What You Need To Know For June 12th

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Welcome Back!

We’re in the quiet part of earnings season, but we have a lot of action from the past few days.

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Let’s get into it.

Earnings Corner 📜 

Trending Up 📈 

Oracle (ORCL) $ORCL ( ▲ 13.1% ) Beat on revenue and EPS. Sales rose 11% y/y to $15.9B, with adjusted EPS of $1.70. 1Q guide implies 12–14% growth and EPS of $1.46–$1.50. Management highlighted >70% cloud infra growth for FY26 and disclosed a rare full-capacity cloud order from one customer. Shares are +7% after hours.

GameStop (GEM) $GME ( ▼ 23.35% ) The OG meme stock missed on revenue but swung to a profit. Sales dropped 17% y/y to $732.4M as demand for physical games keeps eroding. Management confirmed a 4,710 bitcoin purchase and launched a $1.75B convert deal, signaling management is all in on its new identity as a crypto reserve play. Shares are -12% after hours.

Chewy (CHWY) $CHWY ( ▲ 1.83% ) The pet e-com giant beat on revenue and EPS. Sales grew 8.3% y/y to $3.12B, with adjusted EPS of $0.35. Guidance for the second quarter landed at $3.075B, topping estimates. Active customers climbed to 20.76M, yet slower net adds and flat gross margin drew scrutiny given the stock has already doubled this year.

J.M. Smucker (SJM) $SJM ( ▲ 1.19% ) Miss on revenue, beat on EPS. Sales were down 3% y/y and adjusted EPS came in at $2.31. FY guide held, but Smucker took a $980M hit on its $5.6B Hostess deal after a sharp drop in snack and pet sales.

Victoria’s Secret (VSCO) $VSCO ( ▼ 5.36% ) Beat on revenue and EPS. Revenue came in at $1.35B, and adjusted EPS was $0.09. Second quarter EPS was guided to $0.00–$0.15, with a $50M tariff hit expected. The release had been delayed due to a cyberattack but ultimately came through; beauty and swimwear were called out as Q1 bright spots.

Dave & Buster’s (PLAY) $PLAY ( ▲ 0.76% ) The arcade-restaurant chain reported revenue in line but missed on EPS. Sales were down 3.5% y/y, with adjusted EPS at $0.76. FY guide was unchanged. Investors got excited after mgmt. flagging improved momentum and sequential comp improvement, saying the “back to basics” strategy is gaining traction.

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Today’s Headlines 🍿 

• The US and China have agreed to a trade proposal, which now hits the desks of Trump and Xi for final sign-off. China is imposing 10% tariffs on the U.S. while we are imposing a 55% rate on China (30% blanket rate plus 25% for specific products that were already in place). Here’s the rest of the Tariff news you need to know:

  • A rare-earth metals deal is also in place, but with a six-month limit on export licenses for U.S. manufacturers. The U.S. has agreed to loosen restrictions around the sale of jet engines and ethane to China as a trade-off

  • Howard Lutnick has assured Americans that the 55% rate “definitely” won’t change again, although this should be taken with a grain of salt until we hear it from Trump…and even then…

  • Meanwhile, the US Appeals Court has ruled the Trump tariffs can remain in effect for now while the appeal plays out

  • Bessent may extend the 90-day-pause to up to 18 countries who are currently in “good faith talks” with the U.S. - meanwhile, Trump has said unilateral tariffs for the rest of the nations will come in the next 1-2 weeks

  • Musk has apologized to Trump as well - the two spoke over the phone on Monday, prompting Musk to apologize in a post on X

  • Lastly, The US and Mexico are nearing a deal to cut steel tariffs from current levels of 50%, provided that total shipments will remain below a predetermined volume cap

• An Air India plane going from Ahmedabad to London Gatwick crashed shortly after take-off this morning. The plane was reportedly a Boeing 787 Dreamliner and was reportedly carrying up to 242 people. Rescue efforts are underway. Boeing shares are down -7% pre-market.

• Inflation remains in check - CPI rose 0.1% in May, less than estimates of 0.2%. This puts inflation at 2.4% y/y and is a sign that the tariffs may be taking longer than expected to affect prices

• Zuck’s Aggressive AI Deal: Is Zuck overpaying or does he know something we don’t? Meta is finalizing a unique deal to invest $14B in Scale AI, at a 49% ownership level, hiring its CEO Alexandr Wang to head up Meta’s AI super team. According to CNBC, Zuckerberg is frustrated with Meta’s current AI standing, so he’s willing to make this deal for the data-labeling and annotation startup

• Blackstone is getting bullish on Europe, planning to deploy up to 500B over the next decade, arguing that European leaders are starting to realize they need a more deregulatory environment

• Apollo pushes back PE Recruiting: The Private Equity has notified candidates that it will not be hiring for 2027 Associates during this year, a stark change from PE firms generally hiring two years in advance. CEO Marc Rowan noted how they wanted to stop rushing students into decisions. This comes shortly after JP Morgan instituted a policy stating that Analysts who have been found to have accepted a new role will be terminated

• JP Morgan’s RTO hit morale: An internal memo showed JP Morgan forcing employees back in the office 5-days-a-week hurt morale, lowering company culture scores

  • Meanwhile, Jamie Dimon has warned that he expects starting to see economic data deteriorate soon

• Apple’s lackluster Development Day: AI innovations were largely a no-show, with the new ‘Liquid Glass’ display being the big feature of the conference. Other main announcements included live translation capabilities and an array of visual updates, but the stock fell as investors were underwhelmed by the lack of innovation

  • It’s clear though Apple is slow rolling its AI announcement, not wanting to pre-emptively launch something until they feel more comfortable bringing it to market. So are they behind or is there a surprise coming? Only time will tell…

• Google offers buyouts to employees, joining a growing number of companies looking to shrink their workforce. The buyouts stretched several divisions, including Search, as the company focuses in on cost-cutting and expanding its AI infrastructure

• Chime prices its IPO at $27/share - a $11.6B valuation that is a steep discount from its last private mark ($25B). The stock is expected to start trading under “CHYM” today

• Trump’s Fed Chair pick is coming soon - with Kevin Warsh, a former member of the Fed’s Board of Governors, potentially leading the charge. National Economic Council director Kevin Hassett is reportedly also in the running as Trump searches for a loyal and growth-oriented prospect

  • Treasury Secretary Scott Bessent is another surprising candidate, and a guy who would certainly be trigger-happy with the cuts if appointed

• Tesla robotaxi rides set to begin in Austin: Elon announced a tentative date of June 22 to roll out the driverless public taxi service. The initial phase will be limited to 10-20 Model Y cars and done under remote human supervision

• Papa Johns could go private - with Apollo and Irth Capital, a Qatari investment fund, circling the pizzeria with a $2B bid (Semafor)

  • Meanwhile, Bojangles, the fried chicken and biscuits chain, is exploring a $1.5B sale. This almost triple what Durational Capital and TJC paid back in 2019 (>$590mm)

• Deutsche Bank commits $865mm for the Marelli Holdings DIP (BBG) - the Japanese auto-parts maker is among of the first bankruptcy casualties of the trade war

• Cipriani taps Private Credit: Cipriani has raised $190mm of financing, primarily from Beach Point Capital, to grow and expand its global luxury hospitality projects

• Warner Bros Discovery is splitting up Studios and Streaming: The result will be two separate public companies - a linear networks focused company, and a streaming company centered around HBO Max and Warner Bros Studio

• Ken Moelis steps down from Moelis. The Founder of the Investment Banking Boutique is retiring at age 67, with his successor promising to end “hazing” in banking culture

• College Sports were deregulated further - and Private Equity is eyeing a slice of the action. It’s now legal for schools to pay their athletes directly, and PE firms figure to help drive revenue by providing capital for new facilities, stadium upgrades, and fan experiences

• Blackstone is mulling an IPO of Cirsa: The private equity firm may raise $1B for the Spanish gaming company

M&A Transactions💭 

Disney has completed its purchase of 100% of Hulu. Disney will pay Comcast’s NBCUniversal nearly $439.0M for its stake in Hulu. The move closes out an appraisal process that’s dragged on for a few years.  

Sundyne, manufacturer of precision centrifugal pumps, was acquired for $2.16B by Honeywell (NAS: HON). EV/EBITDA was 14.5x. J.P. Morgan and Morgan Stanley advised on the sale.

Oxford Ionics, developer of advanced quantum computing systems, has reached a definitive agreement to be acquired for $1.075B by IonQ (NYS: IONQ) through a reverse merger. Morgan Stanley and Torch Partners advised on the sale.

Megha Engineering & Infrastructures, operator of infrastructure development company, has reached a definitive agreement to be acquired for INR 135,000M by Mr. Krishna Reddy.

Medik8, manufacturer of skincare and personal products, has reached a definitive agreement to be acquired for GBP 800.0M by L’Oreal (PAR: OR). Alantra and J.P. Morgan advised on the sale.

Deep Roots Harvest, producer of medical cannabis, was acquired for $132.7M by Vireo Growth (CNQ: VREO) and Chicago Atlantic (NAS: REFI). Moelis & Company and Lineage Merchant Partners advised on the sale.

Cranes (NYS: CR) has reached a definitive agreement to acquire The Precision Sensors and Instrumentation Product Business of Baker Hughes (NAS: BKR) for $1.15B. Evercore Group advised on the sale.

Alphawave Semi (LON: AWE), a semiconductor company, has reached a definitive agreement to be acquired for $2.4B by Qualcomm (NAS: QCOM). EV/EBITDA was 407.26x and EV/Revenue was 7.8x. Barclays, BMO Capital Markets, and Goldman Sachs advised on the sale.

GADD, provider of asset management services, has reached a definitive agreement to be acquired for EUR 93.7M by Alpcot (STO: ALPCOT B).

Cefetra Group, distributor of agriculture ingredients, has entered into a definitive agreement to be acquired for EUR 186.0M by First Dutch Capital.

Amara Holdings, a Singapore-based investment holding company, was acquired for SGD 514.6M by Wing Tai Holdings (SES: W05), Wing Tai, and Mr. Dawn Teo. EV/EBITDA was 18.54x and EV/Revenue was 4.33x.

Lorne Park Capital Partners (TSXV: LPC), a Canada-based company engaged in building a network of boutique investment managers, has entered into a definitive agreement to be acquired for $126.8M by Sagard. BMO Capital Markets advised on the sale.

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Private Placement Transactions💭 

Nano Solutions, developer of a nanomaterial technology, raised $10.0B of Series A venture funding led by Capstone Partners Korea and Laplace Partners at a pre-money valuation of $64.0B.

Proxima Fusion, developer of fusion plants, raised EUR 130.0M of venture funding led by Cherry Ventures and Balderton Capital.

Laurel, developer of an advanced timekeeping software platform, raised $100.0M of Series C venture funding led by IVP and GV at a pre-money valuation of $410.0M.

Horizon3.ai, developer of a security automation platform, raised $100.0M of Series D venture funding led by New Enterprise Associates.

 Glean, developer of an AI-powered work assistance platform, raised $150.0M of venture funding led by Wellington Management at a pre-money valuation of $7.05B.

SpliceBio, operator of a biotechnology company, raised $135.0M of Series B venture funding led by Sanofi Ventures and EQT Life Sciences.

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Odds of the Day 🍒 

Kalshi traders are pricing in 2 rate cuts in 2025 - a large drawdown from prior expectations

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