Asian Hedge Fund Manager, Long Short Equity, Macro

David Mudd

Cross Asset Strategy

<ul>
<li>Anthropic's and OpenAI's annualized revenue run rates (ARRs) are being portrayed as a viable metric for investors as their IPOs approach, although the numbers are a "black box".</li>
<li>The most significant distortion in both companies' ARR figures is the circular financing loop: the hyperscalers who invest equity capital into Anthropic and OpenAI then route traffic back to them.</li>
<li>Investors should treat ARR with skepticism and not as a reliable basis for valuation. It's a directional indicator of growth momentum from a low revenue base that obfuscates actual performance.</li>
</ul>


Anthropic's and OpenAI's annualized revenue run rates (ARRs) are being portrayed as a viable metric for investors as their IPOs approach, although the numbers are a "black box".
The most significant distortion in both companies' ARR figures is the circular financing loop: the hyperscalers who invest equity capital into Anthropic and OpenAI then route traffic back to them.
Investors should treat ARR with skepticism and not as a reliable basis for valuation. It's a directional indicator of growth momentum from a low revenue base that obfuscates actual performance.


ANTHROPIC & OPENAI - ARR: Every Bubble Has a Gimmick

<ul>
<li>DC company share prices are rolling over, foreshadowing increasing pressure on their hyperscaler customers.  Since the July swoon in semiconductor stocks, the DC sector has underperformed both hyperscalers and semiconductors.</li>
<li>DC players face strong headwinds on multiple fronts, including high leverage/circular financing, supply chain delays, public opposition, and questions about aggressive forecasts of future compute demand.</li>
<li>Leverage is the most prominent risk in the DC sector, with questions looming about completion dates and customers' ability to meet their contracted offtake agreements.</li>
</ul>


DC company share prices are rolling over, foreshadowing increasing pressure on their hyperscaler customers.  Since the July swoon in semiconductor stocks, the DC sector has underperformed both hyperscalers and semiconductors.
DC players face strong headwinds on multiple fronts, including high leverage/circular financing, supply chain delays, public opposition, and questions about aggressive forecasts of future compute demand.
Leverage is the most prominent risk in the DC sector, with questions looming about completion dates and customers' ability to meet their contracted offtake agreements.


DATA CENTER SECTOR: From the Tip of the Spear to Canary in the Coal Mine

Research from Water Tower Research, Water Tower Research

Water Tower Research

Research from Water Tower Research

Water Tower Research is a leading equity research firm that provides research on micro, small and mid cap companies.

Water Tower Research was founded by Wall Street veterans after witnessing a fundamental shift in the investment research industry with the result being a declining knowledge base among investors, a lack of awareness and a shrinking pool of fundamental research being conducted on companies across the small-cap and micro-cap spectrum. The same issues are now increasingly occurring in the mid-cap space. This sea change within the investment community is impacting not only the companies themselves but also current shareholders and potential investors. With significantly less active sell-side sponsorship by Wall Street, a substantial information gap has developed between companies and various constituents in the financial community. The net result is fewer channels for insight and information to flow between companies and investors.

Equity Research Firm

Thematic (Sector/Industry)

<div><ul><li>Our industry cash flow forecasts improved modestly, driven by revenue, but the buildout still burns cash through the end of the decade.</li><li>Adjusted 2030 free cash flow is -$59B, against -$106B in the version we published on September 21.</li><li>Revenue covers 0.94x of 2030 capex, up from 0.89x, and 0.77x on a cumulative basis, up from 0.71x.</li></ul></div>

Our industry cash flow forecasts improved modestly, driven by revenue, but the buildout still burns cash through the end of the decade.Adjusted 2030 free cash flow is -$59B, against -$106B in the version we published on September 21.Revenue covers 0.94x of 2030 capex, up from 0.89x, and 0.77x on a cumulative basis, up from 0.71x.

AI Flow Industry Model : Tracking the Capex Flood and Revenue Streams - 6 October 2026

Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

Equity Bottom-Up

<ul><li>Amazon has quietly transformed advertising into one of its most important businesses, generating roughly $68 billion in ad revenue in 2025 and establishing itself as the world’s third-largest digital advertising platform behind Google and Meta.</li><li>That growth story is now colliding with regulatory scrutiny.</li><li>The Federal Trade Commission, joined by more than 20 state attorneys general, has sued Amazon, alleging that the company secretly altered parts of its advertising auction system in ways that caused advertisers more than $20 billion in harm.</li></ul>

Amazon has quietly transformed advertising into one of its most important businesses, generating roughly $68 billion in ad revenue in 2025 and establishing itself as the world’s third-largest digital advertising platform behind Google and Meta.That growth story is now colliding with regulatory scrutiny.The Federal Trade Commission, joined by more than 20 state attorneys general, has sued Amazon, alleging that the company secretly altered parts of its advertising auction system in ways that caused advertisers more than $20 billion in harm.

Amazon.com Inc - Amazon’s $68 Billion Ad Machine Faces Washington’s Biggest Test!

Pan-Asia Tactical Market Calls (Quant-Driven), MRM Research

Nico Rosti

Pan-Asia Tactical Market Calls (Quant-Driven)

MRM Research

Quantitative Research

Equity Derivatives

<ul>
<li>57% of Alexa AI users purchased products they previously did not know existed, suggesting agentic AI can discover customer needs and generate new purchase opportunities. </li>
<li>
Amazon is betting heavily on this new economics, expecting to generate significant future monetization. The stock's rally could go considerably higher according to our model.</li>
<li>
AI is becoming revenue-generating infrastructure: AWS revenue grew 37% to $42B, showing Amazon’s enormous AI investments can become productive assets that generate substantial new revenue rather than simply increase costs.</li>
</ul>


57% of Alexa AI users purchased products they previously did not know existed, suggesting agentic AI can discover customer needs and generate new purchase opportunities. 

Amazon is betting heavily on this new economics, expecting to generate significant future monetization. The stock's rally could go considerably higher according to our model.

AI is becoming revenue-generating infrastructure: AWS revenue grew 37% to $42B, showing Amazon’s enormous AI investments can become productive assets that generate substantial new revenue rather than simply increase costs.


AMZN US Tactical Entry Point As the Economics of AI-Driven Demand Emerge

United States

Amazon.com, Inc. is an online retailer that offers a wide range of products. The Company's products include books, music, videotapes, computers, electronics, home and garden, and numerous other products.  Amazon offers personalized shopping services, Web-based credit card payment, and direct shipping to customers.

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Amazon (AMZN US)

ANTHROPIC & OPENAI - ARR: Every Bubble Has a Gimmick

Anthropic's and OpenAI's annualized revenue run rates (ARRs) are being portrayed as a viable metric for investors as their IPOs approach, although...

David Mudd

DATA CENTER SECTOR: From the Tip of the Spear to Canary in the Coal Mine

The sudden plunge in demand for an Nvidia-backed data center company’s initial public offering is revealing fresh cracks in the AI funding boom....

David Mudd

AI Flow Industry Model : Tracking the Capex Flood and Revenue Streams - 6 October 2026

Our industry cash flow forecasts improved modestly, driven by revenue, but the buildout still burns cash through the end of the decade.

Water Tower Research

Amazon.com Inc - Amazon’s $68 Billion Ad Machine Faces Washington’s Biggest Test!

Amazon has quietly transformed advertising into one of its most important businesses, generating roughly $68 billion in ad revenue in 2025 and...

Baptista Research

AMZN US Tactical Entry Point As the Economics of AI-Driven Demand Emerge

Amazon is entering a new AI-driven demand cycle. Our model flags a tactical entry opportunity as AWS monetizes and agentic AI starts creating...

Nico Rosti

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