Super Micro Computer DOJ probe, streaming wars: Market Domination
September 26, 2024
On today's episode of Market Domination, Hosts Julie Hyman and Josh Lipton break down some of the biggest stories from the trading day, from fresh labor market data to the state of the streaming wars. Initial jobless claims (the number of people filing for new unemployment applications) hit a four-month low, according to the latest Labor Department data. Michael Darda, Roth Capital Partners chief economist and macro strategist tells Yahoo Finance, “If you look at first-time claims in isolation, it really doesn't look like there's anything wrong with this labor market whatsoever. Unfortunately, that is not the whole story.” The latest labor market differential report, which shows the difference between the share of consumers who view jobs as “plentiful” compared to those who view jobs as “hard to get,” fell to its lowest reading since March 2021. Darda says the recent decline in the labor market differential “would be consistent with the unemployment rate continuing to creep [up], eventually towards 5% and that would throw us back into the recession alarm bell camp.” Shares of Super Micro Computer (SMCI) are plummeting after a report from the Wall Street Journal revealed that the Department of Justice is investigating the company over alleged accounting irregularities. On the other hand, chip stocks like Nvidia (NVDA), Advanced Micro Devices (AMD), and Intel (INTC) are rising in sympathy with Micron (MU) after it issued strong first quarter guidance. A new report from Bain & Company forecasts substantial growth in the AI product market in the coming years. The firm projects that the market for AI-related hardware and software could expand by 40-50% annually, reaching approximately $990 billion by 2027. Bain & Company global technology and cloud services practice chairman David Crawford sees three "broad pockets of growth" for AI. First, large hyperscalers building out their capabilities are generating "enormous" demand. The second pocket for growth lies in enterprise adoption. The third growth area will likely be seen in independent software vendors that build AI capabilities for their products and run them in their own data centers. As the streaming wars heat up, Macquarie US equity research senior media tech analyst Tim Nollen remains Neutral on one of the biggest players: Disney (DIS). Nollen explains that there are several areas that will "hit Disney's PNL (profit and loss) balance sheet and cash flows over the next couple of years." However, ESPN direct-to-consumer will be the biggest factor. He calls this "the largest event in the streaming landscape" since the launch of Disney+, and believes that offering ESPN direct-to-consumer will likely cause cord-cutting to accelerate. Yet, he remains Neutral on the company until there are clearer projections about the success of ESPN direct-to-consumer. This post was written by Melanie Riehl Read More...
On today’s episode of Market Domination, Hosts Julie Hyman and Josh Lipton break down some of the biggest stories from the trading day, from fresh labor market data to the state of the streaming wars.
Initial jobless claims (the number of people filing for new unemployment applications) hit a four-month low, according to the latest Labor Department data. Michael Darda, Roth Capital Partners chief economist and macro strategist tells Yahoo Finance, “If you look at first-time claims in isolation, it really doesn’t look like there’s anything wrong with this labor market whatsoever. Unfortunately, that is not the whole story.” The latest labor market differential report, which shows the difference between the share of consumers who view jobs as “plentiful” compared to those who view jobs as “hard to get,” fell to its lowest reading since March 2021. Darda says the recent decline in the labor market differential “would be consistent with the unemployment rate continuing to creep [up], eventually towards 5% and that would throw us back into the recession alarm bell camp.”
A new report from Bain & Company forecasts substantial growth in the AI product market in the coming years. The firm projects that the market for AI-related hardware and software could expand by 40-50% annually, reaching approximately $990 billion by 2027. Bain & Company global technology and cloud services practice chairman David Crawford sees three “broad pockets of growth” for AI. First, large hyperscalers building out their capabilities are generating “enormous” demand. The second pocket for growth lies in enterprise adoption. The third growth area will likely be seen in independent software vendors that build AI capabilities for their products and run them in their own data centers.
As the streaming wars heat up, Macquarie US equity research senior media tech analyst Tim Nollen remains Neutral on one of the biggest players: Disney (DIS). Nollen explains that there are several areas that will “hit Disney’s PNL (profit and loss) balance sheet and cash flows over the next couple of years.” However, ESPN direct-to-consumer will be the biggest factor. He calls this “the largest event in the streaming landscape” since the launch of Disney+, and believes that offering ESPN direct-to-consumer will likely cause cord-cutting to accelerate. Yet, he remains Neutral on the company until there are clearer projections about the success of ESPN direct-to-consumer.
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