OpenAI’s $38B Cloud Bet, Musk’s $1T Pushback, and Starbucks’ $4B China Makeover

4th November 2025

OpenAI is going big, closing  a $38 billion cloud deal with Amazon to supercharge its next wave of AI models and computing ambitions. Elon Musk faces a rare “no” from Norway’s $2.1 trillion wealth fund as investors revolt against his record-shattering $1 trillion Tesla pay plan. Starbucks brews a bold comeback in China, offloading majority control of its $4 billion business to local giant Boyu Capital in a move to reclaim its caffeine crown. Down under, Australia launches a game-changing solar policy promising households up to three hours of free energy daily. All this and more in today’s Read It And Eat!

Major Headlines

• Starbucks to sell control of China business to Boyu, aims for rapid growth

Starbucks (SBUX.O), said it would sell control of its operations in China to Boyu Capital in a deal that values the business at $4 billion, one of the largest divestments of a China unit by a global consumer company in recent years. The Seattle-based coffee chain said the funds from investment firm Boyu will help it jump-start growth in the world's second-largest economy, where local rivals like Luckin and Cotti now offer lattes for 9.9 yuan ($1.4) - less than a third of Starbucks' prices.

"We aim to bring the Starbucks experience to more customers, in more cities across China. We see a path to grow from today's 8,000 Starbucks coffeehouses to more than 20,000 over time," Starbucks CEO Brian Niccol said in a statement. Under the deal, Boyu whose founders include the grandson of former Chinese President Jiang Zemin  will hold up to 60% of a new joint venture. Starbucks will hold 40% and will continue to license the brand and intellectual property to the venture.

The U.S. firm said the value of the retail business in mainland China - including proceeds from the sale, the value of its retained stake and likely licensing income over at least the next 10 years - will total more than $13 billion. Its shares climbed 3% in after-hours trading. Starbucks has been credited with creating the market for coffee in China after entering in 1999. But its market share there has tumbled to 14% last year from 34% in 2019, according to data from Euromonitor International. Reuters

• Norway wealth fund to vote no on Musk $1 trillion Tesla pay package

  
  

Norway's sovereign wealth fund, the world's largest, said on Tuesday it would vote against ratifying Tesla (TSLA.O), CEO Elon Musk's proposed compensation package, containing shares worth up to $1 trillion, at an annual general meeting this week. Investors in the electric-vehicle maker will decide on November 6 whether to approve the package, likely the largest-ever CEO compensation agreement, which critics have called excessive.

So far, the Norwegian wealth fund is the largest outside Tesla investor to say how it plans to vote. The next-largest to do so, Baron Capital, on Monday said it would back Musk's pay package. The company's largest institutional investors, including BlackRock, Vanguard and State Street, have yet to disclose their voting plans. Tesla's board is pushing for shareholders to approve the plan, with Chair Robyn Denholm warning last week that Musk could leave the company if the deal is rejected.

While the package could grant stock worth up to $1 trillion over 10 years, the cost of those shares at the time of the award will be deducted, making the value to Musk slightly lower, at up to $878 billion, according to a Reuters analysis. "While we appreciate the significant value created under Mr. Musk's visionary role, we are concerned about the total size of the award, dilution, and lack of mitigation of key person risk - consistent with our views on executive compensation," Norges Bank Investment Management said on its website.

The fund, Tesla's seventh-biggest owner with a 1.12% stake worth $17 billion, also voted "no" to Musk's previous compensation plan, drawing a sharp response from the CEO, who turned down an invitation to a conference in Oslo. Various groups have tried and failed to block record payouts to Musk, including a $56 billion compensation plan for 2018 that investors reapproved last year, though legal challenges remain.

NBIM on Tuesday also said it would vote against two out of three Tesla directors who are up for reelection, declining to back board veterans Kathleen Wilson-Thompson and Ira Ehrenpreis while supporting Joe Gebbia, who joined in 2022.The $2.1 trillion Norwegian fund also said it would vote against Tesla's proposed general stock compensation plan, which is intended for all employees and can also be used by the board to benefit Musk.  Reuters

• Australia to offer three hours free solar per day to millions

Australia will offer at least three hours of free solar power every day to households including those without solar panels under an energy-saving programme that is expected to go live in 2026, energy minister Chris Bowen said on Tuesday.

The Solar Sharer programme will begin in the states of New South Wales and South Australia as well as southeast Queensland before it is expanded elsewhere. Users will get the free solar power when generation capacity is highest in the middle of the day. "People who are able to move electricity use into the zero-cost power period will benefit directly, whether they have solar panels or not and whether they own or rent, and the more people take up the offer and move their use, the greater the system benefits that lower costs for all electricity users will be," Bowen said.

The share prices of two of Australia’s largest electricity suppliers AGL (AGL.AX), and Origin Energy (ORG.AX), fell 3% by late afternoon. About four million households in Australia have rooftop solar panels on their homes and peak time sunny afternoons can supply so much power that electricity prices swing into the negative, while peak demand is often several hours later, putting strain on the grid. Households, including apartment dwellers, will be able to access the programme even without their own solar panels.

In 2022, Bowen set a target of 82% renewable electricity by 2030 in addition to the legislated target of a 43% reduction in emissions over the levels in 2005. Customers who choose the deal must have a smart meter and will only benefit if they shift their peak usage to the middle of day and run appliances and charge vehicles then. Reuters

• OpenAI turns to Amazon in $38 billion cloud services deal after restructuring 

OpenAI has signed a seven-year, $38 billion deal to buy cloud services from Amazon.com (AMZN.O), in its first big push to power its AI ambitions after a restructuring last week that gave the ChatGPT maker greater operational and financial freedom. The agreement, announced on Monday, will give OpenAI access to hundreds of thousands of Nvidia graphics processors to train and run its artificial intelligence models.

The deal underscores the AI industry's insatiable appetite for computing power as companies race to build systems that can rival or surpass human intelligence. OpenAI CEO Sam Altman has said the startup is committed to spending $1.4 trillion to develop 30 gigawatts of computing resources - enough to roughly power 25 million U.S. homes.

The deal is also a major vote of confidence for the e-commerce giant's cloud unit, Amazon Web Services, which some investors feared had fallen behind rivals Microsoft and Google in the artificial intelligence race. Those fears were somewhat eased by the strong growth the business reported in the September quarter. Amazon shares hit an all-time high on Monday, with the company set to add nearly $140 billion to its market value. The stock was last up 5%, following a near-10% jump on Friday. Microsoft shares had briefly dipped on the news.

"This is a hugely significant deal (and is) clearly a strong endorsement of AWS compute capabilities to deliver the scale needed to support OpenAI," said PP Foresight analyst Paolo Pescatore. "Scaling frontier AI requires massive, reliable compute," said Altman. "Our partnership with AWS strengthens the broad compute ecosystem that will power this next era and bring advanced AI to everyone." OpenAI will begin using Amazon Web Services immediately, with all planned capacity set to come online by the end of 2026 and room to expand further in 2027 and beyond. Reuters

Minor Headlines 

• Huggies and Kleenex manufacturer Kimberly-Clark to acquire Tylenol maker Kenvue in more than $40B cash-and-stock deal Dallas Innovate

• Disney asks YouTube TV to restore ABC broadcast for Election Day. Yahoo.Finance

• Microsoft to invest over $15 billion in UAE, secures US export licenses for Nvidia chips Reuters

• New Yorkers Go to the Polls to Elect Their Next Mayor New York Times 

• Primark could be split from AB Foods' other operations, company says Reuters

• Palantir forecasts fourth-quarter revenue above estimates on solid AI demand Reuters

• NAACP sues Virginia officials, accusing them of disenfranchising student voters Reuters

• Fearing fraud, Canada rejects most Indian study permit applicants  Reuters