Stocks remain pressured as the US and Iran’s conflict continued, pushing rates higher and leading to a broader selloff & risk off - $SPY & $QQQ . Notably, gold and crypto were off too, as Bitcoin’s stutter step past 80k has cooled down to 77k. With rates back to where they were pre: Bessent’s debasement idea, Warsh’s “play the ball, not the referee” philosophy just means bond vigilantes are in control. Fed Governor Barr has said he’d support a rate hike at the Fed’s next meeting in two weeks if inflation doesn’t ease.

Housekeeping notes - we will be off Friday and push next Sunday’s piece to Monday night because of the holiday. We hope you’re all able to find some time to unwind over the next several days.

We know things can feel like a sprint post Labor Day, and the big announcement we’re expecting next week is Anthropic zoning in on their IPO timing. Let’s get into it.

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Here’s a look at the remaining earnings for this week.

• Wednesday: Snowflake, Broadcom, Hewlett Packard, NetApp, Five Below, Brown-Forman, Tilly’s

• Thursday: Ciena, lululemon, DocuSign, UiPath, Victorias Secret & Co., Lands’ End, American Outdoor

Here’s a look at economic data this week (estimates are in quotations).

• Wednesday: ADP National Employment Report (45,000), Factory Orders (0.5%), Federal Reserve Beige Book

• Thursday: U.S. Trade Balance (-89.7B), Weekly Jobless Claims (205K), US Services PMI, ISM Report On Business Services PMI (54.4)

• Friday: Employment Report (50K), Unemployment Rate (4.1%), Avg Hourly Earnings, M/M% (0.2%), Avg Hourly Earnings, Y/Y% (3%)

Earnings Corner 💸

• Palo Alto Networks $PANW beat on the top and bottom lines, with revenue of $3.41B vs. $3.35B and EPS of $1.02 vs. $0.98. Results were driven by rising AI-driven cyber threats, helping Next Generation Security ARR jump 63% YoY to $9.1B, while more customers adopted multiple products. Rising cloud hosting and hardware costs pressured gross margin 100 bps YoY. Yet mgmt. guided above expectations, but shares slipped after hours as those higher costs raised concerns around near term profitability.

• Dell Technologies $DELL beat on the top and bottom lines, with revenue of $46.97B vs. $44.92B and EPS of $7.04 vs. $4.92. Results were driven by surging AI infrastructure demand, with AI server revenue reaching $16.4B, quarterly AI orders hitting $60.9B, and backlog climbing to a record $95B, while traditional server and networking revenue rose as customers added more compute capacity for AI workloads. Mgmt. raised guidance well above expectations, driven by stronger AI server demand and higher pricing tied to rising input costs, and now expects $74B of AI server revenue for the year

• MongoDB $MDB beat on the top and bottom lines, with revenue of $771.8M. Results were driven by Atlas revenue up 29% and a record 2,900 customer additions, supported by strong enterprise demand and early AI workloads. Mgmt. raised FY guidance, but shares fell as Atlas growth stoped accelerating and has remained at 29% for a third straight quarter, below the higher expectations priced into the stock after its recent run.

On The Move 📈 📉

• California utilities $PCG and $EIX jumped despite BofA cutting PG&E to Neutral with a PT of $13 (from $24) over unresolved wildfire liability in California’s Senate Bill 492.

• Fervo Energy $FRVO popped on a 396-MW power purchase agreement with Google with an option to scale to nearly 1 GW by 2030. Geothermal peer $ORA also jumped on the news.

• GoPro $GPRO rocketed after announcing a merger with Starman Optical to pivot to AI data center and defense markets. Shareholders get $285M, with YouTuber Markiplier (8.5% stake) as the top individual beneficiary.

• Duolingo $DUOL rose after Evercore ISI upgraded to Outperform with a $210 PT, arguing the ChatGPT threat is overstated. Evercore’s survey found that most ChatGPT language learners also use Duolingo, with 63% using it daily.

• Air Liquide has seen Elliott take an activist stake in the French industrial gas supplier. Elliott has engaged with the company for months and wants the Company to improve its profit margins

• MiniMed Group $MMED surged after US revenue growth accelerated to 13.1% from 1.5% in Q4, driven by the MiniMed Flex and Simplera sensor launch that lifted new pumps 20% and new prescribers 24%.

• Moderna $MRNA climbed after the FDA approved Moderna’s updated 2026-2027 Spikevax and mNEXSPIKE COVID vaccines and the launch of ~$4.6B in convertible notes to fund oncology growth.

IPO Roundup 📍

• Shein $SHEIN had a weak Hong Kong debut Tuesday for its $1.7B IPO, which valued the fast-fashion retailer at $26B, a fraction of its $100B peak. Growth has stalled as US and EU tariffs killed the de minimis loophole and Temu as well as AliExpress stepped up competition.

• Softbank-backed SB Energy filed for an IPO to fund AI infrastructure buildout, with 8.8 gigawatts of data center capacity contracted or under construction in Texas and Ohio and a $430B backlog in its data center segment.

• Entrata filed for a US IPO that could raise ~$500M, listing on the NYSE as $ENT. The Silver Lake-controlled property management software company powers 2.5M units (~10% of the US multifamily market) and posted $536.2M revenue in the 12 months ended March 31.

Today’s Headlines 📖🍿

• Banks are pushing major law firms to lower fees, arguing that AI has sped up routine work enough that costs should fall proportionally. Citi expects a new bidding-based fee model, while Morgan Stanley’s general counsel called the traditional hourly-billing model “extraordinarily unstable.”

• Golub Capital co-CEO David Golub says private credit is having a “Darwinian moment,” a cyclical dip in returns and capital inflows that will separate stronger managers from weaker ones, leading to fewer but larger firms.

• Goldman CEO David Solomon isn’t worried about higher long-term Treasury yields, but says the US needs faster growth or less spending to handle the debt. The 10-year is up 60 basis points this year, and Solomon called the move a reflection of fiscal decisions, debt growth, and economic growth.

• Anthropic has signed a $35B cloud-computing deal with Lambda, a Nvidia backed cloud provider. Hut 8 is developing the Texas data center, and Lambda is in recent discussions to raise as much as $3B at a $12B+ valuation.

• Software companies face a $40B maturity wall in 2028 and are opting for short-term “amend-and-extend” deals rather than full refinancings, paying steep premiums for the flexibility.

• PIMCO says most US corporate borrowers can absorb higher refinancing costs, but CCCs face a coupon shock. Coverage ratios remain healthy (6x IG, 3x HY), but CCCs with 2027-2028 maturities could see coupons double if refinanced at today’s index yields.

• Apollo is structuring its $9Bn equity stake in Oneok into a debt instrument it can sell to investors, slicing the investment into tranches that carry investment-grade ratings.

• Apollo-backed broadband provider Brightspeed warned of “substantial doubt” about its ability to continue after Q2 revenue fell 8.7% to $396MM, and it posted CFO of -$341mm in 1H 2026.

• Stan Kroenke is buying the LA Angels at a record $4B valuation. The deal adds MLB to Kroenke’s sports portfolio, which already includes NFL Rams, NBA Nuggets, NHL Avalanche, MLS Rapids, and Arsenal FC.

• Dragoneer Investment Group raised $1B for its new continuation fund, half its $2B target. The firm fell short despite dangling stakes in OpenAI, SpaceX, and Databricks to attract buyers. The deal priced at 5-20% discounts.

• American Industrial Partners is considering raising $8B for its next buyout fund, up from $5B for Fund VIII in 2023. The step-up reflects PE’s pivot to aerospace, defense, and other heavy assets after this year’s software selloff.

M&A Transactions💭

National Capital Hospital, provider of hospital services and a subsidiary of Healthscope, was acquired for AUD 251M by Ramsay Health Care (ASX: RHC). McGrathNicol advised on the sale.

Spectre (Ikast), manufacturer of clothing products, was acquired for an estimated DKK 1.025 billion by Schouw & Co (CSE: SCHO). ABG Sundal Collier advised on the sale.

Al Rowad Industrial Transformation, a subsidiary of National Industrialization (SAU: 2060), was acquired for SAR 684.0M by Tahweel Holding. Trussbridge advised on the sale.

Iplan Networks, provider of telecommunications services, has reached a definitive agreement to be acquired for $260.0M by Telecentro. J.P. Morgan advised on the sale.

Valco Melton, manufacturer of adhesive dispensing equipment, was acquired for $447.0M by Graco (NYS: GGG). EV/Revenue was 3.08. Harris Williams and William Blair advised on the sale.

Wilson, Sons Ultratug Participações, provider of offshore vessel services, was acquired for $500.0M by Tidewater (NYS: TDW).

Coller Capital, provider of independent investor services, was acquired for $3.7B by EQT (STO: EQT). Morgan Stanley advised on the sale.

Kelvion, manufacturer of heat exchange solutions, has reached a definitive agreement to be acquired for from investors including Apollo Global Management Inc. for $4.1B by SLB (NYS: SLB), deepening its push into data center services.

Merida Biosciences, developer of targeted immunotherapies, has reached a definitive agreement to be acquired for $2.88B by Lilly USA (NYS: LLY).

USI Insurance Services, provider of insurance brokerage and consulting services, has reached a definitive agreement to be acquired for $17.0B by Aon (NYS: AON). Insurance Advisory Partners, Morgan Stanley, and Goldman Sachs advised on the sale.

Atlantic Alumina Company, operator of alumina refining and bauxite mining assets, received $350.0M of financing from United States Department of War and Concord Resources. Goldman Sachs Asset Management advised on the transaction.

Australian Strategic Materials, operator of a multi-line mining business, was acquired for AUD 450M by Energy Fuels (TSE: EFR). MA Financial Group and Moelis & Company advised on the sale.

Cloudwave, manufacturer of precision machined parts, has reached a definitive agreement to be acquired for $234.0M by AXISCADES Technologies (BOM: 532395). EV/Revenue was 21,316.17x.

Private Placement Transactions💭

Polymarket, operator of a prediction market platform, is raising $1.0B of venture funding led by 1789 Capital, which includes Donald Trump Jr. among its partners at a reported valuation of $21.0B.

HiBob, developer of a human resources software platform, raised $166.0M of venture funding led by Salesforce, with participation from Farallon Capital Management, at a valuation of over $3.2B.

PLD Space, aerospace company, raised EUR 288.0M of Series C venture funding led by Mitsubishi Electric. Sego Finance, MCH Private Equity, and other investors also participated in the round.

Boddie & Associates, provider of legal services, raised $160.0M of venture funding from undisclosed investors.

Sharpa, manufacturer of electronic equipment, raised CNY 4.5B of venture funding from Alibaba Group, Meituan, and Tencent Holdings at a pre-money valuation of CYN 17.5B.

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The Week Ahead Of Us 🔍

Welcome back!

We had a shaky Friday after the AI trade weakened following Marvell’s softer than expected outlook, plus as rate hike odds surged. Futures are down slightly. Kevin Warsh gave his speech, and as usual, there was confusion. Warsh is saying all the things that imply a 25bps rate hike, but the market doesn’t fully believe him. 25bps hike odds are only at 48% per Polymarket. Normally, “If it looks like a duck, swims like a duck, and quacks like a duck, then it probably is a duck” but the lack of action in August, as well as the unprecedented closeness with the Administration (especially going into the Midterms) makes a hike less clear.

Overall, we are not impressed with Warsh’s early reign thus far. His preference to run a quiet Fed lacks awareness that the Fed is meant to serve as a force of clarity. Without it, market narratives that do things like push the 10-year higher and prompt unprecedented Treasury intervention can happen.

Housekeeping note - we will be off Friday and push next Sunday’s piece to Monday night because of the holiday. Let’s get into it.

Here’s a look at earnings this week.

• Monday: Science Applications International

• Tuesday: Palo Alto Networks, Dell Technologies, MongoDB, NIO, GitLabs, Credo Technology, Medtronic

• Wednesday: Snowflake, Broadcom, Hewlett Packard, NetApp, Five Below, Brown-Forman, Tilly’s

• Thursday: Ciena, lululemon, DocuSign, UiPath, Victorias Secret & Co., Lands’ End, American Outdoor

Here’s a look at economic data this week (estimates are in quotations).

• Monday: None scheduled

• Tuesday: US Manufacturing PMI, ISM Report On Business Manufacturing PMI (55.1), Construction Spending (-0.1%), Job Openings & Labor Turnover Survey (7.4M)

• Wednesday: ADP National Employment Report (45,000), Factory Orders (0.5%), Federal Reserve Beige Book

• Thursday: U.S. Trade Balance (-89.7B), Weekly Jobless Claims (205K), US Services PMI, ISM Report On Business Services PMI (54.4)

• Friday: Employment Report (50K), Unemployment Rate (4.1%), Avg Hourly Earnings, M/M% (0.2%), Avg Hourly Earnings, Y/Y% (3%)

On The Move 📈 📉

• Gap $GAP jumped following the announcement of retail veteran Michael Francis as the next CEO of Old Navy, its largest brand. Francis had previously worked as CMO of Target and a key consultant for Walmart.

• AI optics stocks $COHR and $LITE fell after investors decided Marvell’s $MRVL Google custom-chip deal would take too long to move the numbers.

• Solstice Advanced Materials $SOLS surged after terminating its Element Solutions $ESI acquisition and authorizing a $500M share buyback, its first as an independent public company since spinning off from Honeywell.

• Sportsbook stocks $DKNG and $FLUT rallied after the Ninth Circuit ruled sports bets are not swaps, allowing Nevada to treat sports-prediction markets like Kalshi as unlicensed sportsbooks. Robinhood $HOOD fell on the same ruling.

• PayPal $PYPL fell after Thursday night’s news that Stripe and Advent backed out of their $53Bn takeover bid. Mizuho cut PT to $51 (from $60) and Loop Capital to $50 (from $62).

• Data center stocks $APLD, $CORZ, and $WULF sold off after $IREN booked a $638.8M impairment on obsolete mining hardware. Stretched valuations left the group with little cushion, with IREN at a 137x forward PE and APLD at 526x.

• Elastic $ESTC surged after a Q1 beat and raised FY27 guidance driven by AI-powered enterprise adoption. Morgan Stanley raised its PT to $75 from $66.

• Sellas Life Sciences $SLS fell after a German news report said the REGAL trial reached its 80th event trigger but the company has stayed silent. The drop unwound Thursday’s cancer vaccine rally.

IPO Roundup 📍

• Electra Therapeutics filed for a US IPO to fund its clinical-stage pipeline for immune diseases and cancer. The San Francisco biotech’s lead drug, a monoclonal antibody for a rare hyper inflammatory syndrome, has FDA Breakthrough status.

• Bamboo Insurance filed for US IPO to list on the NYSE as $BMB, following CVC’s $1.8B acquisition of the company a year earlier. The Utah-based homeowners insurance MGU grew written premium from $66.6M in 2022 to $696.1M in 2025.

Access our Reports

1. Investment Banking Compensation Report - here

2. Buyside Compensation Report - here

3. 2Q State of AI in Finance Report - here

Today’s Headlines 📖🍿

• PIMCO says a flood of AI-related debt issuance is causing “indigestion” in fixed-income markets, with CIO Marc Seidner saying “there’s too much, too fast” and that it pushed the 10-year Treasury to near a multi-year high of 4.75%. Still, the firm sees current yields as a “compelling entry point.”

• Harvard economist Kenneth Rogoff warns that US fiscal reform will require a major shock, saying that “interest rates have reversed, but Washington hasn’t,” as national debt tops $40T and the 30-year Treasury hits multi-decade highs.

• Jefferies flags a growing “zombie” problem in PE’s software portfolios: 18-22 investments 5-7 years in are stuck with no liquidity event in sight, no dividend recaps or continuation vehicles, and growth too slow to generate returns.

• PIMCO’s Richard Clarida says Fed Chair Warsh’s Jackson Hole speech left little doubt a September rate hike is on the table. Warsh emphasized that inflation trends haven’t meaningfully improved and financial conditions aren’t restrictive, making the August CPI print the decisive data point before the Fed meets.

• Syracuse University is facing an enrollment crisis that sent it into a 1.5% budget shortfall, as international enrollment fell by half in 2025 and only 21% of undergrads pay full sticker price (vs. 40-58% at peers like NYU, BU, and Northeastern). The school added $458M in debt for new dorms (prompting an S&P outlook downgrade to negative) and offered late “personal distinction awards” of up to $200k to fill the incoming class.

• Acrisure’s $4.4B leveraged loan dropped 10% this month to ~83 cents as fallout from the Mark Walter/Guggenheim probe hits the insurance broker. Q2 EBITDA fell 12% to $345M and leverage reached 15.4x debt-to-earnings (including preferred equity).

• Aon is nearing a deal to buy insurance brokerage USI from KKR for ~$17B. KKR acquired USI in 2017 alongside another firm for $4.3B, and the deal could be announced as soon as Monday.

• OpenAI will end its Cursor usage following the acquisition by SpaceX by November 12, citing concerns that “SpaceX will use our technology within our terms of service.”

• Blue Owl Capital led a $2.4Bn debt deal for Iren Ltd. to finance the purchase of Nvidia’s Blackwell Ultra GPUs for its Mackenzie data center campus in British Columbia.

• Nvidia-backed Lambda raised $1B in private short-dated debt to finance Nvidia GPU purchases tied to its infrastructure collaboration with Microsoft.

• Apple TV is raising prices from $12.99/month to $14.99/month, while the Apple One bundle rose from $19.95 to $21.95. The hike follows a July Apple Music price increase and comes as Apple bulks up its Apple TV content lineup.

• Bain Capital’s Private Credit Group invested ~$6B in H1 2026 across 58 middle market and PE-backed companies. The group served as majority lender on 72% of new commitments and raised $2.2B in new capital.

• Iceland rejected reopening EU accession talks by 52.8% to 47.2% as fishing industry control and national identity outweighed geopolitical concerns.

August 30th’s MVP 👑 - Tim Cook

Tomorrow is Tim Cook’s last day as CEO of Apple. Since Tim Cook was announced as CEO, Apple’s share price has risen by 2,270%.

Enjoy retirement Tim!

M&A Transactions💭

GeoPura, provider of renewable energy solutions, was acquired for $372.1M by Ballard Power Systems (TSE: BLDP). Barclays advised on the sale.

Elevate Semiconductor, manufacturer and provider of semiconductor solutions, was acquired for $250.0M by Diodes (NAS: DIOD). Bank of America advised on the sale.

Forte Biosciences (NAS: FBRX), a clinical-stage biotechnology company, was acquired for $1.58B by argenx (BRU: ARGX). Valuation / EBITDA was -18.28x. Guggenheim Partners advised on the sale.

InverCap Afore, asset manager, has entered into a definitive agreement to be acquired for $264.0M by Afore Coppel.

Pasqal (NAS: PSQL), developer of quantum computing systems, acquired Bleichroeder Acquisition II through a $360.0M reverse merger. Lazard and Lazard Frères advised on the sale.

Plus ES, provider of metering data and energy infrastructure services, has entered into a definitive agreement to be acquired for $2.12B by DigitalBridge Group (NYS: DBRG). EV/Revenue was 105.60x.

Private Placement Transactions💭

Ajaib Teknologi Indonesia, developer of a smart online investment platform, raised $270.0M of Series C venture funding from SBI Holdings and other undisclosed investors.

AusperBio, manufacturer of oligonucleotide-based therapeutics, raised $120.0M of Series C venture funding from InnoPinnacle, Hankang Capital, and CDH Investments.

Owner, developer of a digital marketing platform, raised $240.0M of venture funding led by Goldman Sachs Growth Equity at a pre-money valuation of $2.06B.

Sunrise (Hangzhou), manufacturer of artificial intelligence computing products, raised CNY 2.0B of venture funding from undisclosed investors at a pre-money valuation of CNY 18.0B.

Odds of the Day 🍒

Polymarket traders are now pricing in a 48% chance of a 25bps rate hike in September.

Trade on Polymarket

Noteworthy Chart 🧭

A look at Software’s recovery since SaaSpocalypse 1.0

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_{Today’s Odds of the Day is in paid partnership with Polymarket}

Today of course, we do have Kevin Warsh speaking. We think this is Warsh’s chance to become a better communicator - and that miscommunication would lead to a selloff. There’s probably an A/B path here: A) Warsh appears as a puppet fed chair, says inflation dynamics are transitory (like Oil), which is constructive for stocks, maybe not for rates though - there’s a battle between those dynamics, or B) Warsh gets serious on inflation as it is today, draws a line in the sand on needing to get to 2% and firms up rate hike plans. There’s a barbell range of options, but given his odd communication style, we tilt towards an initially negative reaction, regardless of what he says. Let’s get into it.

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Today’s Jobs:

1. Ares is hiring an AI Credit Product Lead (NY)

2. Apollo is hiring a DCM Associate (NY)

3. Partners Group is hiring a Private Credit Investment Associate (London)

4. Morgan Stanley is making 2027 Summer Associate Hires (NY, Boston)

5. Ares is hiring a Liquid Credit IR Associate (Los Angeles)

Search the Buyside Hub Job Board

Earnings Corner 💸

• Nvidia beat on the top and bottom lines, with revenue of $96.2B vs. $92.3B and EPS of $2.22 vs. $2.09. Results were driven by Data Center revenue more than doubling to $89B as hyperscalers, AI clouds and enterprises built larger GPU clusters to train and run AI models. Growth also broadened beyond hyperscalers as AI cloud providers, industrial companies and enterprises increased spending on AI computing capacity, driving revenue from those customers up 138% YoY, while manufacturing and memory chip constraints kept supply below demand. Mgmt. expects ~70% FY28 revenue growth as AI infrastructure spending continues to scale and guided Q3 revenue above expectations.

• CrowdStrike beat on the top and bottom lines, with revenue of $1.47B. Results were driven by accelerating cybersecurity demand as wider AI adoption and AI-powered attacks pushed companies to add more protection, helping record net new ARR reach $333M. Falcon Flex ARR more than doubled as customers adopted more of CrowdStrike’s security products through a single platform, while demand for its newer AI and threat-detection tools also accelerated. Mgmt. raised FY27 guidance above expectations.

• Marvell Beat on the top and bottom lines as Data Center revenue rose 46% y/y as hyperscalers build out AI infrastructure and develop their own processors. Mgmt. raised FY27 and FY28 revenue guidance above expectations, but shares fell as its new custom AI chip partnership with Google is not expected to meaningfully boost revenue until FY29.

• Salesforce jumped after beating estimates in Q2, with adjusted EPS of $5.90 vs $3.27 expected and revenue up 11% to $11.35B, boosted by a $2.6Bn gain on its Anthropic stake. Salesforce also bumped their FY guide to ~11% revenue growth.

• Synopsys beat on the top and bottom lines, driven by Design Automation revenue (DA) rising 53% y/y as increasing AI chip complexity boosted demand, while the acquisition of Ansys also contributed. Mgmt. raised FY guide above expectations on continued AI-driven demand and double-digit DA growth.

• Abercrombie and Fitch beat on the top and bottom lines, with revenue of $1.27B and EPS of $4.17 vs. $1.95. Results were driven by record sales, led by 8% growth at Abercrombie, while regional strength helped offset weaker Hollister comps. Profitability jumped due to $100M of tariff refunds, which added $1.75/share to EPS. Mgmt. raised FY sales and EPS guidance above expectations.

• Bath & Body Works beat on the top and bottom lines as digital sales returned to growth for the first time in five years due to free shipping and better conversion, while expanded distribution through Amazon and Ulta drove international and other sales up 25%. Store traffic remained weak and total sales fell 2.3% y/y as cautious consumers pulled back, while $80M of tariff refunds heavily boosted profitability. Mgmt. guided Q3 EPS below expectations as cautious spending and turnaround investment weigh on near-term results.

• Kohl’s Missed on the top line but beat on the bottom line as comp sales fell 0.9% amid lower-income consumer pressures, though digital sales rose 2.8% and proprietary brands grew 3%. Profitability was lifted by roughly $100M of tariff refunds, while underlying gross margin was roughly flat excluding the benefit. Mgmt. raised FY EPS guidance, largely reflecting the tariff refund benefit.

• Workday beat on the top and bottom lines as growing adoption of its AI agents drove customer expansion. The company also authorized a new $4B share buyback. Mgmt. raised the low end of FY subscription revenue guidance, with the range roughly in line with expectations.

• Dollar General beat on the top and bottom lines as inflation weary consumers sought lower priced essentials, driving traffic up 2% and comp sales up 3.5%. Expanded $1 offerings and using tariff refunds to lower prices and run promotions helped drive traffic and market-share gains. Mgmt. raised FY guidance above expectations, driven by improving underlying demand rather than tariff benefits.

• Affirm Beat on the top and bottom lines as GMV jumped 36% to $14.1B, driven by strong growth through merchant checkout integrations and its DTC business, while active customers grew 20%. Profitability also improved as operating margins expanded with higher transaction volume. Mgmt. guided FY27 above expectations as it continues to expand its merchant network, products and international presence.

On The Move 📈

• Cybersecurity stocks $PANW, $ZS, $SAIL and $S rallied after CrowdStrike and Okta’s great numbers.

• A Stripe and Advent consortium has reportedly abandoned its ~$50B pursuit of PayPal $PYPL

• Gap $GAP jumped after announcing Michael Francis as new Old Navy CEO effective Nov 2, aiming to turn around the struggling brand that contributes ~60% of Gap’s revenue. Q2 EPS beat but revenue missed.

• Wendy’s $WEN fell after Trian Fund Management reported no plans to pursue a take-private bid for Wendy’s, despite earlier reports on a potential deal.

• HealthEquity $HQY fell despite record Q2 adjusted EBITDA of $167M and raised FY27 guidance. Investors focused on HSA cash yields being locked around 3.9% via hedging.

• Crypto stocks $MSTR, $MARA, and $COIN climbed on continued Bitcoin strength. Strategy led the group as a leveraged Bitcoin proxy.

• Rubrik $RBRK surged after Q2 revenue jumped 38% to $427.3M and the cybersecurity company swung to a $0.20 adj EPS from a prior-year loss.

• Sarepta Therapeutics $SRPT surged as investors positioned ahead of upcoming H2 2026 clinical data readouts for its FSHD and myotonic dystrophy studies.

• Zoom $ZM rebounded from Wednesday’s drop where they had weak Q3 profit guidance. Zoom holds a ~$3B+ stake in Anthropic.

IPO Roundup 📍

• The Anthropic prospectus is coming after Labor Day as the Company eyes an IPO in either September or October.

• Vista, the private jet company, is exploring a $1B IPO at a $10Bn+ valuation, with Milan and Zurich as potential venues. The UAE-based operator of VistaJet and XO runs a subscription-based model and is eyeing a 2027 listing.

• Shein priced its Hong Kong IPO at HK$48.56 per share, raising $1.7B at a ~$26B valuation, down from a ~$100B price tag four years ago. The fast-fashion retailer starts trading Sept. 1.

• KNDS, the Franco-German tankmaker, is relaunching its IPO as soon as late September at a €12B valuation, targeting a Frankfurt-Paris dual listing. Investor meetings begin next week following July’s postponement.

Today’s Headlines 📖🍿

• Russia is preparing to escalate ballistic missile attacks on Kyiv and other Ukrainian cities after concluding peace talks hit a dead end, with Putin warning Ukraine to “be ready to get a blowback” for striking Russian economic infrastructure.

• Meta settled over social media addiction claims for $16.7Bn, paid out over 10 years, with 70% guaranteed to states and the remaining 30% contingent on YouTube and TikTok agreeing to matching payments and similar app changes.

• Apollo President Jim Zelter says America’s next industrial buildout won’t fit the old playbook. IG issuance now rivals US Treasury net issuance as companies raise trillions for AI, energy, and factories. Zelter argues public bonds, banks, insurance, and private credit are now complements rather than substitutes.

• Anthropic will pay Nscale $45B for AI computing power from Nscale’s Monarch campus in West Virginia, generating 460 megawatts of power using Nvidia’s upcoming Vera Rubin chips.

• SK Hynix broke ground on its Indiana memory production base. The $4B factory will be live in 2030 and be a “key HBM production base in America.”

• Time released their 100 most influential people in AI list….but it didn’t include Jensen Huang, Sundar Pichai, Mark Zuckerberg, and many others…

• Citadel Securities notched a record $7.3B in Q2 trading revenue and $3.3B in net income. The firm stayed profitable in July when Jane Street lost $15B and is expanding into fixed income and equity block trading long dominated by JPMorgan and Goldman Sachs.

• Companies still can’t put a dollar figure on the AI payoff three years into the buildout, per Bloomberg. Only 1 of the 60 largest US financial firms has mentioned realized AI returns in 3 years (~$19M combined), even as AI prices collapse and chip/memory costs get repriced upward.

• JPMorgan is leading a $5Bn debt package to fund Volta Infra Holdings’ AI data center buildout, just weeks after Volta raised $300M in venture funding at a $2.4Bn valuation.

• First Brands has been forced to liquidate, with Judge Christopher Lopez rejecting a Chapter 11 plan negotiated between the company, lenders, and creditors as “unconfirmable under any circumstances.”

• Investors are choosing to stay in private credit rather than take a 26% loss. Cox Capital offered to buy up to $90M of non-traded BDC shares from HPS, Apollo, Ares, and Blue Owl at a ~26% discount, but drew less than $5M in orders.

• Kioxia and Sandisk plan to spend ¥5 trillion ($31.4 billion) over six years to expand Japanese NAND flash memory production, including ¥1.8 trillion for a new fab in Kitakami dedicated to high-density 3D chips for AI data centers.

• KKR says US real estate’s $5.1T middle market is underserved by traditional institutional capital. Nearly 5,800 sponsors control 85% of the institutionally sponsored market, and only 31% of it sits in closed-end fund structures.

• Media newsletter Puck is in late-stage talks with RedBird Capital Partners on a deal valuing the company at $250M, which would make RedBird its largest shareholder.

• Bitcoin treasury companies have lost more than $80Bn in combined value since mid-2025, with the top 50 holders’ market cap falling from $150Bn to $67Bn. Strategy alone accounts for $79Bn of the decline.

M&A Transactions💭

Nvidia (NAS: NVDA) has reached a definitive agreement to acquire Hugging Face, developer of a machine-learning community platform, for $12.9B.

Altruist, developer of a digital investment platform, has entered into a definitive agreement to be acquired for $4.0B by The Vanguard Group.

Enbridge (TSE: ENB) reached a definitive agreement to acquire The Crude Oil Gathering Business of Salt Creek Midstream for $600.0M.

Rael, manufacturer of organic feminine care products, has entered into a definitive agreement to be acquired for $290.0M by TowerBrook Capital Partners and other undisclosed investors. Jefferies advised on the sale.

Permiso, developer of cloud identity security software, was acquired for $200.0M by Okta (NAS: OKTA).

Leggett & Platt (NYS: LEG), designs and produces engineered components, was acquired for $2.5B by Somnigroup International (NYS: SGI). EV/EBITDA was 5.62x and EV/Revenue was 0.64x. J.P. Morgan advised on the sale.

The Testing and Measurement Business of Indicor was acquired by AMETEK (NYS: AME) for $5.0B. Evercore Group advised on the sale.

Two Power Plants were acquired by Hull Street Energy for $675.0M. Houlihan Lokey and PEI Global Partners advised on the sale.

First Eagle Investments, provider of investment advisory services, has reached a definitive agreement to be acquired for $7.0B by Victory Capital Management (NAS: VCTR). Bank of America and UBS Group advised on the sale.

Alignment Engine, developer of GPU computing infrastructure, has reached a definitive agreement to be acquired for $500.0M by Volato Group (ASE: SOAR).

Nexa Resources (NYS: NEXA), operates large-scale, mechanized underground and open pit mines, as well as smelters, has reached a definitive agreement to be acquired for $1.31B by Boliden (STO: BOL). EV/EBITDA was 2.76x and EV/Revenue was 0.93x.

Astrum Space, provider of satellite-to-device broadcasting services, has reached a definitive agreement to acquire Black Spade Acquisition III (NYS: BIII) through a $1.0B reverse merger. Cohen & Company Capital Markets advised on the sale.

Private Placement Transactions💭

Blank Street, a coffee shop chain, raised $105.0M of Series C venture funding led by General Atlantic Service.

ICON, developer of construction technologies, raised $114.89M of venture funding from undisclosed investors.

Gatik, developer of autonomous vehicle software, raised $200.0M of Series D venture funding led by Koch Disruptive Technologies and Qatar Investment Authority.

Emerald AI, developer of an infrastructure flexibility management platform, raised $150.0M of Series A venture funding led by DCVC and Energize Capital at a pre-money valuation of $900.0M.

CORE POWER, developer of maritime nuclear energy systems, raised $200.0M of venture funding from Mitsubishi, Sumitomo, and Mitsui.

Honeycomb Internet, provider of physical AI simulation engine infrastructure, raised CNY 1.2B of venture funding from undisclosed investors.

REGENT Craft, developer of an all-electric wing-in-ground-effect vessel, raised $240.0M of venture funding through a combination of debt and equity. $120.0M of Series B venture funding was led by AE Ventures and Mare Liberum Capital Partners. The transaction was supported by $120.0M of debt financing.

Alice, developer of an internet security tool, raised $140.0M of venture funding led by Apax Digital at a pre-money valuation of $660.0M.

PsiBot, developer of robotics and AI solutions, raised over $100.0M of venture funding from Lens Technology, Chery Holding, and 37 Interactive Entertainment.

Quaise Energy, developer of a deep geothermal energy technology platform, raised $169.0M of Series B venture funding led by Prelude Ventures.

Socure, developer of a digital identity verification platform, raised $156.0M of venture funding led by Summit Partners at a pre-money valuation of $5.04B.

Noteworthy Story 🧭

Following Hugging Face’s sale to Nvidia - Kevin Durant, who wrote an early stage check, has been crowned a big winner. Here’s Kevin’s other big wins:

Welcome back!

Yesterday was a solid day in the market as rates cooled off a bit. There’s still a lot going on though, particularly with this U.S. and Canada tariff spat, Warsh speaking Friday, but most importantly, Nvidia reporting earnings today. Plus, we get the Personal Consumption Expenditures price index report this morning.

Meanwhile, the debasement trade has been heating up. Aka, the biggest crypto guy you know is currently saying “I told you so” as Bitcoin in particular is now flirting with an $80k price again.

Here’s a look at the remaining earnings for this week.

• Wednesday: Nvidia, CrowdStrike, Salesforce, Synopsys, Trip dot com,
  Williams-Sonoma, HP, Okta, JM Smucker, Dycom, Abercrombie & Fitch, Bath & Body Works, Kohl’s

• Thursday: RBC, Marvell, TD, Autodesk, Workday, Dollar General, Affirm, Dollar Tree, Ulta Beauty, Burlington Stores, Rubrik, Best Buy, IREN, SentinelOne, Gap, Hyperliquid Strategies, Petco, Build-A-Bear

  Here’s a look at economic data this week (estimates are in quotations).

• Wednesday: Durable Goods (0.5%), 2nd estimate GDP (1.5%), Personal Income M/M% (0.2%), Consumer Spending M/M% (0.1%), PCE Price Idx M/M% (0.1%), PCE Price Idx Y/Y% (3.6%), PCE Core Price Idx M/M% (0.2%), PCE Core Price Idx Y/Y% (3.3%)

• Thursday: Weekly Jobless Claims (206K), Advance U.S. Trade Balance in Goods, Wholesale Inventories, Retail Inventories, Kansas City Fed Survey

• Friday: Kevin Warsh’s Jackson Hole Speech (10am ET), Chicago Business Barometer ISM-Chicago Business Survey Chicago PMI (57.9), U. Michigan Final Consumer Survey (51)

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Earnings Corner 💸

• Dick’s Sporting Goods $DKS Missed on the top and bottom lines, with revenue of $5.59B vs. $5.65B and EPS of $3.53 vs. $3.76. The core business remained strong, with comparable sales up 4.9%, but results were dragged down by Foot Locker, where comps fell as fewer product launches and weakening demand for legacy footwear styles led to excess inventory and heavier discounting. The broader athletic footwear and apparel market also became increasingly promotional, forcing lower prices to remain competitive. Mgmt. cut guidance and now expects Foot Locker comps to be flat to down. Shares sunk heavily on the miss.

• Intuit $INTU Beat on the top and bottom lines, with revenue of $4.35B vs. $4.27B and EPS of $4.03 vs. $3.58. Results were driven by QuickBooks Online Accounting revenue, which rose 20% on higher pricing, customer growth and favorable mix, while Credit Karma grew 16% on strength in personal loans, auto insurance and credit cards, yet Mailchimp remained a drag on growth as demand remained weak, with revenue expected to be flat to down 1% next year. Despite the beat, Mgmt. guided FY27 revenue below expectations, implying growth will slow to 9%-10% from 14% in FY26, while Q1 revenue guidance also came in below consensus.

• Zoom $ZM Beat on the top and bottom lines. Results were driven by enterprise revenue growth of 7.8%, its fastest pace in three years, as larger corporate customers adopted more of Zoom’s AI-powered products. Mgmt. raised its FY outlook, but Q3 EPS guidance came in below expectations as continued AI investment weighed on near-term profits.

On The Move 📈 📉

• Analyst moves: $MRNA climbed on continued cancer vaccine momentum paired with BofA’s PT hike to $170 (from $40), and William Blair’s upgrade to Outperform. $AMD was upgraded to Strong Buy by Raymond James at $641 (from $565), and $JMKE picked up new coverage from Goldman Sachs at Neutral with a $26 PT.

• Richtech Robotics $RR popped after announcing a $12M share buyback, a meaningful figure for the small-cap robotics company with a market cap under $400M.

• Bath & Body Works $BBWI fell for a fifth straight session ahead of Wednesday’s Q2 earnings. Consensus calls for EPS of $0.24, a 35% YoY decline, on roughly flat revenue of ~$1.5Bn.

• Nuclear stocks $OKLO, $SMR, and $UEC rallied in a sector bounce off heavy YTD losses. NuScale separately announced deployment of nuclear-specific AI tools that cut information retrieval time by up to 80%.

• LyondellBasell $LYB rose after reports it submitted an offer for Shell’s US chemical assets alongside ExxonMobil in a deal valued near $8Bn.

• Robinhood $HOOD jumped on continued crypto strength after Bitcoin climbed above $77k, boosting volumes for retail brokerages. Goldman Sachs and Needham both carry $123 PTs.

• Alibaba $BABA slid Monday and hasn’t recovered after announcing a $10.2Bn share placement with all proceeds going towards AI investments.

• Marvell Technology $MRVL climbed after Susquehanna raised its PT to $265 from $230 ahead of Thursday’s Q2 earnings, citing AI networking demand and a Google agreement worth up to $120Bn through 2033.

IPO Roundup 📍

• Oura is seeking to raise $3Bn in a US IPO as early as September, valuing the company at $16Bn, with revenue expected to reach $1.5Bn in 2026, tripling 2024’s $500M.

• Lambda is in talks to raise up to $3Bn in a pre-IPO round at a $12Bn+ valuation, setting up a potential IPO as soon as next year. The Nvidia-backed neocloud is expected to earn $1.5Bn+ in revenue this year.

• Aggreko filed for a US IPO that could value the Glasgow-based power equipment rental firm at ~$15Bn. Revenue hit $1.92Bn with $80M net income in H1 2026, a swing from a $189M loss on $1.5Bn a year earlier.

Today’s Headlines 📖🍿

• Canada retaliated against Trump’s tariffs with new duties of 15-50% on $20B of US goods, effective September 8. The measures target steel, dairy, appliances, agricultural equipment, and electronics. The move comes days after the US imposed 50% tariffs on a wide range of Canadian products.

• Investor Stanley Druckenmiller criticized the Treasury’s move to double long-dated bond buybacks to $4Bn, calling it “price management” rather than genuine liquidity support and political procrastination on entitlement reform as yields round-tripped within a day. The catch - Druck took a lot of heat for his WSJ op-ed being AI-generated….

• Citadel’s Nohshad Shah argues the Bessent Treasury buyback expansion is a “Treasury-led Operation Twist,” not QE, since it’s financed by shifting issuance to short-dated bills, which flattens the curve and puts pressure on the dollar rather than resolving the underlying fiscal contradiction.

• LeBron James’s LLC borrowed nearly $300M in 2017 and 2022 from life insurers advised by Guggenheim Partners against future income from off-court deals like his Nike lifetime partnership. We weren’t exactly expecting LeBron to be caught up in the Mark Walter saga, but the plot thickens…

• Guggenheim Investments told lenders that affiliates may buy its distressed loan, which dropped to as low as 73 cents on the dollar this week. The firm calls it an “attractive investment opportunity” as investigations continue into Mark Walter’s businesses.

• Carlyle’s bond deep dive: Bond investors are waiting for the Fed to restore forward guidance at Jackson Hole. Treasury yields are being driven higher by the real term premium rather than inflation expectations, and forward real yields sit above 2.5% as investors brace for another possible rate shock.

• OpenAI’s head of data centers Chris Malone has left the company. His exit adds to a wave of senior executive departures, including Brad Lightcap, Fidji Simo, and Kevin Weil in recent months.

• The SEC subpoenaed Goldman Sachs, JPMorgan, Citigroup, and Bank of America over their roles in Situational Awareness’ near-collapse, seeking details on the fund’s trades, leverage, and lender communication.

• Sycamore Tree Capital warns that the AI buildout’s massive capital needs carry significant credit risk, particularly “rating-designation risk” from private credit scores that could be revised or challenged, drawing parallels to the telecom bust of the late 1990s.

• JPMorgan warns of a fall S&P 500 selloff, flagging a growing divergence between AI hardware/chip makers and heavy AI capex spenders that mirrors the 1999-2000 tech crash, alongside rising Treasury yields and deteriorating market internals.

• BlackRock is sounding out buyers for TCP Capital Corp’s $671M of loans, with advisers pitching the assets in early-stage talks. TCPC is also weighing reinvesting in the portfolio, returning capital to shareholders, or merging with another entity as the fund struggles with steep markdowns and DOJ scrutiny.

• Ares is leading a $2.2B direct loan to pharmacy benefits manager MedImpact in one of the largest private credit deals of the year. The loan will fund MedImpact’s acquisition of Medical Card System without PE backing, and the second-lien portion could pay at least 8% over the baseline rate.

• Clearlake-backed Ivanti’s Q2 revenue fell 11% YoY to $189MM, with pro forma EBITDA down 21% to $72M, as its shift to a subscription-based model continues to strain its ability to service debt.

• DC-based Awani Capital Management raised nearly $600M for its inaugural fund. The firm targets controlling stakes in middle-market companies and was launched in 2025 by alums of Bethesda’s RLJ Capital Partners.

• JPMorgan is hiring Dan McDow from Citi to head its east coast tech investment banking business. McDow spent the past four years as Citi’s global head of software investment banking.

M&A Transactions💭

Vox Telecom, provider of voice, data, and collaboration services, was acquired for ZAR 14.4B by DNI Invest, Metier, and EM-Three.

Ultra Mission Solutions, developer of mission-critical software, was acquired for $720.0M by Booz Allen (NYS: BAH). Robert W. Baird & Co. advised on the sale.

RE/MAX Holdings (NYS: RMAX), operates as a franchisor of real estate brokerage services, was acquired for $749.934M by The Real Brokerage (NAS: REAX). EV/EBITDA was 16.36x and EV/Revenue was 2.65x. J.P. Morgan advised on the sale.

Mieschke Hofmann und Partner, provider of IT consulting services and a subsidiary of Porsche (ETR: P911), has reached a definitive agreement to be acquired for EUR 320.0M by Tata Consultancy Services (NSE: TCS).

Maverick Power, manufacturer of power distribution equipment, has reached a definitive agreement to be acquired for $2.3B by nVent Electric (NYS: NVT). The company will receive a contingent payout of $550.0M based on achieving certain performance metrics in 2027 and 2028. EV/Revenue was 3.29x.

Etomars, developer of a supply chain management system, has reached a definitive agreement to be acquired for KRW 6.518T by Taewoong Logistics (KRX: 124560).

Claros, operator of a power management company, has reached a definitive agreement to be acquired for $232.8M by Navitas Semiconductor (NAS: NVTS).

Private Placement Transactions💭

Kyoto Fusioneering, developer of a fusion technology, raised JPY 25.72B of venture funding through a combination of equity and loans. JPY 16.72B of Series D was provided by DBJ Capital, SMBC Venture Capital, Development Bank of Japan, East Japan Railway, and other undisclosed investors. JPY 9.0B of Term Loan was provided by Kyoto Financial Group, Sumitomo Mitsui Trust Bank, Sumitomo Mitsui Banking, Mizuho Bank, and other undisclosed investors.

Generalist, developer of a frontier AI and robotics platform, raised $600.0M of Series B venture funding led by Radical Ventures and 8VC.

Efficient Computer, manufacturer of energy-efficient general-purpose processors, raised $153.08M through a combination of Series A-1 and Series A-2 venture funding led by Triatomic Capital.

Noteworthy Chart 🧭

Private equity firms are Turing to structured equity deals to return cash to investors while keeping companies they can’t yet sell. Buyout firms are sitting on $3.8T of unsold assets, and DPI has hit record lows.

The Week Ahead Of Us 🔍

Welcome back!

We have a busy week ahead - don’t snooze off at work quite yet. We have Nvidia reporting this week and Fed Chair Warsh speaking at Jackson Hole Friday; but I do want to talk about a touchy subject that might derail the AI trade - a large part of the U.S. hating datacenters:

While many of the people reading this are leveraging AI for productivity gains, or are invested in AI-related stocks, there’s tens of millions of Americans who are not in fact happy with AI. And it’s hard to blame them given all the negative messaging about data center energy and water usage, as well CEOs screaming about 50% of entry-level white-collar jobs going away.

Americans would rather have a nuclear plant in their backyard than a data center: A Gallup survey found 71% of Americans oppose a data center in their area. This compares to the 53% who would oppose a nuclear energy plant in their area.

It’s not like data centers are new though. You’re using a data center to read this right now. You need data centers to do all the basic things you do on your phone and computer. National data center water consumption accounts for 0.3% to 0.4% of daily water withdrawals at the moment, and of course, data centers have cooling services without water consumption.

But politicians are starting to issue moratoriums and local communities are pushing back. There’s energy bill worries, environmental concerns, and questions regarding taxation benefits. Loudoun County, a DC suburb with 250 data centers, expects to generate $1.3B in tax revenue next year (40% of its total tax revenue) from data centers. Some states and cities though, wonder whether they’re giving away too many tax incentives.

This data center pushback doesn’t look like it’s going away, and it looks like data center buildouts will vary by state-by-state policies. Regardless of where you stand, this messaging looks likely to heat up going into the midterms.

Let’s get into it. Today’s partner is NinjaTrader:

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Here’s a look at earnings this week.

• Tuesday: Bank of Montreal, Bank of Nova Scotia, Intuit, Heico, Zoom, Dick’s Sporting Goods, Box, FS Credit Opportunities Corp,

• Wednesday: Nvidia, CrowdStrike, Salesforce, Synopsys, Trip dot com, Williams-Sonoma, HP, Okta, JM Smucker, Dycom, Abercrombie & Fitch, Bath & Body Works, Kohl’s

• Thursday: RBC, Marvell, TD, Autodesk, Workday, Dollar General, Affirm, Dollar Tree, Ulta Beauty, Burlington Stores, Rubrik, Best Buy, IREN, SentinelOne, Gap, Hyperliquid Strategies, Petco, Build-A-Bear

Here’s a look at economic data this week (estimates are in quotations).

• Monday: None scheduled

• Tuesday: S&P Cotality Case-Shiller Home Px Index, New Homes Sales (619K), Conference Bd Consumer Confidence (90.1)

• Wednesday: Durable Goods (0.5%), 2nd estimate GDP (1.5%), Personal Income M/M% (0.2%), Consumer Spending M/M% (0.1%), PCE Price Idx M/M% (0.1%), PCE Price Idx Y/Y% (3.6%), PCE Core Price Idx M/M% (0.2%), PCE Core Price Idx Y/Y% (3.3%)

• Thursday: Weekly Jobless Claims (206K), Advance U.S. Trade Balance in Goods, Wholesale Inventories, Retail Inventories, Kansas City Fed Survey

• Friday: Kevin Warsh’s Jackson Hole Speech (10am ET), Chicago Business Barometer ISM-Chicago Business Survey Chicago PMI (57.9), U. Michigan Final Consumer Survey (51)

arnings Corner 💸

• BJ’s Wholesale Club $BJ Beat on the top and bottom lines, with revenue of $6.23B and EPS of $1.36 vs. $1.17. Results were driven by value seeking shoppers responding to lower gas prices and grocery deals, with comparable sales up 11.9%, led by grocery, consumer electronics and home goods. Membership momentum also remained strong, with fee income up 9.9% as the member base reached a record 8.5M, driven by strong new member acquisition, retention and higher tier membership penetration. Mgmt. raised FY EPS guidance to $4.60-$4.80 from $4.40-$4.60, above expectations.

On The Move 📈 📉

• Virtu Financial $VIRT jumped after announcing the sale of its brokerage and technology unit, unlocking $3.5Bn of cash into the business.

• Alibaba $BABA plummeted after announcing 1Q 2027 earnings, with net profit falling 75% YoY as AI infrastructure spending increased by 75%.

• Quantum stocks, like IonQ $IONQ, D-Wave Quantum $QBTS, and Quantum Computing Inc $QUBT, surged following strong 2Q 2026 earnings reports and renewed federal funding.

• Crypto stocks, including Robinhood $HOOD and Coinbase $COIN, increased following a high-profile cryptocurrency summit pushing for the passage of the stalled Clarity Act.

• Sellas Life Sciences $SLS rallied on anticipation of its own pivotal REGAL trial readout in AML and continued momentum from the $MRNA and $MRK Phase 3 cancer vaccine breakthrough.

• Hut 8 $HUT fell after Pomerantz LLP announced a proposed $2.35M class action settlement covering investors who bought the stock between Feb 2023 and Jan 2024.

IPO Roundup 📍

• Nscale is looking to raise $3Bn in a US IPO as soon as this September, telling investors it has $51Bn in total contracted revenue ahead of the listing.

• Orion180 Insurance Group filed for a US IPO to expand in the growing excess homeowners and flood insurance market.

• YMTC plans to raise $4.9B in a Shanghai IPO following rival CXMT’s $9.9B debut last month. The Wuhan-based chipmaker’s Q1 2026 net income hit 33.4B yuan, more than double its 2025 total.

• DayOne Data Centers is eyeing a ~$5B US IPO as soon as next quarter, adding to a borrowing spree that includes a new $237M loan for its Hong Kong facility. The Singapore-based operator, backed by SoftBank Vision Fund, Coatue, and Ken Griffin, closed a $4.5B Series C in June.

Today’s Headlines 📖🍿

• Tariffs with Canada are now in effect: Alcoholic beverages, dairy products, and electronics are among the 500+ product categories now facing 50% tariffs by the U.S. Following the last minute breakdown in talks, Canada will place tit-for-tat retaliatory tariffs on the U.S. effective September 8th.

• Sam Altman sat down with David Sentra to talk all things AI. This included addressing fears around AI, how its scaled, and the regret he has about messaging. He took yet another shot at Anthropic for the messaging around “50% of the jobs are going to go away in the next year”. Altman also admitted he was wrong about the speed of AI adoption, now realizing people aren’t changing their habits overnight. You can view the full podcast here

• Nvidia plans to hike prices by more than 15% on servers containing chips like Vera and Blackwell, with increases taking effect on systems shipped next year. Nvidia has to pass prices on due to the supply cost of inputs like memory.

• Blue Owl released their 2026 Mid-Year in focus, calling out several key points: 1) Default rates remain below averages 2) Private credit is offering a 200bps premium to public loans 3) Private Credit is roughly 25% of leveraged lending today and expected to grow further 4) Manager selection is becoming more important and 5) Blue Owl is getting more bullish on digital infrastructure.

• Apollo confirms a data breach exposing names, birth dates, addresses, and Social Security numbers after hackers used social engineering to access its cloud systems. The breach follows a Google-flagged extortion campaign targeting PE and financial firms.

• Vista is exploring a $3B+ sale of Allvue, an asset & credit manager focused data provider. Acquired back in 2019, the Company behind Black Mountain Systems initially had plans to go public in 2021 that were scrapped.

• Lenders are pushing against CD&R: The Sponsor has historically been known as lender friendly, but recent aggressive tactics with Multi-Color have led lenders to rethink things, and form co-op groups faster.

• PIMCO says rising sovereign debt, AI-related corporate issuance, and inflation concerns are pushing 30-year yields to nearly two-decade highs across the US, Europe, UK, and Japan. The firm expects episodic volatility rather than a fiscal crisis and views current yields as an attractive entry point for long-term investors.

• Hyperscalers’ off-grid power push for AI is facing early problems: 3 of 4 operational US off-grid data centers have reported issues. AI workloads create massive power swings that stress equipment, and downtime can cost tens of millions per day.

• Blackstone has already directly deployed AI engineers into portfolio companies. Blackstone and Hellman & Friedman had recently launched Ode with Anthropic, a 160-person AI engineering team already embedded in six Blackstone portfolio companies, and OpenAI has a rival venture backed by TPG.

• Florida-based EverBank is up for sale three years after five PE firms bought it from TIAA in 2023, and an IPO is a backup if no deal materializes. The five owners have clashed over strategy, dragging out the sales process for months.

• At Wall Street’s exclusive Camp Kotok gathering in Maine, veteran finance pros are increasingly anxious about the AI trade. Attendees debated whether the massive AI capex will pay off and were worried the Aschenbrenner blowup could be an early “cockroach.”

• Satellite startup Muon Space raised a $250M Series C backed by Google and Salesforce Ventures. Muon has raised $386M total and is preparing for a potential IPO, projecting $10B+ in future business from NASA, NOAA, and the US Space Force.

• Clearlake-backed FinThrive reported weak Q2 Adj. EBITDA of $40M, down 17% YoY as revenue slipped from $105M to $100M. The company drew upon its $150M credit line to bolster liquidity.

• JPMorgan hired David Fishman from Bank of America as vice chair and head of North America tech M&A. Fishman was most recently co-head of TMT M&A at BofA and reunites with former colleague Kevin Brunner.

• Sweetie Candy owner Tom Scheiman turned down a PE deal and sold a stake in the company to his employees instead, giving dozens an ownership share.

M&A Transactions💭

Zonda Home, developer of media and analytics platform, was acquired for $800.0M by CoStar Group (NAS: CSGP). Houlihan Lokey and Solomon Partners.

Steadfast Group (ASX: SDF), the largest general insurance broker network in Australia and New Zealand, has entered into a definitive agreement to be acquired for AUD 7.7B by Kohlberg Kravis Roberts and AmWINS. Citigroup and J.P. Morgan advised on the sale.

Kartos Therapeutics, developer of targeted oncology therapeutics, was acquired for $450.0M by Ipsen (PAR: IPN). PJT Partners and Goldman Sachs advised on the sale.

PT Chandra Asri Pacific (IDX: TPIA) reached a definitive agreement to acquire The Cycle & Carriage Automotive Distribution Business of Jardine Cycle & Carriage for SGD 265.0M.

Private Placement Transactions💭

Cityblock, operator of personalized health systems, raised $116.0M of Series E venture funding led by General Catalyst.

Starcloud, developer of power and cooling systems, raised $420.0M of Series A1 venture funding led by EQT, Manhattan West Asset Management, and Benchmark Opportunity Partners at a pre-money valuation of $1.88B.

Chart of the Day 🧭

Investment-grade AI debt is drawing junk bond investors as yields hit levels that look like double-B credit. QTS priced $3.9B in high-grade bonds last week at 7.23%, and BlackRock is paying 7.53% on IG bonds for a Texas data center.

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Obviously, high rates are having a negative impact on consumer confidence, plus U.S. interest expenses, but this move to soothe the bond market misses the point. This surprising and interventionist move is not going to inspire confidence from the bond vigilantes! It draws less confidence than more confidence.

Notably, the U.S. national debt passed the $40 Trillion mark and our deficit-to-GDP ratio is nearly 6%. In response to rates going wider, the market struggled yesterday, but Gold has rallied this week and Bitcoin is +18% w/w…I guess Saylor selling should’ve been the bottom indicator.

Let’s get into it.

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Today’s Jobs:

• Beacon Software, an AI-driven holding company that acquires mission critical vertical software companies, is hiring an Investment Lead (SF, CA)

• Ares is hiring a VP, Capital Solutions (NY)

• Apollo is hiring an Associate Director, Strategic Finance (NY)

• Oaktree is hiring an ABF Associate (Los Angeles, CA)

• Blackstone is hiring a Global Fund Finance Associate (Miami, FL)

Search the Buyside Hub Job Board

Earnings Corner 💸

• Walmart Beat on the top and bottom lines, with revenue of $187.9B vs. $186B expected and EPS of $0.81 vs. $0.74. Results were supported by 24% U.S. e-commerce growth, 43% growth in Walmart Connect advertising, and 17% membership revenue growth. However, U.S. comparable sales grew just 2.6% vs.
  3.8% expected, the slowest growth in six years, as lower pharmacy pricing and cautious consumer spending weighed on growth; excluding the pharmacy impact, comps grew 3.4%. Walmart also benefited from $2.9B of tariff refunds, which helped fund price cuts across thousands of products. Mgmt. increased its FY outlook but guided below expectations.

• Target beat on both the top and bottom lines, with revenue of $26.54B vs. $26.14B and EPS of $2.46 vs. $2.33. Results were driven by a 3.8% increase in comparable sales, above expectations, with traffic up 3.6%, digital comps up 8.7%, and same-day delivery growing more than 25%; food and beauty were strong, while apparel and home still lagged. A major one-time boost from $994M of tariff refunds helped lift profitability, though underlying EPS still grew about 20% excluding that benefit. Mgmt. raised FY sales growth guidance to around 5%, up from its prior outlook, and also raised its underlying EPS guidance as stronger sales trends and better execution supported the turnaround, helping shares rise.

• Lowes Revenue missed at $25.96B vs. $26.16B, while EPS beat at $4.40 vs. $4.22. Comparable sales rose just 0.2% as strength in Pro, home services, and 15.7% online growth was largely offset by continued weakness in discretionary DIY spending, with customers still holding back on bigger projects amid high mortgage rates and a soft housing market. Tariff refunds added about $0.11 to EPS, helping support the bottom-line beat. Mgmt. narrowed FY guidance to the low end of its prior range, because it expects DIY customers to remain cautious through the second half.

• TJX Companies Beat on both the top and bottom line. Comparable sales rose 4% as shoppers spent more per trip and transactions increased, with especially strong growth at HomeGoods, Canada, and International. The weak spot was Marmaxx, where comps rose just 1% because merchandise mix and allocation mistakes left some basic and impulse-driven products missing from stores; mgmt. called the issue “self-inflicted and within our control” and said trends have already improved in August. Mgmt. raised FY adjusted EPS and margin guidance and increased its long-term store target to 7,500, but Q3 adjusted EPS guidance came in below the consensus, while higher fuel and freight costs and the Marmaxx slowdown weighed on shares.

• Ross Top line beat at $6.26B while adj. bottom line beat at $2.06. Results were driven by strong customer traffic and compelling merchandise, pushing comparable sales up 10%, while underlying operating margins expanded well above expectations even excluding a $253M tariff refund. The company raised its 2H and FY outlook and increased its 2026 store opening plan to 115 locations.

• Viking Holdings beat on revenue and EPS. Results were driven by fleet expansion and strong demand, with capacity up 10.9% as Viking added ships, while higher revenue per passenger pushed net yield up 6.2% and EBITDA rise 18.2% despite higher costs from operating the larger fleet. Forward demand also remained strong, with 96% of 2026 capacity already sold and 2027 advance bookings up 21%, even as the company plans to increase capacity another 15% next yr. Historically low European river levels have disrupted some itineraries and resulted in future cruise vouchers that are expected to weigh on FY27 and FY28 results, although mgmt. said the disruptions have not hurt booking trends.

• Estee Lauder Top and bottom line beat, with revenue at $3.63B vs. $3.54B and EPS at $0.39 vs. $0.32. Results were driven by continued momentum in prestige fragrance and skincare, with fragrance sales up 10% behind strength at Le Labo and Tom Ford, while China improved as the company increased consumer investment and pulled back on discounting; makeup remained flat and hair care declined 1%. Earnings also benefited from $38M of tariff refunds, which partially offset $102M of incremental tariff costs for the FY. Mgmt. said its turnaround is gaining traction and expects to cut 10,000 jobs as part of its restructuring, which is expected to be substantially completed in FY27. The company guided above expectations.

• Wolfspeed Missed with revenue of $149.6M vs. $150M and a bigger then expected EPS loss. Results were weighed down by continued weakness in materials, where sales fell 44% YoY, and negative gross margins, which more than offset AI data-center sales that grew 20% QoQ and doubled for the FY as demand for its power products increased. Mgmt. expects gross margins to remain negative and guided Q1 revenue roughly in line with expectations.

• Alibaba Beat on the top line but missed on the bottom line. Results were driven by strong AI demand, with AI Cloud and Compute revenue up 45%, but heavy AI infrastructure spending pressured profitability as capex jumped 75% due to increased CPU procurement to meet AI demand, higher semiconductor prices, and equipment-delivery timing, while net profit fell 75%. Mgmt. expects AI-related capex to break even within three years as it expands compute capacity and deploys more of its lower cost in-house chips.

• Deere & Company Beat on the top and bottom lines, with revenue of $12.61B vs. $12.43B and EPS of $5.10. Results were driven by strength in Construction & Forestry, where sales rose 18% on demand from infrastructure, data-center and energy projects, and Small Ag & Turf, where sales rose 12%, helping offset continued weakness in large agriculture. Production & Precision Ag sales fell 6% as farmers remained cautious amid lower crop prices and elevated costs. Mgmt. raised FY net income guidance to $4.5B-$5.0B, roughly in line with expectations, while warning that tariffs remain a headwind.

On The Move 📈 📉

• Moderna pulled back on profit-taking after its mRNA cancer vaccine combined with Merck’s Keytruda posted breakthrough melanoma trial results, which drove a historic 176% surge on Wednesday.

• Crypto players are on the move. $BTC and $ETH rallied after Trump pushed Congress to pass the Clarity Act, which would define crypto as securities or commodities.

• Innio fell despite announcing a $300M+ Waukesha plant expansion to serve growing data center demand.

• SpaceX slipped below its $135 IPO price after 319M new shares became tradable as part of the staggered post-IPO unlock schedule. Up next: ~1.3B shares unlock around SpaceX’s Q3 earnings in early November.

• Circle Internet Group rose after outlining long-term USDC growth targets in the trillions ahead of the Arc mainnet launch on September 16.

• Advance Auto Parts crashed after Q2 revenue missed and comp sales fell 0.5% on DIY channel weakness. Peers $AZO, $ORLY, and $GPC also fell as CEO Shane O’Kelly said “tighter household budgets constrained spending more than we anticipated.”

• Drone stocks and sold off in a broader drone-theme unwind as rising 30-year Treasury yields pressured the group’s high multiples.

IPO Roundup 📍

• Anthropic is targeting a $10B+ credit facility ahead of its potential fall IPO, more than 4x its $2.5B facility from last year. Lead banks are being asked to commit ~$1.25B each as they compete for IPO underwriting mandates.

• YMTC completed pre-listing tutoring, moving closer to a Chinese IPO after rival CXMT’s $9.9B debut last month. The chipmaker is currently the world’s third-largest flash memory maker.

• Orion180 Insurance Group Inc. filed for a US IPO as the Florida-based specialty home and flood insurer eyes a larger share of the excess and surplus insurance market, which has grown at a 25% CAGR to $4B over the past five years.

• Lyntris Inc. $LYNX fell in its NYSE debut Wednesday after a downsized IPO raised $297.5M at $17.50 per share (below the $19-$22 marketed range) for a $1.62B valuation. The Trive Capital-backed defense sensor company sold 17M shares and makes systems for 200+ US DoD and allied programs.

Today’s Headlines 📖🍿

• Opposition to AI data center buildout is becoming a bipartisan issue, with the NRSC warning it’s a “sleeper issue” for the cycle. Pew found over half of Americans are now more concerned than excited about AI, up from 37% in 2021.

• Morgan Stanley has chosen Dallas as a major expansion site, planning a relocation of up to 4,800 jobs by 2031. Their location would be just a mile away from Goldman’s new urban campus.

• Bill Ackman is donating $400M in Pershing Square stock to launch a New York brain research and rehabilitation institute, with plans for a second, similarly sized donation to make it self-sustaining.

• Ramp launched their own AI routing system called Router, letting users switch between models from OpenAI, Anthropic, DeepSeek, and others through a single API, positioning itself as a rival to OpenRouter; which was just acquired by Stripe.

• Stripe has told investors “the singularity” has begun, arguing remaining private is best for the moment and holding off on an IPO. The company reported 41% YoY revenue growth in H1 2026.

• SpaceX attempted to acquire Cognition, an AI coding startup, although talks aren’t currently active and the two are instead discussing Cognition using SpaceX computing capacity. Cognition was valued at $26B in May, and is in talks to raise at a $40B valuation.

• A Guggenheim Investments loan swung sharply Wednesday. It traded below 80 cents Monday, jumped to 90 during a lender call as executives promised better Q3 earnings, then fell back to the low-80s as they dodged questions on the federal probe into owner Mark Walter. For baseball fans…this is one to watch to see if anything happens with Walter’s LA Dodgers.

• Insurance-defense law firm Wood Smith Henning & Berman has agreed to be acquired by PE sponsor Wood Smith Henning & Berman at a $700M valuation (18x 2025 EBITDA). Lawyers would keep ownership of the firm while the PE firm owns the nonlegal side through an MSO.

• PE firm BlackSun raised the first $1B of a $7B Mega Fund I to invest across sports, media, entertainment, and technology. The fund has already bid for Warner Bros Discovery and joined Native American groups in a bid for a Seattle NBA expansion team.

• CD&R’s Cornerstone Building Brands is sounding out private credit firms for a potential LME. Cornerstone’s $2.46B 1L TL due in 2028 trades at 54 cents.

• PE firm Arctos agreed to buy 10% of the Atlanta Falcons at a $10.6B valuation, purchased in two tranches over 18 months. It would be Arctos’ 4th NFL investment (Chargers, Bills, Browns) pending an October NFL vote.

• Standard Life is partnering with a consortium led by CVC and Prudential to enter the UK’s booming pension risk-transfer market. The group committed £2B over five years, and Standard Life holds 51% of voting rights.

• Morgan Stanley is hiring Tim Luke from Barclays as vice chairman in its tech investment banking group. Luke will focus on semiconductors and hardware. He previously served as a senior advisor to former UK PM David Cameron.

M&A Transactions💭

Pinewood Technologies (LON: PINE), a cloud-based full-service technology provider, has entered into a definitive agreement to be acquired for GBP 545.0M by Ridgeview Partners. Jefferies advised on the sale.

Clearwater1, manufacturer of water quality and air purification equipment, has reached a definitive agreement to be acquired for $465.0M by Veralto (NYS: VLTO). EV/Revenue was 3.44x.

Webster Financial (NYS: WBS), a full-service provider of financial services, was acquired for $16.647B by Banco Santander (MAD: SAN). EV/Net Income was 16.79x and EV/Revenue was 5.66x. Piper Sandler and J.P. Morgan advised on the sale.

PCI Energy Solutions, developer of energy management and optimization software, has reached a definitive agreement to be acquired for $1.4B by Mitsubishi Electronic (TKS: 6503).

At-Bay, operator of a cyber-risk insurance and security platform, has reached a definitive agreement to be acquired for $575.0M by Munchener Ruckversicherungs-Gesellschaft (ETR: MUV2). Ardea Partners advised on the sale.

D-Fend Solutions, developer of an autonomous counter-drone system, was acquired for $1.5B by Motorola Solutions (NYS: MSI). EV/Revenue was 8.11x. Jefferies and Goldman Sachs advised on the sale.

Cox Communications, operator of a multi-service broadband communication agency, was acquired for $34.5B by Charter Communications (NAS: CHTR). Allen & Company, BDT & MSD Partners, Wells Fargo, and Evercore Group advised on the sale.

Essity (STO: ESSITY B) reached a definitive agreement to acquire The Feminine Care Business of Kenvue (NYS: KVUE) for $284.0M.

Chaeun Package, manufacturer of cosmetic packaging, was acquired for 44.0B Won by Meritz Securities, Hosan Investment, and Its Management.

MicroAge, provider of managed IT services, has reached a definitive agreement to be acquired for $220.5M by ScanSource (NAS: SCSC).

Wood Smith Henning & Berman, a law firm, has signed a letter of intent with a private equity firm to be acquired in a deal that values the company at roughly $700.0M. EV/Adjusted EBITDA was roughly 18x.

Private Placement Transactions💭

Kynexis, developer of a precision medicine, raised EUR 97.0M of Series A venture funding led by Novartis Venture Fund.

Flash, developer of a human resource management platform, raised $150.0M of Series D venture funding led by Battery Ventures and Kevin Efrusy.

Blacksmith, developer of managed infrastructure, raised $111.26M of Series B venture funding led by Peak XV Partners at a pre-money valuation of $509.0M.

Also, developer of an integrated technology platform, raised $150.0M of Series D venture funding led by Prysm Capital at a pre-money valuation of $850.0M.

Rillet, developer of accounting software, raised $100.0M of Series C venture funding led by ICONIQ Growth at a pre-money valuation of $900.0M.

Castelion, manufacturer of advanced hypersonic weapon systems, raised $1.05B of Series C venture funding through a combination of debt and equity in a deal led by J.P. Morgan Chase at a pre-money valuation of $12.0B.

Muon Space, developer of mission-optimization satellite constellations, raised $250.0M of Series C venture funding led by Eclipse Capital at a pre-money valuation of $1.25B.

Habitat, manufacturer of smart home products, raised CNY 700.0M of Series A venture funding led by Changzhou Venture Capital Group.

Noteworthy Chart 🧭

YTD Inflows for non-traded BDCs have fallen -70% (BBG)

That’s all - talk soon!

Welcome back! This is a pretty lengthy and info-packed newsletter. We’ve been bombarded with information since we last spoke, so let’s talk oil first:

There was an attack on a ship in the Strait of Hormuz yesterday, resulting in a crew member casualty. President Trump has stated there are no current talks taking place with Iran at the moment. The 30-year hit a 19-year high as geopolitical risks are driving rates higher:

It’s important to remember, rates aren’t just an oil story; it’s an AI story too: With AI becoming more of a financing story from lending (instead of cash flow investing), any rate sensitivity might make financing slower or more expensive.

And this comes right as we got Anthropic and OpenAI’s recent financials..

Anthropic’s ARR is on track for $65B+, a herculean rise since $47B in May and $9B in FY25. The Problem? This is actually lower than Yipit data of what people thought. Yipit data was floating $80B of ARR, meaning this came in lower than buyside expectations. Honestly, think the Buyside community who were disappointed need to get a grip.

The bigger issue seems to be OpenAI’s 2Q numbers. The WSJ leaked that 2Q revenue of $6.7B is up just 18% sequentially, while losses have widened. OpenAI has still achieved a massive feat, but this is dwarfed by Anthropic’s $11.6B in 2Q revenue. Basically, Anthropic might have eaten OpenAI’s lunch within 6 months. From reading the tea leaves, the IPO that Anthropic is racing towards looks fine, while the lagging IPO story for OpenAI comparatively looks less compelling.

$QQQ struggled yesterday, there might be some more pain today, and tbh my eye is on Oracle CDS (OpenAI is a massive part of their RPOs). Let’s get into it.

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Here’s a look at the remaining earnings for this week.

• Wednesday: Analog Devices, TJX Companies, Lowe’s, Target, Viking Holdings, Estée Lauder, Nordson, Dycom Industries, BILL Holdings, Webull, Coty, Wolfspeed

• Thursday: Walmart, Alibaba, Deere & Company, NetEase, Aegon, Advance Auto Parts, Ross Stores, Flowers Foods

• Friday: BJ’s Wholesale Club, KE Holdings, The Buckle

Here’s a look at economic data this week (estimates are in quotations).

• Wednesday: Federal Open Market Committee meeting minutes published

• Thursday: Philadelphia Fed Business Outlook Survey (25), Weekly Jobless Claims (205K), Leading Indicators (0%)

• Friday: U.S. Flash Manufacturing PMI (54.3), US Flash Services PMI (53.8)

Earnings Corner 💸

• Fabrinet Beat on both the top and bottom lines, with revenue of $1.32B vs. $1.28B and EPS of $4.10 vs. $3.81, driven by strong AI data-center demand as data-center revenue rose 68% YoY and became more than half of total sales. Growth was broad across data-center interconnect, high-performance computing, and communications infrastructure, while mgmt. said demand remains strong enough to keep expanding manufacturing capacity. Q1 guidance also beat, but shares still fell as Datacom revenue declined sequentially, HPC growth came in more modestly, and FY revenue from Nvidia fell 21%.

• Home Depot Revenue beat at $47.86B vs. $47.27B and EPS beat at $4.92 vs. $4.73. Results were driven by broad demand across Pro and DIY, continued spending on smaller projects, and a higher average ticket, helping comp sales rise 1.7%, while tariff refunds also supported profitability. Larger projects remain pressured by high mortgage rates, which have kept housing turnover low and customers hesitant to take on bigger renovations. Mgmt. reaffirmed FY guidance, keeping sales growth at 2.5%-4.5% and comp sales at flat to +2%, rather than raising the outlook given ongoing uncertainty around inflation, fuel costs, and the broader economy.

• Toll Brothers Top and bottom line beat with revenue of $2.66B vs. $2.62B and EPS of $2.97, though revenue fell nearly 10% YoY as home deliveries declined. Net signed contracts rose 5% YoY, helped by resilient demand from its higher-end customer base, but backlog slipped to $6.24B and operating margin fell to 13.5% from 17.4% as lower volumes and higher costs weighed on profitability. Shares fell as contract volume came in below expectations and the broader housing backdrop remained pressured.

• La-Za-Boy Missed on both top and bottom line with revenue of $475.7M vs. $501M and adjusted EPS of $0.43 vs. $0.49, as sales fell amid an uneven consumer environment. Retail delivered sales rose 10%, but were more than offset by weaker wholesale sales, while Joybird written sales fell 17% as demand remained volatile. Mgmt. guided Q2 revenue below expectations and warned investments in new stores, advertising, pricing, and digital initiatives will pressure margins, sending shares down after hours.

On The Move 📈 📉

• Neocloud stocks , , , and tumbled as the 10-year Treasury yield spiked to 4.74%, hitting the leveraged AI infrastructure trade. CoreWeave took the hardest hit with net debt-to-EBITDA of 10.75 and $640M in interest expense.

• Analyst moves: rebounded on multiple PT hikes following the Q2 earnings beat, $BBWI rose after Citi upgraded to Buy from Neutral with a $31.24 fair value ahead of Wednesday’s Q2 earnings, and $PLNT climbed on a Morgan Stanley PT hike to $51 from $47.

• Klarna tumbled on three fronts: FY GMV guidance cut on German consumer weakness, Q3 revenue guide below consensus, and both CFO and CMO stepping down.

• Carvana fell on concerns billionaire investor Mark Walter may sell down his ~4% stake amid a federal probe of his investment empire. Walter agreed last week to sell the LA Lakers at a record valuation.

• WhiteFiber crashed after announcing a $250M convertible senior notes offering due 2032 to fund AI data center expansion. The offering came a day after it agreed to buy two North Carolina data-center sites for $60M cash.

• Ulta Beauty rose after two exclusive brand launches: Nutrire hair wellness (rolling out to 250 US stores from August 23) and Dr. Reju-All skincare.

IPO Roundup 📍

• Anthropic’s ARR crossed $65B by end of July, up from $47B in May, ahead of a potential IPO later this year. The company is projecting $190B-$200B in 2028 revenue, which its IPO valuation is expected to hinge on.

  • Dario’s stake is only 2% - this was revealed in a recent article that highlighted Anthropic is working to get him and other co-founders advanced voting rights regardless.

• Shein, once valued at $100B, is looking to raise ~$2B at a $26B-27B valuation in Hong Kong. Existing shareholders including IDG Capital, Mubadala, Coatue, and HSG may take up half of the deal.

• General Atlantic, the $130Bn AUM growth equity firm, is eyeing an IPO potentially as soon as this year, after previously filing confidentially with the SEC in 2023 without ever listing.

• Fort Robotics is going public via a SPAC merger with Newbury Street II Acquisition Corp. at a $500M valuation. The Mark Cuban-backed physical AI startup makes hardware and software for safely operating autonomous robots.

Here’s a look at the remaining earnings for this week.

• Wednesday: Analog Devices, TJX Companies, Lowe’s, Target, Viking Holdings, Estée Lauder, Nordson, Dycom Industries, BILL Holdings, Webull, Coty, Wolfspeed

• Thursday: Walmart, Alibaba, Deere & Company, NetEase, Aegon, Advance Auto Parts, Ross Stores, Flowers Foods

• Friday: BJ’s Wholesale Club, KE Holdings, The Buckle

Here’s a look at economic data this week (estimates are in quotations).

• Wednesday: Federal Open Market Committee meeting minutes published

• Thursday: Philadelphia Fed Business Outlook Survey (25), Weekly Jobless Claims (205K), Leading Indicators (0%)

• Friday: U.S. Flash Manufacturing PMI (54.3), US Flash Services PMI (53.8)

Earnings Corner 💸

• Fabrinet $FN Beat on both the top and bottom lines, with revenue of $1.32B vs. $1.28B and EPS of $4.10 vs. $3.81, driven by strong AI data-center demand as data-center revenue rose 68% YoY and became more than half of total sales. Growth was broad across data-center interconnect, high-performance computing, and communications infrastructure, while mgmt. said demand remains strong enough to keep expanding manufacturing capacity. Q1 guidance also beat, but shares still fell as Datacom revenue declined sequentially, HPC growth came in more modestly, and FY revenue from Nvidia fell 21%.

• Home Depot $HD Revenue beat at $47.86B vs. $47.27B and EPS beat at $4.92 vs. $4.73. Results were driven by broad demand across Pro and DIY, continued spending on smaller projects, and a higher average ticket, helping comp sales rise 1.7%, while tariff refunds also supported profitability. Larger projects remain pressured by high mortgage rates, which have kept housing turnover low and customers hesitant to take on bigger renovations. Mgmt. reaffirmed FY guidance, keeping sales growth at 2.5%-4.5% and comp sales at flat to +2%, rather than raising the outlook given ongoing uncertainty around inflation, fuel costs, and the broader economy.

• Toll Brothers $TOL Top and bottom line beat with revenue of $2.66B vs. $2.62B and EPS of $2.97, though revenue fell nearly 10% YoY as home deliveries declined. Net signed contracts rose 5% YoY, helped by resilient demand from its higher-end customer base, but backlog slipped to $6.24B and operating margin fell to 13.5% from 17.4% as lower volumes and higher costs weighed on profitability. Shares fell as contract volume came in below expectations and the broader housing backdrop remained pressured.

• La-Za-Boy $LZB Missed on both top and bottom line with revenue of $475.7M vs. $501M and adjusted EPS of $0.43 vs. $0.49, as sales fell amid an uneven consumer environment. Retail delivered sales rose 10%, but were more than offset by weaker wholesale sales, while Joybird written sales fell 17% as demand remained volatile. Mgmt. guided Q2 revenue below expectations and warned investments in new stores, advertising, pricing, and digital initiatives will pressure margins, sending shares down after hours.

On The Move 📈 📉

• Neocloud stocks $CRWV, $NBIS, $APLD, and $IREN tumbled as the 10-year Treasury yield spiked to 4.74%, hitting the leveraged AI infrastructure trade. CoreWeave took the hardest hit with net debt-to-EBITDA of 10.75 and $640M in interest expense.

• Analyst moves: $DUOL rebounded on multiple PT hikes following the Q2 earnings beat, $BBWI rose after Citi upgraded to Buy from Neutral with a $31.24 fair value ahead of Wednesday’s Q2 earnings, and $PLNT climbed on a Morgan Stanley PT hike to $51 from $47.

• Klarna $KLAR tumbled on three fronts: FY GMV guidance cut on German consumer weakness, Q3 revenue guide below consensus, and both CFO and CMO stepping down.

• Carvana $CVNA fell on concerns billionaire investor Mark Walter may sell down his ~4% stake amid a federal probe of his investment empire. Walter agreed last week to sell the LA Lakers at a record valuation.

• WhiteFiber $WYFI crashed after announcing a $250M convertible senior notes offering due 2032 to fund AI data center expansion. The offering came a day after it agreed to buy two North Carolina data-center sites for $60M cash.

• Ulta Beauty $ULTA rose after two exclusive brand launches: Nutrire hair wellness (rolling out to 250 US stores from August 23) and Dr. Reju-All skincare.

IPO Roundup 📍

• Anthropic’s ARR crossed $65B by end of July, up from $47B in May, ahead of a potential IPO later this year. The company is projecting $190B-$200B in 2028 revenue, which its IPO valuation is expected to hinge on.

  • Dario’s stake is only 2% - this was revealed in a recent article that highlighted Anthropic is working to get him and other co-founders advanced voting rights regardless.

• Shein, once valued at $100B, is looking to raise ~$2B at a $26B-27B valuation in Hong Kong. Existing shareholders including IDG Capital, Mubadala, Coatue, and HSG may take up half of the deal.

• General Atlantic, the $130Bn AUM growth equity firm, is eyeing an IPO potentially as soon as this year, after previously filing confidentially with the SEC in 2023 without ever listing.

• Fort Robotics is going public via a SPAC merger with Newbury Street II Acquisition Corp. at a $500M valuation. The Mark Cuban-backed physical AI startup makes hardware and software for safely operating autonomous robots.

Today’s Headlines 📖🍿

• Trump paused for 3 days 50% US tariffs on ~$20B of Canadian goods that were about to take effect Wednesday. This last minute pause comes as Trump and Carney are seemingly close to a deal.

• Industrial production in July rose just +0.2% (below estimates of 0.4%), with tech and defense output growing well, but autos struggling.

• Long-term sovereign bond yields are surging, with 30-year US Treasury yields hitting a 20-year high of 5.33%, while French, German, UK, and Japanese long bonds approach multi-decade or record highs.

• Google won a $10M bankruptcy auction for Spirit Airlines’ data to train its AI models. The deal covers ~100M emails and ~500M Microsoft Teams chats, plus marketed materials, HR info, financial databases, and audits.

• PIMCO’s Credit Maker Lens says BDC equities are lagging bonds as investors demand a higher risk premium for uncertainty around portfolio valuations. Deal flow premiums eroded from ~300bps in 2017-18 to under 100bps in Q1 2026 and PIMCO warns BDC equity valuations may face more pressure as marks eventually converge with public markets.

• Mark Walter and Todd Boehly are in talks to sell their Chelsea FC stakes to Clearlake Capital. The move follows Walter’s $12.5B Lakers sale just 14 months after buying the team for $10B, and comes as federal investigators probe loans his insurers made to other firms he controls.

• Jeanie Buss is disputing her family’s sale of their 17.8% Lakers stake to Joshua Kushner and Bob Iger at the same $12.5Bn valuation Mark Walter agreed to last week, with her lawyer citing a 2017 court ruling that requires co-trustee approval for any sale.

• Nvidia will back up to $105B of an Ohio data center project for OpenAI, which is part of a partnership that could generate ~$600B in Nvidia revenue through 2030. Jensen Huang denied the deal is “circular financing,” and OpenAI will pay the lease as capacity comes online.

• Barclays names Adeel Khan and Mike Joo as co-CEOs of its investment bank, promoting global markets chief Khan and hiring Joo from a co-head role at Bank of America amid a solid Q2 for the bank’s investment division.

• Four states took Meta to federal court seeking $200Bn in damages, accusing the company of designing addictive products that fueled a youth mental health crisis while promoting its apps as safe.

• KKR-owned Internet Brands plans to issue a bond within the next few weeks to refinance debt, with $3Bn in first-lien loans due May 2028 and $2.8Bn maturing 2029-2031. The company seeks to capitalize on improved business performance after its debt sold off in February amid AI competition fears.

• Cogent Communications is looking to refinance $750M of 7% unsecured notes due June 2027, with Bank of America shopping a first-lien bond deal at 9.5%. $CCOI has tumbled 87% in the last 18 months, and S&P cut to B- last week.

• Boeing and Lockheed’s Martin’s rocket joint venture United Launch Alliance is closing a $1.5B private bond deal, tripling its original $500M target.

• Blackstone’s BCRED and Blue Owl Technology Finance both upsized bond sales, with BCRED raising $750M against a $500M target and Blue Owl raising $400M against a $200M target.

• The University of California sold $1Bn of private equity stakes at more than a 10% discount, including funds tied to software and tech-focused buyouts. The sale comes amid a broader secondaries market boom as client-led deal volume grew from $54Bn in H1 2025 to $56Bn in H1 2026.

• Dallas private equity firm Broadwing Capital Management closed its debut fund $90M above its $350M target, focusing on small, founder-owned manufacturing, distribution, and services businesses.

M&A Transactions💭

Ultradent Products, manufacturer of dental medical devices and supplies, was acquired for JPY 144.3B by Mitsui Chemical America. Jefferies advised on the sale.

TDX Technology, manufacturer of display and camera modules, was acquired for $4.5B by Bhagwati Products.

Talkspace (NAS: TALK), a virtual behavioral healthcare company, has reached a definitive agreement to be acquired for $835.0M by Universal Health Services (NYS: UHS). EV/Revenue was 3.4x. Wells Fargo advised on the sale.

NEOS Investments, provider of investment management services, was acquired for $2.25B by The Goldman Sachs Group. Barclays advised on the sale.

Equity Residential (NYS: EQR), owns a portfolio of 312 apartment communities, was acquired for $6.196B by AvalonBay Communities (NYS: AVB). EV/EBITDA was 5.53x and EV/Revenue was 3.87x. Bank of America, Centerview Partners, and Morgan Stanley advised on the sale.

Epiq Solutions, developer of wireless sensing tools, has reached a definitive agreement to be acquired for $1.1B by TTM Technologies (NAS: TTMI). Robert W. Baird & Co and Goldman Sachs advised on the sale.

ebm-papst, manufacturer of fans and motors, has reached a definitive agreement to be acquired for EUR 5.1B by Madison Air (NYS: MAIR). EV/EBITDA was 17.07x and EV/Revenue was 2.09x. Goldman Sachs advised on the sale.

Ecopetrol Investimentos do Brasil acquired 25% of Brava Energia (BVMF: BRAV3), a company engaged in the oil and gas sector, for $1.2B. After the transaction, Ecopetrol Investimentos do Brasil owns a 51% stake in the company. EV/EBITDA was 5.67x and EV/Revenue was 2.06x.

Blue Ridge Bankshares (ASE: BRBS), a company engaged in offering commercial and consumer banking and financial services, has reached a definitive agreement to be acquired for $448.1M by HomeTrust Bancshares (NYS: HTB). EV/Net Income was 47.73x and EV/Revenue was 5.33x. Stephens advised on the sale.

The 6GW Renewabe Energy Portfolio of Vena Energy was acquired by INOX Clean Energy for INR 60.0B.

RAFI Indices, operator of a global index company, was acquired for $490.0M by TMX VettaFi. EV/EBITDA was 12.89x and EV/Revenue was 10.0x. Ardea Partners advised on the sale.

Omnetics Connector, manufacturer of miniature connectors, was acquired for $770.0M by Arxis (NAS: ARXS).

LCN Capital Partners, provider of real estate investment and asset management services, has entered into a definitive agreement to be acquired for $410.0M by The Goldman Sachs Group. RBC Capital Markets advised on the sale.

Dermatouch, manufacturer of skincare products, was acquired for $3.875B by Wipro Consumer Care & Lighting.

Private Placement Transactions💭

Wispr Flow, developer of a voice interface platform, raised $280.0M of Series B venture funding led by Menlo Ventures at a pre-money valuation of $1.72B.

Unrivaled, operator of a professional women’s basketball league, raised $106.35M of venture funding from undisclosed investors.

Lovable Labs, developer of an AI-driven application builder, raised $400.0M of Series C venture funding led by EQT and Menlo Ventures at a pre-money valuation of $12.9B.

Higgsfield, developer of an AI-driven video creation platform, raised $400.0M of Series B venture funding led by DST Global at a pre-money valuation of $5.0B.

Groq, developer of AI inference platform, raised $1.0B of Series A venture funding led by Disruptive and Infinitum at a pre-money valuation of $2.5B.

Gravis Robotics, developer of robotic excavators, raised $200.0M of Series A venture funding from Softbank.

Antares, manufacturer of transportable fission microreactors, raised $530.0M of Series C venture funding led by Caffeinated Capital and Paradigm.

Velaura, developer of a web infrastructure platform, raised $110.0M of Series A venture funding led by Seligman Ventures at a pre-money valuation of $890.0M.

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The Week Ahead Of Us 🔍

Welcome back!

Stocks were off a bit Friday, but the S&P has advanced 6.43% since the July 29th lows. One of the reasons for Friday’s weakness was preliminary consumer sentiment fell to 51 from 55.2 in July. Earnings are nearly done, but we have some of the big retailers like Home Depot, Lowe’s, Walmart, and Target coming up. Futures are up slightly.

Let’s get into it. Here’s a look at earnings this week.

• Monday: Fabrinet, H World Group, XP Inc., Grifols, Bally’s

• Tuesday: Home Depot, BHP, Keysight Technologies, Baidu, Amer Sports, Klarna, Toll Brothers, La-Z-Boy

• Wednesday: Analog Devices, TJX Companies, Lowe’s, Target, Viking Holdings, Estée Lauder, Nordson, Dycom Industries, BILL Holdings, Webull, Coty, Wolfspeed

• Thursday: Walmart, Alibaba, Deere & Company, NetEase, Aegon, Advance Auto Parts, Ross Stores, Flowers Foods

• Friday: BJ’s Wholesale Club, KE Holdings, The Buckle

Here’s a look at economic data this week (estimates are in quotations).

• Monday: Empire State Manufacturing Survey (12), NAHB Housing Market Index (33)

• Tuesday: Housing Starts (1.3M), Import Prices (0.1%), Industrial Production M/M (0.4%), Capacity Utilization (74.6%), Pending home Sales Idx M/M (0%)

• Wednesday: Federal Open Market Committee meeting minutes published

• Thursday: Philadelphia Fed Business Outlook Survey (25), Weekly Jobless Claims (205K), Leading Indicators (0%)

• Friday: U.S. Flash Manufacturing PMI (54.3), US Flash Services PMI (53.8)

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On The Move 📈 📉

• PayPal rose after reports that Stripe and Advent International are in active talks to acquire the company for $53B. The proposal follows an earlier offer PayPal rejected.

• Wingstop rebounded after a mixed Q2: adj EPS beat estimates, but domestic same-store sales fell 7.5% and management guided full-year comps down 4% to 6%. Eight firms cut PTs but mostly kept Buy/Overweight ratings.

• Duolingo fell as it gave back Thursday’s gains from the Animade animation studio acquisition.

• Broadcom fell on concerns about a $370B AI chip financing vehicle backstopping customer lease obligations.

• Reddit kept surging after being added to the S&P 500 effective August 18, replacing AvalonBay Communities $AVB.

• Bullish gave back Thursday’s earnings rally as investors zeroed in on the $280M Q2 net loss and 44% collapse in digital asset sales, even as adj revenue grew 62%.

• Hertz kept falling after Wednesday’s crash on Bill Ackman’s Pershing Square exiting its stake, ending a 6-day rally that pushed the stock up 85%.

• Oracle fell after a 6-month delay to the Green Chile pipeline meant to power its Project Jupiter AI data center in New Mexico. Oracle said the project remains on schedule.

• Heartflow rocketed after Q2 revenue grew 48% and management raised FY guidance to 40-42% (from 29-32%). Stifel, JPMorgan, and Wells Fargo all raised price targets.

IPO Roundup 📍

• Anthropic disclosed Q2 revenue of $11.5B+, up 14x from $787M a year ago, as it prepares for a potential fall mega-IPO. Morgan Stanley, Goldman Sachs, and JPMorgan are working on the offering.

• RedotPay delayed its ~$1B US IPO to next year or later as the stablecoin payments company seeks regulatory approvals and faces a $470M lawsuit from Binance affiliates alleging its founders diverted customers to a competing product. JPMorgan, Goldman Sachs, and Jefferies are working on the offering.

Today’s Headlines 📖🍿

• Jane Street took a $15Bn loss tied to its stake in Situational Awareness and broader tech losses, marking the trading firm’s first negative month since 2016. Jane Street has still generated over $40Bn in trading revenue YTD but has pulled back on risk-taking and closed positions in Asian equities and AI-exposed semiconductor stocks.

• In Other 13-F News:

  • Berkshire Hathaway’s 13F showed it added $17B to Alphabet, making it its third-largest equity holding. Berkshire also added to Delta, Lennar, and Macy’s, while reducing stakes in Capital One, Kroger, and Nucor.

  • David Tepper’s Appaloosa trimmed Micron stake $MU in Q2, completely exited SanDisk and Corning, and added to Mag7 names.

  • Druckenmiller sold Google and Fox, while adding to his largest position, Taiwan Semi.

  • Bill Ackman and Pershing continued adding to Uber, reduced Amazon, and bought names like Netflix, Visa, and Mastercard.

• Apollo published its 2026 Midyear Credit Outlook. The firm sees credit fundamentals as resilient but the margin for error is narrowing as AI creates a divide across credit markets and turns the buildout into a market-capacity problem. Apollo expects private IG credit to be essential to closing the AI funding gap, and AI factor risk to redefine portfolio diversification.

• Brookfield CEO Bruce Flatt says private credit stress is a “healthy adjustment” after too-loose underwriting, not a systematic problem. Flatt sees the concerns concentrated in PE-backed borrowers and software, while Brookfield focuses on hard-asset lending in real estate and infrastructure.

• ION Group secured a 12-month extension on a UBS credit line used to fund its Prelios acquisition, pushing maturity to July 2027 as investor unease grows over the software firm’s debt load.

  • The company has also missed rent payments on offices in three countries: an eviction notice in Sydney, weeks of denied access in Munich, and a since-withdrawn lawsuit in Connecticut. The missed payments come as scrutiny mounts over Ion’s $10Bn debt load.

• Palmer Square, one of the largest founder-owned CLO management platforms still on the market, is exploring a sale. The firm, owned by Christopher and Angie Long, has $13Bn in US AUM and €4.5bn in European AUM within the reinvestment period.

• Liberty Puerto Rico hit with amended lawsuits from Arini Capital Management and GoldenTree Asset Management, alleging the cable company continued “unlawful transactions,” including a $140MM revolving facility and $200M term loan, using assets that were already shifted beyond creditors’ reach in a September liability management exercise.

• Partners Group $PTRS has become the worst-performing stock in MSCI’s European financials index this year, down 24.8% partly after the firm capped withdrawals from two of its evergreen private equity funds as investor redemption requests reached 6%.

• Volatility Shares Trust filed to launch 32 ETFs for each NFL team, tracking on-ice performance via cash-settled futures on team-specific “Sports Performance Indexes”. These vehicles track wins and losses, as opposed to tying to the financial performance of the teams.

• Telesat took out a $120MM term loan to support its declining legacy satellite business, with shares falling after the company reported a 25% revenue decline and a $12.7MM operating loss for the quarter. Telesat owes $2.1Bn across four debt tranches maturing over the next 14 months, warning that existing cash flows don’t cover debt obligations.

• HPS published a report on AI’s impact on software lending. The firm sees a widening EV/EBITDA gap between vertical and horizontal software multiples. Additionally, private credit is shifting from sponsor-backed buyouts to AI infrastructure financing.

• The CFTC is reviewing “mention markets” on prediction platforms, where traders bet on specific words appearing in speeches or earnings calls.

• Stripe will reportedly buy AI gateway startup OpenRouter for over $7B+. The startup allows companies to switch between AI models fluidly.

• AI enthusiasm is pushing stocks to record highs, but rising Treasury yields could derail the rally. Big Tech is projected to spend $740B on AI infrastructure in 2026 and $1T in 2027, funded increasingly by debt as the 30-year Treasury sits near its highest yield since 2007.

M&A Transactions💭

Qube Holdings, has three main divisions: operating, property, and Patrick, was acquired for AUD 11.7B by Macquarie Asset Management, UniSuper Superannuation Fund, and Pontegadea Inversiones. UBS Group advised on the sale.

Pier House Resort & Spa, operator of a resort and Caribbean spa company, was acquired for $190.0M by Sixth Street Partners and Riller Capital.

Filtration Group, manufacturer of air, gas, and process filtration products, was acquired for $9.25B by Park-Hannifin (NYS: PH). Lincoln International advised on the sale.

Arize, developer of an observability platform, has reached a definitive agreement to be acquired for $915.0M by Dynatrace (NYS: DT). Qatalyst Partners advised on the sale.

Accelerant Holdings (NYS: ARX), operates as a data-driven risk exchange, has entered into a definitive agreement to be acquired for $4.4B by Thoma Bravo. EV/Revenue was 3.85x. Houlihan Lokey and Morgan Stanley advised on the sale.

Polaris DS, provider of bitcoin mining services, was acquired for $444.0M by Core Scientific (NAS: CORZ).

Boralex, a power producer whose core business is dedicated to the development and operation of renewable energy, was acquired for CAD 9.0B by La Caisse and Brookfield Asset Management. EV/EBITDA was 18.43x and EV/Revenue was 9.87x. RBC Capital Markets and National Bank Capital Markets advised on the sale.

Private Placement Transactions💭

Databricks, developer of a data analytics platform, raised $5.0B of venture funding led by Coatue Management, MGX, Blackstone, and Sixth Street Partners at a pre-money valuation of $185.0B.

AIGC micro, developer of high-efficiency core chips for intelligent terminals, raised over CNY 2.0B of Series B venture funding from China structural Reform Fund, Shanghai Guoxin Investment, and Youdao.

Noteworthy Chart 🧭

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Welcome back. Good news, the S&P hit an all time high yesterday!

On Wednesday, July CPI rose 0.1% m/m (3.4% y/y) and core CPI rose 0.2% m/m (2.5% y/y), in line with expectations and 0.1 points cooler than June. Inflation coming in line with expectations means there’s enough ammo for enough Fed members to wait and see come September. Jobless claims came in at 209k, slightly above estimates of 205k, but unemployment benefit claims fell by 22k to 1.78mm.

Polymarket traders are pricing in a 71% chance of no change in September, a stark move from what was a coin flip right after the July meeting.

Still, Kashkari and Hammack are among the Fed Presidents who have been quite vocal for a 25bps hike. In an interview yesterday, Hammack said “my view is we need to act now.” Fed Chair Warsh called last meeting a “family fight”, and the 3 dissenters (in last month’s 9-3 vote to hold rates) are unlikely to move despite what the market is perceiving as encouraging data.

Our early prediction for September? Another hold with Warsh being more bark than bite, but the dissenters get more numbers in their camp. I’m surprised no one has made a 12 angry jurors reference yet.

Let’s get into it.

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Earnings Corner 💸

• Nebius revenue beat at $582.3M vs. $572.8M, while EPS also beat on a narrower loss than expected. Growth came from its AI cloud business, which generated $575M as customers raced to lock in scarce computing capacity, helping the company sign four AI-cloud deals averaging more than $1B each. That scale-up is starting to translate into profitability. The company is still spending heavily to add GPUs and data-center capacity, with Q2 capex at $5.7B, but customer prepayments are helping fund the expansion. Mgmt. raised its year-end contracted power target to 5 GW and said it could already sell all of its planned 2027 capacity.

• Cicsco Systems beat on both the top and bottom lines, driven by strong AI networking demand as hyperscaler infrastructure orders reached $9.3B and networking revenue rose 28% YoY because cloud providers continued spending heavily on the networking equipment needed to connect AI data centers. Mgmt. guided FY2027 revenue above estimates and expects AI infrastructure revenue to nearly double to $7.5B, but that heavier mix of AI hardware is expected to compress gross margins, while growth is also expected to slow as the year progresses. That combination helped explain the share drop despite the beat.

• Cerebras revenue missed at $180M vs. $194M, while EPS beat with a narrower loss than expected. Underneath the headline miss, core revenue more than doubled to ~$210M as its fast-inference cloud business nearly quadrupled, driven by the ramp of its OpenAI deployment and higher usage from other cloud customers, while hardware revenue grew 17%. Demand remains strong, with $25.4B of remaining performance obligations, and mgmt. raised FY core revenue guidance as it adds more data-center capacity to support growth. a $450M GAAP loss largely driven by stock compensation, and Q3 guidance that implies only modest sequential core revenue growth while gross margins are expected to dip before improving later in the year.

On The Move 📈 📉

• Sandisk popped after unveiling ambitious FY28-FY30 targets at its Investor Day: mid-to-high teens revenue growth, ~80% adj gross margins, ~75% adj operating margins, and ~50% adj FCF margin.

• StubHub plummeted Thursday after quarterly expenses jumped 37% vs. 33% revenue growth, as World Cup ticketing chaos wiped out profits. CEO Eric Baker pointed to FIFA’s mobile-ticketing complications leading to a $40,000 net loss versus an expected 11-cent-per-share profit.

• Ackman rotation: tumbled and $NFLX rose after Bill Ackman’s Pershing Square exited its Hertz stake and disclosed a new position in Netflix. CIO Ryan Israel cited loss of confidence in Hertz management after its funding plan, while praising Netflix’s dominance and subscriber base nearly double Disney+ and HBO Max combined.

• Workday rocketed intraday after Reuters reported Silver Lake is in talks to take the HR software provider private. The talks have been ongoing for months, though no deal is guaranteed.

• Tapestry crashed to a six-month low as FY27 revenue guidance implied a slowdown to mid-single-digit growth, even after a Q4 beat and a 16% dividend hike. Kate Spade sales fell 7% in Q4 while Coach grew 14%.

• Birkenstock soared after raising FY26 revenue guidance to the top of its 13-15% range at 15% constant currency growth. Q3 also delivered double-digit growth across every region.

• Wendy’s jumped Wednesday on a FT report that Nelson Peltz’s Trian Fund Management is preparing a takeover bid for the burger chain with backing from BlueFive Capital and Flynn Group.

• Reddit pumped after hours after being added to the S&P 500, replacing Avalon Communities effective August 18. Reddit becomes only the second pureplay social media company in the index after Meta.

IPO Roundup 📍

• Anthropic is eyeing a $2T IPO in October, which would make it the largest IPO ever, surpassing SpaceX. Anthropic closed a May round with $47Bn of annualized revenue, which many believe they have dramatically passed over the past few months. Investors now expect $100-120Bn of revenue by December, more than 10x growth in a year.

• OpenAI’s annualized revenue is on track to top $40B, roughly doubling its run rate from the end of 2025 ahead of its planned IPO. Growth is driven by AI coding software, subscription sales, and its nascent advertising business. The run rate jumped more than 20% month-over-month in July alone.

• DeepSeek is jacking up prices for its flagship V4 models by more than 4x ahead of its potential IPO, signaling a shift toward profitability. Starting August 16, V4-Flash jumps to $1.32 per million tokens (from $0.28) and V4-Pro to $3.96 (from $0.87). Even after the hike, DeepSeek remains far cheaper than Chinese rival Moonshot ($15/M for Kimi K3 and Anthropic’s Fable 5 ($50/M).

Today’s Jobs:

1. Ares is hiring its in Credit Technology Engineering team (NY)

2. Neuberger Berman is hiring a Sr. Credit Analyst (Chicago)

3. Bain is hiring a Liquid Structured Credit Analyst (Boston)

4. Houlihan Lokey is hiring for multiple IB roles (NY)

5. Moelis is hiring an IB Associate focused on data centers (NY)

Search the Buyside Hub Job Board

Today’s Headlines 📖🍿

• AI disruption fears are colliding with private equity debt piled into software companies, with more than $150Bn of software debt due through 2029 and lenders now demanding steeper terms to finance it. Fitch found that 9% of software companies it rates face high AI disruption risk, with the pattern already playing out at Thoma Bravo’s Medallia.

• OpenAI’s Chief Revenue Officer is departing the Company less than a year in. This follows a recent $7B tender and former COO Brad Lightcap’s departure.

• A proprietary survey from Wells Fargo shows that CIOs have increasingly adopted Anthropic over the last twelve months and will increasingly do so over the next twelve:

• The US refunded $33.4Bn in tariffs in July, outpacing the $24.8Bn collected that month and marking the third straight month of negative net tariff revenue, pushing total refunds past $100Bn since the Supreme Court struck down Trump’s IEEPA tariffs in February. The overall federal deficit hit $1.8T for FY 10 months, with the CBO projecting a $2.1T full-year deficit.

• Citadel is imposing two-year non-competes for some investing staff, including analysts. The length of garden leave is tied to compensation. The more you earn, the longer the non-compete, with a year-long minimum.

• Manhattan average rent hit an all-time high of $6,655/month, up 10% YoY, with vacancy rates falling to 1.49%. Brokers point to Mayor Mamdani’s incoming October rent freeze and new pied-à-terre tax as recent accelerants, with landlords already padding market-rate rent to offset costs.

• Mark Walter has agreed to sell the LA Lakers to Joshua Kushner and Bob Iger for $12.5Bn, the highest price ever paid for a sports team, just a year after buying the team at a then-record $10Bn. Walter, whose insurance companies are under federal investigation and restructuring pressure, needed liquidity with the sale expected to free up collateral.

• Databricks raised $5Bn at a $190Bn valuation, a 42% jump from its $134Bn valuation in February. The company has crossed $7Bn in revenue run-rate, more than 80% YoY in Q2.

• Bending Spoons is facing customer backlash after aggressive price hikes on acquired apps. One Harvest invoicing customer saw his annual subscription jump 12x from $211 to $2,547. $BSP also fell after BofA cut its rating on concerns about acquisition debt access.

• Bill Ackman’s Pershing Square USA is now trading at a 22% discount, among the widest of any US closed-end funds, which Ackman called “frankly absurd” on his first earnings call since taking the company public in April. Ackman, who rotated new stakes in Netflix, Visa, Mastercard, and S&P Global, acknowledged missteps in how the IPO was marketed to investors.

• Jane Street’s lease is backing $2.25B in green bonds for an Oklahoma AI data center. The 15-year triple-net structure covers a 149 MW facility developed as a Fluidstack/Next Frontier joint venture, and the notes are rated Ba2 by Moody’s.

• 26% of Gen Z investors say sports betting is part of their long-term financial plan, vs. just 1% of boomers. Over half of young investors have redirected money from investing to sports betting in the past year.

• Goldman Sachs agreed to buy active ETF provider NEOS Investments for up to $2.25B, doubling down on the $180B “boomer candy” market. NEOS manages $30B in options-strategy ETFs that maximize payouts and minimize taxes for investors seeking upside with limited downside.

• AMD raised $4.75B in its largest-ever US dollar bond offering, further adding to a wave of AI-related debt. The high-grade notes were sold in four tranches, with maturities ranging from 3 to 10 years, and the longest tenor priced at 90bps over Treasuries.

Chart of the Day

M&A Transactions💭

The Los Angeles Lakers has entered into an agreement to be acquired for $12.5B by Josh Kushner and Bob Iger from Mark Walter. The transaction represents a record valuation for a North American sports franchise.

Accelerant Holdings (NYS: ARX), operator of a data-driven specialty insurance platform, has entered into an agreement to be acquired for $4.4B by Thoma Bravo. EV/Revenue was 3.85x. Houlihan Lokey and Morgan Stanley advised on the sale.

Arize, developer of an AI observability platform, has entered into an agreement to be acquired for $915M by Dynatrace (NYS: DT).

Decart, developer of an AI infrastructure platform, has entered into an agreement to be acquired for KRW 8.5BB by Anthropic.

Béis, operator of an on-the-go lifestyle brand and weekender bags, has entered into an agreement to be acquired for $178.5M by Samsonite Group. Raymond James advised on the sale.

BlackSea Technologies, developer of AI-enabled manned and unmanned systems, has entered into an agreement to be acquired for $650.0M by AEVEX. EV/Revenue was 4.33x. Raymond James advised on the sale.

EnviroServe, provider of environmental and waste management services, has entered into an agreement to be acquired for $470.0M by Clean Harbors. EV/EBITDA was 17.41x and EV/Revenue was 1.88x. Brown Gibbons Lang & Company and RBC Capital Markets advised on the sale.

NEOS Investments, provider of investment management services, has entered into an agreement to be acquired for $2.25B by Goldman Sachs. The company will receive contingent payout, which is in cash and stock, contingent upon the fulfillment of certain performance and/or service commitments. Barclays advised on the sale.

New Mexico Gas Company, supplier of natural gas services, was acquired for $1.25B by Bernhard Capital Partners. J.P. Morgan advised on the sale.

Systex (TAI: 6214), provider of information technology and consulting services, has entered into an agreement to be acquired for TDW 29.1B by Taiwan Mobile. EV/EBITDA was 7.29x and EV/Revenue was 0.60x.

The Microbiology Business of Thermo Fisher Scientific was acquired for $1.08B by Astorg. Perella Weinberg Partners and Wells Fargo advised on the sale.

BMC Manufacturing, manufacturer of low-voltage switchgear and electrical equipment, has entered into an agreement to be acquired for $1.03B by Kingspan Group. EV/EBITDA was 9.85x and EV/Revenue was 3.89x.

H&R Real Estate Investment Trust, owner and operator of real estate investments, has entered into an agreement to be acquired for $5.01B by Blackstone. EV/Revenue was 9.12x.

Private Placement Transactions💭

Bank of America (NYS: BAC) reached a definitive agreement to acquire an 49% stake in Jio Credit, a provider of digital lending services, for INR 182.68B.

Lovable Labs, developer of an AI driven application builder, raised $400.0M if Series C funding led by EQT and Menlo Ventures.

CodeRabbit, developer of an AI-powered platform, raised $143.0M of Series C venture funding led by Smash Capital and Atomico Partners at a pre-money valuation of $1.36B.

Claris Bio, developer of a topical formulation technology, raised $118.0M through a combination of Series B1 and Series B2 venture led by Catalio Capital Management and Samsara BioCapital at a pre-money valuation of $84.0M.

Bridge to Life, developer of a preservation products and technologies, raised $110.0M of Series C venture funding through a combination of debt and equity. The equity led by Soleus Capital.

Iran demanded the US unfreeze Iranian funds as a condition for reopening the Strait of Hormuz, sending oil prices up more than 6% this week. Pakistan’s defense minister told Bloomberg that the U.S. and Iran are close to “some sort of arrangement” but obviously things remain quite tense.

Today’s inflation day - any surprise to the upside brings September rate hike discussions back on the table. Jobs were weak on Friday, but at 8:30am ET today we’ll know number if inflation is still running hot.

Let’s get into it.

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Here’s a look at the remaining earnings for this week.

• Wednesday: Cisco, Coherent, Nebius, Cerebras, Amcor, Performance Food Group, Trimble, Brinker International, StubHub, Grocery Outlet, Virgin Galactic, Fossil, Jack in the Box, Red Robin

• Thursday: Applied Materials, Brookfield, JD.com, Tapestry, Birkenstock, YETI, Intuitive Machines, McGraw Hill

Here’s a look at economic data this week (estimates are in quotations).

• Wednesday: CPI M/M (0.1%), Core CPI M/M (0.3%), CPI Y/Y (3.4%), CPI Core Y/Y (2.5%), Monthly Treasury Balance

• Thursday: Weekly Jobless Claims (203K), PPI (0.2%), Ex-Food & Energy PPI, M/M (0.2%)

• Friday: Retail Sales (0.1%), Manufacturing & Trade: Inventories (0.1%), U. Michigan Prelim Consumer Survey (54.5)

Earnings Corner 💸

• Cava Revenue beat at $365.4M vs. $360M, while EPS beat at $0.19 vs. $0.18. Growth was driven by 9% same-store sales, with most of that coming from 5.3% higher guest traffic, plus 17 new restaurant openings that are performing ahead of expectations. Restaurant-level margin fell 60 bps to 25.7% as the new salmon launch, more third-party delivery, and higher wages added costs, though stronger sales helped offset some of that pressure. Mgmt. kept FY guidance unchanged and said sales are already recovering after a short-term hit from broader Cyclospora-related concerns around lettuce and fresh produce.

• CoreWeave revenue beat at $2.58B vs. $2.56B, while EPS also beat by posting a narrower loss than expected. Results were driven by surging AI infrastructure demand, with customers like Meta and Anthropic taking more GPU capacity as companies race to secure compute for training and running AI models. Backlog reached $104B and near-term capacity is essentially sold out, the company is spending heavily on new data centers, chips, and power to keep up with demand. Mgmt. raised FY revenue guidance as it expects more capacity to come online and demand to remain strong.

• RocketLab beat at $234.1M vs. $231.6M and AST SpaceMobile revenue missed at $31.5M vs. ~$35M. AST’s revenue came from gateway deliveries and U.S. government contract milestones, while Rocket Lab’s beat was driven by product sales nearly doubling as its space-systems and government business expanded. Both missed on EPS, with AST’s loss widening as satellite production, launches, and network buildout drove spending higher, while Rocket Lab continued investing in Neutron and expanding its space infrastructure. The bigger difference is where each is headed: AST is building a direct-to-cell network for normal phones, while Rocket Lab is becoming a broader launch, satellite, and communications company through Neutron and its Iridium acquisition.

• On Holding revenue missed while EPS beat. Sales rose 13% YoY, driven by strong DTC and Asia-Pacific demand, but reported growth was held back by FX, slower wholesale sales, and promotional activity. Wholesale grew just 5%. Gross margin reached 65.4%, but mgmt. lowered its FY sales outlook to CHF3.47B–CHF3.56B as the company prioritizes full-price sales and margins over faster near-term growth.

• Venture Global revenue came in at $4.58B, up 48% YoY, while EPS beat at $0.51 vs. $0.49. Growth came from selling more LNG as new production at its Plaquemines export facility came online, along with stronger liquefaction fees. The company is spending heavily to finish Plaquemines and build out its next major LNG project, CP2, which pushed first-half capex to $6.9B and debt to $42.4B. Mgmt. still raised FY adjusted EBITDA guidance as it expects more export capacity to come online.

On The Move 📈 📉

• Riot Platforms initially jumped after announcing a 20-year $9.1Bn infrastructure agreement with Anthropic to provide 191 megawatts of computing capacity.

• Life360 tanked despite Q2 subscription revenue growing 31% and a raised subscription guide. Investors focused on the lowered hardware guidance and unchanged overall FY revenue and EBITDA guidance.

• Plug Power jumped after Q2 delivered a revenue beat, breakeven gross margins, and raised 2026 revenue growth guidance. The company is targeting positive EBITDA in Q4, and HC Wainwright reaffirmed Buy.

• Beyond Meat crashed after the former meme stock announced a 1-for-30 reverse stock split to avoid getting kicked off Nasdaq for failing the minimum bid price requirement.

• Aramark rallied after its new Nexus unit won a multi-year AI data center hospitality contract covering hyperscale sites in Wyoming and Texas. UBS, Truist, and BofA raised price targets to $65-70.

• eToro crashed despite Q2 net contribution and adj EBITDA both growing 9% and a $231M TradeZero acquisition. Crypto contribution collapsed to $11M and July capital markets activity came in flat YoY.

• Under Armour kept sliding after Barclays downgraded to Underweight with a $5 PT (~15% downside), citing “delayed brand recovery” and “macro-related consumer malaise.”

IPO Roundup 📍

• Anthropic is meeting with potential investors ahead of its planned IPO this September/early October, potentially the largest ever at a $965Bn valuation, fielding pointed questions on Chinese AI competitors, Trump administration tensions, and data-center backlash.

• Lyntris Inc. is targeting up to $528M in its US IPO, pricing 24M shares at $19-$22 for up to a $2.53B valuation. The Trive Capital-backed defense sensor technology company makes systems combining sensors, antennas, and proprietary software for military use across 200+ programs serving the US DoD and international allies. Evercore, Citigroup, and Guggenheim Securities are leading the offering.

• DayOne Data Centers filed confidentially for a US IPO that could raise ~$5B at a potential $20B valuation, targeting a listing as soon as next quarter. The company closed a $4.5B Series C in June led by Coatue and Hillhouse, and has secured 1.5+ gigawatts of bookings across the Asia Pacific and Europe since its 2022 inception.

Today’s Headlines 📖🍿

• Nvidia struck a megadeal with Apollo, Blackstone, BlackRock, Brookfield, Goldman Sachs, and KKR to create “compute financing platforms” aimed at deploying over $500Bn of outside capital to help Nvidia’s customers finance computing power at attractive rates. The financing could help signal to investors that Nvidia and its partners in the AI boom have the “firepower” to build the infrastructure they need. Still, bond investors have widened the yield they demand on Nvidia debt since June, a sign of pricing in more leverage entering the AI trade.

• Pimco looked at how the massive AI capex cycle is reshaping bond markets, with USD investment grade absorbing far more hyperscaler debt than its euro counterpart. Worth a read if you’re curious how the AI buildout is showing up in credit.

• Intel is raising $15B in an equity offering to fund AI chip growth after its shares nearly tripled this year. JPMorgan, Goldman, Morgan Stanley, and Citi are joint book-runners on the deal, which includes a 30-day option for an additional $2.25B.

• The US Strategic Petroleum Reserve has also fallen below 300M barrels, the lowest in more than 40 years as exports traveling through the Strait of Hormuz have tanked due to the U.S. Iran war.

• Barclays says price-sensitive private investors, now 73% of the Treasury market vs. ~50% a decade ago, are keeping 30-year yields at multi-decade peaks. The 30-year has traded above 5% for 41 straight days (longest since 2007), and Thursday’s $25B bond sale is expected to draw the highest yield since August 2001.

• Mark Zuckerberg published an AI manifesto arguing that superintelligence should be broadly distributed to individuals rather than concentrated among a few labs, framing “balance of power” as AI safety’s real foundation. He positioned Meta as uniquely focused on “personal superintelligence” versus rivals building for institutions.

• PE firms are stuck with nearly 34,000 unsold businesses, up from 32,451 in 2025 and 15,923 10 years ago. US PE returns have lagged the broader market, with 6.4% annualized returns from July 2022 to March 2026 vs. 15.2% for the S&P500, as rates, software pressures, and a dried-up buyer pool challenge exits.

• Regional banks are seeing rising commercial loan demand as AI capex spills into manufacturing and infrastructure sectors, with the KRE regional bank ETF up 17% this year and near-record highs and net C&I loan demand jumping to 16.1% from 4.8% in Q1.

• Jamie Dimon argued AI infrastructure spending will “play out and pay out,” estimating it will add 1% to GDP this year and again next year, even as Alphabet posted negative $5.9Bn FCF in Q2 on $44.9Bn of capex and Amazon’s trailing FCF hit a $7.6Bn outflow.

• Roku launched “Fairground AI,” a free channel broadcasting 24/7 AI-generated content, drawing widespread mockery online for its glitchy visuals and incoherent dialogue. Creator Colin Petrie-Norris marketed it as the first fully-ad supported AI streaming channel, but early clips, including a medieval drama with backward-flying arrows, suggest otherwise.

• 777 Partners filed for Chapter 11 bankruptcy in Texas after creditors owed $26M sought to force an involuntary liquidation last month, accelerating a wind-down that started when co-founder Josh Wander resigned in 2024 amid criminal fraud charges.

• Honolulu is selling ~$196M in municipal bonds this week, with $9.4M going to finish Skyline, the US’s first driverless light-rail system. Costs have doubled from $5B in 2012 to ~$10B today, and the full 19-mile line is expected in 2031.

• Ontario Teachers’ Pension Plan earned 9.5% in the first half of 2026, which was driven by an $8.7B SpaceX stake. The fund’s ~50.7M SpaceX shares (~0.7% of the company) were the venture growth arm’s first-ever investment back in 2019.

• Uber has exited its stake in Serve Robotics after clashes over how to deploy delivery robots, and Serve says it won’t renew the partnership when it expires in early 2027. Serve halved its FY revenue outlook after quarterly delivery volumes through Uber fell for the first time since their 2022 partnership began.

• Citadel Securities says systematic buyers are set to reload on stocks after leveraged ETF assets plunged 42% to $154B last month, and semiconductors saw the largest drop. Corporate buyback authorizations now top $1T, the highest ever for this time of year.

  

M&A Transactions💭

The Warehousing Portfolio in Chennai and Kolkata was acquired for INR 15.0B by Logicap.

oOh!media (ASX: OML), operates a network of out-of-home advertising sites, has entered into a definitive agreement to be acquired for AUD 1.04B by I Squared Capital. UBS Group advised on the sale.

Woojin Electric, manufacturer of power equipment and electrical components, has entered into a definitive agreement to be acquired for KRW 300.0B by Co-Stone Capital. EV/EBITDA was 10.0x.

Varex Imaging (NAS: VREX), manufactures, sells, and services X-ray imaging components, has reached a definitive agreement to be acquired for $1.17B by Teledyne Technologies (NYS: TDY). EV/EBITDA was 14.63x and EV/Revenue was 1.35x. Evercore Group advised on the sale.

Moneris Solutions, provider of payment processing services, has entered into a definitive agreement to be acquired for CAD 2.0B by Francisco Partners. BMO Capital Markets, PJT Partners, and RBC Capital Markets advised on the sale.

MarineMax (NYS: HZO), sells new and used recreational boats, has entered into a definitive agreement to be acquired for $1.5B by Safe Harbor Marinas. EV/EBITDA was 12.75x and EV/Revenue was 0.68x. Wells Fargo advised on the sale.

Kashiv BioSciences, provider of pharmaceutical research and drug delivery services, was acquired for $1.1B by Amneal Pharmaceuticals (NAS: AMRX). J.P. Morgan advised on the sale.

Hansen & Adkins Auto Transport, provider of vehicle transportation services, has reached a definitive agreement to be acquired for $152.1M by Proficient Auto Logistics (NAS: PAL). The company will receive a contingent payout of $22.1M upon the achievement of near-term EBITDA targets.

First State Bank (OTCM: TYFG), a bank holding company, has reached a definitive agreement to be acquired for $204.6M by HBT Financial (NAS: HBT). EV/Net Income was 13.13x and EV/Revenue was 2.93x. Performance Trust Capital Partners advised on the sale.

Two Special Purpose Vehicles of Dilip Buildcon were acquired by Alpha Alternatives Holdings for INR 84.0B. JM Financial advised on the sale.

DBM Global (OTCM: DBMG), engaged in providing construction and superior asset management solutions, has reached a definitive agreement to be acquired for $650.0M by IES Holdings (NAS: IESC). Jefferies advised on the sale.

Cherry Hill Mortgage Investment (NYS: CHMI), a fully integrated, internally managed residential real estate finance company, has reached a definitive agreement to be acquired for $257.187M by TPG Mortgage Investment Trust (NYS: MITT). EV/Net Income was 38.88x and EV/Revenue was 7.21x. BTIG advised on the sale.

Bowman Consulting Group (NAS: BWMN), a professional services firm, has entered into a definitive agreement to be acquired for $988.97M by Bernhard Capital Partners. The transaction was supported by $550.0M of debt financing. EV/EBITDA was 28.69x and EV/Revenue was 1.87x. Bank of America advised on the sale.

Actio Biosciences, developer of genetics-driven precision medicines, has reached a definitive agreement to be acquired for $1.32B by Jazz Pharmaceuticals (NAS: JAZZ). The company will receive a contingent payout of $500.0M upon the completion of future performance terms. Centerview Partners and J.P. Morgan advised on the sale.

Resonant Sciences, operator of a research and development firm, has reached a definitive agreement to be acquired for $500.0M by Joby Aviation (NYS: JOBY).

Cornell Pump Company, manufacturer of centrifugal pumps, has reached a definitive agreement to be acquired for $1.46B by Xylem (NYS: XYL). EV/Revenue was 5.62x. Evercore Group and Goldman Sachs advised on the sale.

ATG Entertainment, operator of a network of performance theatres, has entered into a definitive agreement to be acquired for EUR 4.5B by MARI Group. Jefferies, LionTree, and Goldman Sachs advised on the sale.

Menck, provider of hydraulic pile driving services, was acquired for EUR 501.0M by Caderler.

Kneat (TSE: KSI), the business of developing and marketing a software application for modeling regulated data-intensive processes for regulated industries, has entered into a definitive agreement to be acquired for CAD 650.0M by Thoma Bravo. EV/EBITDA was 66.08x and EV/Revenue was 9.6x. ATB Cormark Capital Markets and CIBC Capital Markets advised on the sale.

Private Placement Transactions💭

Lancium, developer of a scheduling and orchestration system, has entered into a definitive agreement to be receive $3.0B of financing from Nvidia. As part of the transaction $1.0B will be given after hitting specific grid hookup milestones.

Startorus Fusion, developer of nuclear fusion reactors, raised CNY 880.0M of Series A++ venture funding from Bank of Communications Assets Investments, ABC Financial Assets Investment, and Yongxin Capital.

Point2 Technology, developer of a technology platform, raised $136.0M of Series B venture funding led by LB Investment at a pre-money valuation of $209.0M.

Cambridge Aerospace, developer of interceptor systems, raised $300.0M of Series C venture funding led by DFJ Growth at a pre-money valuation of $3.1B.

Vaderis Therapeutics, developer of oral medicine, raised $152.0M of Series B venture funding led by TCG Crossover Management, and Goldman Sachs Asset Management.

River AI, developer of personal intelligence software, raised $1.1B of venture funding led by General Catalyst and AMP PBC at a pre-money valuation of $3.9B.

Aureka Biotechnologies, developer of a therapeutics discovery platform, raised $100.0M of Series B venture funding led by Highlight Capital.

Neros, manufacturer of unmanned aerial systems, raised $250.0M of Series C venture funding led by American Strategic Technology Fund and Sequoia Capital at a pre-money valuation of $2.25B.

We are excited to announce that Bull Street is now part of The Wall Street Rollup, a finance news and media brand led by High Yield Harry.

We want to thank Evelio and the legacy Bull Street team for their great work and passion for the public markets. We are excited to carry the torch and introduce you all to our newsletter.

Our approach is simple:

1. We cover the public markets: Earnings releases, economic events, the biggest stock market movers, IPO news, and everything else moving the markets.

2. We cover the private markets: Private equity activity, the latest in Private Credit, the big bond deals that are financing AI deals and LBO activity, M&A transactions, private placements, distressed debt and bankruptcies, and all of the things that bridge both the public and private markets together.

Our goal is to cover as much information as possible, with a 5-person team working around the clock to deliver value to readers.

You will get an edition from us every Sunday evening, Wednesday morning, and Friday morning.

Thank you for your readership, let’s get into it:

The Week Ahead Of Us 🔍

Here’s a look at earnings this week.

• Monday: Simon Property, Ferguson Enterprises, Alcon, Barrick Mining, Quantum Computing Inc., Life360, AECOM, Hims & Hers Health, Dole, GoPro, JBS, AST SpaceMobile, Rocket Lab

• Tuesday: Lumentum, Cardinal Health, CoreWeave, Venture Global, On Holding, Super Micro Computer, Aramark, Smithfield Foods, CAVA, Amentum, eToro

• Wednesday: Cisco, Coherent, Nebius, Cerebras, Amcor, Performance Food Group, Trimble, Brinker International, StubHub, Grocery Outlet, Virgin Galactic, Fossil, Jack in the Box, Red Robin

• Thursday: Applied Materials, Brookfield, JD.com, Tapestry, Birkenstock, YETI, Intuitive Machines, McGraw Hill

Here’s a look at economic data this week (estimates are in quotations).

• Monday: None scheduled

• Tuesday: NFIB Index of Small Business Optimism (97.2), Existing Home Sales (4.0M), Federal Reserve Bank of New York Q2 Household Debt and Credit Report published

• Wednesday: CPI M/M (0.1%), Core CPI M/M (0.3%), CPI Y/Y (3.4%), CPI Core Y/Y (2.5%), Monthly Treasury Balance

• Thursday: Weekly Jobless Claims (203K), PPI (0.2%), Ex-Food & Energy PPI, M/M (0.2%)

• Friday: Retail Sales (0.1%), Manufacturing & Trade: Inventories (0.1%), U. Michigan Prelim Consumer Survey (54.5)

Earnings Corner 💸

• Berkshire Hathaway top and bottom like beat as revenue beat at $101.8B vs. $95.3B. Operating earnings rose 16%, driven by stronger manufacturing, services and retail earnings, up 24%, along with growth at Berkshire Hathaway Energy and BNSF, which helped offset weaker insurance results as GEICO underwriting profits. The company bought back $4.5B in shares after leadership said the stock looked undervalued, and became a net buyer of stocks for the first time in 14 quarters, helping reduce cash from $397.4B to $365.5B.

• Vistra revenue missed at $4.02B vs. $5.73B, while EPS missed at $1.68 vs. $2.05. Earnings were pressured by a $472M unrealized hedge loss, higher operating costs, and higher interest expense, even as adjusted EBITDA rose 31% on stronger realized energy and capacity prices and contributions from the Lotus plants. Demand also stayed strong, with extreme heat driving high power usage and continued growth from data centers. Vistra kept FY guidance unchanged and is investing up to $1B in its Helix data center partnership with KKR, NVIDIA, and KIA as it looks to capitalize on AI power demand.

• Under Armour revenue missed at $1.10B vs. $1.11B, while EPS beat. Sales fell 3% as softer consumer demand in North America and Asia-Pacific, weaker wholesale orders, lower e-commerce traffic, and heavier industry promotions weighed on results. Profitability held up better as tariff refunds, supply-chain benefits, and tighter cost control helped gross margin expand 590 bps. Mgmt. cut its FY revenue outlook but kept adjusted operating income guidance unchanged as it continues shrinking its product assortment and limiting discounting.

• Wendy’s Top and bottom line beat but the quarter was still weak underneath. U.S. same store sales down 7% as traffic fell 12.5%, while higher beef and labor costs pressured margins. International system sales grew 3.4%, but that wasn’t enough to offset the U.S. weakness. The company withdrew its FY outlook and cut its quarterly dividend as mgmt. works through a turnaround focused on value, food quality, operations, and restaurant economics, while 5%–6% commodity inflation is expected to keep pressure on margins.

On The Move 📈 📉

• Celsius rocketed on Friday after Rockstar Energy’s founder built a 4.7% stake and called for an ouster of the CEO and key executives.

• Atlassian soared after Q4 cloud revenue reaccelerated to 31% YoY when investors had been bracing for a slowdown. CEO Mike Cannon-Brookes also pledged to buy up to $250M in stock on the open market.

• Doximity exploded after CEO Jeffrey Tangney said AI search revenue runs 10x per search in revenue vs. cost. Analysts say that AI upside isn’t reflected in the raised FY guidance.

• SpaceX climbed as the first and largest post-IPO lockup expiration failed to trigger the feared selloff. The unlock released 911.5M shares (143% more than the June IPO float), more than doubling the public float to 11.8% from 4.9%.

• Twilio jumped after raising FY2026 revenue growth to 18-18.5% and completing a $1.2B share buyback covering 10.6M shares.

• Trade Desk kept falling after Q3 adjusted EBITDA guidance of $160M came in less than half of the $340M expected. Citi followed with a “Sell” downgrade and $11 PT, implying another 27% downside.

• Under Armour fell after lowering its FY2027 revenue outlook on softer demand in North America and Asia-Pacific. Q1 revenue fell 3% and North America revenue dropped 9%.

IPO Roundup 📍

• Switch Inc. filed confidentially for a US IPO that could come as soon as November, targeting a valuation approaching $50B. The Las Vegas-based data center operator, majority owned by DigitalBridge Group, is also adding A16z co-founder Ben Horowitz to its board. BofA, Citigroup, Goldman Sachs, JPMorgan, and Morgan Stanley are working on the offering.

• The UK’s IPO slump is squeezing private equity and venture capital exits as just seven PE-backed UK IPOs have priced over the past five years and the London Stock Exchange has seen more delistings than listings every year since 2022. PE firms are turning to take-privates and peer sales instead as UK companies listing at home fell to 46% in 2025 from 71% in 2019, with names like Waterstones and SumUp weighing delays to 2027.

Today’s Headlines 📖🍿

• Here’s the U.S. and Iran latest: Iran has denied any direct talks with the U.S. regarding opening the Strait of Hormuz, with messages being exchanged through intermediaries instead. President Trump has said “we are low keying it” with Iran, with less concern about Iran slow-rolling negotiations due to “its huge inflation and the fact they have no money”.

• Friday’s Jobs numbers were a miss, as July nonfarm payrolls fell by -23k, well below an estimate of a +83k gain. This was primarily due to a drop in 53k government jobs. Unemployment decreased to 4.1% from 4.2%, but labor force participation correspondingly fell to 61.4%, its lowest rate in 5+ years.

• Deep Reads

  • Morgan Stanley put out an interesting piece on the Wisdom of Crowds in Markets across prediction markets, sports betting, and the stock market. The takeaway: betting markets are zero-sum before costs, while the stock market has positive expected returns over time.

  • Fast Company dived into how private equity’s playbook has negatively reshaped Hartford, Connecticut, from hospitals to the local newspaper. It’s an interesting read on how PE Investment can negatively impact treatment at hospitals.

• Levered companies are ditching private credit for cheaper bank loans to cut borrowing costs. Firms with private credit debt are refinancing in the syndicated market roughly 3x more often than the reverse, per JPMorgan/KBRA data.

• Situational Awareness is betting $400mm on a stealth chip startup, Source Foundry. Leopold Aschenbreenner is back in the game, but is sticking to private investments now after his public book blowup.

• BlackRock’s Rick Rieder says last month’s payroll contraction reflected an AI-driven “productivity revolution”, not economic weakness. He argues the US is on track for 6% nominal GDP growth even as hiring stalls, and rate cuts remain possible this year.

• Deirdre Bosa is leaving CNBC and going founder mode, launching her own livestreamed show that focuses on AI.

• AI boot camps have exploded to ~1/3 of the professional certificate market, up from just 2% before ChatGPT launched in 2022. The share of employers expecting entry-level workers to be AI-competent has nearly tripled since last fall.

• AI Fundraising in the U.S. dwarfs China: Despite reportedly strong performance from Chinese modeling, IPO and bond fundraising in the U.S. is dramatically higher than Chinese firms:

• Inside the rise of Pro Padel: The Pro Padel League raised a $15mm Series A back in March, and is targeting a wealthy audience - streaming their 2026 season on CNBC and relying on celebrities endorsements to fuel growth.

Today’s Jobs:

• 1. HPS is hiring a Strategic Financing Associate (NY)

  2. Oaktree is hiring a US Senior Loans Associate (LA)

  3. Blackstone is hiring an Asset Allocation Senior Associate (NY)

  4. PineBridge is hiring a Multi-Asset Analyst (NY)

  5. Napier Park is hiring a Research Analyst (Chicago)

  6. Partners Group is hiring a Valuation Professional (London)

  7. Caxton is hiring a Consumer L/S PM (NY)

  Search the Buyside Hub Job Board

• PE and IB Hiring News:

  • Ralph Yang is joining Audax as MD and Co-Head of Audax Strategical Capital from Blackstone Tac Opps

  • Adam Buzanis has joined OMERS as MD and Head of Funds

  • Adam Kewskin has joined Morgan Stanley’s Industrials IB Group from Bank of America

M&A Transactions💭

The Pizza Hut China Business of Yum! Brands (NYS: YUM) was acquired by Yum China (NYS: YUMC) for $1.2B. Barclays and Goldman Sachs advised on the sale.

Minto Apartment REIT, an unincorporated, open-ended real estate investment trust, was acquired for CAD 3.307B by Crestpoint Real Estate Investments. EV/Revenue was 20.83x. Desjardins Capital Markets and BMO Capital Markets advised on the sale.

The Mobile Tower Business of IHS Holding was acquired by Macquarie Asset Management for $952.0M. The transaction was supported by $289.0M of debt financing. J.P. Morgan advised on the sale.

Beazer Homes USA (NYS: BZH), a construction company, has reached a definitive agreement to be acquired for $2.200496193B by Dream Finders Homes (NYS: DFH). EV/Revenue was 1.06x. Bank of America, J.P. Morgan, Kennedy Lewis Investment Management, and Moelis & Company advised on the sale.

Private Placement Transactions💭

Firmus Technologies, developer of AI-infrastructure systems, raised $2.0B of venture funding from Nvidia, Jane Street, and Coatue Management at a pre-money valuation of $8.5B.

PT PNM Investment Management and JBS USA have entered into an agreement to form a joint venture for $2.5B. The transaction values the company at $10.0B.

Restructuring Updates💭

Quality Fresca (Moe’s franchisee)

• Type: Chapter 11

• Debt: $10M–$50M liabilities; ~$16M secured debt

• What happened: Filed Aug. 4; plans to close 16 of its 38 Moe’s locations while restructuring.

RNDC

• Type: Chapter 11 / wind-down

• Debt: $1B–$10B liabilities

• What happened: Continued court-supervised asset sales and wind-down following its July 26 filing.

Storj Labs

• Type: Chapter 11

• Debt: $1M–$10M

• What happened: Continued restructuring while operating its decentralized cloud-storage network.

Restructuring Rumors💭

Hughes Network Systems

• Type: Potential Chapter 11

• Debt: ~$1.5B near-term maturity

• What happened: Restructuring talks continue as creditors prepare for a potential filing.

First Brands Group

• Type: Chapter 11 / liquidation risk

• Debt: Multi-billion-dollar capital structure

• What happened: Seeking approval of its restructuring plan; warned rejection could result in Chapter 7 liquidation.

QVC Group

• Type: Post-Chapter 11 restructuring

• Debt: ~$5B eliminated

• What happened: Emerged from Chapter 11 after completing its balance-sheet restructuring.

Noteworthy Chart 🧭

Finance hiring in Dallas is dramatically outpacing growth in other major finance hubs:

Last night handed capital allocators a lot to process at once: Microsoft delivered the kind of quarter that reminds you why the franchise holds, Meta reminded you that even great businesses can burn cash faster than they earn it, and the Fed’s three-way dissent sent bond yields surging to levels not seen since 2007 on the 30-year.

The thread running through all of it is the same one that’s defined 2026: AI spending is enormous, the cost of money is climbing, and the market is repricing both in real time.

Here’s what you need to know.

1. The Lead · Tech / Cloud

Microsoft’s Azure Crosses $100 Billion, Blows Past Estimates, Shares Surge 7%

Microsoft (MSFT) posted fiscal Q4 revenue of $90.01 billion, well above the $87.62 billion LSEG consensus, with net income rising to $35.77 billion from $27.23 billion a year ago, according to CNBC. The real headline was Azure: growth accelerated to 43% year over year, topping the 40% consensus, and Azure revenue for the full fiscal year exceeded $100 billion for the first time, up 41%. Capital expenditures and finance leases for the quarter hit $41 billion, up 69%, and CFO Amy Hood guided for further capex growth in fiscal 2027, citing “demand signals across our portfolio.” Free cash flow fell 23% to $19.64 billion, a line that deserves attention, but Hood said the company expects to be free cash flow positive in fiscal 2027. Microsoft 365 Copilot surpassed 30 million paid seats, and GitHub Copilot reached 50 million users, per CEO Satya Nadella on the earnings call. Shares had given up 19% year to date heading into the print.

$100B+: Azure annual revenue for Microsoft’s fiscal 2026, the first time the cloud business has crossed that threshold, up 41% year over year according to CNBC.

The Bull & The Bear

• ▲ Bull: Azure’s acceleration to 43% growth at this scale, combined with commercial remaining performance obligations climbing to $678 billion, is not a fluke. The pipeline is real, the enterprise adoption of Copilot is broadening, and Hood’s guidance of 45% Azure growth next quarter is ahead of every Street estimate. This is a business gaining share while expanding at triple the rate of the broader economy.

• ▼ Bear: Free cash flow dropped 23% to $19.64 billion while capex soared 69% to $41 billion. The accounting shift that lengthens asset useful lives to 25 years and moves leases off the balance sheet will restate roughly $175 billion in capex, which changes how you model returns on invested capital. The OpenAI concentration risk is real: 45% of $625 billion in commercial obligations tied to a single partner is a structural vulnerability Deutsche Bank flagged explicitly last week.

The Bull Street Take

I have been patient on Microsoft all year and this quarter validates that patience. The Azure acceleration is the number that matters: at $100 billion in annual revenue growing 43%, it is not a rounding error on the income statement anymore, it is the business. The capex surge and the free cash flow dip are features of the investment cycle, not signs of deterioration. I want to own infrastructure providers during periods of uncertainty, and Microsoft is the most durable one on the board. The 7% after-hours move, on top of a stock that was already down 19% year to date, is the market finally squaring what it knew with what it feared.

Markets in Review · The Tape

Yields Surge, Stocks Sink as Hawks Take the Wheel

Markets in Review

The major indexes closed sharply lower Wednesday after the Fed’s hawkish 9-3 hold sent bond yields soaring: the S&P 500 fell 1.5% to 7,316.37, the Dow dropped 2.18% (down 1,152 points) to 51,594.86, and the Nasdaq 100 shed 2% to 27,192.31, according to Business Insider.

The session’s damage was concentrated in the afternoon, after the Fed’s 2 p.m. statement landed with a three-way dissent pointing toward a rate hike. The 10-year Treasury yield jumped seven basis points, and the 30-year bond yield hit its highest level since 2007, per Business Insider, as fixed-income investors processed what a no-forward-guidance Fed with vocal hawks actually means for duration pricing.

Equities whipsawed before the close and sold off hard. The Dow’s 1,152-point drop reflected broad selling rather than sector-specific pain, with long-duration growth assets bearing the brunt. The Nasdaq’s 2% decline tracks with where rate sensitivity lives.

After the close, the picture shifted. Microsoft surged 7% in extended trading on a blowout Azure quarter, while Meta fell nearly 10% on a cash flow collapse and light guidance, and Starbucks jumped as much as 9% on a raised full-year outlook. The after-hours tape is telling a more nuanced story than the regular session did.

Go deeper

• Three FOMC dissenters (Hammack, Kashkari, Logan) voted for a hike, the most unified hawkish dissent since September 2016, shifting September from a probable hold to a live meeting.

• Microsoft (MSFT) surged 7% after hours on Azure growth accelerating to 43% and full-year Azure revenue crossing $100 billion for the first time, recovering from a 19% year-to-date decline heading into the print.

• Meta (META) fell nearly 10% after hours as free cash flow collapsed to $784 million from $8.55 billion a year ago, with Q3 guidance missing consensus at the midpoint.

What they’re saying

“The Fed appears to be running out of patience with above-target inflation, despite recent data coming in cold. The committee’s growing hawkish sentiment, shown by the three dissents against today’s hold, has also likely been exacerbated by the recent flare up in hostilities in the Middle East.” -- Kay Haigh, Global Head and CIO of Fixed Income and Liquidity Solutions, Goldman Sachs Asset Management

The Bull Street Take

The regular session sold off on the Fed, and the after-hours session partially reversed it on Microsoft: I am net cautious on duration and net constructive on cloud infrastructure, and Wednesday gave me no reason to change either position.

2. The Fed · Rates

Fed Holds but Three Members Wanted a Hike, 30-Year Yield Hits Highest Since 2007

The FOMC voted 9-3 to hold the federal funds rate at 3.5% to 3.75%, with Cleveland’s Beth Hammack, Minneapolis’s Neel Kashkari, and Dallas’s Lorie Logan all dissenting in favor of a quarter-point hike, according to CNBC. It is the first three-way dissent pointing in one direction since September 2016. After the decision, the 10-year Treasury yield jumped seven basis points and the 30-year bond yield hit its highest level since 2007, per Business Insider. The S&P 500 closed down 1.5% at 7,316.37, the Dow fell 2.18% to 51,594.86, and the Nasdaq 100 dropped 2% to 27,192.31. Chair Kevin Warsh, sticking to his no-forward-guidance posture, offered no roadmap for September, and the post-meeting statement was nearly identical to June’s.

9-3: The FOMC vote to hold rates, with three dissenters preferring a hike, the most unified hawkish dissent since September 2016, per CNBC.

The Bull Street Take

Three regional presidents voting to hike is the bond market’s permission slip to reprice duration, and it used it. The 30-year at its highest since 2007 is the kind of level that changes the math on long-duration assets across the board. I am watching the September meeting as a live hike, not a hold.

3. Earnings · Tech / Social

Meta Drops 10% After-Hours as Free Cash Flow Collapses to $784 Million

Meta (META) beat on Q2 revenue at $60.80 billion versus the $60.17 billion consensus, but Q3 guidance of $61-64 billion (midpoint $62.5 billion) missed the $63.15 billion analysts expected, according to CNBC. The bigger shock: free cash flow cratered to $784 million from $8.55 billion a year ago as the company poured capital into AI infrastructure. Meta narrowed its full-year capex guidance to $130-145 billion. Reality Labs posted a $4.6 billion operating loss on just $431 million in sales. Shares were down 11% for 2026 heading into the print and fell nearly 10% after hours.

$784M: Meta’s Q2 free cash flow, down from $8.55 billion in the same quarter a year ago, per CNBC.

The Bull Street Take

The free cash flow collapse is the story here, not the revenue miss. A business spending at this rate needs the monetization to come fast. Zuckerberg’s comment that Meta is “getting a lot of offers for compute at a significant premium” over cost is interesting, but it is not a business yet.

4. Earnings · Consumer

Starbucks Raises Outlook as Fourth Straight Quarter of Comps Growth Lands

Starbucks (SBUX) posted fiscal Q3 adjusted EPS of 85 cents versus 66 cents expected, with revenue of $9.32 billion topping the $9.16 billion consensus, and same-store sales rising 7.9% against a 6% estimate, per CNBC. The company raised its full-year adjusted EPS outlook to $2.55-$2.65 from $2.25-$2.45 and now expects global same-store sales to rise nearly 6%. North American same-store sales climbed 8.1%, with traffic up 4.5% and average ticket up 3.5%. CEO Brian Niccol’s “Back to Starbucks” turnaround is four straight quarters in, and the numbers are doing the talking.

The Bull Street Take

Niccol’s operational reset is working faster than the skeptics expected. Four consecutive comp quarters of growth at this traffic level tells me the customer is back. At a still-depressed valuation, this is the kind of consumer franchise I want exposure to heading into a higher-rate environment.

5. Earnings · Semiconductors

Qualcomm Guides Light, Plans Across-the-Board Price Hikes Starting September 1

Qualcomm (QCOM) matched Q3 estimates with adjusted EPS of $2.21 on revenue of $9.95 billion, but guided current-quarter EPS to $2.05-$2.25 against the $2.36 consensus, citing a broad-based memory crunch across wafer fabrication, packaging, and other materials, according to CNBC. CEO Cristiano Amon announced price increases across all chips starting September 1 to recover higher input costs. Handset chip sales fell 20% annually to $5.1 billion, while automotive was a bright spot at $1.59 billion, on pace for the company’s $10 billion automotive revenue target by 2029.

The Bull Street Take

Qualcomm passing costs through is the right move operationally, but it puts more pressure on already-stressed smartphone consumers. The automotive pivot is the long-term thesis here, and the BMW cockpit chip deal announced Wednesday is a proof point I’ll keep tracking.

+ Also on the Tape

• Retail / Consumer: Chipotle (CMG) raised its full-year same-store sales forecast to low-single-digit growth from flat, beating Q2 estimates, but warned the U.S. cyclospora outbreak cut about 2 percentage points from late-July sales, per CNBC.

• Fed / Policy: Chair Kevin Warsh will give the keynote at the Jackson Hole Economic Symposium in August, where he says he will address “big questions” on productivity, demographics, and the global economy, per Business Insider.

• Consumer / China: Nike’s China revenue has fallen 30% since its 2021 peak as the “China Chic” domestic brand movement accelerates, with sales declining for eight straight quarters and annual revenue hitting an eight-year low, per CNBC.

• Deals: Meta and BlackRock announced a $14 billion data center joint venture in El Paso, Texas, weeks after Meta disclosed its Louisiana Hyperion project will top $50 billion, per CNBC.

• Semiconductors: Qualcomm completed its acquisition of Modular, a software company building AI programming technology, and plans to unveil its AI software platform at a conference in August, per CNBC.

The Last Word

The market’s job is to find the price where everyone is equally uncomfortable. On a day like Wednesday, it did its job.

Bull Street is for informational purposes only. Nothing here is financial advice. Always do your own research.

The thread connecting this morning’s tape is scale: who controls the critical inputs, who owns the backlog, and who gets paid when the bottleneck is real.

Nvidia just answered the memory question with a $500 billion answer, defense contractors are sitting on backlogs that would take years to work through, and logistics players are scrambling to own the cold chain before GLP-1 demand runs past their capacity.

Buckle in, because earnings week for the hyperscalers starts Tuesday and the Fed meets on top of it.

1. The Lead · AI Infrastructure

Nvidia Locks $500B HBM Deal With SK Hynix, Targeting 2 Gigawatts of AI Capacity

Nvidia announced a supply agreement with South Korea’s SK Hynix late Friday in San Francisco that could be worth $500 billion over several years, according to CNBC. The deal secures high-bandwidth memory (HBM), the component that has become the single tightest constraint on GPU production during the AI boom, and includes construction of large-scale data centers expected to come online in 2027. SK Hynix affiliate SK Telecom will build a cloud business running on Nvidia’s Vera Rubin systems, with Nvidia targeting enough capacity to require 2 gigawatts of power. Separately, Samsung Electronics signed a memorandum of understanding with Broadcom in an estimated $200 billion deal covering memory and foundry collaboration. Nvidia also said it would invest $1 billion into Korean cloud company Naver. The announcements, made at an AI summit attended by South Korean President Lee Jae Myung, signal that massive AI infrastructure buildouts are moving well beyond the handful of U.S. hyperscalers.

$500 billion: Estimated value of Nvidia’s multi-year HBM supply agreement with SK Hynix, announced Friday in San Francisco, per CNBC.

The Bull & The Bear

• ▲ Bull: Nvidia (NVDA) has just locked up the world’s leading HBM producer for years, removing the most visible near-term constraint on its GPU roadmap. The deal’s scale, combined with Broadcom’s (AVGO) parallel Samsung pact, confirms that sovereign governments and conglomerates are entering the AI infrastructure race alongside hyperscalers. That broadens the buyer base dramatically and supports sustained demand well beyond any single company’s capex cycle.

• ▼ Bear: A deal ‘worth $500 billion over a number of years’ is a letter of intent, not a purchase order. Co-development agreements and data center timelines can slip, and concentrating memory supply with one vendor creates its own fragility. If AI capex spending hits a speed bump, the contractual obligations on both sides become the story instead of the upside.

The Bull Street Take

I read this as Nvidia (NVDA) playing offense on supply, not just demand. The HBM shortage has been real and limiting, and locking SK Hynix into co-development for next-generation memory is the kind of move that compounds over a decade, not a quarter. The 2-gigawatt power target is the number I keep coming back to: that is a commitment to physical infrastructure at a scale that does not get unwound easily. For anyone still debating whether the AI buildout is durable, this deal is a data point worth sitting with.

2. Earnings · Defense

Lockheed, Northrop, and RTX Post Record Backlogs as Dual Demand Drives Guidance Higher

All three of the country’s largest defense contractors raised full-year guidance after strong second-quarter results, according to Yahoo Finance. Lockheed Martin (LMT) posted $20.1 billion in sales and a book-to-bill ratio of 3.2x, with backlog reaching $230 billion and sales guidance raised to $79.75-$81.75 billion. Northrop Grumman (NOC) reported a record $105 billion backlog, up 17% year over year. RTX (RTX) led on growth, with adjusted sales climbing 16% organically to $24.7 billion and backlog surging 22% to $289 billion, including $43 billion in new awards in the quarter alone. Near-term missile defense and munitions demand tied to ongoing U.S.-Iran tensions is supporting backlogs now, while long-term modernization programs, including the B-21, next-generation interceptors, and autonomous combat aircraft, are building the decade ahead.

The Bull Street Take

When three contractors raise guidance in the same week and are flagging capacity as the binding constraint rather than contracts, that is not a cyclical bump. I pay attention to what is filling the backlog: a mix of readiness spending today and modernization spending for the 2030s is a better position than either alone.

3. Logistics · Cold Chain

UPS and FedEx Are Racing to Build the Cold Chain That GLP-1s Demand

UPS (UPS) announced a $48 million investment in temperature-controlled facilities in June, after posting its first-ever $3 billion healthcare revenue quarter in Q1 of this year, per CNBC. FedEx (FDX) launched a dedicated life sciences organization this month and disclosed that healthcare transportation revenue reached nearly $10 billion in fiscal year 2026. C.H. Robinson separately told CNBC it surpassed $1 billion in healthcare logistics revenue over the past year, largely driven by GLP-1 growth. A July Gallup poll found that 11% of Americans now take GLP-1 medications for weight loss, up from just 3% in 2024, and demand for temperature-sensitive biologics is projected to grow at an 8.3% compound annual growth rate through 2033, reaching a market value of $39.1 billion, according to Growth Market Reports.

The Bull Street Take

The cold chain story is real and it is underfunded relative to the demand that is already visible. When C.H. Robinson’s vice president explicitly says refrigerated supply is constrained and not unlimited, that is an infrastructure gap that takes years to close. UPS and FedEx have a head start, but the margin opportunity for whoever builds the most reliable end-to-end network is significant.

4. Policy · Trade

New Section 301 Tariffs Draw Immediate Lawsuit Hours After Taking Effect

The Trump administration imposed new tariffs between 10% and 12.5% on goods from more than 80 countries Friday, citing forced labor practices under Section 301 of the Trade Act of 1974, according to CNBC. Hours later, the Liberty Justice Center filed suit in the U.S. Court of International Trade, arguing the tariffs are a pretext to recreate the same global tariff regime the Supreme Court struck down five months ago. Legal experts contacted by CNBC were divided on the outcome, with Georgetown’s Peter Harrell saying the statute was “never intended” for wholesale tariff-schedule rewrites, and Greta Peisch, former USTR general counsel, noting that Section 301’s language gives the government “a lot of flexibility.” Separately, Trump announced a new Section 301 probe into the EU, threatening a “substantial tariff” in response to the EU’s 890 million euro fine on Google (GOOGL).

The Bull Street Take

KPMG’s guidance is the right operating framework here: plan around the tariffs that exist today rather than assume they get reversed quickly. Courts move slowly, and even a successful challenge takes months to filter through. The EU probe adds another variable for any company with significant European revenue.

5. The Week Ahead · Earnings

Meta, Amazon, Microsoft, and Apple Report This Week With the Fed Meeting Alongside

The busiest earnings week of the summer arrives Tuesday, with Boeing (BA) and Corning (GLW) kicking it off before Meta (META), Microsoft (MSFT), and Starbucks (SBUX) report Wednesday, followed by Amazon (AMZN) and Apple (AAPL), according to CNBC. The Federal Reserve’s July policy meeting runs concurrently, adding macro weight to an already packed calendar. For Meta, the key question is AI capex guidance and any signals on a potential cloud-compute rental business. For Boeing, free cash flow is the critical metric, with Wall Street expecting a cash burn of $179 million in Q2 before a turn positive in Q3 and Q4. Procter & Gamble (PG) reports Wednesday with the Street modeling $21.38 billion in revenue and $1.41 EPS amid acknowledged softening in U.S. consumer trends.

The Bull Street Take

This is the week that either validates or complicates the AI capex consensus. Meta’s spending guidance moved the stock last quarter despite superb results. I want to hear what management says about the compute-rental business, because that is the next chapter of the monetization story.

+ Also on the Tape

• Trucking: ACT Research’s June For-Hire Trucking Index shows freight rates still near record territory with the Freight Rate Index at 70.2, even after a 9.5-point pullback from May’s all-time high of 79.7, as driver shortages keep capacity structurally tight.

• Tax: Opportunity Zone investors face a $75 billion aggregate deferred capital gains tax bill coming due December 31, 2026, as the deferral period authorized by the 2017 Tax Cuts and Jobs Act closes, per a Treasury Department working paper.

• Tech/Regulation: Trump threatened the EU with a “substantial TARIFF” after the bloc fined Google (GOOGL) 890 million euros for alleged noncompliance with its Digital Markets Act, with prior fines against Apple, Meta, and Amazon also cited.

• AI: Samsung Electronics signed an estimated $200 billion memorandum of understanding with Broadcom (AVGO) to expand collaboration across memory and foundry technologies supporting next-generation AI infrastructure.

The Last Word

The best time to lock in supply is before everyone else realizes it is scarce. Bull Street

Bull Street is for informational purposes only. Nothing here is financial advice. Always do your own research.

Earnings season delivered a clear theme last night: the cost of betting big on the future is showing up in the present.

Tesla’s free cash flow flipped negative as capex soared, IBM cut its full-year outlook, and Southwest’s fuel bill ballooned even as fares climbed.

The thread connecting all of it is the same tension playing out in every boardroom right now: conviction spending that the income statement hasn’t caught up to yet.

1. The Lead · Earnings

Tesla Misses Big on Earnings as Free Cash Flow Turns Negative and Margins Crater

Tesla (TSLA) posted Q2 adjusted EPS of 33 cents against a 51-cent consensus, according to LSEG estimates compiled by CNBC, even as revenue of $28.24 billion cleared the $25.71 billion bar. The miss that matters most: free cash flow swung to a negative $1.1 billion from positive $146 million a year ago and $1.44 billion in Q1 2026. The culprit is capex, which soared 142% year over year to $5.79 billion as Tesla pours money into Cybercab production, Optimus robot manufacturing lines, and an AI chip fab. Gross margin of 16.8% came in far short of the 19.4% analysts expected and below the 17.2% posted a year ago. Operating margin collapsed to 1.4% from 4.1%. The stock fell about 4% in extended trading. Tesla is simultaneously a car company losing ground on price, a robotaxi business that hasn’t yet proven its safety case at scale, and a robotics venture with, by Elon Musk’s own admission, no existing supply chain.

-$1.1B: Tesla’s free cash flow in Q2 2026, reversing from positive $1.44 billion in Q1, per CNBC.

The Bull & The Bear

• ▲ Bull: The revenue beat was real, with automotive sales up 23% and services jumping 50% year over year, per CNBC. FSD subscriptions rose 56% to 1.48 million. If Cybercab and Optimus deliver anywhere near Musk’s vision, the capex being spent today is seed corn for a business worth multiples of the current auto franchise. Rising gas prices from the Iran conflict are pushing European buyers toward EVs, providing a near-term tailwind.

• ▼ Bear: Gross margin of 16.8% is nowhere near sufficient to justify the valuation on a car-company multiple, and the path to a robot/AI multiple requires execution that has not yet been demonstrated at scale. Operating expenses grew 47% while the company loses money on a free cash flow basis. Average selling prices are falling, regulatory credit revenue is declining, and Chinese competitors including BYD, Nio, and Xiaomi continue to take share in global markets. The stock is already down 17% for the year heading into this print.

The Bull Street Take

I take Musk at his word that Optimus is a generational bet. I also take the income statement at face value. A 1.4% operating margin and negative free cash flow in a rising-rate, rising-cost environment is not a comfortable place to be while you fund a moonshot with no existing supply chain. The revenue growth is real, the FSD subscriber momentum is encouraging, and the long-term thesis hasn’t changed. But capital allocators need to price the execution risk here honestly. This is a hold-with-eyes-open situation, not a buy-the-dip moment.

Tesla Q2 earnings full report: https://ir.tesla.com/#quarterly-disclosure

Markets in Review · The Tape

Margins Under the Microscope

IBM shares entered Wednesday’s session already down 30% year to date following last week’s preliminary earnings warning, while the S&P 500 was up approximately 10% for the year, according to CNBC. Tesla fell about 4% in after-hours trading following its Q2 print.

The session’s dominant story was not a single index move but a margin compression narrative cutting across industries. Tesla’s gross margin of 16.8% missed analyst estimates of 19.4% by a wide margin, per StreetAccount data cited by CNBC, while IBM’s Z mainframe revenue fell 42% and pulled the company’s full-year growth outlook down to 4%-5% from over 5%.

In airlines, Southwest’s 67% surge in fuel costs to $2.22 billion for the quarter illustrates how commodity volatility tied to the U.S.-Iran conflict is still working its way through cost structures, even as fare increases provide partial cover. Average one-way fares rose nearly 21% year over year to $225.61, per CNBC.

In rates, the 30-year Treasury logged its longest stretch above 5% since 2007, according to MarketWatch, a milestone that raises the hurdle rate for long-duration bets across equities, real estate, and corporate credit.

Go deeper

• IBM (IBM) confirmed its preliminary Q2 results, with adjusted EPS of $2.93 versus a $2.97 consensus and revenue of $17.16 billion against a $17.58 billion estimate; the stock is down 30% year to date, per CNBC.

• Southwest (LUV) beat Q2 estimates with adjusted EPS of 94 cents versus 51 cents expected, but Q3 EPS guidance of 50-75 cents missed the 82-cent consensus, sending a cautious signal on the back half of the year, per CNBC.

The Bull Street Take

A tape this fixated on margins rewards the companies that fund their own growth, so I stay long the self-financing operators and make the leveraged stories prove it first.

2. The Tape · Semiconductors

TSMC’s Record Profits Come With a Margin Warning Baked In

TSMC reported a 77.4% jump in Q2 profit year over year, another record quarter, but the company is signaling that U.S. expansion will compress margins for years, according to CNBC. CFO Wendell Huang told investors that gross margin dilution from overseas fabs will run 2% to 3% early in the ramp and widen to 3% to 4% in later stages. Q2 gross margin was 67.7%, up from 66.2% in Q1, which leaves room to absorb the dilution. The catch: Morningstar senior equity analyst Phelix Lee estimates U.S.-made chips cost 20-50% more than Taiwan-produced chips, and that gap will largely land on TSMC’s customers.

$200B: Total U.S. manufacturing commitments TSMC has announced, including a $100 billion investment unveiled last week, per CNBC.

The Bull Street Take

A 67.7% gross margin buys a lot of forgiveness. TSMC is still the only toll booth on the AI highway, and the cost of the U.S. ramp lands on customers who have shown no sign they can walk away.

3. Earnings · Tech

IBM Cuts Full-Year Forecast After Record Single-Day Drop

IBM (IBM) confirmed Q2 revenue of $17.16 billion and adjusted EPS of $2.93, both in line with the preliminary figures released a week ago but short of the $17.58 billion and $2.97 consensus, per LSEG. The company trimmed its full-year constant-currency revenue growth target to 4%-5% from over 5%, citing a 42% collapse in Z mainframe revenue as customers front-loaded hardware purchases ahead of price increases, according to CNBC. IBM stock had already fallen 25% on the preliminary warning and is now down 30% year to date versus the S&P 500’s roughly 10% gain. The one bright spot: software revenue grew 5% to $7.76 billion and the company reiterated its target of $1 billion in higher free cash flow for the full year.

The Bull Street Take

Software up 5% and a billion more in free cash flow says there is a real business under the wreckage. I want one clean quarter before I believe the mainframe pull-forward has washed through.

4. Earnings · Airlines

Southwest Beats on Q2 but Q3 Guidance Disappoints as Fuel Costs Bite

Southwest Airlines (LUV) posted Q2 adjusted EPS of 94 cents versus the 51-cent consensus and adjusted revenue of $8.72 billion against an $8.58 billion estimate, per LSEG. The problem is what comes next: Q3 EPS guidance of 50-75 cents fell well short of the 82-cent consensus, according to CNBC. Southwest’s fuel bill surged 67% to $2.22 billion in the quarter even as average one-way fares climbed nearly 21% to $225.61. CFO Tom Doxey called domestic demand “really strong,” but volatile fuel costs tied to the Iran conflict are forcing the airline to cap Q3 capacity growth at flat to down 1% versus a year ago.

The Bull Street Take

Demand held and fares carried a 21% increase, so the franchise is fine. Fuel swings like this are why I trade airlines and never marry them.

Bull Street Pro · Special Offer

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5. The Fed · Rates

The 30-Year Treasury Hits a 19-Year Milestone Above 5%

The 30-year Treasury yield has now logged its longest stretch above 5% since 2007, according to MarketWatch. New Fed Chair Kevin Warsh has contributed to uncertainty by repeating three phrases across five public appearances without clarifying their policy implications: “family fight,” “first principles,” and “inflation is a choice,” per CNBC. JPMorgan chief U.S. economist Michael Feroli says the “family fight” framing is an attempt at being folksy without departing from tradition. What the market cares about is simpler: a Fed chair who says less and a long bond that keeps climbing is a combination that raises the cost of capital across every asset class.

The Bull Street Take

A long bond above 5% argues with every growth multiple in the market. I underwrite as if it stays there, and anything cheaper is a bonus.

+ Also on the Tape

• Deals: Germany’s Intersnack Group agreed to acquire Utz Brands (UTZ) for $14.25 per share in a $2.9 billion deal, a 91% premium to Utz’s pre-announcement close, taking the salty snack maker private, per Yahoo Finance.

• Autos: GM sold approximately 715,000 vehicles in the U.S. in Q2, a 4.2% year-over-year decline, with much of the drop tied to discontinued models and a pullback in EV demand after the federal tax credit expired, per Yahoo Finance.

• Tech: IBM introduced its Bob AI coding tool, which has been adopted by over 80,000 employees, and signed a letter of intent to build a U.S. quantum chip foundry, per CNBC.

• Macro: TSMC is set to raise prices for advanced and mature chip production by up to 10% in 2027, according to a Nikkei report, as U.S. manufacturing costs estimated at 20-50% above Taiwan levels get passed downstream.

The Last Word

Capex is a promise. Free cash flow is the proof.

Bull Street is for informational purposes only. Nothing here is financial advice. Always do your own research.

The thread connecting this morning’s stories is conviction under pressure: Buffett quietly building a $30 billion Google position while everyone assumed it was Abel’s call, Warsh holding the line on inflation credibility even as CPI and PPI print cooler than expected, and America’s Car-Mart collapsing under the weight of a consumer credit cycle that has quietly turned.

Capital allocation decisions made years ago are landing right now, and the consequences are hard to ignore.

1. The Lead · Markets

Buffett Breaks Silence: He Initiated Berkshire’s $30B Alphabet Position

Warren Buffett, in a CNBC interview with Becky Quick this week, confirmed he personally initiated Berkshire Hathaway’s (BRK.A) now-$30 billion stake in Alphabet (GOOGL), shutting down the widely held assumption that it was new CEO Greg Abel flexing his investing muscles. Berkshire first purchased roughly $4.3 billion in shares in last year’s third quarter, added $11.5 billion in this year’s first quarter, and then invested another $10 billion by buying shares directly from the company to fund Alphabet’s AI buildout. Buffett’s exact words: “I initiated it.” He did clarify that he and Abel operate in lockstep, saying “I am not doing anything that he doesn’t approve of.” For a man who spent decades avoiding tech stocks on principle, this is not a small admission. It is a statement about where durable competitive advantage now lives, according to CNBC.

$30B: Berkshire Hathaway’s total Alphabet position, built across three tranches and personally initiated by Warren Buffett, according to CNBC.

The Bull & The Bear

• ▲ Bull: Buffett’s imprimatur on a $30 billion AI-infrastructure bet is about as strong a long-term signal as the market can receive. Berkshire buying directly from Alphabet’s balance sheet also suggests a relationship built for the long haul, not a trade. If Buffett sees enduring moat characteristics in Google’s AI position, the valuation debate for the stock shifts meaningfully.

• ▼ Bear: Buffett is also accelerating his Berkshire share donations, aiming to dispose of all his shares within roughly eight years, which creates a persistent and growing overhang on BRK.A. And his Alphabet conviction was formed before the Iran conflict reignited energy inflation and before the Fed signaled more rate hikes are likely. The macro environment he underwrote this position in has changed.

The Bull Street Take

I find it telling that Buffett didn’t just approve this trade, he originated it. That matters. This is not the same as a lieutenant making a call while the old man watches from Omaha. Buffett looked at Google’s position in AI infrastructure and decided it was worth the largest tech commitment of his career. I don’t think that conviction is casual. For capital allocators still on the fence about the durability of AI spending, Buffett’s own checkbook is now the most honest data point available.

Markets in Review · The Tape

Cooler Prices, Warmer Warnings

Markets in Review

Treasury yields fell sharply after the June CPI print came in at -0.4% for the month, well below the -0.2% consensus, while stock market futures were mostly positive following the report, according to CNBC. The Fed’s key overnight borrowing rate currently sits in a range of 3.5%-3.75%.

The week’s defining market moment was Tuesday’s CPI release, which printed a 0.4% monthly decline and pushed the annual rate to 3.5%, the biggest monthly drop since April 2020. Traders responded by scaling back rate hike expectations, though a September hike remains a live call, priced near a coin-flip before moving to 63% odds after the CPI release, according to CME FedWatch data cited by CNBC.

The PPI followed on Wednesday with a 0.3% monthly decline, driven by a 12% plunge in gasoline prices. Energy has been the swing factor all month: a brief pause in U.S.-Iran tensions drove oil roughly 25% lower in June, but President Trump declared the ceasefire over last week, sending oil higher Monday and again Tuesday. The commodity picture remains the central risk to the inflation relief story.

Berkshire Hathaway (BRK.A) shares fell initially on Tuesday after Buffett revealed he is accelerating his stock donation schedule, but the stock recovered and ended the week slightly lower, per CNBC. Definium Therapeutics shares surged 50% following positive Phase 3 LSD-drug trial results.

Go deeper

• Treasury yields fell sharply after the June CPI surprise, as traders reduced the probability of a September Fed hike from above 75% to 63%, per CME FedWatch data cited by CNBC.

• Energy drove both moves: gasoline prices tumbled 12% in June on the PPI side and 9%+ on the CPI side, but the Iran conflict re-escalating has already reversed some of those gains at the pump.

• Definium Therapeutics shares jumped 50% after its LSD-based drug, DT120, posted what a Jefferies analyst called the largest effect size he had ever seen in Phase 3 depression trials, per CNBC.

What they’re saying

“The Fed’s war with inflation isn’t over by any means, but there is good news from the front and the odds of Fed rate hikes should continue to recede as inflation at the factory level is trending lower.” -- Chris Rupkey, chief economist at Fwdbonds, via CNBC

2. The Fed · Rates

CPI Falls 0.4%, PPI Falls 0.3%: Good Data, Fragile Story

June delivered the biggest monthly consumer price decline since April 2020, with CPI falling a seasonally adjusted 0.4% and bringing the annual rate to 3.5%, well below the 3.8% consensus, according to the Bureau of Labor Statistics. Core inflation was flat for the month, pulling the 12-month rate to 2.6%. The PPI followed on Wednesday, posting a 0.3% monthly decline against expectations for no change, driven by a 12% plunge in gasoline prices. Fed Chairman Kevin Warsh told Congress the June decline was not a “mission accomplished” moment, and markets still widely expect a rate hike before year-end. The relief, as Navy Federal’s Heather Long put it, “may be short-lived as the war in Iran re-starts,” according to CNBC.

3.5%: Annual CPI rate for June 2026, down from 4.2% in May and below the 3.8% economist consensus, per the Bureau of Labor Statistics.

3. The Fed · Policy

Wall Street Builds ‘WarshGPT’ to Decode the Fed’s New Silence

With Fed Chairman Kevin Warsh deliberately curtailing forward guidance, Wall Street is reaching for new tools. F/m Investments released “WarshGPT,” an AI chatbot built on Anthropic’s Claude model for under $1,000, that parses nearly 1,800 Warsh documents and transcripts to help investors anticipate Fed thinking, according to CNBC. Warsh’s first post-meeting statement ran roughly 130 words, down from over 300 under Jerome Powell, and UBS found he allocated just 5% of press conference sentences to policy-relevant topics versus 27% under Powell. Less guidance cuts both ways: bigger market swings after Fed decisions, but also more alpha available for investors with a real macro framework.

4. Deals · Pharma

Eli Lilly Bets $3.8B on Psychedelics for Depression

Eli Lilly (LLY) agreed to acquire AtaiBeckley, a clinical-stage psychedelic drug developer, for up to $3.8 billion, signaling that Big Pharma is no longer treating psychedelics as fringe science, according to CNBC. AtaiBeckley’s lead asset is a synthetic form of 5-MeO-DMT administered as an intranasal spray for treatment-resistant depression, a condition affecting roughly 4 million Americans. The drug already holds FDA Breakthrough Therapy Designation and is in Phase 3 trials, with Jefferies analysts estimating Phase 3 success could open a $1-2 billion opportunity in TRD alone. Definium Therapeutics also reported Phase 3 results this week showing its LSD-based drug delivered the largest effect size its Jefferies analyst had ever seen, sending Definium shares up 50%.

$3.8B: Eli Lilly’s acquisition price for AtaiBeckley, its bid to lead the emerging psychedelic therapeutics market, per CNBC.

5. The Tape · Consumer Credit

America’s Car-Mart Cuts 40% of Locations, Flags Going Concern

America’s Car-Mart (CRMT), the “buy here, pay here” used-car dealer that finances subprime borrowers directly, closed 60 dealership locations over the past 12 months, shrinking its footprint from 154 to 94 stores, a 40% reduction, according to Yahoo Finance. Full-year revenue fell 7.9% to $1.28 billion and the company posted a net loss of $139 million versus net income of $17.9 million a year prior. CEO Doug Campbell confirmed a going concern disclosure in the Form 10-K, citing unresolved liquidity constraints rather than customer payment deterioration. With the average new-car monthly payment hitting a record $777 and subprime auto financing rates running between 19.4%-21.7%, according to Experian data cited by Yahoo Finance, this is what the consumer credit cycle cracking looks like from the bottom up.

40%: Share of America’s Car-Mart locations closed in 12 months, with a going concern disclosure now attached to its Form 10-K, per Yahoo Finance.

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+ Also on the Tape

From All Upside: They paid a premium for ‘broken’

A $3.9 billion insider buyback, the discount card at your pharmacy counter, and the case that healthcare is the largest mispriced asset in America. Insiders took Select Medical private at an 18% premium, because nobody buys back a broken thing. This is the piece to read if you want to understand why the market keeps pricing the sector on its politics instead of its cash flows.

[Get the full read here]

• Airlines: American Airlines (AAL) CEO Robert Isom is chasing a $3-5 billion profit gap versus United and Delta, betting on premium cabin upgrades, a new 37,000-square-foot Admirals Club at DFW, and Starlink Wi-Fi to finally close the revenue-per-seat divide, per CNBC.

• Tech: Oracle (ORCL) hit a fresh 52-week low after S&P cut its credit rating to one notch above junk, flagging $55.7 billion in fiscal 2026 capex and a projected $42 billion free-cash-flow deficit next year as it races to build AI infrastructure. Roughly half of its $638 billion backlog sits with a single customer, OpenAI, per Yahoo Finance.

• Income: MPLX (MPLX), the Marathon Petroleum midstream MLP, has returned 225% over five years while paying a 7.4% yield and guiding 12.5% annual distribution growth through 2027 on a fee-based model. Its Northwind acquisition pushed leverage to 3.7x debt-to-EBITDA, leaving just 0.3x of room under its 4.0x ceiling, per Yahoo Finance.

The Last Word

Credibility, once spent, is not restocked at the next meeting.

Bull Street is for informational purposes only. Nothing here is financial advice. Always do your own research.

The AI infrastructure trade is printing real money: SK Hynix’s Nasdaq debut raised $26.5 billion on Day One, Micron locked in $22 billion in customer commitments, and memory is no longer a sleepy semiconductor footnote.

The through-line this morning is the distance between headline hype and actual execution, a gap showing up in AstraZeneca’s pipeline stumble, Salesforce’s Agentforce skepticism, and the grocery aisle where value is winning and volume is not.

1. The Lead · Semiconductors

SK Hynix’s $26.5 Billion Nasdaq Debut Signals AI Memory Is Now a Tier-1 Asset Class

SK Hynix (SKHY) rose 13% on its first day of trading on Nasdaq, closing at $168.01 against an ADR pricing of $149, and raised $26.5 billion for factory expansion, according to CNBC. Chairman Chey Tae-won told CNBC’s Kristina Partsinevelos that customers who heard SK Hynix would double capacity in five years responded: “That’s not enough, man.” The company’s valuation has risen more than sevenfold over the past year, driven by its dominance in high-bandwidth memory (HBM), the stacked chip architecture that powers Nvidia’s AI accelerators. SK Hynix has committed to a $390 billion chip fabrication cluster in Yongin, South Korea, plus a $4 billion advanced packaging plant in Indiana. The listing comes roughly a month after SpaceX’s record IPO, underscoring that the largest capital formation events of 2026 are happening in AI infrastructure, not consumer software.

$390B: Planned cost of SK Hynix’s chip fabrication cluster in Yongin, South Korea, per CNBC.

The Bull & The Bear

• ▲ Bull: HBM demand is structurally different from prior memory cycles. AI training and inference workloads require far more bandwidth-intensive memory than smartphones or PCs ever did, and SK Hynix is the technology leader in HBM supply to Nvidia, the world’s most valuable company. The $26.5 billion raised gives it a real runway to expand capacity before competitors can close the gap.

• ▼ Bear: Memory is cyclical, full stop. Every prior technology wave, from dot-com to smartphones to cloud, eventually produced oversupply and a price collapse. The current shortage is driven by a narrow set of hyperscaler customers. If AI capex budgets cool, get renegotiated, or if a cheaper memory architecture emerges, SK Hynix’s sevenfold valuation run becomes a liability, not a moat.

The Bull Street Take

I think the market is right to pay up here, with one caveat. The HBM shortage is real and the customers are real. When Nvidia’s supply chain says it needs more chips after you just announced a capacity doubling, that is a demand signal worth taking seriously. The cyclicality risk is also real, but the AI infrastructure buildout has years of runway left. SK Hynix’s Nasdaq listing is not just a capital event. It is the formal elevation of memory into the same conversation as logic chips and GPUs.

Markets in Review · The Tape

Stocks Close the Week Green as SK Hynix Debut Anchors the AI Memory Trade

Markets in Review

All three major indexes closed higher on Friday, July 10 to cap a choppy week. The S&P 500 rose 0.42% to 7,575.39, the Nasdaq Composite added 0.29% to 26,281.61, and the Dow gained 149.61 points, or 0.29%, to 52,637.01, with SK Hynix’s blockbuster Nasdaq debut anchoring the session.

Friday’s tape was carried by megacap tech. Nvidia (NVDA) rose roughly 4% and Meta Platforms (META) jumped about 6%, together doing most of the index’s heavy lifting even as breadth stayed narrow. The centerpiece was SK Hynix’s (SKHY) Nasdaq listing, which opened at $170 for a pop of more than 14% over its $149 ADR pricing before closing at $168.01, up 13% on the day. Investors also tracked U.S.-Iran ceasefire talks, which stayed fluid into the close.

Risk appetite firmed into the weekend. The VIX fell 5.1% to 15.03, while the 10-year Treasury yield finished near 4.56% as Middle East headlines kept a bid in rates. In commodities, WTI crude slipped about 0.9% to near $71 a barrel and gold eased 0.65% to $4,113.70. Delta Air Lines (DAL) was a notable laggard, falling after flagging substantial fuel costs despite an earnings beat.

On the downside, AstraZeneca (AZN) extended its slide, shedding roughly 3% on Friday after Thursday’s 6.2% drop, its worst single session in over two years, on the Wainua trial failure. Salesforce (CRM) stayed under pressure after the week’s dual KeyBanc and Bernstein downgrades to Sector Weight.

Go deeper

• S&P 500 closed at 7,575.39 (+0.42%), the Nasdaq at 26,281.61 (+0.29%), and the Dow at 52,637.01 (+0.29%), all three finishing green to end the week.

• SK Hynix (SKHY) opened at $170, a 14%-plus pop over its $149 ADR pricing, and closed at $168.01, up 13%, as Nvidia (+4%) and Meta (+6%) led the megacap complex.

• Rates and vol cooled: the 10-year yield sat near 4.56% and the VIX fell 5.1% to 15.03, while WTI crude held near $71 (-0.9%) and gold settled at $4,113.70 (-0.65%).

What they’re saying

“AstraZeneca has bold plans to hit $80 billion in sales by 2030, and investors will now be asking if this target is credible.” -- Dan Coatsworth, Head of Markets, AJ Bell

2. Pharma · Biotech

AstraZeneca’s Pipeline Premium Is Now on Trial After Wainua Failure

AstraZeneca (AZN) shares fell 6.2% in a single session after its Wainua drug failed a late-stage trial for ATTR cardiomyopathy, then dropped an additional 3% the next day, according to CNBC. Most analysts, including Citi, Jefferies, and Leerink Partners, pegged the net present value impact at just 2-4%, making the roughly double market reaction a vote against AstraZeneca’s broader pipeline premium rather than the drug itself. Jefferies called Wainua “a slam dunk” that wasn’t, and noted the failure narrows the headroom above management’s 2030 $80 billion revenue target to roughly $80.8 billion. All three firms, along with Bank of America, still recommend buying the stock, with Citi reiterating AstraZeneca as its top European pharmaceutical pick. Next catalyst to watch: the AVANZAR lung cancer trial, expected to report in July or August.

$80B: AstraZeneca’s 2030 revenue target, now under greater scrutiny after the Wainua trial miss, per CNBC.

3. Earnings · Banks

Citigroup Is the Name to Watch as Five Big Banks Report on the Same Day

Five major U.S. banks are set to report earnings on the same day this week, and according to MarketWatch, Citigroup (C) is expected to show the greatest improvement by at least one key performance measure among the group. The catch: Citi still has a significant gap to close before hitting its own internal performance targets. With bank earnings functioning as a read on credit quality, net interest margin trends, and trading desk activity, the Citi print will carry outsized interpretive weight for the entire sector.

4. Tech · AI Software

Salesforce Takes a Double Downgrade as Agentforce Adoption Disappoints

KeyBanc Capital Markets and Bernstein both downgraded Salesforce (CRM) to Sector Weight on the same day, a rare dual downgrade, after concluding that adoption of Agentforce, its flagship AI agent platform, is progressing more slowly than headline numbers suggest, according to Yahoo Finance. KeyBanc analyst Jackson Ader was blunt, telling clients the only real reason to own the stock now is valuation. The deeper structural concern is that if AI agents replace human users, customers may need fewer per-seat licenses, potentially shrinking Salesforce’s core revenue stream rather than growing it. Salesforce is piloting a usage-based pricing model for agents, but that model remains unproven at scale.

5. Deals · Renewables

GoldenPeaks Poland’s Bankruptcy Is a Case Study in Single-Point-of-Failure Project Finance

GoldenPeaks Poland Holding filed Chapter 11 in the Southern District of Texas on May 29, 2026, with $952 million in funded debt and fewer than €1.1 million in unencumbered cash, according to Yahoo Finance. The proximate cause was the collapse of Spectris Energy, a wholly owned subsidiary that ran every operational function across GoldenPeaks’ entire Polish solar portfolio. When Polish tax authorities froze Spectris’s accounts and suppliers walked, GoldenPeaks had no employees of its own to step in. Brookfield Asset Management, the controlling shareholder and most junior prepetition lender, is now the stalking horse bidder with a $162.8 million DIP loan. The 664 megawatts of operational capacity and all existing power purchase agreements with Nestle, Cargill, and others remain intact.

$952M: GoldenPeaks Poland’s total funded debt at time of Chapter 11 filing, against less than €1.1 million in cash, per Yahoo Finance.

★ Featured Event · Live Webinar

The Game of Money, Live with Oren Klaff

Oren Klaff shares his work with 400+ current investors, and on Thursday, July 30 at 9:00 AM PST he is doing it live: a real deal breakdown, plus the framework he uses to spot a private company with genuine upside before the broader market notices. 55 minutes, live only, no recording, and seats are limited. If you want to sharpen how you think about private-market access, be in the room.

[Reserve your seat here]

+ Also on the Tape

From All Upside: Optimism is a discipline, not a mood

A record tape, a cracked jobs report, and the position Evelio is staking his name on. Why the factories and infrastructure going up right now make disciplined optimism the only rational read, and how to find the buildout nearest you.

• AI / IPO: OpenAI co-founder Greg Brockman consolidates control over ChatGPT, enterprise, and compute after Fidji Simo stepped down due to chronic illness, putting more pressure on him to justify the company’s $852 billion valuation ahead of a prospective IPO.

• Memory: Micron Technology (MU) disclosed $22 billion in strategic customer commitments across 16 agreements, including take-or-pay provisions and pricing floors, as management said AI demand could keep supply tight beyond 2027.

• Consumer: Costco and Walmart are capturing grocery market share as 71% of American shoppers say inflation is a very or extremely serious concern, per the FMI’s June Grocery Shopper Snapshot.

• Macro: U.S. grocery unit volume declined even as dollar sales grew 1.2% in 2025, with 2.2% price increases driving all of the gain, according to McKinsey’s State of Grocery North America 2026.

The Last Word

Capital flows to where the constraint is. Right now, the constraint is memory, not models.

Bull Street is for informational purposes only. Nothing here is financial advice. Always do your own research.

The through-line today is capital in motion: big money flowing into AI infrastructure, a split Fed debating which direction rates go next, and a space race heating up as Blue Origin opens its doors to outside investors for the first time ever.

Underneath it all, Bank of America is flashing a warning about a K-shaped economy that makes the Fed’s job genuinely hard.

Let’s get into it.

1. The Fed · Rates

Fed Split Down the Middle: Hike or Cut, Warsh Won’t Say

Minutes from Kevin Warsh’s first FOMC meeting as chairman, released Wednesday by the Federal Reserve, revealed a committee that is genuinely divided on the next move for interest rates. “Many participants” saw rates ending the year within or slightly below the current 3.5%-3.75% range, while “many other participants” judged that rates would need to go higher, according to CNBC. The dot-plot grid, in which Warsh did not participate, narrowly tilted toward one hike this year followed by cuts in each of the next two. Inflation, elevated by Trump tariffs and the Iran war’s energy shock, is expected to stay hot near term before easing as Hormuz disruptions fade. The committee also noted that AI infrastructure demand is sustaining upward pressure on tech goods and electricity prices. Warsh, consistent with his anti-forward-guidance posture, gave markets little to anchor on.

3.5%–3.75%: The Fed funds rate target range, unchanged for all of 2026, as the committee debates whether the next move is a hike or a cut.

The Bull & The Bear

• ▲ Bull: If energy prices keep declining and tariff pass-through fades as the Fed expects, inflation could retreat faster than the hawks anticipate, giving the committee room to cut without triggering a second wave. The unanimous hold and a chairman allergic to pre-commitment means policy stays nimble, which is exactly what a bifurcated economy needs right now.

• ▼ Bear: Bank of America is already forecasting 75 basis points of rate hikes this year, with PCE inflation projected at 3.5% and the unemployment rate holding near 4.3%, according to Yahoo Finance. If BofA is right, the Fed will be forced to tighten into an economy where lower-income households are already squeezed, and rate-sensitive small caps could see net interest expense jump 13% of 2025 EBIT by 2027.

The Bull Street Take

I read this as a Fed that genuinely does not know what comes next, and the honest answer is: neither does anyone else. The Warsh era started with a 14-page minutes release and a deliberately vague dot-plot. That is not weakness; it is intellectual honesty about an economy running two separate engines at two separate speeds. My read: the base case is a hold through year-end, but the bar for a hike is lower than markets priced in six months ago. Position accordingly.

Markets in Review · The Tape

Futures Dip, Yields Rise as Fed Minutes Land Without a Verdict

Markets in Review

Stock market futures held negative and Treasury yields rose after the Fed released minutes showing a divided committee with no clear directional bias, according to CNBC.

Wednesday’s session was shaped by the Fed minutes release, which confirmed what many suspected: the FOMC under Chairman Kevin Warsh is operating without a strong prior on the next rate move. Futures stayed in the red through the afternoon, and bond markets pushed yields higher as traders digested the possibility that the next move could be a hike rather than a cut.

The real market mover on the session was Broadcom (AVGO), which surged nearly 5% after Apple disclosed a $30 billion+ chip supply agreement running through 2031, per CNBC. That kind of single-stock pop on a supply deal underscores how much the market is paying attention to every signal in the AI buildout narrative.

On the earnings front, Levi Strauss (LEVI) beat on both the top and bottom lines and raised full-year guidance, yet shares still fell more than 5% in extended trading, a data point worth noting for anyone trying to read sentiment in the consumer space right now.

Go deeper

• Broadcom (AVGO) +~5%: The Apple chip deal, exceeding $30 billion and covering more than 15 billion U.S.-made chips, is the kind of long-duration revenue visibility that the market rewards immediately.

• Levi Strauss (LEVI) -5%+ after hours: Clean beat, raised guidance, higher dividend, and still sold off. The market may be pricing in tariff and macro risk that the strong Q2 print has not yet resolved.

• Treasury yields higher: The Fed minutes removed any residual easing bias from the June statement and showed several members open to hiking, giving bond bears fresh ammunition heading into the back half of 2026.

What they’re saying

“There’s some ambiguity in the minutes, suggesting several competing views on policy. The committee is working through a wide range of scenarios and will not commit to a specific scenario until the incoming data provides necessary clarity,” said Jeffrey Roach, Chief Economist at LPL Financial (via CNBC).

2. Deals · AI Infrastructure

Apple Locks In $30 Billion with Broadcom for U.S.-Made Chips

Apple (AAPL) announced a multi-year deal with Broadcom (AVGO) expected to exceed $30 billion, covering more than 15 billion U.S.-made chips and a $1.5 billion expansion of Broadcom’s Fort Collins, Colorado facility, according to CNBC. The agreement centers on custom ASIC silicon, including wireless components for cellular, Wi-Fi, and Bluetooth, running through 2031. Broadcom shares climbed nearly 5% on the news. For outgoing CEO Tim Cook, this is the largest single commitment under Apple’s $600 billion, four-year U.S. investment plan announced in 2025. The deal cements domestic silicon supply at a moment when AI workloads are rapidly expanding ASIC demand across the industry.

$30 billion+: Apple’s commitment to Broadcom for U.S.-made chips, the largest piece of its $600 billion American investment plan.

3. The Tape · Macro

BofA: The U.S. Is Running Two Economies, and Only One Feels It

Bank of America’s mid-year outlook, shared with Yahoo Finance, describes a K-shaped economy: “reflation for higher income, stagflation for lower income.” Spending by the top 1% rose 9.0% year over year in the week of June 6, while lower-income spending grew just 5.5%, per BofA card data. The bank projects real GDP growth of 2.3% in 2026 alongside PCE inflation of 3.5%, a combination that leaves the Fed with no clean off-ramp. The implication is clear: the aggregate data looks healthy precisely because wealthy households are strong enough to carry the headline number, obscuring real stress at the lower end.

4. Deals · Space

Blue Origin Raises $10 Billion in First-Ever External Funding Round

Jeff Bezos’ Blue Origin is raising $10 billion at a $130 billion pre-money valuation, marking the first time the rocket company has sought outside capital since its founding in 2000, according to Business Insider. The round is led by Coatue Management with a $2 billion contribution from Bezos himself, per the New York Times’ DealBook. CEO Dave Limp framed the raise as a “vote of confidence” in a memo to staff. The move comes as Blue Origin races to close the gap with SpaceX, which raised a record $86 billion at its recent IPO surpassing a $2 trillion valuation.

5. Earnings · Retail

Levi’s Beats, Raises Guidance, Lifts Dividend. Shares Still Fall 5%

Levi Strauss (LEVI) reported Q2 adjusted EPS of 28 cents versus 24 cents expected, and revenue of $1.56 billion against a $1.52 billion consensus, then raised its full-year sales growth outlook to 7%-7.5% from a prior 5.5%-6.5%, according to CNBC. The company also raised its dividend. CEO Michelle Gass noted that about two-thirds of the quarter’s sales growth came from unit volumes, not price increases, a sign of genuine demand rather than inflationary cover. Shares still dropped more than 5% in extended trading, a reminder that even clean beats can’t overcome a skittish tape.

★ Featured Event · Live Webinar

The Game of Money, Live with Oren Klaff

Oren Klaff shares his work with 400+ current investors, and on Wednesday, July 16 at 9:00 AM PST he is doing it live: a real deal breakdown, plus the framework he uses to spot a private company with genuine upside before the broader market notices. 55 minutes, live only, no recording, and seats are limited. If you want to sharpen how you think about private-market access, be in the room.

[Reserve your seat here]

+ Also on the Tape

From All Upside: The grid just told its biggest customers to power themselves. Nobody is reading it right.

Emergency orders, a 20-year demand record, and why bring-your-own-power is the next American buildout. This is the piece to read if you want to understand where the AI power story actually goes next.

[Get the full read here]

• AI Debt: Amazon filed for an eight-part bond sale targeting at least $25 billion to fund AI infrastructure, with maturities spanning 3 to 40 years, following roughly $64 billion in bonds already raised earlier this year, according to Yahoo Finance.

• Rail M&A: Union Pacific (UNP) and Norfolk Southern (NSC) submitted the first tranche of data requested by the Surface Transportation Board for their $85 billion merger review, targeting a mid-2027 close, per Yahoo Finance.

• Investing: Michael Burry disclosed a position split roughly 60% Flutter and 40% DraftKings (DKNG), betting that regulators will eventually rein in prediction markets and restore pricing power to licensed sportsbooks, according to CNBC.

• AI Capex: The four largest AI spenders lifted Q2 2026 capital spending 74% year over year to $168 billion, with combined 2026 outlays on track to exceed $700 billion, according to Reuters via Yahoo Finance.

The Last Word

A split Fed is not a weak Fed. It is a Fed that is actually looking at the data.

Bull Street is for informational purposes only. Nothing here is financial advice. Always do your own research.

All Upside

The weekly read for entrepreneurs who see the upside everyone else is missing. A bullish, contrarian take on business and America, plus the exact plays an operator runs. Free, every week.

By Evelio Silvera

Over the July 4th weekend, while the country watched fireworks, the Department of Energy quietly issued emergency orders authorizing PJM, the largest grid operator in America, to direct data centers and other large power users onto their own backup generators within 15 minutes of an emergency signal.

Demand was forecast at 166,147 megawatts, enough to break a record that had stood since 2006. Hospitals, 911 centers, and water plants stayed exempt.

The doom read writes itself: the grid is buckling, AI is eating the power supply, pick a villain.

That read misses what actually happened. The system held. Families kept the air conditioning running through triple-digit heat because the operators asked the biggest, most sophisticated customers to carry their own load for a few hours, and those customers could.

Now put that next to the structural move almost nobody covered.

Three weeks earlier, FERC ordered all six regional grid operators to justify or rewrite their rules for connecting giant new loads, and Texas directed that data center developers shoulder their own infrastructure costs.

The message from every direction is the same: if you want gigawatts, bring capacity with you.

That is not a grid failing. That is a market learning to price reliability, and it moves on-site power from a compliance line item to the strategy itself.

I operate in energy, and I will say it plainly: the next decade of American building goes to whoever can put dependable electrons exactly where the demand stands.

The grid did not fail last week. It sent a price signal, and builders are already answering it.

This is the read the panic headlines will not give you: the constraint named honestly, and the opportunity inside it. I send it free every Tuesday in All Upside, from an operator who builds in energy and healthcare. Subscribe:

All Upside

The weekly read for entrepreneurs who see the upside everyone else is missing. A bullish, contrarian take on business and America, plus the exact plays an operator runs. Free, every week.

By Evelio Silvera

The market keeps trying to price the AI boom through the chipmakers, but the real constraint is power, and this week Texas gave us the clearest look yet at who actually profits from it.

Underneath that run a softer-than-it-looks jobs report, SK Hynix’s $29 billion bet that AI memory belongs on U.S. exchanges, and a Tesla quarter that looked like a blowout until you read the fine print.

The through-line is the one capital allocators price every day: where demand is contracted and where it is only hoped for.

Let’s get into it.

1. The Lead · Energy / Infrastructure

Texas Power Stocks Have Real Contracts, Not Just AI Hype

The market keeps pricing the AI boom through the chipmakers, but the real bottleneck is power, and Texas is where that trade has already been signed. ERCOT now projects state electricity demand could approach 368 gigawatts by 2032, almost entirely driven by AI data centers, according to Yahoo Finance. Vistra (VST) locked 20-year power purchase agreements with Meta for more than 2,600 megawatts of nuclear output and posted first-quarter 2026 adjusted EBITDA up 20% year over year to nearly $1.5 billion. NRG Energy (NRG) closed a $12 billion acquisition of LS Power’s portfolio, doubling capacity to roughly 25 gigawatts, and raised 2026 core profit guidance to $3.93 to $4.18 billion. Energy Transfer (ET) is already piping gas to Oracle data centers near Abilene, with agreements for more than 6 billion cubic feet per day in new demand volumes over the past year.

368 gigawatts: ERCOT’s projection for Texas electricity demand by 2032, almost entirely driven by AI data centers, the demand these power contracts are built to serve.

The Bull & The Bear

• ▲ Bull: These are not AI-hype tickers, they are utilities with signed, long-dated contracts and the cash flow to match. The demand is contracted rather than speculative, and nuclear and gas baseload is exactly what data centers require and cannot easily replace. When the whole buildout runs on electrons, you want to own the companies that sell them.

• ▼ Bear: ERCOT’s 368 gigawatts is a 2032 projection that assumes the data-center boom continues without interruption. Merchant and regulated power both carry execution, permitting, and interconnection risk, and a single-ISO concentration in Texas leaves these names exposed if AI capex cools or the grid simply cannot be built fast enough to honor the contracts.

The Bull Street Take

I am long American energy abundance, and this is the cleanest way to play the AI boom without guessing which model or which chip wins. The picks and shovels of this cycle are electrons, and Vistra, NRG, and Energy Transfer are selling them under contract, not press release. The risk here was never demand. It is whether we can build fast enough to meet it. I would rather own the companies powering the data centers than the ones burning the cash inside them.

Markets in Review · The Tape

Yields Drop, September Hike Comes Off the Table

Markets in Review

The policy-sensitive 2-year Treasury yield fell 3.5 basis points to 4.13% following the June jobs report, according to CNBC. Stock market futures rose after the release as traders dialed back rate-hike expectations.

The June jobs report did the work for bond bulls on Thursday. A miss on nonfarm payrolls (57,000 vs. the 115,000 consensus) and a plunge in labor force participation sent the 2-year yield to 4.13%, its lowest post-report level in recent weeks, as markets repriced the Federal Reserve’s near-term path.

Equity futures responded positively to the data, reading a soft labor market as reducing the risk of near-term monetary tightening. Fed Chair Kevin Warsh had called the labor picture ‘steady’ just the day before, but Thursday’s numbers challenged that characterization.

On the commodity side, Brent crude continues to trade well off its highs. Benchmark Brent has fallen 39% from its March peak, per CNBC, as Saudi Arabia has ramped oil flows through the Strait of Hormuz following the June 17 U.S.-Iran ceasefire, shipping roughly 34 million barrels through the strait since then.

Go deeper

• The 2-year Treasury yield, the most rate-sensitive part of the curve, dropped 3.5 basis points to 4.13% as traders removed a potential September hike from CME FedWatch futures.

• Leisure and hospitality shed 61,000 jobs in June, the BLS said, reflecting slower-than-usual seasonal hiring and dragging the headline payroll number well below consensus.

• The S&P 500 has cumulatively surged approximately 50% since April 8, 2025, per CNBC, the day before the tariff reversal that sparked the rally.

What they’re saying

‘The slowdown in payroll growth challenges the narrative of renewed labor market strength that has been building in recent months but, importantly, reinforces the view that the Federal Reserve is under little pressure to tighten policy,’ said Seema Shah, Chief Global Strategist, Principal Asset Management

2. The Economy · Labor

June Jobs Report: 57,000 Payrolls, and a Labor Force Participation Rate at a 50-Year Low

The U.S. economy added only 57,000 nonfarm payrolls in June, according to the Bureau of Labor Statistics, badly missing the 115,000 Dow Jones consensus and well below May’s downwardly revised 129,000. The headline unemployment rate fell to 4.2%, but for the wrong reason: the labor force participation rate dropped to 61.5%, its lowest since March 2021 and, excluding the Covid era, its lowest in 50 years, per CNBC. The labor force itself shrank by 720,000 in June alone. ‘What really affects me is not so much the unemployment rate,’ said Dan North, senior economist at Allianz. ‘This is a big leg down in one month.’ Treasury’s policy-sensitive 2-year yield fell 3.5 basis points to 4.13% following the release, according to CNBC, as traders removed a potential September rate hike from the table.

720,000: Workers who exited the labor force in June alone, per the BLS household survey, driving the headline unemployment rate lower even as fewer people were actually employed.

3. Markets · Chips

SK Hynix Wants AI Investors, and It Is Coming to the Nasdaq to Get Them

SK Hynix plans to list on the Nasdaq around July 10, tapping American investor appetite for AI memory chips and aiming to close the valuation gap with rival Micron (MU), according to Fortune and Bloomberg. The $29 billion listing would give U.S. funds direct access to a leading maker of the high-bandwidth memory that AI data centers cannot run without. SK Hynix still trades cheaper than its American peer, near 6.2 times estimated earnings against Micron’s roughly 7 times, even after a year in which memory names have ridden the AI buildout hard. As one analyst told Fortune, we are in a time of extreme enthusiasm about chip stocks, and this listing is built to convert it.

4. Geopolitics · Energy

Red Sea Attack Tests the U.S.-Iran Ceasefire and the Global Oil Route

A cargo vessel triggered a distress alert 30 nautical miles southwest of Al Hudaydah, Yemen, on Sunday, according to the UK Maritime Trade Operations Centre. The incident puts the fragile U.S.-Iran ceasefire signed June 17 back in focus: that deal is still in a 60-day negotiation window to produce a permanent peace. Brent crude has already fallen 39% from its March highs as Saudi Arabia ramped flows through the Strait of Hormuz, shipping roughly 34 million barrels through the strait since June 17, per trade intelligence firm Kpler. Any sustained disruption to the Bab el-Mandeb, the chokepoint linking the Red Sea to the Gulf of Aden, would threaten the relief valve the oil market has been counting on.

5. Autos · EVs

Tesla’s Blowout Quarter Comes With a Warning Sign

Tesla (TSLA) delivered 480,126 vehicles in the second quarter, up 25% year over year and 34% from the first quarter, beating the roughly 406,000 Wall Street consensus by about 74,000 units and snapping a two-year run of annual declines, per the company’s report. The warning sits underneath the beat: Tesla produced only 451,758 vehicles, so it delivered 28,368 more cars than it built, drawing down inventory rather than selling into pure new demand. That drawdown accounts for close to 38% of the delivery surprise, and the stock still fell about 7.5% on the news, its worst session in nearly a year. A blowout headline that leans on backlog is a strong quarter, but it is not the same signal as demand outrunning supply.

+ Also on the Tape

• Autos: Ford (F) was named the top mass-market brand in J.D. Power’s 2026 initial quality ranking, its first time leading mainstream brands since 2010, after cutting warranty costs by $1.5 billion in 2025.

• Autos: Hybrid vehicles are pulling ahead of EVs as the breakout segment of the U.S. car market, winning on function and price rather than serving as a bridge to full electrification, according to MarketWatch.

• Labor: Initial jobless claims for the week ended June 27 came in at 215,000, down 1,000 from the prior week and below the forecast of 220,000, per the Bureau of Labor Statistics.

• The Fed: Fed Chair Kevin Warsh called the jobs picture ‘steady’ on Wednesday while reiterating inflation remains above the 2% target, and futures markets now point to a potential rate hike only as early as October, per CME FedWatch.

• Private Markets: In private equity, every deal has four seats at the table and retail investors get the weakest one, argues Oren Klaff on Bull Street: the winning move is getting in before the professional money does, not after it passes.

  —> https://bullst.substack.com/p/the-private-equity-trick-investors

The Last Word

You cannot run artificial intelligence on artificial power. Someone has to build the real thing.

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Bull Street is for informational purposes only. Nothing here is financial advice. Always do your own research.

The through-line today is the price of ambition: who is paying it, who is passing it on, and who just found a way to get paid on the other side.

Meta turned its AI spending problem into a cloud revenue pitch, chip stocks gave back some of their historic Q2 run, ADP’s June number came in soft, and the USMCA’s non-renewal just added another layer of trade fog over an auto industry already sorting winners from losers by powertrain.

A lot to work through this morning.

1. The Lead · Tech

Meta Turns Its AI Spending Problem Into a Cloud Revenue Play

Meta (META) closed up nearly 9% on Wednesday after Bloomberg reported the company is building a cloud business to sell excess computing capacity to outside customers, confirmed by CNBC’s Jim Cramer. The company is debating whether to offer access to hosted AI models or raw compute power, according to Bloomberg. Meta told investors in April it plans to spend as much as $145 billion on capex this year, and the cloud pivot is being read as a way to recoup some of that enormous outlay. The move follows the playbook of Elon Musk’s SpaceX, which has already inked deals with Anthropic at $1.25 billion per month and Google at $920 million per month for excess capacity. The announcement sent neocloud names CoreWeave and Nebius Group each plunging roughly 12% as investors braced for a formidable new competitor, according to CNBC.

$145 billion: Meta’s planned 2026 capital expenditure budget, the spending pile the new cloud business is designed to help justify, per the company’s April investor communication.

The Bull & The Bear

• ▲ Bull: Meta has already spent the money. Monetizing idle capacity is pure margin on infrastructure that exists. If the company can attract enterprise customers at the scale SpaceX has with Anthropic and Google, this business could meaningfully offset capex concerns and reprice META as a cloud infrastructure play, not just a social media company.

• ▼ Bear: Meta is walking into the most competitive market in tech, going up against Amazon, Microsoft, and Google on their home turf. The company’s first AI model under Alexandr Wang, Muse Spark, was positioned as a ‘foundation’ rather than a state-of-the-art offering, which is not the profile of a cloud provider that commands premium pricing. Excess capacity today can become a stranded asset tomorrow if AI demand normalizes.

The Bull Street Take

I like this move more than the market’s one-day pop suggests. The knock on Meta’s AI spending has always been that it was burning cash with unclear returns. A cloud business changes the unit economics of every dollar already deployed. The risk is execution in an unfamiliar market. But Zuckerberg has a track record of copying the playbook that works and scaling it. SpaceX showed this can be worth billions per month. Meta has more compute than almost anyone. Worth watching closely.

Markets in Review · The Tape

Chip Stocks Crack as AI Infrastructure Trade Faces Its First Real Test

Markets in Review

Wednesday’s session saw a sharp reversal in semiconductor names even as Meta (META) surged nearly 9%, creating a bifurcated tape where the hyperscalers held firm while the picks-and-shovels names took the hit.

The VanEck Semiconductor ETF (SMH) fell more than 5% on Wednesday, one day after closing out what CNBC described as the fund’s best quarter ever, a 71% gain from April through June. Micron (MU) led the carnage with an 11% drop that erased $138 billion in market cap. Intel (INTC) fell 9% and AMD fell 7%, per CNBC.

The catalyst was Meta’s reported move to sell excess compute capacity, which markets read as a signal that AI infrastructure supply may be closing in on demand. That is a meaningful shift in narrative for stocks that spent Q2 pricing in insatiable, indefinite demand for memory and processors.

On the other side of the ledger, Meta’s 9% gain reflected investor relief that the company’s enormous capex commitment may generate direct revenue. CoreWeave and Nebius Group each fell roughly 12% as the neocloud market priced in a powerful new entrant, per CNBC.

Go deeper

• Micron (MU) dropped 11% despite reporting more than a quadrupling of revenue last week with gross margins surging to 84.9% from 39% a year earlier, per CNBC, illustrating how quickly sentiment can overwhelm fundamentals in momentum-driven sectors.

• Semiconductor equipment names Lam Research (LRCX), KLA Corp. (KLAC), and Applied Materials (AMAT) all fell at least 10% on Wednesday after each had more than doubled in Q2, per CNBC, a textbook example of how violent reversals can be at the end of a historic run.

• Meta (META) was the session’s standout gainer at nearly +9%, with KeyBanc analysts writing that the cloud move positions Meta ‘more into the enterprise side of the market, which could provide more immediate’ ROI, per CNBC.

What they’re saying

“Earnings are accelerating, yet multiples are compressing. All I can attribute that to is hyperscalers have been valued as capital intensive and asset-heavy versus asset-light.” -- Richard Saperstein, CIO at Treasury Partners, on CNBC’s Closing Bell

2. Macro · Labor

ADP’s June Number Comes In Soft, Setting Up a Crucial Friday Payrolls Report

Private payrolls rose by 98,000 in June, according to ADP, below the Dow Jones consensus of 110,000 and down from an unrevised 122,000 in May. Nearly half the gains came from education and health services (48,000), while leisure and hospitality added a meager 2,000 jobs, a continuing soft signal for consumer demand, per CNBC. ADP’s chief economist Nela Richardson called it ‘a slowdown in job creation’ driven by both supply constraints and weaker demand. The Wall Street consensus for Friday’s BLS nonfarm payrolls report is 115,000, with the unemployment rate expected to hold at 4.3%.

3. Deals · Trade

USMCA Is Officially Not Renewed, Kicking Off Years of Renegotiation Risk for Autos

The Trump administration confirmed Wednesday it will not renew the USMCA trade pact in its current form, triggering annual reviews that could last until 2036 and reshaping the supply chains underpinning roughly $2 trillion in annual North American trade, according to CNBC. The auto industry, representing about 18% of U.S. trade with Canada and Mexico, faces the most acute exposure: the administration is reportedly pushing to raise regional value content requirements to 82% from the current 75%, with 50% of that value required to originate in the U.S., per CNBC. AlixPartners warns the cost to move certain parts from China into the U.S. could rise as much as 50%, and Boston Consulting Group cautions that standards set too high could paradoxically reduce U.S. production.

4. The Tape · Autos

Hybrids Are Winning the U.S. Auto Market as GM’s EV Bet Costs It Ground

Second-quarter U.S. auto sales revealed a widening split between automakers with strong hybrid lineups and those without. Toyota (TM) posted a 1.1% sales gain driven by a ~20% increase in electrified vehicles, Hyundai reported a 67% increase in hybrid sales for the first half, and Honda’s record electrified sales powered an 8.4% overall gain, per CNBC. GM (GM), which offers only one low-volume hybrid, reported a 4.2% quarterly sales decline, with EV sales off 33% year over year. Cox Automotive now warns Toyota could overtake GM as the top-selling automaker in the U.S. by year-end. Gas prices up more than 20% from a year ago, according to AAA, are the engine behind the hybrid surge.

+ Also on the Tape

• AI: Palantir (PLTR) CEO Alex Karp said on CNBC that AI models have been ‘completely, irresponsibly, oversold,’ claiming enterprise CEOs are privately ‘twice as livid’ about token costs and lack of ROI as he is publicly.

• Media: Comcast (CMCSA) named former CFO Michael Angelakis as incoming CEO of the cable and internet business as part of its planned tax-free spinoff of NBCUniversal and Sky into a separate publicly traded entity.

• Autos: Nissan was a surprise Q2 bright spot, posting a 9.6% sales gain despite limited electrified models, driven by a sales-focused turnaround plan, per CNBC.

• AI Infra: Neocloud companies CoreWeave and Nebius Group each fell roughly 12% after Meta’s cloud ambitions raised the specter of a massively capitalized new competitor entering their market.

Featured Contributor · Private Markets

There Are Four Seats at Every Deal. One of Them Wins No Matter What.

by Oren Klaff, click here the read the exclusive article for Bull Street

Every private equity deal is financial engineering, Oren Klaff argues in his third piece for Bull Street, and the question is never whether there’s a trick, because there always is. Continuation vehicles, preferred stacks, recap dividends, fee resets, fund-of-funds Russian dolls: every structure is built to move value from one seat at the table to another. What actually decides whether you win or lose is which of the four seats you occupy when the price gets set: the Banker, the Founder, the Professional Investor, or the Retail Buyer. One of those seats makes money on every deal regardless of whether the company wins or loses. That is the magician. Guess which seat gets the trick pulled on it.

His point for anyone allocating into private markets: you end up in the fourth seat by default. You see a deal already shopped to twenty funds and passed on, the deck looks great, you commit, and three years later it gets recapped, diluted, or sold to an affiliated buyer while the people running it make money either way. The fix is not smarter diligence or another article on the yield curve. It is changing seats: getting in before the professional investors, investing alongside management rather than the PE firm, and having direct access to the people writing the structure before it is handed to you as a done deal.

Oren’s Take

Be not the investor. Be the banker. It’s the line I put on the cover of every presentation I give, because the value in this industry is captured at the seat, not at the transaction. Every PE professional knows this, it’s the reason they went into PE in the first place. You can keep being the exit strategy for people you’ve never met, or you can get closer to the deal before it reaches you as love it or leave it.

→ On Thursday, July 16, Oren is running a live walk-through with the Bull Street community on exactly how the seat-change works, no slides, no course pitch. Reserve your spot: https://orenklaff.com/bullst

The Last Word

The market loves a spending story until it demands a revenue one. Meta just handed it one.

Bull Street is for informational purposes only. Nothing here is financial advice. Always do your own research.