OpenAI Burned $3.7B in Cash Despite Surging Revenue, Snap's New Glasses Tank the Stock

**Zaid Admani** (0:00)
Public.com presents The Rundown, your daily market update in 10 minutes. My name is Zaid Admani, and today is Wednesday, June 17th. In today's episode, we'll preview Kevin Warsh's first Fed meeting as chairman and what falling oil prices could mean for interest rates. We'll also break down OpenAI's leaked financials and tell you why the market was not a fan of Snap's new $2,200 smart glasses. And stick around to the end of the show to find out how SpaceX just shattered every options trading record on its first day. We got a great show for you today.
Let's go.
Markets took a bit of a breather on Tuesday after a solid three day run. The S&P 500 fell by 0.6% while the NASDAQ dropped 1.2%. The Dow did finish in the green and hit record highs, but nobody cares about the Dow.
Tech was back to selling off yesterday. It was the worst performing sector, especially chip stocks like AMD, Intel and Micron, which were all down between 6% to 7%. Energy stocks were also down yesterday as oil prices continue to fall. Brent crude fell to under $80 a barrel for the first time since March, as the US and Iran are expected to sign a deal on Friday that would reopen the Strait of Hormuz and also allow Iran to sell their oil into the global market. So this is a pretty major development. If this deal holds, it could be a huge relief for inflation and also give the Fed some breathing room when it comes to interest rates. Inflation has been running above 3% for the last few months, mainly because of higher energy prices from the war. And remember, the Fed's inflation target has historically been 2%. That's why recently several Fed officials have been openly talking about raising interest rates this year to get inflation under control, especially since the labor market continues to be stable. In fact, the market is pricing in a 60% chance the Fed does raise interest rates by the end of the year. We should get more information today on what the Fed is thinking as the Fed meeting wraps up. This is the first Fed meeting under new Fed Chair, Kevin Warsh, and the Fed is expected to keep interest rates unchanged between 3.5 and 3.75% at this meeting. But the market will be paying really close attention to what Kevin Warsh says in his press conference. Remember, President Trump constantly criticized previous Fed Chair, Jerome Powell, for not cutting interest rates. I'm sure he's expecting Kevin Warsh to cut interest rates at some point. But with where inflation is at right now, I mean, that puts Kevin Warsh in a tough spot. Maybe Kevin Warsh won't hammer the 2% inflation target the way that Jerome Powell did at every single one of his press conferences. And look, now with oil prices coming down, thanks to the Iran deal, Warsh can probably make a stronger case to the rest of the Fed committee to keep interest rates where they are. So it should be an interesting day, and I'm really curious to see how the market reacts. The Fed meeting wraps up at 2 p.m. Eastern at the Kevin Warsh press conference at 2.30. Now, I'm actually going to be on a plane headed to LA for a family vacation during the press conference. So hopefully they have good wifi on this flight. And also just another reminder, today is the last episode of The Rundown for this week. We're not going to have a show tomorrow and Friday, and also no deep dive this weekend either. You know, the stock market is actually going to be closed on Friday for Juneteenth. So we decided to take an extended break for the first time. In fact, Thursday will be the first time in The Rundown's history that we skip a show on a day the stock market is open. But we'll be back to our normal daily schedule on Monday with a full recap of everything that came out of the Fed meeting. So if you're new here, definitely get subscribed to the podcast, and we'll see you guys back here on Monday.
Let's run through some headlines, starting with OpenAI. We finally got a peek under the hood at OpenAI's financials, and the numbers are pretty interesting and kind of concerning. Information was able to obtain internal Q1 financial documents. And according to the report, OpenAI's revenues and losses are both surging. Let's start with the top line first. OpenAI brought in $5.7 billion in revenue in the first quarter of 2026 That's triple from the same period last year. But here was the problem. OpenAI burned through $3.7 billion in cash and had an operating loss of $9.3 billion. The company spent $8.6 billion in R&D and more than $2.3 billion in stock-based compensation for its employees. But you know what really stood out to me was that OpenAI's gross margins were only 39%.