Or we're actually not talking about it enough because even more than those technologies, at least in our minds and in theory, this has the more-- a bigger potential to change many, many, many different businesses and the way we sort of conduct our day to day lives.

BRAD SMITH: Yeah.

JULIE HYMAN: And we don't really know yet.

BRAD SMITH: We don't know yet. However, what we do know is that if there were investors out there trying to get ahead of the artificial intelligence trade and try to get kind of a sense of where some of the totem pole elements start to come together around the artificial intelligence, and generative artificial intelligence specifically here, you kind of got that through the earnings calls that took place. And I think back to the Meta Platforms earnings call, where Mark Zuckerberg, in his very monotone way, did deliver something that was extremely valuable, I think, for investors who are trying to understand where the parts of generative AI are to potentially invest in. And I kind of broke it down into this acronym, AMC.

And at the top of it you have the Applications. In the middle, you've got the Models, those language learning models that the applications are built on top of. And then at the bottom of that, the foundation of that entire generative AI house, if you will, is the Chips. And the chips that we've heard, or at least the kind of data center or semiconductor plays that we've heard so far, a lot of companies pointing right now back to NVIDIA.

And how much they're leveraging or intend to leverage the DGX cloud, which we had heard about an earnings call ago for NVIDIA as well. And so kind of thinking about it within that acronym. I think a lot of the conversation from an investment standpoint is-- well, it seems like chips are really going to be the core focus of this. And could be a near-term and long-term kind of leader in terms of where the longer return to value for shareholders would be in the generative AI landscape.

JULIE HYMAN: I mean, it's also interesting how many different other companies are using ChatGPT specifically. I mean, open door-- Nextdoor-- Nextdoor, for example, is using ChatGPT as a foundational product for its AI offering. So then that goes back to OpenAI, which goes back to Microsoft. So that also is something that investors are clearly thinking about.

BRAD SMITH: Yeah, and even translation too. Brian Chesky told us from Airbnb's perspective, they want to just be able to run simple language translation. That's one of the lower hanging fruits.

JULIE HYMAN: There's does it already write.

BRAD SMITH: Right.

JULIE HYMAN: If you're message your person and they don't speak English or don't speak whatever, they translate it.