Smartkarma Daily Briefs

• Expansion of Microsoft Research to Singapore as a regional research and development frontier
• Focus on AI research in Singapore, including foundational AI, embodied AI, and AI in health
• Importance of tapping into local talent and culture for AI development

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• American Electric Power’s (AEP) second quarter of 2025 showcased several pivotal developments and a strong financial performance, indicative of both strategic progress and growth potential.
• This summary encapsulates the earnings call highlights, offering a balanced view of the company’s current state and future prospects.
• First, AEP reported a record-breaking second quarter with operating earnings of $1.43 per share, a notable increase from the previous year’s $1.25 per share.

• Microsoft reported a strong finish to fiscal year 2025, delivering financial results that surpassed Wall Street’s expectations and underscored its continued momentum in cloud and AI-driven services.
• For the fiscal fourth quarter, Microsoft posted adjusted earnings of $3.65 per share on revenue of $76.4 billion, handily beating the consensus estimates of $3.37 per share on $73.9 billion in revenue.
• This marked a notable improvement over the prior year’s fourth-quarter figures of $2.95 per share on $64.7 billion in revenue.

• Meta Platforms delivered a standout performance in the second quarter of 2025, with shares surging 12% to $779.70, just shy of its all-time high.
• The company significantly exceeded Wall Street expectations, reporting earnings per share of $7.14 versus the expected $5.88 and revenue of $47.5 billion, up 22% year-over-year.
• This strong financial showing was driven by growth in daily users, ad impressions, and price-per-ad across Meta’s platforms.

• Seasonal patterns shift in August, with weaker average returns and greater downside skew supporting a case for selective hedging.
• Most markets are at or near 52-week highs, further strengthening the argument for protective positioning.
• Unlike July’s consistent vol-selling setup, August presents a more mixed environment for volatility strategies.

• Qualcomm recently reported its fiscal third-quarter 2025 results, delivering revenues of $10.4 billion and a nonGAAP EPS of $2.77, which were near the high end of guidance.
• The company’s chipset business, QCT, recorded revenues of $9 billion, reflecting ongoing growth across automotive, IoT, and handset segments.
• Notably, automotive and IoT revenues increased by 21% and 24% year-over-year, respectively, driven by Qualcomm’s strategy to diversify and expand its product offerings beyond mobile handsets.

• Recent legislations in major economies have propelled the mainstream adoption of stablecoin. While offshore use of stablecoin has been centered around crypto trading and informal economies, we believe the regulated stablecoins present two key opportunities: “open-source digital wallets” for payments and “open clearing houses” for settlements.
• Digital wallet payment solutions built around stablecoin have a much lower bar than building a web2 digital wallet company, in both technology and commercial terms.
• In developed economies dominated by credit cards, stablecoins could drive a new wave of digital wallet adoption, potentially capturing significant market share.

• Trane Technologies’ second quarter of 2025 results reflect a combination of robust growth drivers and challenges that provide a nuanced picture for potential investors.
• Positively, the company announced record bookings and revenues, with adjusted operating margins expanding by 90 basis points and adjusted EPS growing by 18%.
• A key highlight was Trane’s Americas Commercial HVAC business, which saw bookings increase by over 20%, driven particularly by a strong demand for Applied Solutions, which grew by over 60% year-over-year.

• Demand for AI compute has opened the door to a new kind of business: GPU-as-a-Service.  New kids on the block, Nebius and CoreWeave, are competing with the hyperscalers.
• Nebius has gained a foothold in the rapidly growing AI data center market, and it’s eyeing up to $1 billion in recurring revenue by the end of 2025. 
• The best comp is CoreWeave,  but Nebius’ balance sheet is much stronger, allowing it access to cheaper capital to help fund its growth.

• OpenAI is one of the fastest-growing private companies ever, with an estimated $10 billion annual revenue run rate by mid-2025 – up 82% from the year before. 
• Subscriptions and API fees have fueled OpenAI’s rocket-like trajectory, but they won’t get it to its ambitious goal of $174 billion in annual revenue by 2030. 
• Investors slapped a $300 billion price tag on the firm earlier this year, with $500 billion now being touted. What’s it worth?