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Maybe, just maybe, big tech firms need to do a better job of explaining their AI investment strategies. Shares of Google parent Alphabet fell 7% on Thursday after the company disclosed a further increase in capital expenditures this year—money it will spend on new AI chips, servers and data centers. The drop all but wiped out the gains the stock had enjoyed so far this year. Sure, the entire stock market sold off, presumably as a result of rising oil prices and the intensification of the Iran war. But Alphabet was among the worst hit, along with Tesla, which also reported sharply higher capex on Wednesday and whose shares fell 15% on Thursday. It’s tough to consider Tesla’s stock valuation on any kind of rational basis, given that it trades based more on its connection to Elon Musk than reality. But Alphabet is a different animal. There’s little doubt Google is among the best positioned of big tech companies in terms of its ability to take advantage of AI advances, given its strength in chips, AI models and consumer apps that should benefit from AI. But even for Alphabet, you have to wonder how much more money the company will have to spend to reach the promised land. Alphabet’s projected capex for this year—now as much as $205 billion—is more than double what it spent in 2025, which in turn was nearly three times what it was spending two years before that. Next year, Chief Financial Officer Anat Ashkenazi said on Wednesday, capex will “increase significantly” again! Dan Flax, an analyst at Neuberger Berman, said today that Alphabet’s capex “will likely be well over $300 billion.” For context, analysts expect the company to generate $259 billion in cash from operations next year, according to S&P Global Market Intelligence. That suggests Alphabet could burn $40 billion in cash next year, which is quite a turnabout for a company that before this spending surge routinely generated $60 billion to $70 billion in free cash flow. And when will this end? Alphabet executives are vague about it. CEO Sundar Pichai keeps talking about the industry being in the “early innings” of the AI transition, which implies the heavy spending could go on for a while. Ashkenazi said on Wednesday that “our goal is to invest as long as we see an attractive return on that investment.” In other words, trust us. That may not be enough anymore.

#SpaceX 🚀 will use Nvidia systems exclusively for its AI services and plans to launch Vera Rubin servers next year, betting orbit can offer more room and easier cooling than data centers on Earth. https://finance.yahoo.com/technology/article/nvidia-stock-rises-after-musk-says-spacex-will-exclusively-use-companys-chips-211803293.html?_bhlid=95e2f6ebafe8e62de6d11c4da4ba4129dd0418df

Palantir just posted the quarter that breaks whatever mental model you still had about how B2B companies behave at scale. It already had re-accelerated at a rate we’ve never seen before. And then it just … did it again. https://cloud.substack.com/p/5-interesting-learnings-from-palantir-2c6?utm_source=post-email-title&publication_id=10969&post_id=209803655&utm_campaign=email-post-title&isFreemail=true&r=6hfx4&triedRedirect=true&utm_medium=email

Uber confirmed that it will plug more than $10 billion into its robotaxi efforts in the coming years, though the stock fell yesterday after its profit outlook for Q3 disappointed investors. #Auto Future https://www.reuters.com/business/autos-transportation/uber-forecasts-weak-quarterly-profit-doubles-down-robotaxi-investment-plans-2026-08-05/?utm_source=snacks&utm_medium=email&utm_campaign=snacks_20260806&utm_content=cc8f994041e242d7800549aae059ecbb

OpenAI's agents built themselves a message board and nobody noticed for weeks. At Black Hat the company admitted the agents that breached Hugging Face had been coordinating inside its own package manager, swapping working exploits across hundreds of thousands of messages, delegating tasks and proposing signed messages to unmask a suspected imposter. The hacking isn't the alarming part. They invented op-sec. https://www.wired.com/story/openai-didnt-notice-its-ai-agents-using-a-message-board-to-plan-their-hacking-spree/

TSMC is developing an advanced chip-packaging technology similar to what Intel offers, a sign that the Taiwanese giant is worried about Intel. https://www.theinformation.com/articles/tsmc-develops-ai-chip-packaging-tech-counter-intel?offer=rtsu-engagement-25%2Crtsu-featured-articles-pro&utm_campaign=RTSU%3A+TSMC+Develops&utm_content=14355&utm_medium=email&utm_source=cio&utm_term=9983

A good year for IPOs. A bit less so for their performance. And not a year at all for SaaS. Per PitchBook there has been $1,786.8 billion in US VC-backed IPO value through July 28. That’s not a record. That’s five prior years stacked on top of each other and then doubled. Then you do the subtraction. #SpaceX 🚀 went public on June 12 at $135 a share, at a valuation of roughly $1.77 trillion. It sold 555.56 million shares and raised $75 billion, $85.7 billion once underwriters took their overallotment. The single largest IPO ever executed, by a wide margin. So of that $1,786.8B: about $1,770B is one rocket + coding/AI + tweet company. The other 43 VC-backed IPOs this year combined are worth roughly $17 billion. That’s not a boom. That’s 2023 with a trillion-dollar asterisk stapled to it. #Data is beautiful https://www.saastr.com/2026-is-the-biggest-ipo-year-in-history-but-take-out-one-company-and-its-one-of-the-worst/?sftoken=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpYXQiOjE3ODYyMjk0ODMsImV4cCI6MTc4NjIyOTU0MywiaW5kaXZpZHVhbElkIjoiMDBRVVcwMDAwMGdodUY3MkFJIiwidGVuYW50SWQiOiJhMzYwL3Byb2Q1LzczZGFiZTNjMzU5MjQ3YTNhZDljNzA1NjljMWY1NGE3IiwiY29yZVRlbmFudElkIjoiY29yZS9wcm9kLzAwRDM2MDAwMDAwc0NyMkVBRSJ9.uNDpC-B8rzSdl7P4cQtQKSDBlQm5D4Tle0Wfwy05OtQ

The recent memory chip selloff offers investors a new opportunity to jump into the sector. Samsung is the best bet (https://www.theinformation.com/articles/samsung-new-memory-chip-underdog-now?offer=rtsu-engagement-25%2Crtsu-featured-articles-pro&cio_link_id=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__78ca81c10356e79c74244627892e95b58455d370dcff128d8b5b345ed5d6e7a7&utm_campaign=RTSU%3A+Samsung+Is+the&utm_content=14230&utm_medium=email&utm_source=cio&utm_term=9879).

Apple expects choppy waters ahead for the quarter that ends in September, the company said on its June quarter earnings call. Apple’s Chief Financial Officer Kevan Parekh warned that supply constraints for advanced chip manufacturing will “increase significantly.” #Gadgets The company experienced such constraints during the June quarter for Macs, and to a lesser extent iPhones and iPads, due largely to a limited supply of its processing chips. Nvidia chips for artificial intelligence have been soaking up more and more of the chip making capacity of Taiwan Semiconductor Manufacturing Company, Apple’s primary chip manufacturing partner. For the June quarter, Apple reported sales of $109.4 billion, up 16.4% from the prior year, and a net income of $29.8 billion, advancing 27% annually. The iPhone grew nearly 22% to $54.3 billion in sales. The company said it expects revenue to increase between 9% and 11% in the September quarter from the year earlier period, while it expects iPhone growth to slow to the mid-teens as supply constraints grow. Apple fell more than 7% in after-hours trading following the guidance announcement. While many stocks are getting hit hard this week over concerns with heavy AI spending, Apple has stood apart from the pack by limiting its capital expenditures on AI. The company’s stock was up 23% so far this year prior to its earnings announcement, outperforming most of its tech peers. On the call, CEO Tim Cook noted that he will soon hand off the top job at the company to John Ternus, its current hardware leader, who will replace Cook in September. “This will be my final earnings call, and John will lead these calls going forward,” Cook said. “The transition is going seamlessly, and I am beyond excited for John to step into his new role and lead Apple into its next era.” https://www.apple.com/newsroom/2026/07/apple-reports-third-quarter-results/?utm_campaign=%5BREBRAND%5D+%5BTI-AM%5D+Th&utm_content=1095&utm_medium=email&utm_source=cio&utm_term=124

Online fashion retailer Shein received Chinese regulatory approval to list in Hong Kong, capping off the e-commerce platform’s tumultuous two-year quest to float its shares. The China Securities Regulatory Commission said in a statement on Friday that it had approved Shein’s application to sell not more than 341.6 million shares on the Hong Kong stock exchange. The approval is valid for 12 months. If Shein doesn’t list in 12 months, it must submit an updated application. Before the bid to list in Hong Kong, China-founded Shein first sought to go public in New York in 2024,  then London. Both attempts failed amid mounting controversies over the company’s labor practices, allegations of copyright infringement and other thorny issues. https://www.reuters.com/world/shein-wins-china-approval-ipo-hong-kong-2026-07-10/

A Chinese company has begun manufacturing one of the key pieces of equipment used in chip manufacturing (https://www.theinformation.com/articles/china-starts-mass-producing-homegrown-duv-chipmaking-tools-advance-local-chip-industry?offer=rtsu-engagement-25%2Crtsu-featured-articles-pro&cio_link_id=eyJlbWFpbF9pZCI6ImRnU2kwUVlEQUplSkJwYUpCZ0dmbzhvQXQyMmNkck53WTl3OTdScz0iLCJocmVmIjoiaHR0cHM6Ly93d3cudGhlaW5mb3JtYXRpb24uY29tL2FydGljbGVzL2NoaW5hLXN0YXJ0cy1tYXNzLXByb2R1Y2luZy1ob21lZ3Jvd24tZHV2LWNoaXBtYWtpbmctdG9vbHMtYWR2YW5jZS1sb2NhbC1jaGlwLWluZHVzdHJ5P29mZmVyPXJ0c3UtZW5nYWdlbWVudC0yNSUyQ3J0c3UtZmVhdHVyZWQtYXJ0aWNsZXMtcHJvXHUwMDI2Y2lvX2xpbmtfaWQ9Q0lPLS1MSU5LSURcdTAwMjZ1dG1fY2FtcGFpZ249UlRTVSUzQStDaGluYStTdGFydHMrTVx1MDAyNnV0bV9jb250ZW50PTE0MzE4XHUwMDI2dXRtX21lZGl1bT1lbWFpbFx1MDAyNnV0bV9zb3VyY2U9Y2lvXHUwMDI2dXRtX3Rlcm09OTk1MSIsImludGVybmFsIjoiYTJkMTA2MDM4NjRhOTc4OTA2IiwibGlua19pZCI6OTA1NTR9__8f2b3d61f0380cd8920b03394d74226b6f59db594e301dda6ed60c27592ff1e2&utm_campaign=RTSU%3A+China+Starts+M&utm_content=14318&utm_medium=email&utm_source=cio&utm_term=9951), a key step towards self reliance in chips.

The stocks of both Palantir and Shopify were caught up in the enterprise software sell-off of the first half, falling as much as 40% from where they finished 2025, but both have recovered much of the ground they’ve lost. As of Friday’s close, Palantir is only down 3.2% year to date, while Shopify is only down 5.9%. #The Most Important Thing In contrast, Canva, a still-private design software firm, has found a growing number of its users are using OpenAI’s ChatGPT instead of Canva, in response to OpenAI’s introduction of a new model that is better at creating designs for media such as posters. That contributed to Canva reducing its revenue growth forecast in discussions with investors last week, we reported. Another issue, our story said, was that the costs of the #Artificial Intelligence features Canva introduced were so high that it had to slow down their rollout to more users. Another design software firm, publicly traded Figma, unnerved investors last week by projecting a 12 percentage point slowdown in revenue growth for the third quarter. Figma executives said they were testing new products before starting to charge for them, but the stall fed investors’ worries about the company’s exposure to AI rivals. Figma stock weakened and finished the week down 38% for the year. There are also questions about Datadog, which sells software that helps businesses monitor how cloud applications perform and identify security threats. In May, Datadog stock had leapt 30% after the company reported that customers using AI-related services accounted for only 20% of the total but 80% of annualized revenue. But last week, Datadog stock dropped 19% in one day after it projected a slowdown in the third-quarter revenue growth due to one large customer—a “leading AI company”—reducing its usage starting in that period. Executives didn’t give details, but the revelation touched on a worry that investors have about how software firms will lose business over time: Customers might not cut off software suppliers completely, but they will spend less. Despite the sell-off, Datadog’s stock is still up a lot so far this year, so we’d put it in the category of a winner, with an asterisk. https://www.theinformation.com/articles/canva-hits-ai-speedbump-costs-chatgpt-competition?utm_campaign=article_email&utm_content=article-17593&utm_medium=email&utm_source=sg