🚀 Palantir's Skyrocketing Earnings

Good afternoon! Apple just pulled the plug on its AR glasses project, codenamed N107. The glasses, designed to pair with a Mac and rival Meta’s AR ambitions, fizzled out thanks to tech hurdles, lackluster exec feedback, and, frankly, too many moving parts. Turns out, making the future look stylish isn’t so easy.

Meanwhile, Apple’s Vision Pro remains the belle of the $3,499 ball—if anyone can afford to attend. With Meta working on standalone AR glasses by 2027, Apple’s still tinkering with updates and dreaming big about its next wearable hit. For now, AR glasses join Apple’s list of “almosts,” right next to that self-driving car.

MARKETS

• Wall Street took a sharp hit on Monday as fears of an escalating trade war rattled investors. Stocks tumbled at the open after President Trump announced sweeping tariffs on Canada, Mexico, and China. However, the market found a lifeline mid-morning when Mexico brokered a last-minute deal to delay its tariffs for a month, easing some of the immediate pressure.

• The S&P 500 slid 0.8%, the Dow shed 122 points after recovering from a 665-point plunge, and the Nasdaq lost 1.2%. Despite the rebound, tensions remained high as Canada vowed to retaliate with tariffs on $105 billion of U.S. goods, setting the stage for continued market volatility.

STOCKS
Winners & Losers

What’s up 📈

• Triumph soared 33.94% after announcing it will be acquired by private equity firms Warburg Pincus and Berkshire Partners for $3 billion. ($TGI)

• IDEXX Laboratories popped 11.13% after the veterinary health-care company posted stronger-than-expected earnings for the fourth quarter. ($IDXX)

• Tempur Sealy climbed 5.99% after a court ruling allowed it to acquire Mattress Firm, denying the Federal Trade Commission’s attempt to block the deal. ($TPX)

• Tyson Foods rose 2.21% after the poultry and beef giant beat analysts' expectations on both the top and bottom lines last quarter. ($TSN)

• iShares MSCI Mexico ETF gained 2.49% after President Trump announced that tariffs on Mexico would be delayed for one month, reversing earlier losses. ($EWW)

What’s down 📉

• Boot Barn sank 9.53%, extending its selloff from Friday’s disappointing third-quarter earnings report. ($BOOT)

• Polaris tumbled 8.39% following a downgrade from UBS analysts, who slashed their price target for the motorcycle manufacturer from $67 to $48. ($PII)

• PVH dropped 7.01% after Wells Fargo downgraded the apparel company to equal weight from overweight, citing inventory risk and foreign currency pressures. ($PVH)

• Tesla fell 5.17% after reports suggested it may be losing market share in key EV markets. ($TSLA)

• iShares MSCI Canada ETF declined 1.55% as investors assessed the potential impact of new tariffs on Canadian goods. ($EWC)

• Prologis slipped 1.18% after Raymond James downgraded the real estate investment trust to market perform, citing elevated investor expectations following strong quarterly results. ($PLD)

EARNINGS
Palantir’s AI Reign Just Went Into Overdrive

Palantir just dropped an earnings report that had investors scrambling to hit the “buy” button. The data analytics firm posted a 36% jump in Q4 revenue to $828 million, smashing analyst expectations, while U.S. commercial sales skyrocketed 64%. If that wasn’t enough, CEO Alex Karp predicted “untamed organic growth” in AI demand, leading Palantir to raise its full-year revenue outlook to $3.75 billion, well above Wall Street’s $3.54 billion projection. The stock soared 22% in after-hours trading reaching $102.4, adding another chapter to its meteoric 340% rise in 2024.

The AI War Chest Gets Bigger

Palantir has long been a Pentagon darling, and that relationship is paying dividends. U.S. government sales spiked 45% to $343 million, thanks to expanded contracts with the Army and Special Operations Command. Meanwhile, Karp’s vision for an AI-powered defense industry is taking shape—Palantir inked a partnership with AI startup Anthropic to bring its language models into U.S. intelligence operations, while deepening ties with weapons maker Anduril. Translation? Big tech and big defense are merging, and Palantir is at the center of it all.

A Political Tailwind for Palantir

Investor enthusiasm for Palantir has surged since Trump’s return to the White House, with expectations that his administration will double down on defense spending and favor U.S. tech firms over foreign competitors. Palantir has positioned itself as a key player in this vision—Chief Technology Officer Shyam Sankar recently outlined a blueprint to revitalize U.S. manufacturing and defense technology, while Karp has been vocal about the need for the U.S. to maintain technological dominance. Citing political scientist Samuel Huntington, Karp argued that global power has historically been shaped by technological and military strength—a stance that reinforces Palantir’s role in securing America’s AI and defense future.

What’s Next? More AI, More Government $$$

Palantir expects U.S. commercial sales to jump another 54% in 2025 and is still raking in major government contracts, including a $619 million Army deal through 2028. But it’s also navigating a shifting AI landscape, especially after China’s DeepSeek debuted an AI model that rattled U.S. tech stocks. Karp is unfazed, telling CNBC that America needs an “all-country effort” to maintain its edge. With AI, defense, and geopolitical tensions all fueling its rise, Palantir isn’t just riding the AI wave—it’s steering the ship.

NEWS
Market Movements

• 🚗 Tesla’s California Car Registrations Drop 12% in 2024: Tesla’s vehicle registrations in California fell 12% last year, marking the automaker’s fifth consecutive quarterly decline in the state. The drop was attributed to high interest rates, increasing competition, and CEO Elon Musk’s involvement in the U.S. election. Despite the overall decline, the Model Y remained California’s best-selling vehicle with 129,000 units sold, while Model 3 sales fell 36% to 53,000. ($TSLA)

• 🏦 Trump Establishes Sovereign Wealth Fund, Suggests It Could Buy TikTok: President Trump signed an executive order to create a U.S. sovereign wealth fund aimed at economic development, infrastructure projects, and potential strategic investments. Treasury Secretary Scott Bessent stated the fund would be operational within 12 months, leveraging U.S. assets and possibly tariff revenue. Trump floated the idea of using the fund to acquire TikTok, which is facing a 75-day divestment deadline due to security concerns.

• 🤝 SoftBank and OpenAI Form AI Venture with $3B Annual Investment: SoftBank and OpenAI announced a 50-50 joint venture, SB OpenAI Japan, to accelerate AI development, with SoftBank committing $3 billion annually. The partnership aligns with SoftBank’s broader push into artificial intelligence and marks a significant expansion of OpenAI’s global presence. Analysts see the move as a strategic counter to Microsoft's dominant stake in OpenAI. ($SFTBY)

• 🥩 Tyson Foods Raises Sales Forecast After Strong Q1 Earnings Beat: Tyson Foods increased its annual sales forecast, expecting up to 1% growth following a better-than-expected first quarter. Revenue rose 2.3% to $13.62 billion, while adjusted earnings per share of $1.14 exceeded Wall Street’s $0.88 estimate. Shares rose 2% on the upbeat results. ($TSN)

• 🔋 Honda to Invest $1B in Ohio EV Hub with Tesla-Style Giga Presses: Honda announced plans to invest over $1 billion in Ohio to establish a dedicated EV production hub, including new battery manufacturing and Tesla-style giga presses. The initiative aims to modernize Honda’s EV strategy and improve efficiency as competition intensifies. Honda joins a growing list of automakers investing heavily in U.S.-based EV production. ($HMC)

• ⚖️ X Expands Lawsuit Against Major Brands Over Ad Boycott: X (formerly Twitter) broadened its legal battle against companies including Nestlé, Colgate-Palmolive, and Shell, alleging an organized ad boycott that cost the platform billions. The lawsuit accuses the brands of colluding to damage X’s revenue through coordinated ad pullbacks. The legal fight highlights ongoing tensions between Elon Musk’s platform and major advertisers. ($CL) ($SHEL)

TRADE
Trump Hits Pause on Canada, Mexico Tariffs—For Now

After days of economic anxiety and diplomatic back-and-forth, President Trump has agreed to pause tariffs on Canadian imports for at least 30 days, according to Prime Minister Justin Trudeau. The move follows a similar one-month delay for tariffs on Mexico, with both countries making commitments to crack down on fentanyl trafficking.

The original plan? 25% tariffs on imports from Mexico and Canada, and a 10% tariff on Chinese goods, with Canadian energy products set for a slightly lower 10% levy. Now, the Canadian tariffs are on hold, with Trump saying he’ll reassess after seeing progress on border security and drug enforcement efforts.

Canada’s Counterpunch

Trudeau wasn’t bluffing when he warned of retaliation. Canada had lined up $155 billion in counter-tariffs on U.S. goods, including beer, clothing, and household appliances. Ontario even banned U.S. liquor from shelves (sorry, Tito’s fans). The Canadian prime minister framed the tariffs as a betrayal, invoking WWII and 9/11 as moments when Canada stood with the U.S.—not exactly the tone of a friendly trade dispute.

The Market Fallout

Investors breathed a small sigh of relief, but the market remains rattled. Goldman Sachs warned that if tariffs remain in place, S&P 500 earnings could take a 2-3% hit, with automakers, homebuilders, and consumer goods companies among the hardest hit. Car prices could rise by $3,000 on average, homebuilding costs would climb, and Super Bowl guacamole might as well be caviar with avocado prices set to skyrocket.

Meanwhile, Trump’s claim that tariffs would pressure Canada to become the 51st U.S. state (yes, he actually said that) isn’t exactly making trade negotiations smoother.

What’s Next? For now, Trump is giving Canada 30 days to prove it’s serious about border security and drug enforcement before tariffs go back on the table. Mexico got a similar deal after its president deployed 10,000 soldiers to its northern borderto curb fentanyl shipments.

But if Trump does move forward with tariffs in a month, this could become one of the most aggressive trade wars in modern history—one that could disrupt $1.4 trillion in trade and send shockwaves through supply chains, consumer prices, and financial markets.

Stay tuned. This saga is far from over.

Calendar
On The Horizon

Tomorrow

The week kicks off with a spotlight on labor market data, starting with the job openings report. November's 8.1 million job openings and a 4.8% openings rate signaled a robust hiring environment, and economists are eyeing December's numbers for similar strength. But for anyone rooting for a Fed rate cut, a little softness in the data wouldn’t hurt.

Tuesday brings a heavyweight lineup of earnings from across industries. Expect updates from Pfizer ($PFE), PayPal ($PYPL), Spotify ($SPOT), PepsiCo ($PEP), Chipotle ($CMG), Snap ($SNAP), and Ferrari ($RACE), to name just a few. With so many big players reporting, Wall Street is bracing for a flurry of headlines.

After Market Close:

• Alphabet has been throwing down serious cash in the AI arena, racking up $13 billion in capital expenditures last quarter—a hefty 62% year-over-year jump. Investors are eager to see if the spending spree is paying off, especially with DeepSeek stirring doubts about the necessity of such massive AI investments. And then there’s Google Search. Is ChatGPT stealing its lunch? With a reasonable valuation compared to its Magnificent 7 peers, a solid performance tomorrow could send Alphabet shares climbing. Consensus: $2.13 EPS, $96.67 billion in revenue. ($GOOGL)

• Advanced Micro Devices has been living in Nvidia’s shadow when it comes to AI dominance. But the latest buzz from DeepSeek—that companies might not need ultra-expensive chips to build AI models—could be AMD’s ticket to the big leagues. While it may not outbuild Nvidia, AMD’s budget-friendly chips could appeal to tech giants chasing AI cost-efficiency. Tomorrow’s results will show if AMD can capitalize on this shift. Consensus: $1.09 EPS, $7.54 billion in revenue. ($AMD)

NEWS
The Daily Rundown

• 🏀 Mavericks Trade Luka Dončić to Lakers for Anthony Davis in Stunning NBA Deal: In a shocking trade, the Dallas Mavericks sent Luka Dončić to the Los Angeles Lakers in exchange for Anthony Davis. The move pairs Dončić with LeBron James, forming a star-studded duo expected to shake up the Western Conference. While the Lakers gain an elite scorer and playmaker, analysts question whether the Mavericks received fair value for their young franchise player.

• 🔑 Elon Musk Granted Access to U.S. Treasury Payment System: Treasury Secretary Scott Bessent granted Elon Musk’s team “read-only” access to the federal payment system that handles trillions in Social Security checks and tax refunds. The move follows the abrupt resignation of a key Treasury official who had resisted providing Musk access. While Musk claims the system will be used to curb government waste, critics warn of potential conflicts of interest and the risk of private business influence over federal funds.

• 🛑 USAID Website Goes Dark After Trump Freezes Foreign Aid: Nearly two weeks after President Trump signed an order halting U.S. foreign aid, the website for the U.S. Agency for International Development disappeared without explanation. Additionally, two senior officials were placed on administrative leave after refusing to grant access to classified systems to Trump’s newly established Department of Government Efficiency. The developments have sparked concerns that the administration is dismantling USAID, with some calling the situation “ominous.”

• 📉 Trump Fires CFPB Director Rohit Chopra Amid Regulatory Shakeup: President Trump dismissed Rohit Chopra, the Biden-appointed director of the Consumer Financial Protection Bureau, in a move to reshape financial regulations. Chopra, a Warren ally, was known for cracking down on banks, fintech companies, and data brokers accused of misusing consumer information. His removal signals a shift in financial oversight, with Trump expected to ease regulatory restrictions on Wall Street and consumer lending.

• 🏈 Chiefs Look to Make NFL History with Threepeat Super Bowl Win: The Kansas City Chiefs will attempt to become the first team in NFL history to win three consecutive Super Bowls when they face the Philadelphia Eagles. The matchup is a rematch of Super Bowl LVII, where a controversial call helped Kansas City secure victory. With Patrick Mahomes leading the team, the Chiefs are aiming to cement their dynasty, while the Eagles are looking for redemption.

• 🎮 The Sims Celebrates 25 Years with a Re-release of Classic Games: Electronic Arts is commemorating The Sims’ 25th anniversary by re-releasing The Sims and The Sims 2 in a $39.99 bundle. The life simulation game, which became a cultural phenomenon, has sold over 200 million copies worldwide since its debut in 2000. EA hopes the re-release will introduce the franchise to a new generation while giving longtime fans a dose of nostalgia.

• 🛫 Air Traffic Control Staffing Crisis Leaves 73 Facilities Critically Understaffed: A report found that 285 out of 313 U.S. air traffic control facilities are operating below recommended staffing levels, with some key locations short by 40%. Two facilities on Long Island, which manage over 1.2 million flights annually, are among the most affected. The shortage has raised safety concerns, as training new controllers takes years and demand for air travel continues to rise.

• ✈️ Air Ambulance Crash in Philadelphia Kills Seven, Including Child Patient: A medical Learjet 55 crashed shortly after takeoff from Northeast Philadelphia Airport, killing all six onboard, including a young patient, and one person on the ground. The crash caused an explosion that set nearby homes and vehicles on fire, injuring 19 others. Investigators are considering catastrophic engine failure or a bird strike as potential causes of the tragedy.

• 🇮🇱 Hamas Releases American-Israeli Hostage Keith Siegel Amid Ceasefire Negotiations: Hamas released three hostages, including American-Israeli dual citizen Keith Siegel, as part of an ongoing ceasefire agreement with Israel. Siegel is the first American freed under the deal, which has seen 18 hostages released so far. While the truce has brought temporary relief, tensions between Israel and Hamas remain high as negotiations continue.

• 🩸 Cyberattack Forces Major Blood Bank to Cancel Donations Amid Shortage: A ransomware attack on the New York Blood Center has disrupted operations, forcing the cancellation of appointments and blood drives. The attack comes at a time when the U.S. is already experiencing a critical blood shortage, heightening concerns among hospitals and emergency response teams. The organization has yet to announce when normal operations will resume.

• 🎤 Beyoncé Announces ‘Cowboy Carter’ Stadium Tour for 2025: Following her Grammy win, Beyoncé announced a 2025 stadium tour for Cowboy Carter, set to kick off in Los Angeles on April 28. The tour will include stops in major U.S. cities like New York, Houston, and Atlanta, as well as international shows in London and Paris. Fans are eagerly awaiting ticket sales, with demand expected to be sky-high after the success of her Renaissance Tour.

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