HPE's 1.2B Vultr Deal, Huawei's 3D Chip Gamble, Cisco SD-WAN Zero-Day

Full transcript

Alex: Good morning, and welcome to Daily Tech News. I am Alex.

Jordan: And I am Jordan. Today is the first of October, and the new quarter came out swinging, with enterprise hardware, a fifteen billion dollar data center play in Japan, a brand-new phone chip built to dodge American sanctions, and a nasty zero-day in Cisco's networking gear.

Alex: Let us start with Hewlett Packard Enterprise, because this one is a straight enterprise A I demand signal. HPE just raised its long-term revenue growth forecast for its networking business, and it announced a one point two billion dollar order to build A I server racks for cloud firm Vultr.

Jordan: One point two billion, with a B. That is not a pilot project, that is a fleet.

Alex: Exactly. HPE now expects its networking segment to grow at a high teens compound annual rate through fiscal twenty twenty-nine, more than doubling its old forecast of five to seven percent a year.

Jordan: And this is the unit that got a lot bigger after the Juniper Networks acquisition last year, right?

Alex: Right. HPE also raised its Juniper cost-savings target to eight hundred million dollars in annual run-rate savings by the end of fiscal twenty twenty-eight, up from six hundred million. And Rami Rahim, who runs the networking unit, said A I is reshaping the technology stack and making the network more strategic.

Jordan: The detail that caught my eye is what the racks actually are. AMD Helios A I racks for Vultr's data centers in the United States, equipped with A I chips plus HPE's own networking switches and software. So networking and A I compute are converging into one purchase, and HPE shares jumped nearly six percent in premarket trading.

Alex: Exactly. Now to Japan, where JERA, Japan's biggest power generator, is partnering with Dell Technologies and a United Kingdom based A I infrastructure developer called RHAELM, that is R H A E L M. They signed a memorandum of understanding to build a standardized, repeatable framework for A I infrastructure at national scale, starting with a fifteen billion dollar hyperscale data center in Chiba.

Jordan: Fifteen billion for one project, and the model is meant to be reused. What is the actual build?

Alex: RHAELM develops, constructs, operates, and finances a four hundred megawatt class hyperscale A I data center on land adjacent to JERA's Chiba power station. JERA supplies the four hundred megawatts of power under a fifteen to twenty-five year agreement, and Dell provides standardized, rack-scale A I infrastructure.

Jordan: The framing is what is new. A standardized model built from the outset, to cut lead times and complexity, then applied in other global markets. It is the factory approach to data centers.

Alex: And the timeline tells you how far out A I buildout planning goes. Phased operations begin in twenty twenty-eight, full four hundred megawatts in twenty twenty-nine. They are lining up power, hardware, and financing on a five-year horizon.

Jordan: I will also note they are putting the campus right next to the power plant. After last week's Oracle project Jupiter delay, the industry knows that announcing megawatts is easy and energizing them is the hard part.

Alex: Now the gadget story of the day, and it is a fascinating one. Huawei unveiled its Mate 90 smartphone series today, with Harmony O S seven and a brand-new Kirin ninety fifty Pro chip that uses a technique Huawei calls LogicFolding.

Jordan: LogicFolding is the clever bit. Instead of relying on shrinking transistors, which is what advanced chipmaking normally does, Huawei restructures the chip's internal wiring in three dimensions rather than the conventional flat, two-dimensional layout. That allows denser, faster processing.

Alex: There is a catch though. It requires more wafers to produce, and Richard Yu, who runs Huawei's consumer business, was blunt that advanced semiconductor capacity remains very limited in China, with Huawei's Ascend A I chips competing for that same capacity. China still relies on D U V lithography while E U V machines remain out of reach.

Jordan: So LogicFolding is an engineering workaround for not having the most advanced chipmaking tools. Squeeze more performance out of older processes by stacking the wiring in three dimensions.

Alex: Huawei claims a thirty-one percent performance increase over last November's Mate 80, and says the technique will appear in more future smartphones. If it works, it changes the math on how long a company can stay competitive while locked out of cutting-edge manufacturing.

Jordan: That dovetails with the CXMT memory story we covered last week. The whole Chinese chip industry is doing more with older tools. It is slow, it is expensive, but it keeps working.

Alex: Let us shift to security, because Wednesday brought a new actively exploited zero-day that enterprise network teams need to know about right now. Cisco rolled out urgent patches for a critical authentication bypass in Catalyst S D WAN Manager.

Jordan: And this one is ugly. It is tracked as C V E twenty twenty-six seventy-six thousand five hundred four, with a C V S S score of nine point eight out of ten. The flaw sits in the A P I session-based authentication, and improper handling of URI encoding in an HTTP request lets a remote, unauthenticated attacker bypass authentication and get admin access to the A P I.

Alex: All Catalyst S D WAN Manager deployments are affected, regardless of configuration, and there are no workarounds. CISA has already added it to its Known Exploited Vulnerabilities catalog, urging federal agencies to patch within three days. Cisco managed S D WAN deployments are already patched, so if you run your own, upgrade to the fixed releases now.

Jordan: For listeners keeping score on network device flaws, that is the third big one in a week, after the F5 BIG-IP zero-day and the Citrix NetScaler flaws. The network edge keeps getting hammered.

Alex: Quick hits before we wrap. The Bitget story got bigger. The crypto exchange confirmed that the three hundred eighty-seven point five million dollar theft last week exploited a zero-day in third-party security products. Investigators at SlowMist found the attackers had access as far back as August thirty-first and used a customized tool to bypass withdrawal risk controls across eleven blockchains.

Jordan: So the security products meant to protect the infrastructure were the way in. A supply-chain story now.

Alex: Second, the Dutch Institute for Vulnerability Disclosure, or D I V D, disclosed that its own network breach was caused by two chained zero-days in the open-source Zammad ticketing system. Session hijacking to remote code execution to root, in seconds, carried out by an autonomous A I agent. Users should upgrade to Zammad version seven or take vulnerable instances offline.

Jordan: An A I agent breaching the vulnerability disclosure institute itself. About as on-the-nose as this year gets.

Alex: Third, Apple patched a CoreGraphics zero-day used in targeted attacks, reportedly involving iPhone crypto wallets. And one for the I P O watchers: Accelevation, a data center power and cooling firm, debuted on the Nasdaq below its offer price, valuing it at about three point nine billion dollars. Investors are still picky about A I infrastructure valuations after the Oracle financing scare.

Jordan: Picking the right A I infrastructure bet is apparently the hard part, even when the tailwinds are this strong.

Alex: That is the episode. The A I buildout keeps accelerating, Huawei is engineering around sanctions with three-dimensional chips, and the security front stays relentless.

Jordan: If you are patching Cisco S D WAN today, good luck, and we will see you tomorrow morning.