Plus: An exclusive from Fortune on a conflict of interest by a Trump Cabinet appointee.
Fortune 500 Digest with Alyson Shontell
Saturday, June 14, 2025
Foreword
Alyson Shontell
Editor-in-Chief

Fortune senior writer Lila MacLellan here, filling in for Alyson and eager to share some thoughts from our second Fortune COO Summit, which was held in a steamy (106 degrees!) Scottsdale, Ariz., this week.

The swift rise of game-changing artificial intelligence was the defining theme of this year’s conference, but it shared the spotlight with another pressing concern for second-in-command executives: corporate culture. Both on stage and in private conversations, leaders from Fortune 500 C-suites expressed excitement about where AI is taking businesses, along with some healthy trepidation about managing that change.

Some examples of AI that upped the crowd’s adrenaline levels: Attendees heard from Chipotle (No. 372) CEO Scott Boatwright, the fast food company’s COO until last August, who said that AI will allow the company to open a new location every 24 hours this year. Diane Brady, executive editorial director of Fortune Live Media, interviewed her chatty digital twin. And, in one morning session, Babak Hodjat, CTO of AI at Cognizant (No. 217), demonstrated how companies can use networks of AI agents to create nimble workflows, turning a process that formerly took days into a hours-long task. (At last year’s summit, the AI agent concept was still fuzzy to most people, Hodjat noted. This year, we watched transfixed as AI agents chatted with each other in real time to solve a hypothetical problem at the dating app company Hinge.)

During the summit’s penultimate conversation, Jason Gowans, Levi’s chief digital and technology officer, explained how the denim retailer just this week began piloting an AI sales app that teaches in-store employees about denim fits and “why they should care about selvedge,” while Mason Smoot, chief restaurant officer at McDonald’s (No. 165), described an AI hiring tool, McHire, and some forthcoming AI that will make customizing your McDonald’s order easier.

Just keep in mind, some bells and whistles are fine, said Fortune correspondent Phil Wahba, who was moderating that panel, but consumers simply want their orders to work. “You don’t have to make it the Star Wars of retail,” he said.

So it went throughout the conference: The razzle-dazzle of new technology was tempered with words of caution about implementing AI without alienating staff or customers. As more than one COO explained to me, CEOs may be out there talking up generative AI with the board and investors, but it will be COOs overseeing AI’s successful adoption on a granular level.

There were no obvious answers to any of the questions that arose. COOs seemed to agree that there was no universal playbook for the shift we’re seeing. But Gowans and Smoot also shared anecdotes about company-created apps that needed to be redesigned when they discovered the tech wasn’t well aligned with the needs and pain points of employees and consumers. The lesson: As AI remakes businesses, COOs will have to flex their operational expertise: “We’ve had to go back,” said Smoot, “make some improvements, and continually look at it.” —Lila MacLellan

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Fortune 500 C-suite Power Moves
ABM Industries (No. 458) promoted David Orr, who has been with the company for 24 years, to CFO. Paramount Global (No. 147) appointed Andrew Warren as EVP and interim CFO, effective June 27. Avis Budget Group (No. 360) appointed Daniel Cunha as CFO, effective July 1.
And more in this week's Fortune 500 Power Moves.
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Deals & Developments
  • Warner Bros. Discovery (No. 114) announced that it will split into two publicly traded companies by mid-2026. CEO David Zaslav will continue to run one of the companies, which will include HBO Max and the company’s movie properties. CFO Gunnar Wiedenfels will lead the other company, which will include the company’s cable channel businesses.
  • Qualcomm (No. 117) agreed to acquire Alphawave Semi for $2.4 billion. The purchase of Alphawave, which designs semiconductor technology for data centers, will allow the wireless communications tech and chipmaking giant to move further into the AI data center market.
  • KKR (No. 145), as part of a consortium of investors, announced it will acquire Assura, a U.K.-based investor in health care properties, for £1.7 billion ($2.29 billion), according to the Wall Street Journal. The acquisition will add to the existing health care and health care infrastructure companies in KKR’s portfolio.
  • Baker Hughes (No. 155) will sell its Precision Sensors & Instrumentation product line to Crane for approximately $1.15 billion. According to Baker Hughes, the sale allows the company to “reallocate capital toward higher-return opportunities using a strategic and disciplined approach to capital deployment.”
  • Regeneron Pharmaceuticals (No. 306) has reportedly withdrawn from the bidding to acquire 23andMe out of bankruptcy after TTAM Research Institute, a nonprofit controlled by 23andMe cofounder and former CEO Anne Wojcicki, submitted a bid of $305 million, according to the Wall Street Journal. Last month, Regeneron had submitted a winning $256 million offer before TTAM responded with this new bid.
Overheard
“That’s all they did—around the same block over and over and over, all day long.”
—Austin resident Christian Pfister, who told Fortune he’s seen Tesla Model Ys circling his neighborhood recently ahead of the June 22 launch of Tesla’s self-driving taxi service in the city
In interviews with Fortune 500 CEOs:
  • Mark Read, CEO of advertising giant WPP (No. 216 on the Fortune 500 Europe), said in an interview with Fortune, “The foundational models like Google Gemini and OpenAI are so powerful, the trick is to build a proprietary application on top of them, one that you can use to make your business better.”
On earnings calls:
  • Oracle (No. 87) beat earnings expectations with $15.9 billion in Q4 revenue, up 11% year-over-year. That puts fiscal 2025 revenue at $57.4 billion, and CEO Safra Catz noted in the earnings presentation that the company expects “FY26 will be even better as our revenue growth rates will be dramatically higher.”
  • United Natural Foods (No. 138) saw 7.5% year-over-year sales growth in Q3, led by the company’s wholesale natural products business. CFO Giorgio Matteo Tarditi