Nasdaq 100 Plunges and Intel Falls Most in 40 Years | Bloomberg Technology

Nasdaq 100 Correction

• The Nasdaq 100 has plunged into correction territory, marking the fourth straight week of declines.
• This decline mirrors the drop seen in April.

Intel's Grim Forecast

• Intel shares have fallen by the most since 1982, as the company announced a grim forecast and job cuts.
• The company's revenue was poor, with gross margins falling significantly due to rising chip costs.

Intel's Actions to Salvage the Situation

• Intel has taken several actions to try to salvage the situation, including suspending their dividend, doubling down on partnerships, and selling off some of their fabs.
• Despite the challenges, Intel's cost cuts, dividend suspension, and capex reductions will generate $40 billion in incremental cash over the next couple of years, ensuring the company's survival. However, the quality of that survival remains uncertain.

Intel's Challenges in the AI Market

• The shift in spending patterns from CPUs to GPUs and other accelerators, driven by the AI boom, has put Intel in a difficult position.
• Intel's AI and accelerator play is minimal, with only $500 million in revenue expected this year, compared to AMD's $4.5 billion and Nvidia's potential $100 billion in data center revenue.

Intel's Data Center and Mobileye Performance

• Data center demand is showing signs of improvement, but Intel is still losing market share, and Gaudy is not enough to offset this.
• Mobileye, Intel's autonomous driving subsidiary, slashed its guidance for the rest of the year, indicating a decline in revenue.

Amazon's AI Investments

• Amazon's stock is down more than 11% because they announced they will be spending heavily on artificial intelligence, which will impact profits.
• Analyst Poonam Goyal believes that the investments in AI will pay off in the long term, but the market was surprised by the heavy spending.

Amazon's Focus on AWS

• While Amazon's overall revenue is growing, the focus is on the high operating margin of their AWS (Amazon Web Services) segment.
• AWS currently contributes 60% of Amazon's total revenue and is expected to grow further, driving margin expansion.

Apple's Earnings and AI Focus

• Apple's focus on artificial intelligence, specifically Apple Intelligence, is seen as a driver for future iPhone upgrades.
• Apple's stock is up because they beat expectations and grew revenue, returning to revenue growth after declining last quarter.

Apple's China Performance

• Apple's sales in Greater China declined by 6%, but on a constant currency basis, the decline would have been 3%.
• Apple's growth in China has slowed, requiring them to address currency headwinds and contextualize their sales figures.

Apple's iPhone Sales and the Osborne Effect

• Apple's strong iPhone sales indicate that consumers are heavily reliant on Apple devices, even if they could potentially delay purchases.
• Gene Munster, Managing Partner of Deepwater Asset Management, discussed the Osborne Effect, a phenomenon where consumers delay purchases of existing products due to anticipation of upcoming releases. He argued that Apple is bucking this trend by achieving consistent revenue growth despite the anticipation of new iPhone releases.

Apple's Services Segment

• Gene Munster, a partner at Deepwater Asset Management, discussed Apple's recent earnings report, highlighting the strong performance of its services segment despite concerns about regulation.
• Munster emphasized that services growth remained robust, exceeding expectations and demonstrating the strength of Apple's product ecosystem.

Twilio's Earnings and Growth Strategy

• Twilio CEO Khozema Shipchandler discusses the company's earnings and the changes he has made to improve growth trajectory.
• Shipchandler emphasizes the company's focus on operating discipline, innovation, and combining communications with contextual data and AI to drive personalized experiences for customers.

Snap's Earnings and Advertising Challenges

• Jasmine Enberg, a principal analyst at eMarketer, analyzed Snap's recent earnings report, noting that the company's revenue missed estimates, indicating a setback in its efforts to revamp its advertising business.
• Enberg acknowledged some positive signs, including growth in active advertisers and diversification of revenue streams with Snapchat Plus, but emphasized that brand advertising remains a significant headwind for Snap.

Doordash's Strong Outlook

• Doordash is a rare bright spot in the market with a strong outlook.
• The company reported strong earnings and a positive outlook for the fiscal third quarter.

Doordash's Expansion Beyond Food Delivery

• Doordash is redefining convenience by expanding its platform beyond food delivery.
• The company now offers grocery, convenience, and retail products in over 30 countries.

Doordash's Growth in New Verticals

• Doordash is seeing strong growth in grocery and retail.
• This growth is not just in the U.S., but also in many international markets.

Nintendo's Profit Decline

• Nintendo's profits have fallen by 71% in the three months ending June.
• This decline is attributed to consumers holding off on purchases as they await the release of a new flagship game console.

Ant Group's Growth in the Philippines

• Billionaire Jack Ma's group-backed fintech company, Ant Group, has surpassed 90 million users in the Philippines.
• This achievement values the company's stake at $1.2 billion.

Coinbase's Revenue Diversification

• Coinbase CFO Alicia Haas discusses the company's strong growth in subscriptions and services.
• She emphasizes the company's commitment to revenue diversification and achieving an all-time high in subscriptions.

Sarah Brass Systems' IPO

• Sarah Brass Systems, a company specializing in AI-optimized chips, has confidentially filed for an IPO, aiming for a listing in the second half of the year.
• The IPO is expected to occur in early October, following a period of IPO activity after Labor Day.

Sarah Brass's AI-Optimized Chips

• Sarah Brass, a company that produces chips, is at the forefront of AI development.
• Their chips are significantly larger and more powerful than traditional chips, enabling them to handle massive amounts of data.

Concerns About AI Infrastructure

• There are concerns about the significant investment required in infrastructure to support the development and implementation of AI.
• This investment is a hot topic, with Amazon guiding for a significant increase in the second half of 2024.

Market Downturn and New York City

• Despite the market downturn, the week has been positive for New York City.
• This is likely due to the city's resilience and its position as a global financial hub.