What you Need to Know for August 7th

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Welcome back! This has been an insane earnings week. We were bombarded with earnings the past couple days, so with a lot of stocks on the move, we’ll skip the pleasantries and get right into it.

Earnings Corner 💸 

• Sandisk $SNDK ( ▼ 6.81% ) Revenue beat at $8.97B vs. $8.48B, while EPS beat at $39.25 vs. $34.96. Results were driven by surging AI data center demand, higher flash memory pricing, and stronger volumes, with data center revenue more than doubling to $2.98B. Demand continues to outpace supply, keeping memory on allocation through 2027, while new multi year customer agreements now cover roughly half of FY27 production and two thirds of FY28 output. Shares fell as softer Q1 revenue guidance and slightly lower gross margin expectations failed to match the high bar set by the stock’s massive run.

• Monster $MNST ( ▼ 0.32% ) top and bottom line beat as sales outside the U.S. rose 34.6% and now account for about 46% of total sales. The energy drink category also continued to attract new consumers, helping the core Monster Energy segment grow 21.6% as usage occasions expanded and household penetration increased, supported by higher marketing spend across social, digital, sponsorships, and endorsements. Higher pricing and favorable product mix helped offset increased costs, though shares slipped after hours due to higher operating expenses and continued weakness in the Alcohol Brands segment.

• Celsius $CELH ( ▼ 18.46% ) had a disappointing quarter, especially relative to the performance that Monster saw. Revenue of $818mm missed estimates of $870mm due to weak Celsius brand performance (-11.7%) that offset strong Alani Nu growth. Adj. EBITDA of $184mm was a miss vs. estimates of $198mm. Mgmt. noted 3Q is expected to look similar to 2Q, with the start of a recovery expected in 4Q.

  • Note, while the core Celsius product was down -11.7% y/y, it was down only -2% on the retail side, with destocking being a big driver of the difference. Given these results, Celsius is in the penalty box for the WSR Investing Club team as there is no near-term positive catalyst until 2027.

• Uber $UBER ( ▲ 3.36% ) Revenue missed at $14.19B vs. $14.24B, while EPS came in line at $0.81. Results were driven by strong ride-hailing and delivery demand, with gross bookings up 24%, helped by World Cup travel and continued customer growth. Uber also outlined plans to invest more than $10B in autonomous vehicles, with AV service already live in seven cities and targeted for 15 by year-end, as it works to become a leading commercialization platform for robotaxis. Softer Q3 EPS and bookings guidance, along with uncertainty around partnerships like Waymo and the cost of scaling AVs, weighed on the outlook and on shares.

• Disney $DIS ( ▲ 2.87% ) Revenue missed at $25.17B vs. $25.38B, while EPS beat at $2.06 vs. $1.86. Results were driven by continued strength in Experiences, where revenue rose 10% as higher park attendance, cruise demand, hotel activity, and increased guest spending helped lift operating income. Its new TikTok partnership will also bring fan created short form content to Disney+, helping drive younger user engagement across brands like Marvel, Pixar, and Star Wars. Disney also raised its FY buyback target to $9B after selling its A+E stake and reaffirmed 12% adjusted EPS growth for FY26 and double digit growth for FY27.

• DoorDash $DASH ( ▲ 2.89% ) revenue beat at $4.45B while EPS missed. Results were driven by continued strength across restaurant, grocery, retail, and international delivery, with total orders up 27% and total order value up 36%, helped by strong DashPass growth and Deliveroo. Profit fell as higher order-related costs and increased spending on marketing, R&D and AI offset the revenue growth. Strong guidance was issued, supported by continued demand and improving unit economics.

• Airbnb $ABNB ( ▼ 0.56% ) revenue slightly beat at $3.61 and EPS beat at $1.37 vs. $1.25. Results were driven by strong travel demand across regions, with nights and seats booked up 10%, particularly strong growth in Latin America, and a World Cup boost in North America. FCF rose 30% to $1.25B, while the company continued expanding beyond home rentals into hotels and services. Airbnb also raised FY revenue growth guidance to at least mid-teens and lifted its adjusted EBITDA margin target.

• DraftKings $DKNG ( ▲ 1.88% ) Top line missed while EPS bear at $0.09. Results were pressured by customer-friendly sports outcomes and heavier promotional spending, which drove sports revenue down 11% even as betting volume and monthly unique payers increased. Mgmt. maintained FY guidance, while highlighting that its Predictions product is growing faster than expected and giving the company another growth avenue heading into the NFL season. Shares slipped after hours as the revenue miss and weaker profitability outweighed the results.

• Cloudflare $NET ( ▼ 2.91% ) top and bottom line beat, results were driven by accelerating demand for its cloud, security, and developer products as AI agents generate more machine to machine traffic across the internet, with billings up 35% and large customers growing 26%. The company raised FY guidance as stronger AI-driven demand and customer growth supported a better than expected outlook.

• AppLovin $APP ( ▼ 19.66% ) revenue missed at $1.92B vs. $1.94B, while EPS came in roughly in line at $3.76. The miss was driven by slower than normal improvements in its AI ad models, with a major model upgrade landing just after quarter-end, while higher compute spending also weighed on results. Advertiser demand remained healthy and e-commerce spend hit a record, but softer Q3 guidance and concerns that growth in its core mobile gaming ad business may be slowing.

• Expedia $EXPE ( ▼ 4.1% ) top and bottom line beat. Growth was driven by strong B2B demand as more travel partners used Expedia’s platform, while better U.S. consumer trends helped lift bookings across its brands. B2B revenue rose 23%, gross bookings were up 12%, and room nights increased 6%. Better marketing efficiency and cost control also helped expand margins, while the stronger booking trends led the company to raise FY guidance.

• Dutch Bros $BROS ( ▼ 18.79% ) revenue beat at $550.9M vs. $525.4M, while adjusted EPS beat at $0.33. Growth was driven by strong same-store sales and continued new shop openings, while the company is also paying $105M for up to 65 former Salad and Go locations whose drive-thru format allows Dutch Bros to convert them more quickly and expand in markets where it already has strong brand awareness. The company raised FY guidance, but shares following the big Salad and Go expenditure

On The Move 📈 📉

• Western Digital $WDC ( ▼ 13.03% ) dropped despite a Q2 beat, as analysts flagged that peer Seagate’s $STX ( ▲ 1.83% ) delivered relatively stronger results on growth, margin expansion, and EPS.

• Atlassian $TEAM ( ▼ 2.78% ) is up +32% after hours after a surprise beat.

• Shake Shack $SHAK ( ▼ 5.5% ) rallied after activist investor Starboard Value took a stake, the same day the burger chain’s Q2 sales and profit beat Wall Street estimates.

• Trade Desk $TTD ( ▼ 6.8% ) crashed after Q2 revenue and EPS missed and Q3 revenue guidance came in at $650M vs $805M consensus. Q3 adjusted EBITDA guide of $160M was less than half of the $340M expected.

• Honeywell Aerospace $HONA ( ▼ 23.16% ) plunged after a Q2 EPS miss in its first earnings since spinning off from Honeywell in June. Management cited supply constraints and lowered H2 sales growth guidance.

• New York Times $NYT ( ▼ 1.08% ) tumbled 13% Wednesday and hasn’t recovered after Q2 digital-only subscriber growth slowed to 280K net adds, the smallest sequential increase in a year. Q2 revenue and EPS both beat estimates.

• Papa John’s $PZZA ( ▼ 17.18% ) fell after the pizza chain suspended its quarterly dividend and cut FY guidance, said it wasn’t interested in selling itself after an 18-month strategic review, and reported North American same-store sales fell 8.3%.

• Peloton $PTON ( ▼ 15.57% ) slumped after FY27 revenue guidance of $2.3-2.4B came in below Wall Street’s $2.43B consensus even as Q4 beat on revenue and EPS. Subscribers fell 8.8% YoY to 2.553M.

IPO Roundup 📍 

• Braveheart $BRVE ( ▲ 65.56% ) soared in its Nasdaq debut Thursday after raising $382.5M in an upsized offering priced at $18 (above the $15-$17 marketed range) for a $2.11B valuation.

• Nscale is targeting a US IPO as soon as September with $51B in contracted revenue and quarterly revenue climbing to $100M+ in Q2. The London-based AI data center operator, whose board includes former Meta executives Sheryl Sandberg and Nick Clegg, is adding 10 gigawatts of power capacity and recently agreed to buy Anyscale for $1.65B. GS and JPM are working on the offering.

• Attovia Therapeutics Inc. $ATTO ( ▼ 6.94% ) jumped 29% in its Nasdaq debut Wednesday after raising $289M in an IPO priced at $17 for a $942.3M valuation.

Today’s Jobs:

1. HPS is hiring a Strategic Financing Associate (NY)

2. Oaktree is hiring a US Senior Loans Associate (LA)

3. Caxton is hiring a Consumer L/S PM (NY)

4. PineBridge is hiring a Multi-Asset Analyst (NY)

5. Napier Park is hiring a Research Analyst (Chicago)

Today’s MVPs - Outgoing Summer Interns

Today’s MVPs are all the interns wrapping up their summer programs. Whether you received a return offer or not, this is just the start of your career. Keep working hard and smart, there’s still so much more to learn.

Today’s Headlines 📖🍿 

• Jane Street is negotiating a private-credit deal of up to $15B to rework its $11B debt load and limit its financial disclosures. PIMCO is among the investors on the deal, which would free up capital for private companies and AI infrastructure after Jane Street’s record $16.1B Q1 trading revenue.

• Publicly traded private credit BDCs are showing signs of stabilization in Q2 after most funds hit multi-year lows earlier this year. BlackRock took the most aggressive step, selling 48% of its TCPC loan portfolio to a Pantheon CV, while major managers like Ares, Blue Owl, and Blackstone trimmed bad investments and lowered leverage. Firms have yet to identify a clear path to renewed growth as major private credit players pivot toward AI infrastructure backing.

• OpenAI’s first hardware device will be a hockey puck-sized, doughnut-shaped smart speaker priced at $300-$400, set for release in 2027. Apple is currently suing OpenAI for alleged trade-secret theft, which could complicate the launch.

• Leopold Aschenbrenner’s Situational Awareness is back in action, yesterday he wired $400M to a Sequoia-backed private company, his second bet on the firm after a $100M investment last month. The move comes days after Aschenbrenner sold public stocks to Ken Griffin’s Citadel at a 10% discount.

• Sequoia closed $10bn in new growth-fund commitments and agreed to invest $2.5bn more in Anthropic this spring. The firm returned $5bn to investors this year, betting on a $1.1bn Ineffable Intelligence seed round and a $300M Etched chip investment.

• DeepSeek plans a “significant” price increase across its AI services, an unusual shift from the Chinese firm whose ultra-low pricing has pressured rivals. V4 Flash currently runs at $0.14/$0.28 per million input/output tokens versus Anthropic’s Fable 5 at $10/$50. The move comes in advance of a possible IPO this year.

• Google DeepMind CEO Demis Hassabis is stepping down to become chairman and Alphabet chief scientist, with CTO Koray Kavukcuoglu taking over as SVP reporting to Sundar Pichai. Alphabet shares originally fell on the news.

• Alphabet looks to raise $20-25bn in its latest US bond offering across 10 tranches with maturities 2-40 years, weeks after its raised 2026 capex outlook triggered a selloff.

• First-lien lenders are suffering more in bankruptcies compared to historical norms, with 23% of the past three years’ bankruptcies leaving first-lien lenders with under 30 cents on the dollar. This is driven by overvalued loans, shrinking amounts of junior debt (shrunk from 47% to 23% in the last 3 years), and the rise of liability management exercises (increased from 10% to 52%).

• Bank of America spends $250M+ annually on GLP-1s for its 211k employees, up from $0 about five years ago. This now makes it 13% of the bank’s $2bn healthcare budget, with CEO Brian Moynihan calling it a “good investment.”

• Several top US law firms are exploring private equity investment via a “management services organization” structure that separates legal work from administrative functions to sidestep rules barring non-lawyer ownership. Law firm Quinn Emanuel has spoken with Guggenheim Securities, and Paul Weiss met with New Mountain Capital.

• Ares was forced to scale back a €1bn continuation vehicle to €400M after investors demanded steeper discounts. The company is now targeting a €2.5bn continuation vehicle for loans from its 2018 European fund, with Coller Capital exploring anchoring the deal.

  • Meanwhile, Ares is also leading a $2.2bn direct loan to finance MedImpact Holdings’ acquisition of Puerto Rico-based Medical Card System, one of the largest private credit deals this year amid a slower dealmaking environment marked by record fund redemptions.

M&A Transactions💭 

Thorne Research, manufacturer of dietary supplements, has reached a definitive agreement to be acquired for $3.8B by Procter & Gamble (NYS: PG). EV/Revenue was 5.85x. Canaccord Genuity and Perella Weinberg Partners advised on the sale.

Takaful Ikhlas, provider of shariah-compliant financial protection services, has reached a definitive agreement to be acquired for MYR 1.640B by MNRB Holdings (KLS: 6459).

The Estate Family Home Portfolio of Leaf Living has reached a definitive agreement to be acquired for GBP 400.0M by Border to Coast Pensions Partnership. CBRE Group advised on the sale.

International Personal Finance (OTCM: IPFPF), provides consumer loans, was acquired for GBP 543.0M by BasePoint. EV/Net Income was 11.2x and EV/Revenue was 0.75x. Stephens, Panmure Liberum, and Peel Hunt advised on the sale.

Maurel & Prom (PAR: MAU) has reached a definitive agreement to acquire The Colombia and Ecuador Oil Business of Gran Tierra Energy (ASE: GTE) for $1.33B. Bank of America and RBC Capital Markets advised on the sale.

Electronic Arts (NAS: EA), one of the largest global developers and publishers of video games, was acquired for $55.0B by Saudi Arabia’s Public Investment Fund, Affinity Partners, and Silver Lake. The transaction was supported by $18.055B of debt financing. EV/EBITDA was 31.87x and EV/Revenue was 7.01x. Goldman Sachs advised on the sale.

Command Alkon, developer and distributor of software, has entered into a definitive agreement to be acquired for $715.0M by Francisco Partners. The transaction values the company at an estimated $1.3B. EV/EBITDA was 14.13x and EV/Revenue was 5.65x. Evercore Group advised on the sale.

UOB Asset Management, provider of asset management services, has reached a definitive agreement to be acquired for SDGG 555.0M by Allianz Global Investors.

Paraway Pastoral, operator of a domestic farm, has entered into a definitive agreement to be acquired for $3.0B by Ranchland Capital Partners.

gChem, manufacturer of specialty chemicals, has reached a definitive agreement to be acquired for $850.0M by ContextLogic Holdings (OTCM: LOGC). Morgan Stanley advised on the sale.

Medicover Hospitals, operator of a chain of healthcare centers, has entered into a definitive agreement to be acquired for EUR 1.2B by Kohlberg Kravis Roberts. The transaction values the company at EUR 1.82B. EV/Revenue was 8.07x.

Hot Topic, operator of a mall and web-based specialty retail chain, has reached a definitive agreement to be acquired for $350.0M by Spencer Gifts. Jefferies advised on the sale.

Fundare Resources, operator of an oil and natural gas agency, has reached a definitive agreement to be acquired for $320.0M by Japan Petroleum Exploration (TKS: 1662).

AVK-SEG, provider of power and energy solutions, was acquired for $1.0B by Partners Group.

easyjet (LON: EZJ), a leading European low-cost airline, has reached a definitive agreement to be acquired for $7.7B by Apollo Global Management.

Private Placement Transactions💭 

Oxide Compute, manufacturer of an integrated rack-scale computer system, raised $445.0M of Series D venture funding from undisclosed investors.

iSpace, manufacturer of commercial carrier rockets, raised nearly CNY 1.0B of Series Venture funding from undisclosed investors.

River Mobility, manufacturer of electric vehicles, raised $120.0M of Series C venture funding through a combination of equity and convertible debt led by Elev8 Venture Partners and Claypond Capital Partners.

Moove, operator of a global mobility fintech company, raised $250.0M of Series C venture funding led by Woven Capital, Ion Pacific, and Mubadala Investment Company at a pre-money valuation of $1.85B.

Expedition Therapeutics, operator of biopharmaceutical development services, raised $115.0M of venture funding led by General Atlantic.

Acrab, developer of an agentic AI computing infrastructure, raised $130.0M of Series B venture funding from Vertex Ventures Southeast Asia & India, Vertex Growth, and other undisclosed investors.

Hadrian, developer of an autonomous manufacturing platform, raised $1.37B of Series D venture funding led by Valor Equity Partners, WCM Investment Management, Washington Harbour, Baillie Gifford, J.P. Morgan Chase, and 137 Ventures at a pre-money valuation of $6.5B.

Lumilens, developer of photonic interconnect, raised $700.0M of Series C venture funding led by Atreides Management, Bain Capital Ventures, Meritech, Seligman Ventures, and Spark Capital.

LifeMine, developer of a drug discovery platform, raised $188.0M of Series E venture funding led by Milky Way Investment Group.

Odds of the Day 🍒 

Polymarket traders are pricing in a 46% chance of a democratic sweep in the midterms.

Obviously, none of this constitutes financial or investment advice. *Today’s Odds of the Day is in paid partnership with Polymarket