CNBC's Hugh Son joins 'Squawk on the Street' with details about how banks are piloting new AI tools.

Goldman Sachs is piloting an autonomous coding program developed by the startup Cognition, which has gained attention for its AI software developer, Devin. This tool is designed to handle entire coding projects, from planning and execution to testing and debugging, with minimal human intervention. The initiative is part of a wider experiment in the banking sector to explore how AI can improve productivity.

While the technology promises significant efficiency gains, questions remain about its impact on jobs. Although human oversight is still required, there is industry-wide speculation that such advancements could eventually lead to a reduction in software engineering roles. Executives across the tech sector are closely monitoring these developments, particularly as companies report on workforce changes.

Goldman Sachs' big AI move

Also this morning, CNBC reporting that Goldman Sachs is piloting an autonomous coder. This is potentially a major step in AI's evolution, at least for Wall Street. Yu Sun broke that story. He joins us now to discuss it. So tell us what this is, first of all, Hugh, and how it's going to be used at the bank. Hey, David. Yeah. So, I mean, I think the headline here is we're in the middle of this grand experiment in productivity with AI, and the honest truth is nobody knows how far they can take it. So the leap forward that Goldman is in the middle of is that instead of just using sort of a corporate chat GPT, which everybody started having starting last year, they're going to be using a program from a startup called Cognition. And Cognition really came onto the scene just a year ago or so with an autonomous software developer called Devin, they named Devin. And it was a pioneer in this idea that instead of just helping software engineers do their jobs faster by completing code and helping them debug things, that it could just actually just take the entire job and do it. So that, you know, Devin would, if you give it the certain prompts, you know, in a Slack channel, it will be able to create a plan, execute that plan, execute the code, test the code, debug it, and then hand it back to you and say, here's the project that you asked for, sir. And so that's really blown some people's minds. It's shot up to a $4 billion valuation in about 18 months there, David. Yeah, well, I mean, the question slash concern, of course, in so many different areas, including banking and trading at a firm like Goldman Sachs is, is it and will it replace people? Is that the sense that this is something that will create efficiencies ultimately that will result in fewer jobs being needed or even jobs being replaced? Well, you know, there always have to be humans in the loop, at least at the intermediary stage, I think. But, you know, for me, the question is, if you have 12,000 software engineers and you give them, you know, 36,000 agentic AI programs, and they're three times as productive, do you need three? Do you need these? Do you need those 12,000 people? Or can you do with, you know, a third of them? And I think, you know, in the beginning, at least the talk is, well, they're going to be more productive. They're going to be able to handle more. I mean, ultimately, I think on an industry-wide level, they're going to, there's going to be a contraction in jobs. And you already have people like, you know, Jassy and Salesforce Mark Benioff talking about this. Yeah, we're going to be clearly paying attention to headcount and comp per employee when we start getting those results next week. Hugh, great scoop. Hugh Son, watching Goldman and AI.

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