It was a very light fundamental news week for the coverage universe. I already published my Lemonade earnings review and my Palo Alto Networks earnings review.
Next week will be a busy one. I will be writing reviews on Nvidia, Salesforce, Zscaler, Hims, Mercado Libre, Snowflake, Axon, Cava and The Trade Desk. I will also publish brief coverage of Duolingo, Rocket Labs and Zeta.
Other reviews and recent content published this season:
- Axon Deep Dive.
- Cloudflare Earnings Review.
- Robinhood & Shopify Earnings Reviews.
- Datadog Earnings Review.
- Palantir Earnings Review.
- AMD & PayPal Earnings Reviews.
- Alphabet & Uber Earnings Reviews.
- Amazon Earnings Review.
- My Current Portfolio & Performance.
- Access 8 other reviews from earlier in the earnings season.
1. SoFi (SOFI) – Blue Owl
During the week, news broke about Blue Owl halting redemptions for a retail-focused fund. That understandably made capital markets anxious. Considering SoFi’s loan platform business (LPB) benefits from healthier capital market liquidity conditions, the stock had a bad week. While the nervousness makes a lot of sense, I don’t think SoFi is in trouble here. Blue Owl recently spoke on an earnings call about working with high quality partners like SoFI as a company strength amid other recent credit market issues. There is no indication of them souring on the relationship, and the $5B contract is in place through March 2027. LPB’s relationship with this partner is not in the part of Blue Owl’s company that is having these issues.
SoFi is far from immune to economic and credit cycles. They matter a lot for their financials, which is why SoFi guidance is explicitly based on reasonable unemployment and GDP outcomes. If the unemployment rate moves a lot higher or if real liquidity issues start becoming more prevalent, then SoFi’s results would temporarily suffer. This news does not signal those things in my mind.
2. Coupang (CPNG) – Ongoing Breach News
Korea's Fair Trade Commission stated that any business suspension stemming from the data breach would be difficult. They cannot "confirm whether personal info was stolen as a result of the public-private investigation," which will likely make the punishment less severe than some feared. They said they'd effectively lay the hammer if they did find that personal sensitive data was leaked, but they're just not finding that. Good to hear.
Korean lawmakers have been exceedingly aggressive towards this company, and this is a sign of their tone softening. This is all from Maeil Business Newspaper, which is a highly regarded source over there.
3. Headlines, Markets & Macro
Claude (Anthropic) debuted a new AI agent to find security vulnerabilities. This hit the sector on Friday. I personally see cybersecurity as the safest software sub-sector in terms of AI risk defensibility. At the same time, market sentiment is at a point where any headline like this will send software stocks lower. That won’t last forever for the companies that continue to effectively and profitably compound. But it’s the current reality.
The Supreme Court just struck down the Trump tariffs. The administration responded by saying they’d tweak the underlying laws utilized to to keep tariffs in place and will add another 10% global tariff on trade partners. It’s going to get noisier and more chaotic before the final outcome becomes more clear. We’ll see how everything unfolds.
Shopify got upgrades from Truist and Phillip Securities this week. Oppenheimer channel checks point to modest upside for Zscaler and Snowflake results. A lot more sell-side research highlights were shared in the Discord channel during the week.
Meta expanded its usage of Nvidia chips as part of a multi-year partnership.
Rackspace and Palantir announced a new partnership to jointly help customers adopt the AI platform (AIP) and Foundry. Rackspace is training 30 of their engineers on Palantir’s products and implementation.
Uber is investing $100M in autonomous vehicle (AV) charging infrastructure to support future scaling and bolster its overall value proposition for AV partners.
Amazon cut its Ring partnership with Flock Safety. This means those roughly 10M doorbell video feeds will no longer be available to that Axon competitor, but will remain part of its coverage network (at least for now). This is a small piece of good news for Axon's overall competitive differentiation.
ServiceNow CEO Bill McDermott beginning to deploy his $20M commitment via insider purchases starting with a $3M open market purchase during week Also Bill & CFO Gina Mastantuano cancelled their scheduled selling plans. There should be more purchases coming from Bill in the near future.
Output Data:
- Final GDP Reading Q/Q for Q4 rose by 1.4% versus 2.8% expected and 4.4% last reading. The ugly GDP reading vs. expectations was driven by the government shutdown, but slowing consumer spending and lapping the beginning of inventory front-loading ahead of tariffs last year did contribute to the miss as well.
- The New York Empire State Manufacturing Index for February came in at 7.1 versus 6.4 expected and 7.7 last month.
- The Philly Fed Manufacturing Index for February came in at 16.3 versus 7.5 expected and 12.6 last month.
- Core Durable Goods Orders M/M for December grew by 0.9% vs. 0.3% expected in 0.4% last month.
- Durable goods orders M/M for December grew by -1.4% versus -1.8% expected and 5.4% last month.
- Industrial Production M/M for January rose by 0.7% vs. 0.4% expected and 0.2% last month.
Inflation Data:
- The core personal consumption expenditures (PCE) price index M/M for December rose by 0.4% versus 0.3% expected and 0.2% last month.
- The core PCE for December rose by 3% versus 2.9% expected and 2.8% last month.
Consumer & Employment Data:
- Continuing jobless claims came in at 1.869M vs. 1.860M expected and 1.852M last report.
- Initial jobless claims came in at 206K vs. 223K expected and 229K last reported.