Apple Taps Google’s Gemini for AI, Paramount Takes Warner Bros to Court, Trump’s Rate Cap Shakes Banks, and UBS Prepares for Life After Ermotti

13th January 2025

Apple is leaning on Google’s Gemini to power the next phase of its AI ambitions, marking a rare deep partnership between two longtime rivals as Siri tries to catch up in the generative AI race. In Hollywood, Paramount is escalating its fight for Warner Bros, suing for deeper disclosure on Netflix’s rival deal and signaling a proxy battle that could reshape the media landscape. Markets, meanwhile, are rattled after Donald Trump floated a 10% cap on credit card interest rates, sending bank stocks sliding on fears of a hit to consumer lending profits. And in Europe, UBS is preparing for a leadership transition, with CEO Sergio Ermotti set to step down in 2027 after steering the historic Credit Suisse integration. All this and more in today’s Read It And Eat!

Major Headlines 

• Google’s Gemini to power Apple’s AI features like Siri

It’s official. Apple has chosen to work with Google, a longtime partner, to power AI features like Siri. “After careful evaluation, we determined that Google’s technology provides the most capable foundation for Apple Foundation Models and we’re excited about the innovative new experiences it will unlock for our users,” Apple and Google said in a statement.

The multi-year partnership will involve Apple using Google’s Gemini models and cloud technology for future Apple foundational models. The deal is not exclusive, per a source familiar with the matter. Apple has historically focused on vertical integration, relying on its own hardware and software.The iPhone-maker has faced a fair amount of public chatter criticizing it after its AI efforts, particularly its assistant Siri, lagged behind competitors. That’s not to say Apple hasn’t been quietly building powerful foundational models. The company released the first versions of Apple Intelligence in 2024, which adds AI to existing OS functions like searching for photos and summarizing notifications. Apple has also focused on privacy with its AI rollout, with much of the processing happening on-device or through tightly controlled infrastructure. Apple says it will maintain those privacy standards throughout its partnership with Google. 

Apple’s partnership with Google also comes as the search and adtech giant is in the midst of multiple antitrust lawsuits, including one that put its relationship with Apple front and center. In August 2024, a federal judge ruled that Google acted illegallyto maintain a monopoly in online search by paying companies like Apple to present its search engine as the default on its devices and web browsers. Between 2021 and 2022, Google paid Apple about $38 billion to secure default search placements.  In December 2025, Judge Amit Mehta issued his final remedies on the case, which include banning Google from entering into exclusive, default agreements like the one it had with Apple “unless the agreement terminates no more than one year after the date it is entered.” Google has not only surpassed Apple in market cap but is now worth 4tn.  TechCrunch

• Paramount sues Warner Bros for Netflix deal details, plans proxy fight

Paramount Skydance (PSKY.O), on Monday sued Warner Bros ​Discovery (WBD.O), for more information on a rival $82.7 billion deal with Netflix (NFLX.O), escalating a battle to take control of one of the ‌most storied Hollywood studios. The David Ellison-led company also said it planned to nominate directors to Warner Bros' board, in one of its most aggressive steps to convince investors that its $108.7 billion all-cash bid is superior to Netflix's cash-and-stock deal.

Paramount and Netflix have been in a heated battle for Warner Bros, its prized film and television studios and its extensive content library, which includes "Harry Potter" and the DC Comics universe. Warner Bros last week rejected Paramount's latest offer, advising shareholders to vote in favor of the ‌Netflix deal. In a letter to shareholders, Paramount also said it would propose an amendment to Warner Bros' bylaws that would ​require shareholder approval for any separation of the media giant's cable TV business, which is key to the Netflix deal. Paramount's argument is that its all-cash bid of $30 per share for the whole of Warner Bros is superior to Netflix's cash-and-stock offer of $27.75 per share for the studios and streaming assets and ‍will more easily clear regulatory hurdles. 

Paramount filed the lawsuit in the Delaware Court of Chancery, seeking to force disclosure of the financial analysis behind the Warner Bros board's support for the Netflix merger. The CBS parent said last week the value of Warner Bros' cable spinoff was virtually worthless and reiterated its amended after another rejection from Warner ⁠Bros' board. With Monday's lawsuit, Paramount has escalated its actions, but it has not yet increased the price it is willing to pay. "I don’t think ‍the lawsuit matters much. It would take ages to get through the court system if they full-on go that route," Craig Huber, analyst at Huber Research Partners, said. "If they ‌want Warner ‌Bros bad enough, raise the bid. Money talks." Reuters

• Financial stocks fall as Trump's credit card rate cap plan rattles investors

U.S. financial stocks and UK-listed lenders fell on Monday as President Donald Trump's call for a one-year cap on credit card interest rates ​threatened a key revenue stream for the industry. The move deepened concerns over the sector as investors grapple ‌with interest-rate uncertainty and will likely dull the potential benefit from a shift toward value stocks.

Trump on Friday called for a 10% cap on the interest rate on credit cards starting January 20 without providing details on how he planned to make the companies comply.Shares of JPMorgan Chase (JPM.N), and Bank of America (BAC.N), the top two U.S. lenders, dropped 2.5% and 1.6%, respectively, in early trading. Citigroup (C.N), ‌fell 3.7% while Wells Fargo (WFC.N), declined 1.5%. Wall Street analysts, however, expressed skepticism about the cap going ​into effect, noting that such a measure could only be enacted by Congress with passage unlikely."It would take an Act of Congress for such rate caps to be in place, given the overwhelming legal challenges an executive order would likely ‍face," analysts at UBS Global wrote in a note.

British bank Barclays' (BARC.L), shares touched their lowest in nearly a month and were last down 2.2%. Shares of U.S. consumer finance firms such as Synchrony Financial (SYF.N), Bread Financial (BFH.N), and Capital One (COF.N), fell between 8% and 11%. American Express (AXP.N), tumbled 3.8%, ⁠while payment processors Visa (V.N), and Mastercard (MA.N), slipped 1.8% each. However, analysts said the move could backfire, as lenders would be forced to slash limits or close accounts of borrowers with a lower credit score. Reuters

• UBS CEO Ermotti to step down in April 2027 after steering Credit Suisse integration

UBS Group's (UBSG.S), veteran CEO Sergio Ermotti, who helped the lender navigate the takeover and integration of former rival Credit Suisse, is planning to step down in April 2027, the Financial Times reported on Tuesday. Ermotti headed UBS from 2011 to 2020 and was rehired as CEO in 2023 to steer its massive takeover of Credit Suisse to take advantage of the Swiss banker's experience of rebuilding the bank after the global financial crisis.

In 2024, he pledged to lead UBS "at the very least" until the Credit Suisse integration was finished at the end of 2026 or early 2027. UBS currently aims to "substantially" finish the integration by end-2026. The lender's shares have surged nearly 30% in the past year, and have more than doubled in value since the eve of its purchase of the collapsed Credit Suisse. Aleksandar Ivanovic, UBS' asset management chief, has emerged as one of the executives most likely to succeed Ermotti, the Financial Times reported, citing sources.

Other UBS figures said by insiders to be in contention for the CEO job include the bank's Americas president Robert Karofsky and Asia Pacific boss Iqbal Khan, Reuters has reported previously. Bea Martin, who was named the bank's chief operating officer in October, has also been floated as a contender. The report comes at a time when UBS is trying to fight the Swiss government's proposals to strengthen banking rules. Ermotti said late last year that UBS aimed to keep operating out of Switzerland, but also said capital proposals by the Swiss government were not acceptable to the bank. Reuters

Minor Headlines 

• Meta plans to cut around 10% of employees in Reality Labs division, NYT reports Yahoo.Finance

  
  

• Apple leads global smartphone market with 20% share in 2025, says Counterpoint Yahoo.Finance

  
  

• Nvidia, Eli Lilly announce $1 billion investment in AI drug discovery lab Yahoo.Finance

  
  

• UK hedge fund trader Chris Rokos pays himself £477mn Financial Times

  
  

• Nvidia hired its first-ever CMO Wall Street Journal 

  
  

• Billionaires ramp up California exits amid threat of wealth tax Bloomberg

  
  

• Gold investors stay bullish after historic 2025 Reuters

  
  

• Donald Trump announces 25% tariff on countries ‘doing business’ with Iran Financial Times