| | | Hello. | Broadcom just grew its AI chip sales by 143% in a single quarter. But the stock fell 15%. | If that sounds backwards, you're going to want to read today's main story, because it explains one of the most important things happening in this market right now: | The AI boom is absolutely real. The problem is that the stocks have run so far, so fast, that "real" and "growing" aren't enough anymore. You have to be perfect. | We're going to walk through what three of the biggest names in chips told us this week (in plain English, no engineering degree required). | 🧠 The AI chip reality check (Broadcom, Arm, and TSMC, explained simply)
₿ The money is leaving crypto, and we can see where it's going
👖 Lululemon reports as the "two-track consumer" splits further
🤖 Amazon commits $11 billion to robot-run warehouses
💳 Visa starts testing stablecoin payments
🎵 Bill Ackman dumps his Universal Music stake after getting rejected | Let's get into it. | This is not financial advice. Always do your own research. Past performance doesn’t guarantee future results. |
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| | The AI Chip Reality Check | Three of the biggest chip companies on Earth reported or moved this week, and together they tell you exactly where the AI trade stands. | Broadcom had a monster quarter and got punished for it. Broadcom makes custom AI chips for the giant cloud companies (think of it as the tailor who builds bespoke chips for Google and friends, instead of selling the same one off the rack like Nvidia). Its AI chip sales jumped 143% to $10.8 billion, total revenue rose 48%, and it beat profit estimates. The stock dropped about 17% anyway. | Why? One word: guidance. Guidance is the forecast a company gives for next quarter, and the market cares about it far more than the results just posted in some ways. Broadcom guided to $16 billion in AI revenue next quarter. Sounds huge, except traders were expecting closer to $17.2 billion (the "whisper number," the unofficial higher bar the market actually holds you to). Miss the whisper, and a 143% growth quarter turns into a sell-off. The lesson for your portfolio: when expectations get this high, good news can still tank a stock. | Arm became one of the most expensive stocks in the entire market. Arm designs the blueprints nearly every chip is built on. Its stock has added $218 billion in value in a few weeks and is up 280% this year, which pushed its trailing P/E ratio to around 481. Quick translation: a P/E of 481 means you're paying 481 years of the company's current profits for the stock! For comparison, the average big US company sits somewhere around 25. Now, that’s not a knock on Arm's business, which is excellent. It's a flashing sign that the price leaves zero room for error. | Meanwhile, the company that actually builds the chips says demand is booming. TSMC is the world's chip foundry, the factory that physically manufactures what Nvidia, Apple, and Broadcom design. Its CEO said underlying chip demand remains "robust," with the shift toward AI agents driving even more usage. So the real-world demand is not the problem. | Put it together and you get the state of the AI trade in one line: the boom is very, very real, but the stocks have sprinted out ahead of it accordingly. That doesn't mean sell everything. It means the risk has shifted from "will AI demand show up?" (it has) to "am I paying a reasonable price for it?" When a great company drops 15% on a great quarter, that's the market telling you expectations, not fundamentals, are now in charge. Worth a gut-check on how much you're paying for your AI names! |
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| | 📰 Market Headlines | | The money is leaving crypto, and it's not hard to see where it's going. Bitcoin slid to around $63,600, down about 13% on the week and roughly 50% below its October high, with an 11-day stretch of ETF outflows totaling $3.45 billion. Pretty scary, but analysts are saying this looks less like panic and more like rotation: cash moving out of crypto and into AI stocks and the wave of new IPOs. Makes sense to us… the Bitcoin narrative is just not strong at all right now. It’s neither functioning as “digital gold” (gold is far outperforming it) and it’s also not benefitting from geopolitical turmoil. Meanwhile, AI stocks have soared for months and months on end. Investors are more interested in taking a risk on SpaceX and Anthropics’ IPOs than on continuing to hold Bitcoin, it seems. | Lululemon reports today as the "two-track consumer" splits further. The athleisure maker heads into earnings down roughly 76% from its high at the end of 2023, squeezed by weak North America sales and a $380 million tariff hit. Stack that against Macy's beating and raising guidance this week (with luxury Bloomingdale's up 10%), and you can see the split clearly: the high and low ends are holding up while the aspirational middle gets pinched. We’ll see later today if Lulu can flip that narrative! | Amazon is putting $11 billion into robot-run warehouses. Amazon committed more than 10 billion euros to overhaul its European logistics with AI-powered robots (including its next-generation Proteus) and 25,000 new jobs. This is Abundance Theory in physical form: the same AI wave lifting chip stocks is now moving boxes and shrinking delivery times… while creating new jobs. We know that AI has also led to layoffs, but the narrative is starting to flip (even OpenAI CEO Sam Altman is walking back his claims that AI could take everyone’s job). But we’ll be watching the margin line over the next few years to see when the robots truly pay off (or not). | Palantir rolled out a wave of enterprise AI deals. At its AIPCon event, Palantir announced a deeper Google Cloud integration using Gemini, a private-equity AI platform built with law firm Kirkland & Ellis, and multiyear deployments in insurance and construction. The pitch stays the same: Palantir wants to be the operating system that companies (of all types) actually run their AI on. | Bill Ackman dumped his Universal Music stake after getting rejected. Pershing Square sold its entire $1.65 billion position in Universal Music Group, just days after UMG's board rejected Ackman's $64 billion takeover bid as undervaluing the company. A reminder that even famous investors don't always get their way (still love you, Ackman). | The jobs report lands tomorrow. Economists expect roughly 105,000 new jobs for May (down from 115,000 in April) and unemployment around 4.3%, the last major read before the Fed meets June 16-17. A cooling but not collapsing labor market keeps the cut-or-hike debate very much alive. |
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| | 🚨 Trending on Reddit | CrowdStrike (CRWD) chatter focused on the stock's steep decline. Users expressed disbelief at anyone buying near the highs, with some drawing comparisons to Broadcom (AVGO), which only saw a minor dip by comparison. Sentiment leaned bearish as traders debated whether the selloff signals deeper problems. Anthropic mentions centered on IPO speculation and broader AI market implications. Users discussed how a potential Anthropic listing could impact Google, which holds a significant stake, and debated whether S&P 500 rules might change to accommodate massive private-to-public transitions like SpaceX and Anthropic. Invesco QQQ (QQQ) conversation turned anxious as users noted recent losses and portfolio pain. Some highlighted exposure to leveraged products like 2x Space ETFs as a major contributor to their drawdowns, with overall sentiment reflecting concern about near-term tech weakness.
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| | 🤫 Insider Trading | Stocks | Who bought/sold | Details | Total |
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Fortinet Inc ($FTNT) | VP, Engineering & CTO | Sold 3,907 shares @ $146.44 | $572,144 | EverCommerceInc ($EVCM) | CEO | Sold 5,658 shares @ $9.57 | $54,157 |
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| | | | 🎙️ Make Your Voice Heard | Broadcom grew its AI chip sales 143% and the stock still fell. What's your read on AI stocks right now? | |
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| | 🎤️ What you said last time | |
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| | 🧠 The Missing (Market) Links | The US data center market is forecast to hit $494 billion by 2031, as AI workloads reshape cooling requirements faster than facilities can adapt. Corporate bookings to World Cup host cities jumped 46% in the US and 295% in Canada, with Toronto's spend spiking 486%. Prescription drug prices jumped 81% after US market entry, per new research tracking post-launch pricing. The US pet food market hit $46.9 billion in 2025 and will reach $62.1 billion by 2034, with dog food accounting for 42% of sales. Over 60% of the $25 billion in US seafood imports escape federal monitoring, per a new policy brief on IUU fishing. Northern Virginia remains the world's largest data center hub, but Texas and Arizona are gaining share as power availability outweighs demand. Japanese feed producer Feed One is slashing fishmeal content from 40.5% to 30% this year after prices topped $6 per kilogram.
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| | 📜 Quote of the Day | | ❝ | | | The big money is not in the buying and selling, but in the waiting. | | | | Charlie Munger |
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| | That’s all for today. Did we miss anything? Smash the reply button to let me know. | Cheers,
Brandon & Blake of Invested Inc |
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