🥱 Musk Calls Out Stargate

Good afternoon! Samsung just announced the Galaxy S25 Ultra, a sleek refresh that ditches the Note-era curves for flat edges and a bigger, bezel-slimmed 6.9-inch screen. Powered by the Snapdragon 8 Elite chip, it keeps the $1,299 price tag while adding a sharper 50-megapixel ultrawide camera and promising seven years of software updates. AI takes center stage in One UI 7.0, with features like cross-app actions and suggested routines aiming to make your life easier.

Not all changes are applause-worthy—Bluetooth is out for the S Pen, making it a basic stylus again, and Google Gemini replaces Bixby as the default assistant. Still, the Ultra feels like a refined step forward, with smarter tools and thoughtful updates. Mark your calendars for February 7 if you’re ready to upgrade.

MARKETS

• Tech stocks had their moment in the spotlight Wednesday, with the Nasdaq surging 1.3% and the S&P 500 flirting with its record high. Netflix stole the show, jumping nearly 10% thanks to its biggest-ever subscriber gain, while Nvidia and Oracle rode the wave of AI hype like pros.

• The buzz? A $500 billion AI joint venture dubbed "Stargate," unveiled by Trump alongside SoftBank, Oracle, and OpenAI, which sent tech investors into overdrive. Meanwhile, the Dow posted a modest 0.3% gain, propped up by Procter & Gamble’s 2% earnings-fueled climb. Who said midweek couldn’t feel like a party?

STOCKS
Winners & Losers

What’s up 📈

• Netflix soared 9.69% to a record high after reporting earnings of $4.27 per share and revenue of $10.25 billion, both above estimates. The streamer also announced plans to raise subscription prices. ($NFLX)

• Seagate Technology jumped 6.84% following a strong earnings beat, with $2.03 per share on $2.33 billion in revenue, exceeding expectations. ($STX)

• Oracle climbed 6.75% after President Donald Trump unveiled project “Stargate,” a $500 billion AI infrastructure joint venture including Oracle, OpenAI, and Softbank. ($ORCL)

• Travelers gained 3.16% on better-than-expected earnings of $9.15 per share and $12.01 billion in revenue, surpassing forecasts. ($TRV)

• Procter & Gamble rose 1.87% as fiscal Q2 earnings of $1.88 per share and $21.88 billion in revenue beat expectations, driven by strong household staples demand. ($PG)

What’s down 📉

• Trump Media & Technology Group slid 5.56%, continuing its post-inauguration decline. ($DJT)

• Ford dropped 3.84% after a Barclays downgrade to equal weight, citing volume headwinds and cost improvement uncertainty. ($F)

• Textron lost 3.44% as Q4 revenue of $3.61 billion missed estimates, despite adjusted EPS of $1.34 slightly topping forecasts. ($TXT)

• Johnson & Johnson fell 1.94% after its 2025 sales forecast came in below expectations, despite Q4 earnings beating estimates. ($JNJ)

AI
Musk Throws Cold Water on Trump’s Stargate AI Project

President Trump’s ambitious $500 billion Stargate AI initiative barely got out of the gate before Elon Musk called it into question. Just hours after the White House announcement, Musk took to X (formerly Twitter lol), claiming that the companies involved—OpenAI, SoftBank, and Oracle—“don’t actually have the money” to back their pledges. Musk’s skepticism wasn’t entirely unexpected, given his longstanding rivalry with OpenAI CEO Sam Altman, but it added immediate drama to Trump’s latest tech showcase.

What is Stargate?

The Stargate initiative is designed to bolster U.S. dominance in artificial intelligence through massive investments in data centers and infrastructure. Highlights include:

• $100 Billion Upfront: An initial deployment of funds, with a goal to hit $500 billion over four years.

• Geopolitical Rivalry: Trump positioned the project as America’s answer to China’s growing AI infrastructure.

• Tech Partners Galore: Alongside the headline names, Nvidia, Microsoft, and Arm were tapped as key collaborators.

Trump promised 100,000 new jobs and hailed the initiative as a “tremendous” milestone for U.S. innovation. The market seemed to agree, with Oracle shares climbing 7% and related tech stocks like Nvidia and Arm enjoying a boost.

Musk vs. Altman (Round 100)

Musk’s criticism stems from a rocky history with Altman, his former OpenAI co-founder. Their split wasn’t amicable, and Musk now competes via his own venture, xAI. In response to Musk’s comments, Altman defended the project, tweeting that construction on Stargate’s first data center in Texas is already underway. He also fired back, saying Musk’s remarks were “wrong” and hinted that Musk should focus on his new government advisory role, leading Trump’s cost-cutting initiative, DOGE.

Show Me the Money

Skeptics wonder whether SoftBank can fulfill its financial commitments. While Masayoshi Son has pledged $100 billion for U.S. projects, SoftBank’s liquidity raises eyebrows, with just $30 billion in cash and a history of leveraging debt for big bets. Microsoft, a technology partner in Stargate, seemed unfazed—CEO Satya Nadella simply said, “I’m good for my $80 billion.”

The announcement was a boon for tech stocks, especially those tied to data centers and AI hardware. But Musk’s public doubts and vague project details cast uncertainty on whether Stargate will truly reach its lofty goals. For now, Stargate is one giant leap for headlines, but a small step toward AI dominance.

NEWS
Market Movements

• 📉 EA Lowers Guidance Amid Weakness in Soccer and Other Games: Electronic Arts slashed its full-year guidance for bookings, attributing the shortfall to underperforming titles, especially its soccer franchise, EA Sports FC. The company reported weaker-than-expected engagement with its "Dragon Age" game and forecasted lower sales for its soccer games. Shares dropped 7% in extended trading. ($EA)

• ✈️ JetBlue Becomes First Airline to Accept Venmo: JetBlue became the first airline to accept Venmo payments for flights, aligning with the company's strategy to attract budget travelers amid financial struggles. ($JBLU, $PYPL)

• 💼 Goldman Sachs Launches GS AI Assistant: Goldman Sachs launched GS AI Assistant, a generative AI tool for 10,000 employees, with plans to expand firm-wide in 2025. The AI will handle tasks like summarizing emails and coding. ($GS)

• 🤖 Google Invests Another $1 Billion in Anthropic: Google agreed to a $1 billion investment in AI startup Anthropic, building on its previous $2 billion funding and 10% ownership stake. The deal is part of Anthropic’s broader $2 billion funding round at a $60 billion valuation. ($GOOGL)

• 💬 LinkedIn Faces Lawsuit Over AI Data Use: LinkedIn is being sued for allegedly sharing Premium users’ private messages with third parties to train AI models without consent. The lawsuit seeks damages for breach of contract and privacy violations. ($MSFT)

• 🏢 CEOs Establish 'War Rooms' for Trump's Policies: CEOs are establishing "war rooms" to address President Trump’s rapid executive orders on tariffs, tax policies, and immigration. Businesses are analyzing potential impacts on supply chains and trade, while law firms launch hotlines for compliance guidance. ($JPM, $MMM)

• ⚕️ FDA Approves Johnson & Johnson's Spravato for Depression: The FDA approved Johnson & Johnson's Spravato nasal spray as the first standalone option for treatment-resistant depression. Sales hit $780 million in the first nine months of 2024 and are expected to grow to $1–$5 billion annually. ($JNJ)

• 📊 Microsoft Revises OpenAI Partnership Amid Stargate Launch: Microsoft’s exclusivity agreement with OpenAI has been adjusted, allowing OpenAI to work with additional cloud providers like Oracle and SoftBank for its Stargate AI project. Microsoft plans to continue investing in its own AI infrastructure. ($MSFT)

CRYPTO
Silk Road Creator Ross Ulbricht Gets Pardoned

Ross Ulbricht, the man behind the infamous dark web marketplace Silk Road, just received a full pardon from President Trump. If his name rings a bell, it’s because he was sentenced to life without parole in 2015 for running a site that enabled anonymous sales of everything from drugs to forged documents. Dubbed the "Amazon of illicit goods," Silk Road marked a turning point in internet crime—and Ulbricht became its poster child.

From Idealism to Infamy

In 2011, Ulbricht launched Silk Road, blending libertarian ideals with cutting-edge anonymity tools like Tor and Bitcoin. His goal? A free market beyond government reach. The site quickly became a hub for drug deals, generating over $1 billion in transactions and netting Ulbricht millions in commissions. But with its rapid growth came attention from law enforcement—and trouble for its founder.

The cracks in Ulbricht's anonymity came from rookie mistakes. Early forum posts promoting Silk Road led investigators to his email, and a border check uncovered fake IDs linked to him. In 2013, he was arrested at a San Francisco library while logged into Silk Road as his alias, Dread Pirate Roberts. The evidence? A laptop full of incriminating files, including site code and chat logs.

The Sentence That Sparked Debate

Convicted on charges ranging from drug trafficking to money laundering, Ulbricht was sentenced to life without parole—a sentence critics argue was extreme. Prosecutors tied Silk Road to six drug-related deaths and alleged murder-for-hire plots, though no killings were ever proven. The crypto community and libertarians rallied around his case, claiming it was a government overreach.

Trump’s pardon of Ulbricht came with a side of controversy. Calling those involved in his conviction “scum,” Trump positioned the decision as a win for liberty and justice. Ulbricht, now 39, had expressed remorse and a desire to rebuild his life, penning letters to previous administrations and gaining support from advocacy groups.

Seized Opportunity

Ross saw his empire crumble in 2013 when authorities seized 173,991 bitcoins from his laptop—worth over $33.6 million at the time. Fast forward to today, and that stash would clock in at a staggering $5.9 billion.

The plot thickened in 2020 when the U.S. government tracked down another 69,370 bitcoins, this time taken by a hacker who looted the Silk Road. That haul was valued at over $1 billion back then but would now be worth nearly $2.4 billion.

With these jaw-dropping seizures, the chances of Ulbricht having any secret crypto left appear slim (but never zero). His legacy may have cemented him as a pioneer of the dark web, but his fortunes? Thoroughly locked away — by Uncle Sam from a first glance. But who knows what this crypto mastermind has tucked away…

Calendar
On The Horizon

Tomorrow

Tomorrow brings the weekly jobless claims report, giving us a final snapshot of the labor market ahead of the Fed’s much-anticipated meeting next week. On the earnings front, we’re keeping an eye on updates from the airline sector with reports from American Airlines ($AAL) and Alaska Air ($ALK), and the rail industry with numbers from Union Pacific ($UNP) and CSX ($CSX).

After Market Close:

• Intuitive Surgical is riding the wave of healthcare’s tech revolution, using robotics to redefine minimally invasive surgeries. Once a sci-fi fantasy, robot-assisted procedures are now a booming reality, driven by the needs of an aging population that demands advanced care solutions.

  The challenge? Intuitive’s valuation has skyrocketed alongside its stock in recent years, raising questions about whether it can sustain the momentum. If management can justify the premium price with strong performance and innovation, the company could remain a frontrunner in the push to modernize healthcare. Consensus: $1.75 EPS, $2.2 billion in revenue. ($ISRG)

NEWS
The Daily Rundown

• 💰 Report Predicts Five Trillionaires in a Decade: Billionaires like Mark Zuckerberg, Elon Musk, and Jeff Bezos are projected to surpass $1 trillion in wealth within the next 10 years, according to Oxfam. The world’s 2,770 billionaires saw their combined wealth soar to $15 trillion last year, growing three times faster than in 2023.

• 🥇 Rusty Olympic Medals Spark Outrage: LVMH’s Chaumet-designed Paris Olympic medals have rusted due to changes in varnish mandated by EU regulations. Over 100 athletes have requested replacements, and the International Olympic Committee has apologized. Despite the backlash, LVMH reclaimed its position as Europe’s largest company this week.

• 🚦 Trump Mandates Federal Workers Return to Office: President Donald Trump signed executive orders requiring federal employees to return to in-person work five days a week. The move, paired with a hiring freeze and reclassification of senior-level positions, is expected to prompt voluntary resignations. Trump has also proposed relocating nearly 100,000 government jobs out of Washington, DC, following a similar tactic from his first term.

• 🌐 Canada Prepares for Potential U.S. Tariffs: Canadian Prime Minister Justin Trudeau pledged a "robust" response to Trump’s proposed 25% tariff on Canadian imports, emphasizing the critical role of Canada’s resources in the U.S. economy.

• 📈 Netflix Surpasses 300 Million Subscribers: Netflix added a record 19 million subscribers in Q4, bringing its total to 301.63 million. The company reported $10.25 billion in revenue, exceeding expectations, and highlighted the success of live sports like NFL games and the Tyson-Paul boxing match as growth drivers.

• 🎬 AI Use in Film Sparks Oscars Controversy: The Brutalist director Brady Corbet used AI tools to refine accents in Hungarian dialogue, drawing criticism amid broader industry debates on AI in cinema. Meanwhile, other Oscar contenders like Emilia Pérez have admitted to similar AI enhancements, fueling the controversy.

• ⚾ Ichiro Suzuki Elected to Baseball Hall of Fame: Ichiro Suzuki became the first Japanese-born player inducted into the Hall of Fame, receiving 99.7% of votes. His MLB career includes over 3,000 hits and numerous accolades, solidifying his place as a baseball legend.

• ⚕️ FDA Approves New Treatment for Depression: Johnson & Johnson’s esketamine nasal spray, Spravato, has been approved for adults with treatment-resistant depression. This breakthrough offers hope to patients who have not responded to oral antidepressants.

RESOURCES
The Federal Reserve Resource

Join our small yet growing subreddit 🚀: https://www.reddit.com/r/investinq/

Wall Street Reads 💎 (Best Books):

• Stock Market Books📚
  https://drive.google.com/file/d/1NQ-vdLE1afXFcc5PwDRp1d5VSHzDly88/view?usp=sharing

• Options Trading Books📗 https://drive.google.com/file/d/1xeYL3IpjT623CJpO_Ole1Z-GuzHQQJzg/view?usp=sharing

• Business Books 📖https://drive.google.com/file/d/1VfuTqhPVB2YjDOd0N56UhF6kmZU-kLci/view?usp=sharing

Check out our latest issues 🎯: https://investinq.beehiiv.com