Welcome to the CAVEAT Weekly Newsletter, where we break down some of the major developments and happenings occurring worldwide when discussing cybersecurity, privacy, digital surveillance, and technology policy.
At 1,450 words, this briefing is about a 7-minute read.
At a glance.
- US Department of Energy forms a billion-dollar partnership with AMD.
- OpenAI succeeds in business reorganization.
Department of Energy forms partnership with AMD.
The news.
On Monday, the United States (US) Department of Energy (DOE) announced that it was forming a new billion-dollar partnership with Advanced Micro Devices (AMD). With this partnership, AMD will help build two new supercomputers to assist with solving large scientific problems, including nuclear power, cancer research, and national security. The DOE will host both computers, while AMD and its partners will provide the hardware and capital investment.
The DOE’s two new supercomputers, Lux and Discovery, will be co-developed with AMD, Hewlett-Packard Enterprise (HPE), Oracle Cloud Infrastructure, and Oak Ridge National Laboratory (ORNL). Lux, based on AMD’s MI355X chips, is expected to come online within six months, while Discovery, powered by AMD’s MI430 chips, is slated to be delivered in 2029.
Alongside this deal, the DOE also announced it will build seven new supercomputers with Nvidia. These new supercomputers will be specifically designed to both maintain and help develop the US’s nuclear weapons arsenal as well as research alternative energy sources.
The knowledge.
This partnership between the DOE and these semiconductor manufacturers signals the US government’s evolving and deepening commitment to expand the federal government’s use of artificial intelligence (AI). These supercomputer partnerships are one of the key ways that the federal government is executing on its AI adoption strategy.
The Trump administration’s AI Action Plan, which was announced in July, outlines three pillars:
- Accelerating AI innovation.
- Building American AI infrastructure.
- Leading the world in international AI diplomacy and security.
For pillar one, the administration is working to both remove or revise current federal regulations that are slowing AI development. In this effort, the administration has rescinded the former Biden administration’s executive orders and begun auditing agency regulations to ensure they do not hinder AI innovation or adoption. Alongside removing these barriers, the administration has also committed to forming more partnerships with the private sector to expand research and development, further government AI adoption, and promote innovation.
Pillar two echoes these goals by focusing heavily on supporting AI infrastructure projects. These efforts include streamlining the permitting process related to data center construction, chip manufacturing, and energy facilities. Additionally, pillar two prioritizes encouraging companies to continue investing to build new and expand existing infrastructure to meet growing demands.
Lastly, pillar three aims to further grow the US’s global AI influence by allowing companies to increase the export of AI technologies, including hardware, software, and key components, to key allies. Alongside increasing exports to allied nations, the administration emphasized its goals to lead the global community when setting protective measures.
The impact.
This partnership marks a significant milestone in executing the Trump administration’s AI Action Plan. By partnering with AMD and Nvidia, the DOE is both expanding federal AI adoption and signaling continued investment in domestic innovation.
For businesses, this partnership is likely indicative of future federal AI investments. Organizations should monitor these developments to anticipate new funding opportunities, shifts in federal priorities, and potential regulatory impacts.
OpenAI completes major reorganization.
The news.
On Tuesday, OpenAI, the developer of ChatGPT, announced that it has completed a multi-billion-dollar reorganization. The new structure splits the company into two parts: its original nonprofit arm and a new for-profit entity. This follows probes from both the California and Delaware State Attorneys General.
With this reorganization, Bret Taylor, the Chair of OpenAI’s board of directors, stated:
“OpenAI has completed its recapitalization, simplifying its corporate structure. The nonprofit remains in control of the for-profit, and now has a direct path to major resources before AGI arrives.”
Delaware Attorney General Kathleen Jennings wrote in a statement on Tuesday that her office had reviewed the restructuring and did not object. California Attorney General Rob Bonta echoed these findings in his statement, emphasizing that his office would not oppose the new structure after securing concessions from OpenAI. Attorney General Bonta further stated that he believes these concessions will “ensure charitable assets are used for their intended purpose, safety will be prioritized, as well as a commitment that OpenAI will remain right here in California.”
These concessions were further outlined in a Memorandum of Understanding signed by both California’s Attorney General and OpenAI on Monday.
With this restructuring, the non-profit arm of the business, known as the OpenAI Foundation, will take a 26% stake in the new for-profit business, now called the OpenAI Group PBC. This stake is estimated to be worth approximately $130 billion. Microsoft will also take a 27% stake in the for-profit business, estimated to be worth approximately $135 billion.
The knowledge.
This restructuring has been an intensely debated subject after the company originally proposed this reorganization in December 2024. At the time, OpenAI argued that this change would achieve the following:
- Support the long-term success of the company’s mission.
- Make the non-profit organization sustainable.
- Enable both sides of the business to “do its part.”
This restructuring was met with substantial pushback from a coalition of nonprofit organizations, who in April 2025 called upon California’s attorney general to protect OpenAI’s charitable assets from a for-profit takeover. Alongside calling for government action, the coalition also wrote a letter, which included former OpenAI employees and Nobel laureates, arguing that the restructure would undermine the state government’s ability to protect public interests.
This pushback eventually led to OpenAI backtracking on some of its initial goals, emphasizing that the non-profit arm would maintain control of the for-profit portion and be a large shareholder.
With the restructuring now complete, the company is valued at $500 billion and could potentially enable the company to begin the IPO process.
The impact.
This development marks a significant change in the AI landscape. Given how concerned many were about the restructuring, it is likely that this formal announcement will draw significant attention and potentially give way to several lawsuits.
In the larger context, this development will test how the government handles public-benefit companies. Additionally, this split model will also likely create new capital and funding opportunities and continue bringing increased regulatory scrutiny to the AI industry as a whole.
Highlighting key conversations.
In this week’s Caveat Podcast, our team sat down with Sanny Liao, the Co-Founder and CTO of Fable Security. With California’s upcoming election, concerns are high about cyber risk and points of exposure. Throughout the conversation, our team and Liao discuss what some of the biggest threats are to this upcoming election, how attackers can target employees, and how California counties can best prepare their employees ahead of this event.
Like what you read, and curious about the conversation? Head over to the Caveat Podcast for the full scoop and additional compelling insights. Our Caveat Podcast is a weekly show where we discuss topics related to surveillance, digital privacy, cybersecurity law, and policy. Got a question you'd like us to answer on our show? You can send your audio file to caveat@thecyberwire.com. Hope to hear from you.
Other noteworthy stories.
UN cybercrime treaty to be signed in Hanoi.
What: The United Nations (UN) looks to sign a new cybercrime treaty.
Why: Over the weekend, the UN agreed to sign a new cybercrime treaty aimed at addressing offenses costing trillions of dollars annually. With this treaty, the UN aims to streamline international cooperation efforts when addressing cybercrime.
UN Secretary-General Antonio Guterres commented on the treaty, stating:
“Cyberspace has become fertile ground for criminals…every day, sophisticated scams defraud families, steal livelihoods, and drain billions of dollars from our economies. The UN Cybercrime Convention is a powerful, legally binding instrument to strengthen our collective defenses against cybercrime.”
The convention will formally take effect after forty nations ratify it.
FCC votes to tighten restrictions on Chinese-manufactured telecommunications equipment.
What: The Federal Communications Commission (FCC) has further restricted Chinese-manufactured telecommunications equipment.
Why: On Tuesday, the FCC voted to increase its restrictions in a 3-0 vote. With this vote, the FCC prohibited the authorization of devices containing parts from companies on the “Covered List,” alongside empowering the agency to block the sale of previously authorized Covered List equipment.
This move follows a previous announcement by the FCC on October 15th, which stated that the agency was planning to revoke the authority of HKT, a leading Hong Kong telecommunications carrier.
FCC Chair Brendan Carr stated:
“These present loopholes that bad actors could use to threaten the security of our networks. America’s foreign adversaries are constantly looking for ways to exploit any vulnerabilities in our system.”