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With gas prices spiking, going to office is now a pay cut

2026-05-11 · 15:51 UTC ·Alex Wilhelm from Cautious Optimism ·5 min read

Brief

Rising gasoline prices — roughly a 60% increase in the U.S. since earlier this year — are making return-to-office mandates feel like pay cuts for many commuters: the average American travels about 26 miles to and from work, amplifying cost and time burdens. Governments from India to Indonesia, Myanmar, Malaysia, Sri Lanka and Vietnam are implementing measures to reduce commuting and gasoline demand. On the cybersecurity front, Anthropic’s Mythos is effectively constrained by U.S. policy, while OpenAI’s GPT-5.4‑Cyber and GPT-5.5‑Cyber (reported as strong) are being discussed with EU officials for access; several European AI labs (Mistral, H Company, LeCun’s team, Black Forest Labs, SAP) are racing to produce cyber-capable models. In markets, CoreWeave beat revenue expectations in Q1 2026 with $2.08B but reported a wider loss of $1.12/sh, guided Q2 to $2.45–$2.60B (below consensus), showed operating margin deterioration (‑7% vs. ‑3% YoY), and signaled heavy debt service (~25% of revenue) even as it scales power to 3.5GW under contract.

Why it matters

U.S. gasoline prices are up about 60% versus earlier this year; with the average American commuting about 26 miles to and from work, the return-to-office movement is effectively a pay cut for many workers.

Key details

  • Multiple governments are mandating or encouraging reduced commuting to blunt fuel demand: India has urged citizens to cut gasoline use, Indonesia moved government staff to work-from-home on Fridays, Myanmar set Wednesdays at home for government staff, and Malaysia, Sri Lanka and Vietnam have also imposed restrictions.
  • On cybersecurity AI, Anthropic’s Mythos model faces U.S. White House restrictions from broad distribution, while OpenAI has released GPT-5.4‑Cyber and GPT-5.5‑Cyber (reported as strong) and is in talks with the EU to provide access; European labs (Mistral, H Company, Yann LeCun’s group, Black Forest Labs, SAP) are racing to build competing cyber-capable models.
  • CoreWeave Q1 2026: revenue $2.08B (vs. $1.97B expected), GAAP loss $1.12/share (vs. $0.90 expected), operating margin -7% (vs. -3% a year ago); active power passed 1GW in Q1 and 3.5GW active/under contract; Q2 revenue guidance $2.45–$2.60B (midpoint $2.53B) below analysts’ $2.69B; debt servicing costs are ~25% of revenue; company targets $12–$13B 2026 revenue and an $18–$19B run‑rate by year-end.
Cleaned source text

And look, a hot IPO! ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­

With gas prices spiking, going to office is now a pay cut

And look, a hot IPO! May 11, 2026 · Alex Wilhelm

Welcome toCautious Optimism, a newsletter on tech, business, and power. Modestly upbeat_. Monday. Well, the Strait isn’t opening anytime soon, but hantavirus has come home. Meanwhile, oil prices are rising, European fintech stalwart Wise is transferring its primary listing to the United States, and AI investment is saving American GDP (which we need). But you and I? Today, we’re diving into pay cuts, fair play in the cybersecurity market, Cerebras’ new (higher) IPO price, and more. To work!— Alex

📈 Trending Up

Whoops… Granola (shoutout Jordan) … taking them to court … calls for Starmer to bounce … Hantavirus in Europe … Taiwanese defense … pivoting to video … Xi v. Trump

Pay cuts: With gasoline prices up 60% compared to earlier this year in the United States, the return-to-office movement is rapidly looking like a pay cut. The average American commutes about 26 miles to and from work, and given signs of low-end-consumer distress, the added pressure is no doubt unwelcome. And, it’s only compounding the expense of stress and time due to long commutes even for high-paying technology jobs. But will companies hit pause on RTO? Of course not. Tech companies want fewer workers, and I doubt that attrition is very high at present given how off-vibes the labor market is.

Meanwhile, around the world, countries are trying to cut back on commuting as the global flow of oil and refined products constricts: India wants citizens to pull back on gasoline usage, and Indonesia’s government staff is working from home on Fridays. In Myanmar, it’s Wednesdays at home for government staff, while in Malaysia, the restriction is even stricter. Where else? Sri Lanka, Vietnam, you get the idea.

Cybersecurity in the EU: While Anthropic’s upcoming Mythos model proves its bona fides as a hallmark of advancements in finding, exploiting, and patching cybersecurity bugs, the EU remains stuck. The White House seems bent on keeping the Mythos model from even U.S. companies, let alone our allies across the pond. So, Europe is sitting on its hands.

Enter OpenAI, which is not similarly restricted. The ChatGPT maker is apparently in conversations with the EU over “access to its new cyber model,” CNBC reports. The AI lab last month GPT-5.4-Cyber, and GPT-5.5-Cyber last week (both are said to be very good).

Yes, it’s good to see Europe working to get out of the dark, but it’s also not _great_ to see such a large chunk of the Western digital world lagging in the race to fix fleets of undiscovered bugs.

This would be a great time for Mistral to drop a competing model with cybersecurity chops. Several European AI labs are vying to build what’s next (Mistral, H Company and Yann LeCun’s latest in France, and Black Forest Labs and SAP in Germany), but it’s not merely coding models that matter.

Who am I missing? Hit reply and let me know.

Fun question: How long until the difference between a coding model and a cybersecurity model collapses to zero?

📉 Trending Down

The open in open-source mobile … aligned incentives … marriages in China … fertilizer availability … more red than green … inflation in China … AI in news … Indian GDP growth

CoreWeave, everyone’s favorite bellwether for the neocloud segment, got hammered on Friday, losing 11.4% of its market cap. Its sin was that it crushed growth expectations by reporting revenue of $2.08 billion in Q1 2026, ahead of the anticipated $1.97 billion.

I’m kidding. CoreWeave’s shares were thrown out because it reported a wider loss than expected ($1.12 per share vs. expectations of $0.90 per share), and because it only expects revenue to increase by $450 million, or about 22% from Q1. I’m serious: CoreWeave expects Q2 revenue to land between $2.45 billion and $2.60 billion, and the mid-point of that range, $2.53 billion, failed to meet analysts’ expectations for $2.69 billion.

With slower-than-expected revenue growth, widening losses (operating margin was -7% in Q1 2026 compared to -3% a year ago), and passing 1GW of active power in Q1 with a total of 3.5GW active or under contract, CoreWeave is the best and worst of the AI era. It is rising like a helium balloon, but its debt servicing costs are around a quarter of its revenue, which makes for a difficult situation when your operating margins are in the red.

CoreWeave expects revenue of $12 to $13 billion this year, and aims to end 2026 with run-rate revenue of $18 to $19 billion. That would put its Q4 revenue at about $4.5 billion to $4.75 billion? That’d be excellent, as long as its debt servicing costs fall sharply as a portion of gross profit.

Cerebras’ IPO is gonna be a gusher

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