Mid-Morning Look

Thursday, July 31, 2025

U.S. stocks seeing “lift off” this morning with record highs for the Nasdaq and S&P 500, getting a boost from stellar earnings results/guides from META and MSFT in big tech, juicing the AI trade on Wall Street ahead of AAPL, AMZN earnings results tonight. Trade talk also helping keep trader sentiment strong after the U.S. signed another trade deal overnight, this time with South Korea, joining Japan, EU and many other countries in recent days, while tariffs were increased for Brazil and India. US Treasury yields fall with the 10-year last down 4.2 bps at 4.336%; two-year yields down at 3.928%, while the dollar was strong early (DXY more than 300bps move over the last week). Economic data also showing ongoing strength in the US economy, with a deluge of data today including improving jobless claims (ahead of nonfarm payrolls tomorrow and after better ADP data yesterday), a stronger Chicago PMI reading, though PCE inflation data crept up from the prior month but was mostly in-line with guidance. The earnings barrage overnight/this morning exactly that, covering some of the biggest movers down below. Smallcap stocks lagging as focus turns back to large caps on better earnings, putting the recent “meme” fad behind us. The recent economic data not giving investors hopes for rate cuts after yesterday’s FOMC meeting with inflation staying well above 2% Fed target, though other segments remain strong. The Fed passed on a July cut yesterday, while futures markets showing lessened chances of a September rate cut (not 37% chance).

• Weekly Jobless Claims climbed to 218,000 Jul 26 week (consensus 224,000) from 217,000 prior week (previous 217,000); the 4-week moving average fell to 221,000 Jul 26 week from 224,500 prior week (previous 224,500); the insured unemployment Rate unchanged at 1.3% Jul 19 week from 1.3% prior week; continued claims unchanged at 1.946M vs. est. 1.955M.
• June personal saving rate 4.5% vs May 4.5%; June personal income +0.3% (consensus +0.2%) vs May -0.4% and June Personal Spending +0.3% (consensus +0.4%) vs May unchanged (prev -0.1%); June real consumer spending +0.1% vs May -0.2%.
• June overall PCE price index +0.3%, in-line with estimates and above May +0.2%, while headline June y/y PCE price index +2.6% (consensus +2.5%) vs May +2.4%. June core PCE price index +0.3% m/m vs. May +0.2% and US core PCE on y/y basis rose +2.8% (consensus +2.7%) and vs May +2.8% (prev +2.7%).
• U.S. Q2 employment cost index +0.9% (consensus +0.8%) vs Q1 +0.9% (prev +0.9%); U.S. Q2 wages/salaries +1.0% vs Q1 +0.8% (prev +0.8%); U.S. Q2 benefit costs +0.7% vs Q1 +1.2% (prev +1.2%).

• Semiconductors lagging on results; ARM posted in-line F1Q (Jun) results, as royalties miss, while licensing beat. F2Q (Sep) guidance is mixed, as revs were in line (royalties lower, while licensing is higher), while EPS is below. FORM shares slide on guidance; Q2 non-GAAP EPS $0.27 misses the $0.30 estimate; Q2 revs $195.8M vs. est. $190.17M; sees Q3 EPS $0.25 plus/minus 4c vs. est. $0.30 and revs $200M, plus/minus $5M vs. est. $199.46M. LRCX weighs on equipment names after guidance/commentary (follows Q1 beat); QCOM shares fall; posted solid FQ3 results that beat expectations and guided FQ4 in line with expectations; Q3 results reflect stronger QCT auto and IoT revs, which offset weaker smartphone revs that QCOM attributed to weaker mix in the quarter; looking into FQ4, QCT handsets are expected to grow 5% q/q despite the loss of iPhone 17 market share. WDC reported JunQ strong at $2.61B, while guiding the SepQ to $2.70B/$1.54 (above est. $2.55B/$1.42) with 41.5% GM (cons. 40.3%) as pricing remains stable with strong demand
• In Telco: ERIC has strengthened its partnership with Softbank Corp. through a new commercial agreement covering 4G and 5G network products and solutions. VOD downgraded to Sell from Neutral at Goldman Sachs on reduced confidence in the company’s organic growth and returns outlook with limited upside from mobile consolidation. SATS EchoStar is being pushed by the FCC to sell some of its wireless spectrum to settle a dispute over whether it is utilizing the airwaves quickly enough, Bloomberg reported. In Cable, CMCSA a much better print than rival CHTR last week, as Q2 revenue of $30.31B topped the $29.8B estimate on better EPS $1.25 (vs. est. $1.18) saying its May debut of their “Epic Universe” theme park in Central Florida key in driving quarterly results; also lost 226,000 broadband customers in Q2, smaller than the expected 255,000 loss (CHTR posted wider losses last week); SIRI loses fewer subscribers in second quarter on podcast strength.
• In Chemicals: FMC Q2 top/bottom line beat while backs FY25 adjusted EPS view $3.26-$3.70 (est. $3.43) and sees FY25 revenue $4.08B-$4.28B, vs. est. $4.2B; Keybanc noted Chemical Market Analytics (CMA) released its monthly chlor-alkali report, as the caustic soda index fell $15/ton m/m, ahead of CMA’s forecast of a $5/ton decline, a disappointment (shares of OLN, WLK greatest exposure); TROX shares fall as weak coatings market/fierce competitive pressures (from Western/Chinese producers) resulted in a significant drop in TROX’s volumes, which along with high cost inventory and fixed cost absorption drove EBITDA down 43% Y/Y and well below expectations.

• CCRD +11%; as EEFT announced it will acquire CCRD in a stock-for-stock merger transaction valued at approximately $248M, or $30 per share of CoreCard common stock.
• CGNX +24%; reported adj. 2Q25 EPS of $0.25, which beat consensus of $0.24 and our estimate of $0.23. Revenues of $249M increased 4.1% y/y (up ~3% on a constant currency basis) and were above consensus of $246M and in line with our estimate of $249M. Revenue was modestly above the midpoint of the Company’s prior guidance.
• CMCSA +3%; better print than rival CHTR last week, as Q2 revenue of $30.31B topped the $29.8B estimate on better EPS $1.25 (vs. est. $1.18) saying its May debut of their “Epic Universe” theme park in Central Florida key in driving quarterly results; also lost 226,000 broadband customers in Q2.
• CRWV +12%; on track to snap 6-day losing streak, rising after being upgraded to Buy at Citigroup and removing its 90-day downside catalyst watch with shares down -45% from the peak and -32% since the M&A announcement (vs. AI peers +8%), while adding that existing multi-year contracts with MSFT, OpenAI and others will drive revenue growth.
• CVNA +23%; after reporting very strong Q225 results as revenue and EBITDA came in 6% and 9% above consensus, respectively; Q2 beat as EPS $1.28 vs est. $1.11, adj EBITDA $601Mm vs est. $551.9Mm on revs $4.84B vs est. $4.589B, retail units sold 143,280; sees Q3 sequential increase in retail units sold.
• EBAY +13%; after reported 2Q results with GMV and PF EPS above Street estimates by 4% and 6%, respectively; 2Q GMV growth came in at +4% y/y ex-FX (vs. -1-2% guide), driven by strength in focus categories including cards and collectibles; sees Q3 ex-FX GMV growth to 3-5% y/y and signaled that the company is tracking towards the higher end of the FY25E guide.
• PI +29%; shares rise on results; impressive Q2 report and provided better-than-expected guidance for Q3. Revenues declined 4% y/o/y, above Street expectations of an 8.5% decline.
• RBLX +14%; after results; raising FY25 bookings to $5.87-$5.97B well above prior view of $5.29-$5.36B; forecast Q3 bookings between $1.59B-$1.64B vs. estimate $1.35B which followed Q2 bookings beat ($1.44B vs. $1.24B); Q2 average daily active users grew 41% to 111.8 million, while hours engaged jumped 58% to 27.4 billion.

• ARM -11%; posted in-line F1Q (Jun) results, as royalties miss, while licensing beat. F2Q (Sep) guidance is mixed, as revs were in line (royalties lower, while licensing is higher), while EPS is below. F1Q +25% y/y royalty growth was driven by Armv9, CSS, which drove outsized handset growth vs. LSD% unit growth.
• BAX -18%; shares slump in MedTech as Q2 EPS/sales miss estimates and guides Q3 profit below consensus.
• CFLT -31%; posted Q2 beat, but decelerating revs q/q, while announced mixed 3Q guidance amidst continued spend optimization from large customers, along with a significant reduction in spend by a large AI-native company.
• IP -4%; shares fell after missing Q2 profit estimates on higher input costs with adj EPS $0.20 below the $0.41 estimate saying margins were affected due to higher costs and muted demand in Europe (did post Q2 sales beat).
• MGM -6%; Q2 revs $4.4B vs. est. $4.32B; Q2 adj Ebitda $648M; China unit reported a 9% revenue growth at $1.11 billion; Revenue from its regional operations segment, which encompasses casinos in U.S. markets outside Las Vegas, also rose 4% to $964.6 million; Q2 Room Revenue: $767M -> $735M (a 4% drop).
• SHAK -17%; shares slumped Q2 revenue rises 12.6% yr/yr, beating analyst expectations, and adjusted EPS for Q2 beats consensus, reflecting strong operational performance, but did not provide any guidance weighing on sentiment.
• TROX -25%; as weak coatings market/fierce competitive pressures (from Western/Chinese producers) resulted in a significant drop in TROX’s volumes, which along with high-cost inventory and fixed cost absorption drove EBITDA down 43% Y/Y and well below expectations.

Syndicate:

• FIG (Figma) 36.94M share IPO, priced at $33.00 (range was $30 – $32 (up from $25 – $28)
• SI (Shoulder Innovations) 5M share IPO, priced at $15.00 (range was $19 – $21)
• PRME 38M share Spot Secondary, priced at $3.30
• DUOT 6.67M share Spot Secondary, priced at $6.00
• Deals to be priced today
• DYAI 6.06M share Spot Secondary
• CTW (CTW Cayman) 3M share IPO, range $5 – $6