Core Viewpoint - Fastly's shares have declined 26.4% year to date, underperforming the Zacks Internet Software industry's appreciation of 14.8% and the broader Zacks Computer & Technology sector's return of 5.7%, reflecting macroeconomic uncertainty and near-term softness in enterprise IT spending [1][2] Group 1: Company Performance - Fastly's strong partner ecosystem, expanding product portfolio, and consistent enterprise traction provide visibility into sustained execution, making the recent dip an attractive entry point for investors [2][17] - Fastly closed the first quarter of 2025 with 577 enterprise customers, contributing 93% of total revenue, and remaining performance obligations rose 33.5% year over year to $303 million [11][17] - The company expects revenues between $143 million and $147 million for the second quarter of 2025, indicating sequential growth from the March quarter, with a non-GAAP operating loss projected between $8 million and $4 million [15][17] Group 2: Product Innovations - Fastly continues to enhance its platform by introducing capabilities that address modern infrastructure challenges, evolving into a full-stack edge cloud platform [5][17] - New features include Client-Side Protection for browser-based security, expanded Bot Management capabilities, and HTTP Cache API support for programmatic cache control, improving developer experience and security [6][7][8] Group 3: Market Positioning - Fastly benefits from a rich partner base, including Microsoft, Alphabet, and Palo Alto Networks, enhancing its positioning in multi-cloud environments and security-led use cases [9][10] - Fastly shares are attractively valued, trading at a forward 12-month price-to-sales (P/S) of 1.63X, significantly lower than the industry's 5.76X [12][17] Group 4: Future Outlook - The company's stable second-quarter outlook and disciplined execution offer added visibility, with positive estimate trends supporting the case for accumulation [17][18]

Core Acquisition and Strategy - CoreWeave, Inc. has announced the acquisition of Weights & Biases to enhance its leadership in high-performance AI cloud infrastructure, combining compute capabilities with tools for model training and monitoring [1][9] - The acquisition adds a customer base of over 1,400 organizations, which management believes will unlock greater value for shared customers [2] Product Launch and Integration - CoreWeave and Weights & Biases launched their first joint product offerings, which include Mission Control Integration, Weights & Biases Inference, and Weave Online Evaluations, aimed at accelerating AI development [3][4] - These products create a seamless platform to improve efficiency and empower developers to scale AI solutions confidently [4] Financial Guidance and Market Position - For 2025, CoreWeave has guided revenues to be between $4.9 billion and $5.1 billion, driven by increasing demand for AI infrastructure [5][9] - CoreWeave's shares have increased by 27.5% in a month, outperforming the Internet Software industry's growth of 6.6% [8] Competitive Landscape - CoreWeave faces competition from Nebius Group and Microsoft, with Nebius focusing on organic growth and vertical integration in AI infrastructure [6] - Microsoft is expanding its AI infrastructure through partnerships and investments, positioning Azure AI as a core platform for the AI era, with over 60,000 Azure AI customers, a nearly 60% increase year over year [7]

Core Insights - Reddit is transitioning from community-led discovery to full-funnel performance marketing, resulting in a 61% year-over-year increase in advertising revenue to $358.6 million in Q1 2025, with performance campaigns making up 60% of total ad spend [1][10] Group 1: Advertising Strategy and Tools - Reddit is focusing on attracting conversion-oriented advertisers through innovative solutions like Dynamic Product Ads (DPAs), which utilize real-time catalog feeds and machine learning to enhance product visibility and return on ad spend [2] - New tools such as the Meta campaign import feature and expanded Smartly.io integration have been introduced to simplify campaign setup and management, enabling brands to scale their performance efforts more efficiently [3] - Over 90% of managed advertisers utilized Reddit's Pixel for conversion tracking in Q1, and revenue linked to Conversion API (CAPI) has more than tripled year-over-year, indicating strong adoption of Reddit's performance tools [4] Group 2: Competitive Landscape - Reddit faces increasing competition from Snap and Alphabet, both of which are enhancing their performance advertising capabilities and audience targeting tools [5] - Snap is expanding its commerce features with Dynamic Ads and improved conversion APIs, targeting mobile-first, Gen Z-focused verticals that overlap with Reddit's performance campaigns [6] - Alphabet is strengthening its position through Google Ads and YouTube shopping integrations, leveraging advanced AI and machine learning to optimize advertising for intent and conversion, posing a significant challenge to Reddit [7] Group 3: Financial Performance and Valuation - Reddit's shares have declined 17.9% year-to-date, contrasting with the broader Zacks Computer & Technology sector and Internet Software industry, which have increased by 0.9% and 11.2%, respectively [8] - Reddit's stock is trading at a forward 12-month Price/Sales ratio of 11.78X, significantly higher than the industry's 5.62X, indicating a premium valuation [12] - The Zacks Consensus Estimate for Q2 2025 earnings is 19 cents per share, an improvement from a loss of 6 cents per share in the previous year, while the fiscal 2025 earnings estimate is $1.21 per share, up from a loss of $3.33 per share in fiscal 2024 [15]

Core Insights - CoreWeave, Inc. (CRWV) is launching advanced offerings tailored for AI model training and inference, positioning itself as a competitive player in the Infrastructure-as-a-Service market with a projected global economic impact of $20 trillion from AI by 2030 and a total addressable market (TAM) of $400 billion by 2028 [1] Product Development - The company has introduced three new AI cloud software products aimed at accelerating AI development processes, marking its first software release since acquiring Weights & Biases in May 2025 [2][8] - New products include Mission Control Integration for rapid training issue resolution, W&B Inference for testing open-source AI models, and Weave Online Evaluations for real-time performance feedback [2] Technological Advancements - CRWV has rapidly adopted cutting-edge technology, being the first to deploy NVIDIA's H100 and H200 GPUs at scale and to offer GB200 NVL72 instances, which has positively impacted its revenue [3] - The introduction of next-gen AI Object Storage, combined with Kubernetes services, provides a comprehensive production-level setup for AI customers from the outset [3] Strategic Focus - The company is concentrating on four main areas: scaling capacity, financing infrastructure, enhancing platform differentiation, and expanding market reach [4] - CoreWeave is expanding its global presence to tap into new markets and strengthen existing customer relationships [4] Competitive Landscape - Microsoft (MSFT) is a major competitor in AI infrastructure, leveraging its Azure platform and significant investments in OpenAI to enhance its market position [5] - Nebius Group N.V. (NBIS) is also emerging as a specialized AI infrastructure provider, focusing on large-scale GPU clusters and cloud platforms, supported by its partnership with NVIDIA [6] Financial Performance - CoreWeave's stock has surged by 334.2% year-to-date, significantly outperforming the Internet Software industry's growth of 13.1% [7] - The company trades at a forward price-to-sales ratio of 10.31X, which is higher than the industry average of 5.68 [9]

Core Insights - Snowflake (SNOW) is enhancing its AI integration across its platform, which is driving strong adoption and improving its competitive position in enterprise infrastructure [1] - The launch of Cortex Gen2 and Openflow is aimed at expanding platform capabilities, improving analytics performance, and supporting scalable AI workloads [2] - Snowflake's partnerships with companies like Acxiom and Canva demonstrate the growing relevance of its AI infrastructure across various enterprise functions [3] Product Innovations - Cortex Gen2 enhances analytics performance and adaptive compute for scalable AI workloads [2] - Openflow introduces a managed ingestion layer for various data types, improving interoperability and data movement [2] - New tools like Snowflake Intelligence, Data Science Agent, SnowConvert AI, and Cortex Knowledge Extensions are expected to attract more clients [1] Competitive Landscape - Snowflake faces increasing competition from Palantir Technologies (PLTR) and Datadog (DDOG), both of which are enhancing their AI infrastructure [4] - Palantir's Artificial Intelligence Platform (AIP) supports secure deployment of large language models and integrates governance and operational control [5] - Datadog is expanding its observability capabilities and investing in GenAI integrations, which overlap with Snowflake's offerings [6] Financial Performance - Snowflake shares have increased by 37.2% year to date, outperforming the broader Zacks Computer & Technology sector and the Zacks Internet Software industry [7] - The forward 12-month Price/Sales ratio for Snowflake is 14.43X, significantly higher than the industry average of 5.62X [11] - The Zacks Consensus Estimate for second-quarter fiscal 2026 earnings is 26 cents per share, reflecting a year-over-year growth of 44.44% [14]

Core Insights - Meta Platforms (META) is enhancing its WhatsApp features by introducing channel subscriptions, promoted channels, and ads in the Status tab, which is utilized by 1.5 billion users globally while ensuring user privacy through end-to-end encryption [1][10] - The company generated 97.8% of its total revenues in Q1 2025, with a focus on improving advertisers' return on ad spending through its AI-driven ad recommendation system, Andromeda, powered by NVIDIA [2] - The introduction of a new Generative Ads Recommendation model has led to a 5% increase in conversion rates, with significant growth in user engagement across platforms [3] Revenue Growth - META's Family of Apps other revenues reached $510 million in Q1 2025, marking a 34% year-over-year growth, driven by WhatsApp Business and Meta Verified subscriptions [4][10] - The company's 2025 revenue is projected to grow by 11.8% year-over-year, reaching $179.67 billion [4] Competitive Landscape - META faces strong competition for advertising dollars from Alphabet (GOOGL) and Amazon (AMZN), with all three companies expected to capture approximately 50% of global ad spending by 2028 [5] Stock Performance and Valuation - META's stock has appreciated by 19.9% year-to-date, underperforming the broader Zacks Computer & Technology sector and the Zacks Internet Software industry [8] - The forward 12-month Price/Sales ratio for META is 8.98X, compared to the industry's 5.57X, indicating a premium valuation [15]

Core Insights - Sea Limited (SE) shares have increased by 45.5% year to date, significantly outperforming the Zacks Internet Software industry's growth of 10.6% and the Zacks Computer and Technology sector's rise of 1.1% [2] - The company's growth is driven by strong performance in its three main segments: Shopee (e-commerce), Monee (digital financial services), and Garena (digital entertainment) [2][8] Sea Limited's Performance - Year-to-date, Sea Limited has outperformed competitors such as NetEase, Alibaba, and JD.com, with NetEase and Alibaba shares appreciating by 45% and 33.1% respectively, while JD.com shares have decreased by 5.6% [3] - The stock is currently trading above both the 50-day and 200-day moving averages, indicating a bullish trend [6] - Shopee achieved a record gross merchandise volume (GMV) of $28.6 billion, a 21.5% increase year over year, while revenue rose by 28.3% to $3.5 billion [11][12] - Monee's revenue surged by 57.1% year over year to $787.1 million, benefiting from its expansion into Brazil and diversification into banking, investment, and insurance [14] - Garena's revenues increased by 8.2% year over year to $495.6 million, with bookings rising by 51.4% to $775.4 million, driven by the success of the game Free Fire [15] Financial Metrics and Estimates - Adjusted EBITDA for Sea Limited reached $264.4 million, a significant improvement from a loss of $21.7 million in the previous year, attributed to higher take rates and cost optimization [12] - The Zacks Consensus Estimate for SE's second-quarter 2025 earnings is $1.03 per share, reflecting a 123.91% increase from the previous year [18] - The consensus estimate for 2025 earnings is $4.23 per share, indicating a 151.79% jump from 2024's reported figure [18] Valuation and Market Position - Sea Limited shares are considered overvalued, with a forward Price/Book (P/B) ratio of 10.02X compared to the industry's 6.26X [19] - The P/B ratio is also higher than that of competitors NetEase, Alibaba, and JD.com, which are trading at 4.03X, 1.81X, and 1.22X respectively [21] Competitive Landscape - Despite strong performance, Sea Limited faces stiff competition in Asia and Brazil, particularly with the introduction of TikTok Shop in Brazil, which poses a significant challenge in the e-commerce sector [22] - Shopee Live is experiencing slow uptake in Brazil due to early-stage market conditions and limited awareness of live shopping [23]

Core Company Insights - CoreWeave, Inc. (CRWV) has projected 2025 revenues to be between $4.9 billion and $5.1 billion, driven by increasing demand for AI infrastructure [1][10] - The company has secured significant contracts, including an OpenAI deal valued at up to $11.9 billion and a $4 billion expansion with a major AI enterprise client, enhancing revenue visibility [2][10] - CoreWeave operates 33 data centers across the U.S. and Europe, supported by 420 megawatts of active power, and has expanded its client base by acquiring Weights and Biases, adding 1,400 AI labs and enterprises [3][10] Market Position and Growth Potential - CoreWeave is well-positioned to capture a substantial share of the AI infrastructure market, with a success-based capital expenditure model and expanding global reach [4] - The global economic impact of AI is forecasted to reach $20 trillion by 2030, with the total addressable market expected to grow to $400 billion by 2028 [4] Industry Trends and Competitors - The increasing spending on AI infrastructure is expected to benefit other players in the market, including Nebius Group N.V. (NBIS) and Microsoft Corporation (MSFT) [5] - Nebius anticipates achieving an annualized run-rate revenue of $750 million to $1 billion, with a strong start in Q1 2025 showing a 700% increase in ARR [6] - Microsoft projects revenues for its Intelligent Cloud segment between $28.75 billion and $29.05 billion for Q4 fiscal 2025, with Azure expected to see revenue growth of 34% to 35% [7][8] Performance Metrics - CoreWeave's shares have increased by 120.8% year-to-date, significantly outperforming the Internet Software industry's growth of 4.1% [9]

Industry Overview - The Internet Software and Services sector is experiencing growth due to increased IT spending on solutions that support hybrid operating environments [1] - The Internet Software industry is ranked in the top 17% of Zacks Industry Rank, indicating an expectation to outperform the market in the next three to six months [2] Company Highlights UiPath Inc. (PATH) - UiPath offers an end-to-end automation platform with a range of robotic process automation solutions [6] - The platform includes AI, ML, and NLP capabilities, enhancing decision-making and information processing [7] - Expected revenue and earnings growth rates for the current year are 8.5% and 3.8%, respectively, with a 1.9% improvement in earnings estimates over the last week [8] Five9 Inc. (FIVN) - Five9 provides intelligent cloud software for contact centers, enabling a wide range of customer service functions [11] - The platform includes AI-driven features such as virtual agents and workflow automation, benefiting from the growing adoption of AI tools [13] - Expected revenue and earnings growth rates for the current year are 9.6% and 11.7%, respectively, with a 5.7% improvement in earnings estimates over the last 60 days [14] Fastly Inc. (FSLY) - Fastly offers infrastructure software for cloud computing, security, and edge computing solutions [15] - The Fastly AI Accelerator was introduced to optimize LLM generative AI applications [15] - Expected revenue and earnings growth rates for 2025 are 8.6% and 25%, respectively, with a 10% improvement in earnings estimates over the last week [17] Calix Inc. (CALX) - Calix provides cloud and software platforms for broadband service providers [18] - The company has integrated AI into its platforms to enhance operations and service delivery [20] - Expected revenue and earnings growth rates for 2025 are 7.1% and 65.4%, respectively, with a 21.1% improvement in earnings estimates over the last 60 days [20] Confluent Inc. (CFLT) - Confluent operates a data streaming platform that allows real-time data streaming for various industries [21][22] - Expected revenue and earnings growth rates for the current year are 19% and 24.1%, respectively, with a 2.9% improvement in earnings estimates over the last 60 days [23]

Core Insights - CoreWeave, Inc. (CRWV) stock has surged 136.6% in the past month, closing at $149.70, significantly outperforming the Zacks Internet Software industry and the S&P 500 composite [1][4] - The company reported revenues of $981.6 million in the last quarter, exceeding estimates by 15.2% and reflecting a 420% year-over-year increase [5][9] - CoreWeave has established a strategic partnership with OpenAI valued at approximately $11.9 billion, alongside significant expansion agreements with enterprise customers [6][16] Revenue Growth and Market Position - The demand for AI cloud platforms is projected to have a global economic impact of $20 trillion by 2030, with a total addressable market expected to reach $400 billion by 2028 [5] - CoreWeave anticipates full-year 2025 revenues between $4.9 billion and $5.1 billion, supported by a substantial revenue backlog of $259 billion [9][10] - The company has expanded its data center network to 33 locations across the U.S. and Europe, backed by 420 megawatts of active power [7] Competitive Landscape - CoreWeave faces intense competition in the AI cloud infrastructure sector, with major players like Amazon and Microsoft dominating over half of the market [11] - The company collaborates with NVIDIA to implement GPU technologies, being one of the first cloud providers to deliver NVIDIA's advanced clusters for AI workloads [8] Financial Outlook and Challenges - CoreWeave expects capital expenditures to range between $20 billion and $23 billion for 2025, driven by increased investment to meet customer demand [12] - Interest expenses are projected to remain high, with the first quarter seeing expenses of $264 million, which could impact profitability [13] - A significant portion of revenue, 77% in 2024, is derived from the top two customers, indicating a risk related to customer concentration [14]