Welcome back. What an insane day in the market. After an initial rally on Wednesday, when the market rotated out of chips into hyperscalers and real economy names, things got dramatically worse on Thursday. The market suddenly worried about AI development and the AI buildout now that the Democratic party has taken control of Congress. It’s notable on the local level too. 41% of planned data centers now face a pause or new state rules (Cleanview). More below on the worst companies impacted, but the bottleneck and construction names were the obvious losers.
This has led to a Hedge Fund manager flushout with Walleye handing back capital and many other managers rumored to be in deep trouble.
The biggest problem is whether the Anthropic IPO is still on track - and whether the low-end $1.5T valuation is actually now the high-end valuation. The roadshow should be next week, so we’re going to find out sooner rather than later.
I would lean on it still happening, but an extension of yesterday’s crash would raise further doubts. Friday is crucial to try to re-stabilize sentiment. Let’s get into it.
Together With 9fin
October’s credit sell-off has brought the financing of the AI buildout into sharper focus. Spreads have widened across names including Oracle, Broadcom, CoreWeave and SoftBank, while funding activity has slowed alongside a broader faltering of primary issuance.
Are creditors now being better compensated for the risks they take — or are markets anticipating a more demanding phase of the investment cycle?
Explore the key questions shaping 2027 credit decisions:
What role will banks and alternative lenders play in funding the buildout?
Can borrowers bridge the gap between upfront capital spending and future customer cash flows?
Is the market separating into a smaller group of winners and a longer tail of vulnerable businesses?
How should investors assess interconnected financial commitments and competing claims across the capital stack?
What do higher US Treasury yields mean for AI borrowers?
How do AI investment, growth, inflation, and rates feed back into each other?
Investors, bankers, and advisers will walk away with a clearer view of exposure, opportunities and risk in what is undoubtedly the biggest funding story of 2026.
Earnings Corner 💸
McDonalds $MCD ( ▼ 0.78% ) Missed on revenue at $7.16B vs. $7.29B, but beat on EPS. U.S. same store sales fell 0.2% as budget conscious consumers pulled back on spending, though results improved throughout the quarter as value meals and digital promotions helped drive traffic, returning sales to growth in September. Global same-store sales rose 1.5%, supported by stronger international demand. Mgmt. is testing new affordable meal bundles for a nationwide rollout in early 2027 to attract price sensitive customers and sustain the U.S. recovery.
Uber $UBER ( ▼ 1.56% ) Beat on revenue at $14.77B vs. $14.69B, but missed on EPS. Results were driven by strong freight growth, which offset weaker than expected ride hailing and delivery revenue, as higher fuel costs and driver shortages constrained international mobility growth. Mgmt. is investing in driver incentives to meet strong demand and expanding its autonomous vehicle fleet. The company also announced a partnership with Amazon $AMZN to offer Prime members free Uber Eats delivery on orders of $25 or more, expanding its customer reach and intensifying competition with DoorDash $DASH ( ▼ 9.4% ) .
AppLovin $APP ( ▲ 31.04% ) Beat on revenue at $2.18B and EPS at $4.30. Revenue surged 55% YoY, driven by growing adoption of its AI-powered advertising platform, helping advertisers target customers more effectively and improve ad performance. Strong revenue growth and high profit margins boosted cash flow despite rising costs. Mgmt. guided Q4 revenue above expectations and expanded its share buyback authorization to $3.6B, reflecting confidence in continued growth.
Expedia $EXPE ( ▼ 13.74% ) Beat on revenue at $4.94B vs. $4.73B and EPS at $9.39 vs. $8.77. Revenue grew 12% YoY, driven by strong travel demand and B2B growth, while cost efficiencies boosted profitability. Despite raising its FY outlook, Mgmt. guided Q4 revenue below expectations due to geopolitical disruptions and shifting promotional timing. Mgmt. also noted that AI travel agents have yet to meaningfully impact booking behavior.
Sweetgreen $SG ( ▼ 2.12% ) Beat on revenue at $176M vs. $170.1M, while its EPS loss of $0.26 was roughly in line. Revenue grew 2% YoY from new restaurant openings, despite same-store sales falling 6.4% following the Cyclospora outbreak. Sales recovered in October as new menu offerings and returning customers boosted demand. Mgmt. raised its FY same store sales outlook to a 5.5% decline, improved from its prior 7%–8% decline forecast.
Celsius Holdings $CELH ( ▼ 2.31% ) Beat on revenue at $847M and EPS, driven by strong demand for Alani Nu, whose sales rose 24%, offsetting a 6% decline in its flagship Celsius brand amid weaker demand and inventory reductions. Despite higher sales, rising aluminum, fuel, and distribution costs pressured margins. Mgmt. expects slower Q4 growth as some shipments shifted into Q3 and plans new product launches and international expansion in 2027 to support growth.
DraftKings $DKNG ( ▲ 1.77% ) Missed on revenue at $1.33B vs. $1.39B expected and posted a bigger then expected EPS loss of $0.53. Revenue grew from stronger sports betting activity, but heavy investment in its new prediction markets business pressured profitability. Mgmt. cut its 2026 outlook amid higher spending on DraftKings Predictions, which has attracted 1.6M+ customers but remains a drag on profitability.
Cloudflare $NET ( ▼ 8.28% ) Beat on revenue at $782.5M and EPS at $0.38. Revenue surged 39% YoY, its fastest growth in nearly four years, driven by strong demand for AI infrastructure, developer tools, and cybersecurity services. Higher costs pressured profitability, though adjusted operating margins improved. Mgmt. raised its full-year revenue outlook to $2.96B and guided Q4 above expectations, reflecting continued strong demand.
Six Flags Entertainment $FUN ( ▲ 16.52% ) Beat on revenue at $1.17B and adjusted EPS at $2.70. Revenue fell 11% YoY due to the sale and closure of eight parks, though same park sales grew 1.4% as higher guest spending offset weaker attendance. Mgmt. warned of weaker Q4 earnings following a fatal roller coaster accident in Georgia, which led to ride closures and a company wide safety review, while unfavorable weather further pressured attendance.
Affirm $AFRM ( ▼ 7.85% ) beat on revenue at $1.26B and EPS at $0.47, driven by strong buy now pay later demand, with transaction volume up 34% YoY and Affirm Card spending more than doubling. However, higher credit-loss provisions and rising delinquencies raised concerns about lending risks. Mgmt. guided above expectations and expects at least 30% annual transaction volume growth.
CAVA $CAVA ( ▼ 3.18% ) Missed on revenue at $356.4M and EPS. Same store sales growth slowed to 3.1% as Cyclospora concerns and higher gas prices pressured traffic, while rising labor and expansion costs squeezed margins. Despite reaching 500 locations, Mgmt. raised its full-year same-store sales outlook but trimmed profitability guidance amid continued expansion costs.
On The Move 📈 📉
AI buildout suppliers Sterling Infrastructure $STRL ( ▼ 13.86% ) and Modine $MOD ( ▼ 7.28% ) have tanked the past two days on AI slowdown worries
Neocloud stocks $IREN ( ▼ 16.95% ), $CRWV ( ▼ 9.83% ), and $NBIS ( ▼ 14.95% ) plunged as they’ve been identified as a more high risk group.
Chips including Micron $MU ( ▼ 17.46% ) AMD $AMD ( ▼ 17.26% ) Nvidia $NVDA ( ▼ 9.26% ) Qualcomm $QCOM ( ▼ 9.49% ) , and Arm Holdings $ARM ( ▼ 13.08% ), plunged following lackluster earnings results from Qualcomm and Arm Holdings and AI buildout worries
Warby Parker $WRBY ( ▲ 22.5% ) surged following a strong 3Q26 earnings report with 10.4% YoY net revenue growth, 3% active customer growth, and raised guidance.
Tripadvisor $TRIP ( ▼ 27.65% ) cratered after a leadership shake-up and lower Q3 adjusted profit, with CEO Matt Goldberg leaving in February and CFO Michael Noonan by year-end.
Albertsons $ACI ( ▼ 3.64% ) slipped after a judge ordered it to pay $900mm for substantially contributing to Washington state’s opioid crisis.
Atlassian $TEAM ( ▼ 3.47% ) tumbled after hours as it forecast subscription ARR growth slowing to about 18.5% by year-end from 22.5%, despite a fiscal Q1 beat.
Twist Bioscience $TWST ( ▼ 15.41% ) dropped after a Bear Cave report alleged its rally was fueled by a short squeeze and by investors wrongly assuming it partners with Anthropic.
Lyft $LYFT ( ▼ 4.8% ) slid as Q3 revenue of $1.82Bn missed estimates and the company posted a quarterly loss.
IPO Roundup 📍
Some potential investors now doubt Anthropic’s IPO can hit a $1.5Tn valuation after Thursday’s $2.5Tn Nasdaq selloff, and one says it could land closer to $1Tn. The company could also delay the deal or raise less than the $100Bn expected.
Harvey, the legal AI startup valued at $15.5Bn, has held early talks with Latham & Watkins about a possible IPO, but a listing isn’t expected anytime soon. The company crossed $400mm in annualized recurring revenue in September and plans to see how Anthropic’s IPO goes before moving forward.
Agility Robotics $AGLT ( ▲ 2.22% ) became the first humanoid robot maker to go public in the US, through a SPAC merger. The Nvidia-backed company has $300mm+ in committed orders for its Digit 5 robot.
Wonder Group, the Marc Lore-founded restaurant-tech platform that owns Grubhub and Blue Apron, has confidentially filed for an IPO after raising $650mm in July at a $9Bn pre-money valuation.
Rezera set terms to raise $200mm in its IPO, marketing ~16.7mm shares at $11-$13 each, with pricing expected next week. The Boston biotech plans to start a Phase 3 trial of its peripheral artery disease drug in H1 2027.
YMTC put its $4.9Bn Shanghai IPO on hold as Beijing tightens approvals for share sales. The Chinese chipmaker is now likely to list in H1 2027.
Today’s Jobs:
Ares is hiring a Credit Technology Analyst (NY)
Apollo is hiring a Thematic Investing Associate/Principal (NY)
PIMCO is hiring an MBA Summer Intern Credit Analyst (CA)
KKR is hiring a Capital Solutions Analyst (London)
Barings is hiring a HY Associate Director (London)
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Today’s Headlines 📖🍿
PIMCO public policy head Libby Cantrill says the biggest risk to the AI buildout is at the state level. All 45+ ballot initiatives restricting data centers appear to have passed, and many new Democratic governors ran on statewide moratoriums.
ING is reportedly auctioning about $500mm of data center loans after the Democratic sweep. The package includes a $25mm slice backing a Stargate site in New Mexico, where Oracle sent the developer a force majeure notice.
Microsoft passed on an option to more than double its lease at Nscale’s Texas site. The deal was potentially worth tens of billions of dollars, and it’s the second time this year that Microsoft has walked away from Nscale.
Goldman Sachs and Apollo are in talks to sell pieces of SpaceX’s $40Bn chip financing, with some buyers asked to buy slices of up to $500M ahead of a formal syndication.
Walleye Capital, a $17Bn multi-strategy hedge fund, plans to return capital to investors and has cut equity long-short head Anil Gondi and a substantial portion of its long-short investment teams after a 5.9% October loss.
OpenAI released GPT-6 Cyber, a version of its Astra model built for security research. It found 81 previously unknown high-severity Firefox flaws, and access is limited to approved customers for now.
Thoma Bravo founder Orlando Bravo says private equity is facing a liquidity crisis. When the firm shops a portfolio company, it gets 10 bids that “all look the same”; non-control deals for a small stake.
Cleveland Fed President Beth Hammack pushes for restrictive policy to bring inflation back to 2%, favoring “more frequent, smaller adjustments” to avoid falling behind.
Apollo says real estate is barely paying more than Treasuries. Property yields are about 0.6 points above the 10-year, a fifth of the long-run average. Apollo sees more opportunity as $1.5Tn of property loans come due in 2026-27.
Wendy’s board unanimously rejected Trian’s roughly $1.4Bn take-private offer. The board said the bid substantially undervalues the company and adopted a poison pill.
FIFA will open confidential files on Gianni Infantino’s scrapped FIFA Forward Enterprise plan to bring private investors into a minority stake in a company running the World Cup’s commercial rights at a $20Bn valuation.
CVS Health plans to split into two companies, spinning off its 9,000 retail pharmacies, in-store clinics, and mail-order into CVS Pharmacy, while the remaining CVS Health keeps Aetna and Caremark. Shares $CVS ( ▲ 1.71% ) fell 13% on the news.
M&A Transactions💭
Andersons agreed to buy low-carbon ethanol producer Harvestone Low Carbon Partners for $915.0M.
The Kraft Heinz’s Coffee Business located in North America has entered into a definitive agreement to be acquired by One Rock Capital Partners through a $500.0M LBO. The transaction values the company at an estimated $650.0M. Centerview Partners and Rothschild & Cod advised on the sale.
Aurora Cannabis (TSE: ACB), focused on the production, distribution, and sale of cannabis products in Canada and internationally, reached a definitive agreement to be acquired by Organigram Global (TSE: OGI) for CAD 509.78M. EV/Revenue was 1.72x. Origin Merchant Partners advised on the sale.
Runwood Homes, provider of residential and specialized dementia care services intended for the elderly and dependent individuals in the United Kingdom, was acquired by Foundation Partners Asset Management and Omega Healthcare Investors through a GBP 615.0M LBO.
Proscia, developer of a digital pathology platform designed to enhance cancer diagnosis, was acquired by Agilent Technologies for $270.0M.
MERMEC Group, manufacturer of high-tech railway infrastructure products intended for the railway industry, was acquired by Siemens Mobility for an estimated EUR 1.0B.
Laurentian Bank of Canada, provides personal banking, business banking, and real estate and commercial financing services to its personal, business, and institutional customers across Canada and the United States, was acquired by Fairstone Bank of Canada for CAD 1.9B. EV/Revenue was 1.96x. Blair Franklin Capital Partners and J.P. Morgan advised on the sale.
Korean Air Catering & Duty Free Services, provider of duty-free products and meal services intended for the airline sector, was acquired by Korean Air Lines Company (KRX: 003490) for KRW 776.6B. The transaction values the company at an estimated KRW 970.75B. UBS Group advised on the sale.
JoongAng Ilbo, provider of English-language news publishing services intended for international readers interested in South Korea, reached a definitive agreement to be acquired by a consortium of Daou Technology (KRX: 023590), CJ (KRX: 001040), and Shinsegae (KRX:004170) for KRW 520.0B.
Gentari India, provider of clean energy services intended to meet today's sustainable energy needs, has entered into a definitive agreement to be acquired by Kohlberg Kravis Roberts through an estimated INR 60.0B LBO.
Elisity, developer of a network segmentation platform designed to reduce security risk and simplify enterprise network control, was acquired by IonQ for $1.3B.
Alif Semiconductor, manufacturer of microcontrollers and fusion processors designed to enable the creation of secure, power-efficient, and intelligent IoT devices, was acquired by Analog Devices (NAS: ADI) for $1.35B. Qatalyst Partners advised on the sale.
Agility Robotics, develops bipedal humanoid robots for use in commercial and industrial environments, acquired Churchill Capital XI through a $420.0M reverse merger, resulting in the combined entity trading on the Exchange under the ticker symbol AGLT. BTIG advised on the transaction.
Dextra Group, manufacturer of engineered steel construction products designed for infrastructure and energy projects, reached a definitive agreement to be acquired by NV Bekaert (BRU:BEKB) for EUR 140.0M.
Deoleo (MAD: OLE), engaged in the food processing sector. It produces olive oil, rice, table olives, vinegars, mayonnaise, mustards, ketchup, flour, and dates, reached a definitive agreement to be acquired by Dcoop, S. Coop. And. and Acesur for EUR 470.0M. The potential transaction values the company at an estimated EUR 500.0M. EV/EBITDA was 5.91x and EV/Revenue was 0.61x. William Blair & Company advised on the sale.
Core Entech, provider of an environmental management services designed to address ecological challenges arising from industrial operations, was acquired by an undisclosed investor for KRW 800.0B.
Outwest Energy, via its financial sponsor ARC Financial, has entered into a definitive agreement to acquire The Kaybob Oil and Gas Properties in Canada of Paramount Resources through a $341.0M LBO. ATB Cormark Capital Markets, RBC Capital Markets, and Scotiabank advised on the sale.
Private Placement Transactions💭
Transtreams, manufacturer of artificial intelligence chips designed for scalable hardware-software compute infrastructure, raised 1.0B yuan of Series B venture funding in a deal led by Yizhuang Guotou, Qiming Venture Partners, and Aurora Capital.
Sentra, developer of a cybersecurity platform designed to enable cloud-driven organizations to regain control and secure data, raised $150.0M of Series C venture funding in a deal led by Capital One Ventures.
Nooks, developer of a revenue agent platform designed to facilitate collaboration between human sales teams and artificial intelligence, received $500.0M of venture funding from General Catalyst.
Laza Medical, developer of an intelligent imaging system designed to simplify cardiac procedures, raised $160.0M of Series B venture funding in a deal led by GE HealthCare Technologies.
Zipline, developer of an autonomous aerial delivery system designed for logistics and delivery purposes, raised $1.5B of venture funding in a deal led by Paradigm, WCM Investment Management, and Layer Global.
Vaeridion, developer of an air mobility technology designed for a green revolution in aviation, received EUR 94.5M of grant funding from European Innovation Council.
T-Therapeutics, operator of a biopharmaceutical company intended to develop engineered soluble biologics for oncological and immunological indications, raised $133.0M of Series B funding in a deal led by Advent Life Sciences and British Business Bank.
Sand AI, developer of an artificial intelligence large model platform designed to accelerate the video editing process, raised 200.0M USD of Series B+ venture funding in a deal led by Co-Stone Capital and Wangsu Science & Technology (SHE: 300017).
EOS-X Space, manufacturer of aerospace components intended to provide space tourism services, raised $260.0M of Series D venture funding from undisclosed investors, putting the company's pre-money valuation at $940.0M.
Harbinger, developer of electric vehicle technologies designed to provide technologically progressive commercial vehicles and modernize the medium-duty vehicle industry, raised $240.0M of Series D venture funding in a deal led by Tiger Global Management, Capricorn Investment Group, and Ridgeline.
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