Government Shutdown - The Senate has passed a bill to end the government shutdown, which is expected to pass in the House and be signed into law by President Trump [1][7][10] - The House will begin a series of votes to pass the bill, with expectations of a close vote [8][9] - The reopening of the government is anticipated to reverse economic damage caused by the shutdown, including flight delays and lack of government data [10][11] SoftBank and Nvidia - SoftBank sold its entire stake in Nvidia, amounting to $5.8 billion, citing the sale as a necessary financing measure rather than a reflection on Nvidia's performance [3][4][14] - The sale allows SoftBank to provide investment opportunities for shareholders and maintain financial strength [4][14] - Nvidia's stock is experiencing downward momentum after Coreweave, a cloud computing provider, lowered its annual sales forecast due to a data center delay [2][16] Coreweave and Market Impact - Coreweave's annual sales forecast was cut from $5.15 billion to a range of $5.05 billion to $5.15 billion, disappointing investors [16] - Analysts note that supply constraints are short-term but highlight execution risks in the cloud computing sector [2][3] - The AI sector is experiencing volatility, with significant gains in the S&P 500 recently, but concerns remain about sustaining momentum [17][19] Corporate Buybacks - US corporate buybacks have reached approximately $1.2 trillion this year, 15% ahead of the same time last year, indicating confidence among companies [42][44] - The increase in buybacks suggests that companies may view their stocks as undervalued despite market highs [44][46] - The service sector's performance is crucial, as it constitutes a significant portion of GDP, and recent data shows a rebound in new orders [47][48] AI Sector Trends - The AI sector is seeing mixed performance, with companies like Coreweave facing challenges while others like Nebus report significant sales growth [39][41] - The adoption of AI is still in early stages, with many companies yet to scale their AI initiatives [28][30] - Investment opportunities may arise from companies addressing capacity constraints in the AI infrastructure space [21][22]

Core Insights - Alphabet's Google plans to invest 5.5 billion euros ($6.41 billion) in Germany to enhance its infrastructure and data center capacity in Europe [1] Investment Details - The investment is aimed at expanding Google's operational capabilities in the European market [1] - This move reflects Google's commitment to increasing its presence and infrastructure in Germany specifically [1]

Core Viewpoint - Michael Burry accuses major technology companies of using aggressive accounting practices to inflate profits from the AI boom, specifically by understating depreciation expenses [2][3][4] Group 1: Accounting Practices - Burry claims that "hyperscalers" are artificially extending the useful life of chips, leading to understated depreciation expenses [2][3] - This accounting maneuver could result in an estimated $176 billion understatement of depreciation from 2026 to 2028, inflating reported earnings across the industry [3] - Companies like Oracle and Meta Platforms could see their profits overstated by approximately 27% and 21%, respectively, by 2028 due to these practices [3] Group 2: Market Reactions - Burry has recently taken significant short positions against AI companies, including $187 million in put options against Nvidia and $912 million against Palantir Technologies [7] - Following Burry's disclosures, shares of Nvidia and Palantir experienced notable fluctuations, with Nvidia rebounding nearly 6% and Palantir rising almost 9% after previous declines [8] Group 3: Industry Context - Burry draws parallels between the current AI enthusiasm and the late-1990s tech bubble, suggesting potential overvaluation in the sector [6]

Financial Data and Key Metrics Changes - Q3 group revenue reached $146 million, representing a year-over-year increase of nearly 355% and a quarter-over-quarter increase of 39% [7] - Annualized run rate revenue for the core business at the end of September was $551 million, with the core infrastructure business growing 400% year-over-year and 40% sequentially [7] - Adjusted EBITDA margin for the core infrastructure business expanded quarter-over-quarter to nearly 19% [7] - The company raised its 2025 CapEx guidance from approximately $2 billion to around $5 billion, reflecting strong demand outlook [10] Business Line Data and Key Metrics Changes - The core infrastructure business accounted for nearly 90% of total revenue, with significant growth attributed to capacity constraints limiting revenue growth [7] - The company sold out all available capacity in Q3, indicating strong demand for its services [2][7] Market Data and Key Metrics Changes - The company signed a major deal with Meta valued at approximately $3 billion over the next five years, following a previous deal with Microsoft valued between $17.4 billion and $19.4 billion [3][12] - The demand environment is described as overwhelming, with a 70% quarter-on-quarter expansion in pipeline generation [22] Company Strategy and Development Direction - The company is focused on building its core AI cloud business while also pursuing large long-term deals to support growth [3][4] - Plans to grow contracted power to 2.5 gigawatts by the end of 2026, up from 1 gigawatt previously discussed [4][10] - The launch of new enterprise-ready cloud platform version 3.0, called Aether, aims to expand the addressable market opportunity [5] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving an annualized run rate revenue of $7 billion to $9 billion by the end of 2026, driven by strong demand and capacity expansion [6][17] - The company remains focused on maintaining healthy margins and a sustainable business model while navigating the AI revolution [42][63] Other Important Information - The company is actively evaluating financing options, including corporate debt, asset-backed financing, and equity, to support aggressive growth plans [8][32] - The company plans to file a prospectus supplement for an at-the-market equity program for up to 25 million Class A shares [8] Q&A Session Summary Question: Can you tell us more about the new Meta deal? - The Meta deal is approximately $3 billion, limited by available capacity, indicating potential for larger deals if capacity were available [12][13] Question: What is included in the $7 billion-$9 billion ARR target? - The target includes contracted power and demand from AI startups and enterprises, with more than half already booked [15][17] Question: What is the timeline for infrastructure build-out? - The company is ramping up capacity in various regions, with new data centers expected to come online in 2026 [18][19] Question: How will the Microsoft and Meta deals impact revenue? - Revenue from Microsoft will ramp up in 2026, while Meta's deployments are expected to conclude in the next three months [21] Question: What does the demand environment look like? - Demand is accelerating, with a 70% increase in pipeline generation in Q3 [22] Question: What are the constraints to growing capacity? - The main bottleneck is securing power and supply chain issues, which the company is actively addressing [38] Question: How is the enterprise initiative progressing? - The company is making strides in becoming enterprise-ready, with new functionalities and compliance certifications [48][49] Question: What is the opportunity around the Token Factory? - The Token Factory aims to serve a broader set of customers, enabling enterprises to build AI applications at scale [50][52]

Financial Data and Key Metrics Changes - Q3 group revenue reached $146 million, representing a year-over-year increase of nearly 355% and a quarter-over-quarter increase of 39% [7] - Annualized run rate revenue for the core business at the end of September was $551 million, with the core infrastructure business growing 400% year-over-year and 40% sequentially [7][9] - Adjusted EBITDA margin for the core infrastructure business expanded to nearly 19% quarter-over-quarter [7] Business Line Data and Key Metrics Changes - The core infrastructure business accounted for nearly 90% of total revenue, with significant growth attributed to capacity constraints limiting revenue growth [7][9] - The company sold out all available capacity in Q3, indicating strong demand and a bottleneck in revenue growth due to capacity limitations [2][4] Market Data and Key Metrics Changes - The company signed a major deal with Meta valued at approximately $3 billion over the next five years, following a previous deal with Microsoft valued between $17.4 billion and $19.4 billion [3][12] - The demand environment is characterized by overwhelming interest in capacity, with a 70% quarter-on-quarter expansion in pipeline generation [22] Company Strategy and Development Direction - The company is focused on building its core AI cloud business while also pursuing large long-term deals to support growth [3][4] - Plans to grow contracted power to 2.5 gigawatts by the end of 2026, up from 1 gigawatt previously discussed, with significant investments in capacity and infrastructure [4][10] - The launch of new enterprise-ready cloud platform version 3.0, called Aether, and the inference platform Nebius Token Factory aims to expand the addressable market [5][6] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving an annualized run rate revenue of $7 billion to $9 billion by the end of 2026, driven by strong demand and capacity growth [6][17] - The company remains focused on maintaining healthy margins and a sustainable business model while navigating the rapid growth in the AI sector [42][63] Other Important Information - The company is raising its 2025 CapEx guidance from approximately $2 billion to around $5 billion to support aggressive growth plans [10] - The company is actively evaluating financing options, including corporate debt, asset-backed financing, and equity, to support its growth strategy [8][32] Q&A Session Summary Question: Can you tell us more about the new Meta deal? - The Meta deal is approximately $3 billion, limited by available capacity, indicating strong demand for larger contracts [12][13] Question: What is included in the $7 billion-$9 billion ARR target? - The target includes contracted power and existing capacity, with more than half already booked [15][17] Question: What is the timeline for infrastructure build-out? - The company is ramping up capacity in various regions, with new data centers expected to come online in 2026 [18][19] Question: How will Microsoft and Meta revenue contribute in 2025? - Microsoft revenue will ramp up in 2026, while Meta is expected to reach full revenue run rate in 2026 [21] Question: What does the demand environment look like? - Demand is accelerating, with a 70% increase in pipeline generation in Q3 [22] Question: Why is incremental ARR down? - Incremental ARR decreased due to capacity constraints, but is expected to increase significantly in Q4 [24] Question: How is the U.K. facility progressing? - The U.K. facility is progressing well, with strong demand leading to pre-sold capacity [35][36] Question: What is the company's approach to financing? - The company is focused on maintaining a disciplined capital structure while exploring various financing options [32][34] Question: How is the enterprise initiative ramping up? - The company is making strides in becoming enterprise-ready with new product launches and compliance certifications [48]

Financial Data and Key Metrics Changes - Q3 group revenue reached $146 million, representing a year-over-year increase of nearly 355% and a quarter-over-quarter increase of 39% [9] - Annualized run rate revenue for the core business at the end of September was $551 million, with the core infrastructure business accounting for nearly 90% of total revenue and growing 400% year-over-year [9] - Adjusted EBITDA margin for the core infrastructure business expanded quarter-over-quarter to nearly 19% [9] Business Line Data and Key Metrics Changes - The core infrastructure business was the primary driver of revenue growth, with significant contributions from mega deals with Microsoft and Meta [4][9] - The company sold out all available capacity, indicating that revenue growth was limited only by the capacity brought online [9] Market Data and Key Metrics Changes - The demand environment in Q3 was described as very strong, with a 70% quarter-on-quarter expansion in pipeline generation [24] - The company expects to achieve a contracted power of 2.5 gigawatts by the end of 2026, up from 1 gigawatt discussed in the previous earnings call [5][11] Company Strategy and Development Direction - The company is focused on building its core AI cloud business while also pursuing large long-term deals with major clients [4][6] - Investments are being made to secure critical infrastructure, including hardware and power, with a CapEx guidance increase from approximately $2 billion to around $5 billion for 2025 [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving an annualized run rate revenue of $7 billion to $9 billion by the end of 2026, driven by strong demand and accelerated capacity growth [6][19] - The company remains focused on maintaining healthy margins and a sustainable business model while navigating the rapidly growing AI market [44] Other Important Information - The company launched its new enterprise-ready cloud platform version 3.0, called Aether, and a new inference platform called Nebius Token Factory, aimed at expanding its addressable market [6] - The company is actively evaluating financing options, including corporate debt, asset-backed financing, and equity, to support its growth plans [10][34] Q&A Session Summary Question: Can you tell us more about the new Meta deal? - The new deal with Meta is approximately $3 billion, limited by the capacity available. The company is optimistic about signing more large deals in the future [14] Question: What exactly is in the $7 billion-$9 billion ARR target? - The target includes contracted power and demand from AI startups and enterprises, with more than half already booked [17][19] Question: What gives you confidence that you can reach your 2.5 gigawatts goal of contracted capacity? - The company is ramping up capacity in various regions, including the U.K. and Israel, and has secured a roadmap for 2.5 gigawatts of power [20][21] Question: How should we think about revenue contribution from Microsoft and Meta deals for this year and going forward? - Revenue from Microsoft will ramp up in 2026, while Meta's deployments are expected to conclude in the next three months, with full revenue run rate anticipated in 2026 [22] Question: What does the overall demand environment look like in Q4 and into the next year? - The demand profile is accelerating, with a significant increase in pipeline generation and strong confidence in future growth [24] Question: How are you thinking about CapEx and what is your philosophy on CapEx spending? - The company plans to secure as much capacity as possible, with a focus on building infrastructure in line with visible demand [27][29] Question: Is there any chance that GPUs are oversupplied in the coming year? - The company believes the market will remain supply constrained at least until 2026, with a conservative approach to capital spending [65]

Core Viewpoint - The tech sector is experiencing a divergence in investor sentiment, with large companies benefiting from increased capital expenditure forecasts while smaller firms face skepticism and stock price declines due to rising spending concerns related to profitability [1][2][3]. Group 1: Company Performance - DoorDash's stock dropped 17%, marking its worst decline in five years, after announcing plans to invest "several hundred million dollars" in new products and technology [5][6]. - Duolingo experienced a 25% drop in stock value, now down 41% for the year, despite beating revenue and bookings, as it focuses on user growth over immediate monetization [9][10]. - Roblox shares fell nearly 16% after warning that increased spending on safety and infrastructure could impact margins, with analysts expressing concerns about profitability [18][19]. Group 2: Investment Strategies - DoorDash is investing heavily in autonomous delivery and has spent a total of $5.1 billion on acquisitions, indicating a commitment to future growth despite short-term margin pressures [6][7]. - Duolingo is prioritizing user growth by investing in AI features, suggesting that financial results from these long-term investments may take several quarters to materialize [10][11]. - Roblox's management acknowledges that investments in safety may hinder near-term engagement but are expected to benefit long-term growth [18][19]. Group 3: Analyst Sentiment - Analysts are cautious about smaller companies like DoorDash, Duolingo, and Roblox, expressing skepticism about their ability to generate substantial new revenue from increased spending [2][7][17]. - KeyBanc Capital Markets downgraded Duolingo's stock to hold, citing concerns over the impact of increased investments on near-term bookings and earnings [10][11]. - Benchmark analysts downgraded Roblox shares to hold, anticipating that investments will hinder profitability in the near term [18][19].

Financial Performance - Nebius' third-quarter sales increased by over 300% [1] Business Development - Nebius announced an AI infrastructure deal with Meta [1] - Nebius predicts rapid growth through 2026 [1]

Core Insights - Nebius Group has signed a deal worth approximately $3 billion with Meta to provide AI infrastructure over a five-year period [1] Company Summary - The agreement with Meta signifies a substantial investment in AI infrastructure, indicating Nebius Group's growing role in the AI sector [1] - The deal reflects Meta's ongoing commitment to enhancing its AI capabilities, which may lead to increased demand for AI services in the industry [1] Financial Summary - The contract is valued at around $3 billion, highlighting the financial scale of the partnership and its potential impact on Nebius Group's revenue over the next five years [1]

Core Points - CoreWeave's stock declined due to lowered guidance for capital spending and revenue for 2025, attributed to data center capacity issues [2][3][5] - The company reported a third-quarter loss of $0.22 per share, an improvement from a loss of $1.82 per share a year earlier, with revenue increasing by 133% to $1.365 billion, surpassing Wall Street estimates [7][9] - CoreWeave's remaining performance obligations (RPO) rose to $55.6 billion, an 85% increase from $30 billion in the previous quarter, indicating strong future revenue expectations [8] Financial Outlook - Capital spending guidance for 2025 was reduced by $8.5 billion, or 40% at the midpoint, alongside a decrease in revenue and operating income guidance by $150 million and $110 million, respectively [5] - The company expects a significant increase in capital spending in early 2026 [5] Capacity and Demand - CoreWeave has over 1 gigawatt of uncontracted data center capacity, which will take 12 to 24 months to become operational [6] - The company primarily serves clients in the artificial intelligence sector, with major customers including Microsoft and Meta Platforms [12] Market Performance - CoreWeave's stock fell more than 8% to $96.54 following the earnings report, after previously experiencing a 160% increase in 2025 [9] - The stock reached an all-time high of $187 on June 20, 2025 [9] Strategic Partnerships - Nvidia holds a 7% stake in CoreWeave and is a strategic partner, providing AI accelerators for the company's cloud computing services [9][10]