In today’s briefing:
- Google, Microsoft, Facebook and Nvidia: AI Spending Implications at the Hyperscalers
- Elon Musk’s Latest X-Ceptionally Bad Idea
- Meta 2Q’23 Earnings Update
- Verizon: Legacy Businesses Are Still Out Of Fashion
- Meta: Making Sense Of Its Q2 Highs And Lows
- ATEN: Gradual Improvement
- NTGR: Trough in the Past
- Understanding Gold’s Intrinsic Value
- Breaking Down Worldcoin’s Launch
- HighPeak Energy, Inc. – Equity Improves Liquidity Position
Google, Microsoft, Facebook and Nvidia: AI Spending Implications at the Hyperscalers
- Google, Microsoft, and Facebook reported earnings.
- Let’s discuss their capex plans and what that means for our new data center champion, Nvidia.
- I think it’s pretty straightforward that Nvidia has revenue beats for the foreseeable future.
Elon Musk’s Latest X-Ceptionally Bad Idea
- Elon Musk has killed Twitter’s last and greatest value by renaming it X. As in, fill in whatever the heck it is now.
- Twitter’s strong, globally recognized brand worth had been worth much as $20 billion—its last and only valuable asset.
- Incredibly, it gets worse. Hundreds of other companies already own rights to the X name and logo—including META and Microsoft.
Meta 2Q’23 Earnings Update
- Facebook exceeded 3 Bn MAU for the first time, and MAP is now approaching 4 Bn.
- DAU/MAU engagement looks steady across all regions.
- While ARPU exhibited considerable strength, please note the material weakness in YoY comparison.
Verizon: Legacy Businesses Are Still Out Of Fashion
- Verizon’s share price continues to fall amid speculations and low interest in slow-growth businesses.
- The business is stabilizing and on-track to deliver much needed top and bottom line growth, according to the company.
- No matter how you look at it, being bullish on Verizon Communications Inc. (NYSE:VZ) takes a real contrarian view with ability to endure pain and keep a long-term focus.
Meta: Making Sense Of Its Q2 Highs And Lows
- Despite the positives, we are worried about a potential nominal earnings decline and its effect on Meta’s price multiples.
- The company’s second quarter financial results communicate robust growth.
- However, risks remain, and we are concerned about the potential nominal Earnings decline and the effect onMeta’s priceMultiples.
ATEN: Gradual Improvement
- ATEN reported higher revenue and earnings in the second quarter signaling improved business environment compared to the first quarter
- ATEN reported second quarter revenue of $65.8 million compared to our forecast of $62.4 million
- In North America large enterprise and tier-one service providers are reassessing their purchasing activity is not new
NTGR: Trough in the Past
- NTGR is beginning to experience stability in demand and inventory within its connected home segment suggesting growth could be around the corner
- The lower inventory levels at retail partners should result in fewer promotion activity as NTGR is now projecting the return of seasonal strength in the third quarter
- NTGR reported second quarter revenue ahead of expectations with connected home revenue being the factor for the outperformance
Understanding Gold’s Intrinsic Value
- There can be no doubt that gold has intrinsic value, as it is a rare commodity. But even if it wasn’t rare, like sand or manure, it would still have intrinsic value, just much less than it currently does.
- The question I have been asking is how much of the gold price reflects its intrinsic value, and how much is something else?
- Gold is a monetary asset and, as a result, is valued above and beyond its intrinsic value.
Breaking Down Worldcoin’s Launch
- Worldcoin’s launch was one of the most unique and controversial in recent years.
- Much of the controversy stems from the understandable skittishness with Worldcoin’s goal (creating a global identity network) and sci-fi-like methods of achieving this goal (eye scans).
- This has been nicely summarized by the MIT Technology Review.
HighPeak Energy, Inc. – Equity Improves Liquidity Position
HighPeak closed a secondary offering of ~14.8 million shares of common stock on July 21, 2023.
The shares were priced at $10.50, netting the company proceeds of ~$151.2 million.
Members of the management team and board of directors purchased ~10.0 million, or 68% of the shares sold
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