Davis Wilson:

NVDA Earnings 4:20pm!

Nvidia reports earnings tonight. The timing couldn’t be more dramatic. The broader market has been selling off for weeks. Nvidia itself has dropped from $210 to $181. Investors are muttering (again) about an “AI bubble.”

But here’s the truth: there’s no AI bubble. There’s only a bubble about people talking about bubbles. Under the surface nothing has changed. And that’s exactly why Nvidia is setting up for a move higher.

Since the launch of ChatGPT in late 2022: Nvidia’s revenue is up 6x, profits are up 9x, its stock price is up 10x. Today, Nvidia trades at 50x trailing earnings – one of the lowest multiples this company has had in years.

If Nvidia’s business were truly slowing, you’d see it first in the spending habits of the hyperscalers like Meta, Microsoft, and Amazon, who are still spending explosive amounts of money on Nvidia's products.

Fundamentally, nothing has changed with Nvidia. This pullback isn’t the start of an AI collapse. It’s the market mispricing a company whose fundamentals have only improved. Earnings tonight may add volatility, but the long-term direction is unchanged. I suggest you own the stock.

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Greg Guenthner:

Meta Wins FTC Antitrust Suit, Will Keep Instagram and WhatsApp

A U.S. district judge on Tuesday ruled against the Federal Trade Commission (FTC) in its antitrust lawsuit against social media giant Meta.

In his ruling, Judge James Boasberg said the FTC failed to prove that Meta purchased Instagram and WhatsApp with the goal of eliminating them as competitors in the social media market.

The FTC was seeking to force Meta to divest itself of both Instagram and WhatsApp, despite the commission originally approving their purchases in 2012 and 2014, respectively.

Boasberg said government lawyers insufficiently argued that Facebook, Instagram, and Snapchat make up what they referred to as a personal social networking market. Instead, the judge sided with Meta's argument that if there was a private social networking market, it doesn't exist anymore, and that the company also has to compete with major rivals such as TikTok and Google's YouTube.

The FTC's case could have been devastating for Meta. The company would have lost one of its most important moneymakers in Instagram, which has helped it better compete with TikTok, while also having to divorce itself from one of the world's leading messaging apps in WhatsApp.

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Enrique Abeyta:

Larry Summers Resigns From OpenAI Board After Release of Emails With Epstein

Former Treasury Secretary Larry Summers said Wednesday that he will resign from the board of OpenAI after the release of emails between him and the notorious sex offender Jeffrey Epstein.

Summers had announced Monday that he would be stepping back from all public commitments, but it was not immediately clear whether that included his position at the artificial intelligence startup.

“I am grateful for the opportunity to have served, excited about the potential of the company, and look forward to following their progress,” Summers said in a statement to CNBC.

Details of Summers’ correspondence with Epstein were made public last week after the House Oversight and Government Reform Committee released more than 20,000 documents it obtained pursuant to a subpoena from Epstein’s estate. Summers has faced intense scrutiny following the release of those files.

Congress on Tuesday agreed to pass a bipartisan bill ordering the Department of Justice to release all of its files on Epstein, clearing the path for Trump to sign it into law.

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