Welcome back!
This is a long newsletter, but it’s been a extremely busy couple of days. And we want to make sure we’re covering as much ground for you as humanly possible.
So I won’t delay, well, other than saying we love writing for you all. Let’s get into it:
Here’s a look at the remaining earnings for this week.
Wednesday: Meta Platforms, Tesla, Lam, Thermo Fisher, SAP SE,Texas Instruments, IBM, Abbott Laboratories, Moody's, AT&T, Philip Morris International, NextEra Energy, Abbott, Southwest Airlines, CSX
Thursday: Procter & Gamble, Union Pacific, Lockheed Martin, Spotify, Blackstone, Western Digital, Comcast, Valero Energy, Newmont, Honeywell, Norfolk Southern, Barclays, Nasdaq, Bloom Energy, American Airlines
Friday: American Express, First Citizens BancShares, SLB Limited, Rogers Communication
Here’s a look at economic data this week (estimates are in quotations).
Thursday: Weekly Jobless Claims (200K), Leading Indicators (-0.1%), Kansas City Fed Survey
Friday: US Flash Manufacturing PMI (55.3), US Flash Services PMI (58.1), U. Michigan Final Consumer Survey (46.3)
Earnings Corner 💸
Netflix $NFLX ( ▼ 1.66% ) Revenue was in line at $12.87B, while EPS beat at $0.87 vs. $0.82. Revenue grew nearly 12% YoY, driven by membership growth and recent price increases, while profit also benefited from the timing of expenses. However, slowing engagement and a slower than expected rollout of some ad products led the company to cut its 2026 ad revenue outlook to ~$2.7B from ~$3.0B. Mgmt. guided Q4 revenue to $13.44B, below expectations, which pressured shares after hours.
Tesla $TSLA ( ▲ 1.54% ) rose as Tesla and SpaceX formed special committees to evaluate a potential merger, with Musk saying there is “a lot of merit” to combining the companies as their AI, robotics, chip and connectivity efforts increasingly overlap. No deal terms have been agreed and shareholders would ultimately need to approve any transaction. SpaceX $SPCX ( ▼ 0.12% ) also reported revenue up 161% YoY to $14.6B, driven by surging AI/data-center demand, while Musk said annual recurring revenue could reach $500B–$1T by the end of 2027.
Super Micro Computer $SMCI ( ▲ 1.15% ) reported preliminary Q1 revenue of $18.5B–$19.5B vs. ~$15B expected, well above prior guidance, as strong AI server and data-center demand continued to drive growth. Gross margin guidance also improved to 12%–12.5% on a better customer and product mix. Full Q1 earnings are due in early November.
GE Aerospace $GE ( ▼ 3.67% ) beat on revenue at $13.3B vs. $12.9B, driven by strong commercial engine and services demand as airlines continued spending on repairs, spare parts and new engine deliveries. Orders jumped 49% YoY, but concerns persisted that higher fuel prices could eventually slow flying activity and aftermarket growth, while the 777X ramp is expected to pressure profit next year. Mgmt. raised 2026 sales growth guidance, though the outlook implied softer than expected Q4 earnings.
General Motors $GM ( ▼ 6.84% ) beat on revenue at $50.0B vs. $48.7B, helped by strong pickup truck sales and fewer loss-making EV sales. Despite the beat, shares fell as rising commodity and logistics costs, along with lower expected truck deliveries in Q4, pressured the outlook. Mgmt. narrowed its 2026 profit guidance and announced a new $20B buyback.
Capital One $COF ( ▲ 0.87% ) beat on revenue at $16.34B vs. $16.27B, while EPS also came in well above expectations. Results were helped by stronger net interest income, better credit performance and lower than expected provisions, while the Discover integration has already generated about $1.8B of annualized synergies. Legacy Discover card balances are still shrinking, but mgmt. expects growth to return after the integration progresses and plans to keep investing in marketing, technology and the Discover network.
3M $MMM ( ▲ 5.78% ) come in roughly in line on revenue at $6.6B, while margins improved on cost controls, pricing and stronger industrial demand. Growth in data centers and semiconductors helped offset softer auto and consumer electronics demand, and the company expanded its Amazon partnership for optical connectivity products tied to AI infrastructure. Mgmt. raised 2026 EPS guidance to $9.10–$9.15.
United Airlines $UAL ( ▲ 2.27% ) slightly missed on revenue at $17.88B vs. $17.9B, as strong pricing and continued travel demand were offset by sharply higher fuel costs. Revenue still grew 17% YoY as passengers kept booking despite higher fares, but fuel expense jumped 62%, squeezing margins and earnings. Mgmt. cut its 2026 profit outlook and guided Q4 EPS well below expectations as it expects fuel prices to rise further.
Northrop Grumman $NOC ( ▲ 4.57% ) was roughly in line on revenue at $11.1B, while EPS beat as rising global defense spending drove stronger demand across aircraft, missiles and defense systems. Governments are replenishing military stockpiles and ramping spending amid ongoing conflicts, helping push orders and backlog to a record ~$110B. Mgmt. raised 2026 EPS guidance.
On The Move 📈 📉
Equifax $EFX ( ▲ 11.33% ) soared after beating its Q3 earnings guidance despite mortgage weakness, as diversified-markets growth and AI-driven cost savings lifted profitability.
BlackBerry $BB ( ▲ 8.7% ) rose after its QNX royalty backlog topped $1.2Bn as automakers adopted its software for next-generation vehicle computers.
Hasbro $HAS ( ▲ 11.2% ) jumped after a strong Q3 driven by a 31% rise in Wizards of the Coast revenue. Hasbro also raised its revenue and EBITDA guidance.
DaVita $DVA ( ▼ 6.23% ) fell after the Trump administration unveiled a kidney care plan designed to increase competition and shift focus toward early preventive treatment.
Lionsgate $LION ( ▲ 14.41% ) popped after Legendary Entertainment reportedly submitted a takeover offer, reviving on-and-off talks that began last year.
Sea $SE ( ▼ 9.09% ) slipped after CEO Forrest Li said in an internal memo that the company plans to launch an AI cloud business and is considering an IPO for Monee, its fast-growing digital finance unit.
IPO Roundup 📍
A draft Anthropic S-1 reviewed by the WSJ had some interesting takeaways:
H1 2026 revenue hit $16.3Bn, up from $1.1Bn a year earlier.
It posted an $80.7Bn net loss, $72Bn of which came from accounting charges tied to its convertible notes.
Computing commitments top $600B and could reach $750B.
About one-fifth of revenue came from just two customers.
KNDS plans to go public as soon as markets allow, ideally before France’s April 2027 election, its CEO said. Germany is also in talks to buy a 50% stake in the tankmaker.
ZeroHedge took a look at recent delayed data center listings below:
Together With Constellation AI
As frontier intelligence becomes a commodity, a firm's knowledge becomes its most valuable competitive advantage.
Constellation's Lab, a team of former investors, engineers, and academics, works alongside your firm to capture its judgment and turn it into local, firm-specific models. Your data stays sovereign, inference costs come down, and your knowledge compounds into an asset only you own.
The best firms are already moving. Read our whitepaper on why firm-owned intelligence is the future.
Today’s Headlines 📖🍿
September US pending home sales have fallen 7.3% to a record low as 30-year mortgage rates climbed from 6.71% at the start of September to 7.4% this month.
Meanwhile, Treasury Secretary Scott Bessent said the administration will not release Fannie Mae and Freddie Mac from conservatorship, expecting to tackle the ownership structure “the next year, the year after.”
Citadel’s Ken Griffin says investors are “almost certainly” in an AI bubble. “All of Corporate America is looking at their bills from Anthropic and OpenAI and going, ‘Okay, we need to think about how to make sure we’re getting productivity out of this,’” he said.
Blue Owl might be for sale as its stock remains down 67% from its January 2025 high after clients asked to withdraw 17% of its largest private credit fund last quarter.
Optimum Communications is nearing a deal to turn the keys over to lenders such as Apollo, Oaktree, and JP Morgan. Formerly known as Altice USA, the broadband giant has struggled to manage a $26B debt load amid cord-cutting pressures.
Blackstone has implemented an AI “chief investment officer” trained on more than 14 years of internal deal memos and committee debates that gives its investment committee a second memo on every deal.
Goldman and Evercore are pitching evergreen continuation funds that would let private equity firms hold assets for 10-15 years.
New PE firm Aldaron, co-founded by Palantir and Carlyle veterans, closed its debut fund at about $885mm. Its “transformation equity” strategy uses AI to grow portfolio companies, and its first acquisition, Oak Point Partners, expects revenue to rise as much as fivefold in four to five years.
Hedge funds are dumping tech at the fastest pace in a decade. Their net leverage fell to a one-year low of 48.6%. The Nasdaq 100 fell 5.5% last week, its worst drop since April 2025.
Carlyle says corporate credit looks to be the next asset class to reprice. It sees AAA CLO tranches as an attractive alternative to Treasuries, yielding about 120 bps over SOFR, nearly as much as the 10-year, while carrying far less volatility.
DeepSeek open-sourced the software it uses to run its AI models more cheaply. The tool, called DeepInfer, aims to lower compute costs and energy use.
The NFL is partnering with General Atlantic on a new sports investing venture. The league’s investment arm, 32 Equity, has backed 46 businesses since 2013, including Fanatics and Clear.
HY managers are favoring BB debt after the selloff pushed valuations to their cheapest since March, even as CCC yields have surged above 15% and three-year cumulative default rates run 4.17% for BB versus 45.67% for CCC.
PIMCO says software loans have “improved optics but unchanged economics.” They still trade about 8 cents on the dollar below non-software peers. About $62Bn of them mature in 2028 and 2029.
WestJet’s bonds have fallen to their lowest level since issuance in June, with the 8% 2031 bond falling from 95 cents on the dollar in early October to 85 cents.
French alternative manager Tikehau Capital is seeking a strategic investor and has held talks about selling a stake in itself as shares are down more than 20% since its 2017 listing.
Thames Water has offered Pimco a compromise to win its backing for £2.4Bn ($3.2Bn) of new rescue debt, with a creditor vote set for October 29.
Waymo plans to quintuple its fleet from 4,000 cars to 20,000 by the end of next year, using the $5Bn it borrowed from private credit lenders without an Alphabet guarantee.
Lindt & Sprüngli’s board replaced CEO Adalbert Lechner with former CEO Dieter Weisskopf on an interim basis after two guidance cuts this year.
Find fall fares that fit
Cool air, colorful leaves or a whole new city skyline: There's still time to book your fall escape with Alaska Airlines. Watch the aspens turn golden in Denver, catch a set on Broadway in Nashville, or trade sweaters for sunshine in Palm Springs.
Subject to availability. Terms and conditions apply.
M&A Transactions💭
Salesforce (NYS: CRM) has announced a definitive agreement to acquire Braze (NAS: BRZE), a customer engagement platform that powers customer-centric interactions between consumers and brands, for approximately $5.66B in enterprise value. Under the agreement, holders of Braze Class A common stock will receive $47.50 per share in cash.
DIAGRAM, developer of digital agriculture technology designed to drive social, economic, and environmental sustainability across the agri-food value chain, has entered into a definitive agreement to be acquired by Bf International Best Fields Best Food for EUR 221.0M.
Cogknit Semantics, operator of a product innovation laboratory intended to build technology products using speech, computer vision, and text machine learning, reached a definitive agreement to be acquired by to be acquired by Zen Technologies for INR 1.3515B.
Trivium Packaging, manufacturer of metal packaging products intended for beverages, personal care, home care, pharmaceutical and food industries, entered into a definitive agreement to be acquired by Silgan Holdings and American Industrial Partners for an estimated $3.4B. J.P. Morgan and BMO Capital Markets advised on the sale.
Silence Therapeutics (OTCM: SLNCF), a biotechnology company focused on discovering and developing novel molecules incorporating short-interfering ribonucleic acid or siRNA, reached a definitive agreement to be acquired by Merck (ETR: MRK) for approximately $1.3B. EV/Cash Flow was 42.44x. Centerview Partners and Morgan Stanley advised on the sale.
Infinity Transportation, provider of railcar leasing services intended to address logistical and financial needs, has entered into a definitive agreement to be acquired by Ares Management through an estimated $2.9B LBO. Macquarie Capital advised on the sale.
Gentari Renewable India, provider of clean energy services intended to assist customers in reducing emissions across the energy value chain, entered into a definitive agreement to be acquired by Kohlberg Kravis Roberts through an INR 6,000 crores LBO.
Corex Resources, producer of light oil and natural gas intended to serve the energy sector, reached a definitive agreement to be acquired by Saturn Oil & Gas for CAD $302.0M.
Codifrance, distributor of food products intended to supply local convenience stores and independent grocers, has reached a definitive agreement to be acquired by Carrefour (PPR: CA) for EUR 152.0M.
Cleanaway Waste Management (ASX: CWY), Australia's largest waste management business with a national footprint in the collection and disposal of waste, has entered into a definitive agreement to be acquired by EQT through an estimated AUD 9.4B public-to-private LBO. EV/EBITDA was 13.3x and EV/Revenue was 2.26x. Macquarie Capital advised on the sale.
Atkore, a manufacturer of Electrical products for the non-residential construction and renovation markets, as well as residential markets, and Safety & Infrastructure products for the construction and industrial markets, was acquired by Prysmian (MIL: PRY) for $3.8B. EV/Revenue was 1.3x. Citigroup and J.P. Morgan advised on the sale.
Agip Oil Ecuador, provider of hydrocarbon exploration and exploitation services intended for the energy sector, has entered into a definitive agreement to be acquired by ENAP Sipetrol Argentina, via its financial sponsor Xtellus Capital Partners, through a $207.0M LBO.
Agile Defense, provider of digital transformation services intended to serve the Department of Defense and other federal customers, reached a definitive agreement to be acquired by Maximus (NYS:MMS) for $660.0M. The agreement has a cash purchase price of $660.0M payable upon closing and subject to certain adjustments, with potential additional contingent consideration tied to achieving certain performance objectives. Piper Sandler advised on the sale.
Mitsubishi Electric Mobility, manufacturer of automotive electrical equipment based in Tokyo, Japan, reached a definitive agreement to be acquired by Foxconn Technology (TAI: 2354) for approximately JPY 115.0B.
An undisclosed investor reached a definitive agreement to acquire The China Business of Accenture (NYS: ACN) for approximately $1.5B. J.P. Morgan advised on the sale.
Trumid, operator of a financial technology platform intended to modernize fixed income trading, reached a definitive agreement to be acquired by Tradeweb Markets for $1.97B. Goldman Sachs advised on the sale.
NCBA Group (NAI: NCBA), provide retail, corporate, and digital banking, brokerage, bancassurance, insurance, and investment banking services, was acquired by Nedbank Group (JSE: NED) for an estimated ZAR 13.9B. EV/Net Income was 6.75x and EV/Revenue was 2.17x.
Malabar Resources, producer of metallurgical coal and renewable energy intended for industrial and utility applications, reached a definitive agreement to be acquired by New Hope (ASX:NHC) for an estimated AUD 1.33B. The transaction values the company at an estimated AUD 1.8B.
ShaMaran Petroleum (OSL: SNM), an oil development and exploration company, reached a definitive agreement to be acquired by Gulf Keystone Petroleum (LON: GKP) for approximately $601.0M. EV/EBITDA was 6.12x and EV/Revenue was 4.31x.
Huayi Microelectronics, manufacturer of semiconductor power devices intended for electric vehicles, industrial control, automotive, home appliances, and consumer electronics industries, was acquired by HT-Tech (SHE: 002185) for CNY 3.0B.
Private Placement Transactions💭
Town, developer of an artificial intelligence (AI)-powered digital assistant platform designed to automate knowledge work tasks across existing software tools, raised $108.0M of Series B venture funding in a deal led by Forerunner Ventures and Menlo Ventures.
Tenstorrent, developer of artificial intelligence processor architectures and open-source software platforms designed to accelerate deep learning workloads, raised $1.5B of Series E venture funding in a deal led by Trace Capital and Innovation X Advisors, putting the company's pre-money valuation at an estimated $4.7B.
Salmon, operator of a digital banking platform intended to provide consumer lending and financial services through mobile access, raised $140.0M of venture funding through a combination of debt and equity. $90.0M from Spice Expeditions, Washington University in St. Louis, and Moore Strategic Ventures. The transaction was supported by $50.0M of debt financing.
Nouscom, developer of an immunotherapy platform designed to develop engineered viral vector vaccines for the treatment of cancer, raised EUR 120.0M of Series D venture funding in a deal co-led by M Ventures and Revelation Partners.
FAIR Intelligent, manufacturer of collaborative robots designed for human-machine collaboration applications, raised nearly CNY 1.0B in series C+ and Series D venture funding led by Dragonball Capital and Meituan.
Neolix Technologies, manufacturer of autonomous delivery vehicles intended to automate last-mile logistics, raised nearly $400.0M of Series E venture funding in a deal led by Boyu Capital.
AaltoSemi, manufacturer of integrated circuit packaging substrates designed for semiconductor connectivity, raised nearly CNY 1.5B of Series B venture funding from Victory Giant Technology, Rockchip, and SummitView Capital.
Horizon3, developer of a security automation platform designed to perform autonomous penetration testing and operational security assessments, raised $250.0M of Series E venture funding in a deal led by NightDragon and New Enterprise Associates, putting the company's pre-money valuation at $1.75B.
Noteworthy Chart 🧭
Nscale is under more scrutiny as it looks to go public; especially since a large amount of its data center centers are not active.
Housekeeping Items:
Our Weekly Poll:
How are we doing?
Finance Jobs: Looking for a job in Finance? Join Buyside Hub to access the Job Board for free.
Join beehiiv: Looking to start your own newsletter? Join beehiiv through us and you’ll get 30 days free and 3 months of a 20% discount.
Join our Referral Program☕
Enjoyed the newsletter? Send it to a friend 🤝
Obviously, none of this constitutes financial or investment advice. Today’s Paid Partner is Constellation.