Good morning. It's Thursday, May 7, and we're covering China’s exploding AI entertainment industry, ASML’s warning that rivals remain years behind, and more.

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xAI Hands Compute to a Rival
Despite Elon Musk publicly trashing Anthropic for months, SpaceXAI signed a deal Wednesday giving Anthropic access to Colossus 1 — its Memphis supercomputer with over 220,000 NVIDIA GPUs and more than 300 megawatts of capacity. Anthropic will route the compute toward Claude Pro and Claude Max subscribers to ease the capacity strain that's been crimping reliability, and also expressed interest in co-developing multiple gigawatts of space-based AI compute with SpaceX.

Claude Agents Get a Memory and a Manager
Instead of leaving agents to repeat the same mistakes, Anthropic shipped three new features for Claude Managed Agents: dreaming (a research preview that reviews past sessions to extract patterns and curate memory), outcomes (rubric-based self-grading evaluated by a separate grader), and multiagent orchestration (a lead agent that delegates to specialists working in parallel on a shared filesystem). Internal benchmarks credit outcomes with up to 10-point task-success gains — including 8.4% on docx generation and 10.1% on pptx — while early users like Harvey saw roughly 6x completion-rate improvements with dreaming on legal workflows.

NVIDIA Turns Homes into AI Nodes
NVIDIA is partnering with homebuilder PulteGroup and startup Span to place compact AI data centers inside newly built houses, using spare household electrical capacity for inference workloads. Each wall-mounted system reportedly includes 16 NVIDIA Blackwell GPUs, four AMD EPYC CPUs, and 3TB of RAM, blurring the line between residential infrastructure and distributed computing. The project reflects growing pressure on traditional data centers as AI demand strains power grids and construction timelines.

Musk's Terafab Targets $119B Chip Bet
Rather than wait on TSMC and Samsung capacity, SpaceX filed paperwork in Grimes County, Texas for an initial $55B semiconductor fab — potentially scaling to $119B over multiple phases — built with Tesla resources and Intel as manufacturing partner, though Musk noted Texas is one of several sites still under consideration. Branded "Terafab," the project is sized for his stated goal of producing enough chips for 1 Terawatt of compute annually, supplying xAI servers, satellites, autonomous Tesla vehicles, robots, and orbital data centers.

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Matt explores Anthropic vs. OpenAI’s opposing AI philosophies, from sentient AI fears and safety to regulation, jobs, and AGI.

Chinese entertainment companies are rapidly adopting artificial intelligence to produce microdramas — short, mobile-first soap operas — at dramatically lower costs, with some studios creating episodes for as little as $30 per minute without actors, cameras, or film crews. In March 2026 alone, nearly 50,000 AI-generated microdramas were uploaded to Douyin, according to Chinese consulting firm DataEye, almost matching the platform’s 2025 total uploads.

The boom has been fueled by increasingly advanced Chinese AI video models, including ByteDance’s Seedance 2.0, but it is also disrupting jobs across the entertainment industry. Actors report dwindling roles, directors are laying off production staff, and legal disputes over unauthorized use of people’s likenesses are mounting, prompting Chinese regulators to introduce new consent rules for digital avatars. → Read the full article here. (Paywall)

ASML CEO Christophe Fouquet said competitors remain far behind the Dutch chip equipment giant despite growing efforts to challenge its dominance in extreme ultraviolet (EUV) lithography, the technology used to manufacture the world’s most advanced semiconductors. In an interview published May 5, 2026, Fouquet argued that building a viable EUV system requires decades of accumulated expertise, noting that ASML itself spent 20 years solving a single technical hurdle after developing its first EUV image 30 years ago.

The company’s machines — which can cost more than $400 million each — have become central to the global AI boom, as hyperscalers including Microsoft, Meta, Amazon, and Google pour more than $600 billion into AI infrastructure this year. Fouquet also defended export controls that limit China’s access to advanced systems while warning that completely cutting off sales could accelerate foreign competition. → Read the full article here.

Researchers at EPFL have developed an AI framework called Synthegy that allows chemists to design molecules and plan chemical reactions using natural-language instructions instead of complex software rules. The system combines large language models with traditional chemical search algorithms, enabling scientists to describe goals such as avoiding unnecessary reaction steps or prioritizing certain molecular structures.

Synthegy then evaluates possible synthesis pathways, scores them against the chemist’s instructions, and explains its reasoning. In a double-blind study involving 36 chemists and 368 evaluations, the system’s rankings aligned with human assessments about 71% of the time. The researchers say the approach could accelerate drug discovery and make advanced chemistry tools more accessible by turning AI into a collaborative reasoning assistant rather than a replacement for human expertise. → Read the full article here.

DeepSeek Eyes $45B Valuation: The Chinese AI lab is reportedly raising its first venture round, fueled by rapid advances in open-weight models and China-backed efforts to build alternatives to U.S. AI infrastructure.

Hugging Face Launches Robot App Store: The company unveiled an open-source Reachy Mini App Store with 200+ community-built apps, letting non-coders create and customize desktop robot behaviors.

Marc Lore Wants AI-Built Restaurants: Wonder’s new AI system can generate restaurant brands, menus, pricing, and recipes in under a minute, turning its robotic kitchen network into a platform for creators and food startups.

Mira Murati Says Altman Misled Staff: OpenAI’s former CTO testified that Sam Altman falsely claimed the legal team determined a GPT model did not need safety review approval

Greg Brockman Details Musk’s OpenAI Exit: OpenAI’s president testified that Elon Musk demanded full control of the company in 2017, then abruptly withdrew support after co-founders rejected his vision for the company.

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Thanks for reading. See you next time!

— Matthew Berman, Nick Wentz & the Forward Future Team