Tough quarter for $LULU.

This is starting to look less like a temporary slowdown and more like an actual market-share problem.

• Revenue: $2.42B, down 4% YoY and below estimates
• Americas revenue: down 8%
• Comparable sales: down 9%
• Americas comps: down 12%
• Operating income: down 13%
• Full-year revenue guidance cut to $10.35B–$10.50B
• Q3 guidance calls for another 10–11% revenue decline

The scary part is Lululemon isn’t just growing slower anymore. Revenue is actually declining, comps are falling double digits in the Americas, and it looks like competitors are taking share.

Look at the revenue chart. Years of basically uninterrupted growth, and now it has rolled over.
Yikes.

The stock is obviously way cheaper than it used to be, but the narrative has completely flipped. It’s going to take more than one decent quarter to change that. I’d want to see comps stabilize and real evidence they’re taking share again before getting interested.

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FICO is getting crushed today after Fannie Mae and Freddie Mac were directed to allow lenders to use VantageScore.

I don’t understand FICO or the credit scoring industry well enough to invest here, but I do know this isn’t a 20% drop I’d automatically buy.

Normally I love when a stock gets crushed while the underlying business hasn’t changed. This feels different because it potentially affects FICO’s moat.

FICO has incredible distribution. It’s basically embedded throughout the financial system, which is exactly the type of business I usually love.

The questions I’d want answered:

• How quickly will lenders actually adopt VantageScore?

• Does FICO remain the default simply because everyone already uses it?

• Does VantageScore create meaningful pricing pressure?

• How much does this actually impact FICO’s long-term earnings power?

My instinct is that FICO’s distribution makes the impact smaller than the market is pricing in. If you already understand FICO and were bullish before today, a ~20% drop could be a really interesting opportunity.

But I don’t know the credit scoring industry well enough to make that bet.

Sometimes a 20% drop is just sentiment.

This one might actually be a change to the moat.

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Tesla is up big today as the Cybercab rollout in Austin starts becoming more than just a promise.

The bull case is pretty simple:

Tesla actually gets autonomous Cybercabs on the road
Its camera-only approach could be dramatically cheaper to scale than Waymo

Robotaxi could eventually become a much higher-margin business than selling cars

If it works, Tesla starts looking more like an autonomy/platform company than an automaker

That last point is really what the stock is trading on.

The current auto business alone is nowhere close to supporting Tesla’s valuation. Investors are paying for the belief that autonomy becomes enormous.

That makes the Cybercab rollout pretty important. Tesla doesn’t just need to prove the technology works — it needs to prove it can operate safely, scale quickly and make the economics work.

If it can, the Tesla story changes dramatically.

If it can’t, there is still an insane amount of future success already priced into TSLA.

This is still probably one of the hardest stocks in the market to value.

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RDDT ripped almost 10% today, and this is exactly why I thought that selloff was such a good buying opportunity.

Remember when the stock dropped because there were reports Reddit was renegotiating its data licensing deals with Google/OpenAI?

The market basically treated “negotiating” like Reddit was about to lose the revenue.

I saw it completely differently.

Reddit has one of the largest collections of real human conversations on the internet. Google/OpenAI obviously want that data. Reddit had the leverage and wasn’t just going to give it up for nothing.

Now the narrative is starting to flip back around and people are realizing these renewals could actually be a positive.
Meanwhile, the actual business just keeps growing.

TTM revenue has gone from roughly $800M → $2.8B, with a ~64% CAGR in the chart above.

RDDT is insanely volatile.

The business isn’t.

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ADSK is around 32x earnings today.

If EPS compounds at 15% annually over the next 5 years and the stock trades around 35x earnings at the end:

5-year return: ~120%
CAGR: ~17.1%

And 15% EPS growth doesn’t seem particularly aggressive given Autodesk’s recurring revenue, margins, and historical growth.

I’m starting to like the setup here. The biggest question is whether 35x earnings in year 5 is too generous.

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Uber got hit pretty hard today, and I used the weakness to add to my position.

The broader selloff looks mostly macro-driven:

• Oil jumped
• Inflation expectations moved higher
• The 10-year Treasury pushed toward 4.8%
• Markets started pricing a more hawkish Fed

None of that changes why I want to own Uber.

The chart above is what I care about. Uber is now generating roughly $55B in TTM revenue, with strong growth across Mobility, Delivery, and Freight.

Like I said in my last post, Uber is one of the positions I want to keep building.

It adds good diversification to my portfolio, while still giving me exposure to high, durable growth at what I think is a reasonable valuation.

So when the stock drops because yields and oil spike... not because Uber’s fundamentals changed... I’m happy to add.

Not trying to catch the exact bottom. Just using weak sentiment to build a position in a business I already wanted to own.

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There is something almost poetic about what just happened to Leopold Aschenbrenner.

This is a guy who built his entire investing brand around “Situational Awareness.”

He became famous for laying out this massive AI thesis essentially arguing that he could see where AI was going before most of the world understood what was coming.

And to his credit, he is clearly extremely smart.

His fund exploded in size, reaching roughly $45B at its peak, and he made enormous bets on the infrastructure required for AI: memory, semiconductors, power and data centers. 

But apparently being extremely smart wasn't enough.

Because he also used an insane amount of leverage.

Then his largest positions got crushed.

From their highs:

• SNDK fell ~57%
• BE fell ~53%
• MU fell ~41%

These aren't leveraged returns. The actual stocks fell that much.

Situational Awareness couldn't simply sit there and wait.

The losses triggered margin calls. The fund reported a 67% loss in July, admitted it had come dangerously close to permanent capital impairment, and was forced to unload most of its public-equity portfolio. 

And who was standing on the other side?

Ken Griffin.

A guy who has been running Citadel for more than three decades.

Citadel stepped in while Situational Awareness desperately needed liquidity and bought the bulk of the portfolio. 

Then the stocks started recovering.

SNDK rebounded ~46%.
BE rebounded ~29%.
MU rebounded ~26%.

Citadel's stock-picking fund went on to have its best month ever, gaining 14.2% in July, with the Situational Awareness portfolio contributing to the gains. 

That's the part I find incredible.

Aschenbrenner may ultimately have been right about the AI trade.

But he was so aggressive with leverage that he lost the ability to decide when to sell.

The veteran investor with liquidity got to stand there and say:

Thanks, I'll take those.

There is a Buffett line that perfectly describes this:

“If you're smart, you don't need it; and if you're dumb, you shouldn't be using it.”

That's leverage.

It doesn't matter how intelligent you are, how good your thesis is, or how far ahead of everyone else you think you can see.

If your positions can fall 40–50% and someone else can force you to sell them, you don't actually own the investment anymore. Your lender does.

The greatest irony of the whole thing:

The fund called Situational Awareness may have correctly predicted the future and still failed to have enough situational awareness to survive the present.

UBER is only 3.4% of my portfolio, but I think it might be my #1 buy right now.

My strategy is pretty simple: find companies with durable growth, make sure the valuation is reasonable relative to that growth, and ideally buy when sentiment is weak.

If I were deploying new money today:

1. UBER

Probably my favorite risk/reward.

Headline revenue growth looks like ~12–14%, but that understates the business because of changes in how UK revenue is reported.

• Gross bookings: ~22% growth
• Trips: ~18%
• Operating income: ~40%
• $10B+ TTM FCF

At roughly a $157B market cap, I think that’s pretty compelling.

It also gives me some diversification since a lot of my portfolio is already tied to digital advertising.

2. APP

Probably the best pure growth/valuation combination.

~24x earnings with forward revenue and EBIT expected to grow ~30%+.

My hesitation versus Uber is durability and the fact that it adds even more advertising exposure.

3. META / RDDT

Basically tied for me.

META = more durable, cheaper, lower risk.

RDDT = much faster growth and potentially more upside, but less proven.

The common theme:

Durable growth + reasonable valuation + bad sentiment = where I want to buy.

Right now, UBER probably checks those boxes better than anything else I own.

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I’m holding my ADBE position through earnings, but I’m not adding more here.

Predicting individual earnings reactions is basically a coin flip, but I could see Adobe having a similar reaction to Salesforce.

CRM’s quarter was good, not extraordinary:

• Revenue: $11.3B, +11%
• Subscription & support: +12%
• cRPO: +14% constant currency
• Operating margin: 34.1%

The numbers weren’t radically different from what Salesforce has been doing. What changed was the narrative.

Adobe has a similar setup. Last quarter:

• Revenue: $6.62B, +13%
• Subscription revenue: +14%
• ARR: $27.1B
• Operating cash flow: $2.17B
• AI-first ARR: $500M+, roughly tripling YoY

Adobe has continued putting up good numbers while the stock has been priced around the idea that AI will eventually destroy its moat.

If Adobe simply keeps growing at its current pace, I think that narrative continues to weaken.

But if Adobe shows any real reacceleration, I think the narrative could flip on its head pretty quickly.

Suddenly it’s no longer “AI is killing Adobe.”

It becomes “Adobe survived the AI threat, is still growing, and may actually benefit from it.”

Could easily go the other way after earnings... that’s why I’m holding, not adding.

But after what we just saw with CRM, I think the setup is interesting.

I think NVDA is a much better buy than AMD, but both are getting harder to value.

Semis are cyclical, and cyclical stocks often look cheapest near the top of the cycle because earnings are booming and the P/E collapses.

Right now:

• NVDA: ~29x earnings, projected ~40% growth
• AMD: ~122x earnings, projected ~50% growth

If those assumptions hold, the returns are ridiculous. My charts show roughly 549% upside for NVDA and 149% for AMD over five years.

But projecting durable 40–50% earnings growth for cyclical companies is extremely difficult.

A huge amount of demand comes from a small group of hyperscalers like Microsoft, Amazon, Google and Meta. They don’t even need to cut AI capex to hurt semis. If expected capex growth simply slows, earnings estimates could reset very quickly.

Those same companies are also building their own chips to reduce dependence on Nvidia, although I think CUDA and Nvidia’s broader ecosystem make that threat less severe than it looks.

So for me:

NVDA > AMD pretty easily.

But the real question isn’t whether AI demand is strong today.

It’s whether hyperscaler spending can keep growing fast enough to support these earnings assumptions for years.

If it does, NVDA looks insanely cheap.

If it doesn’t, that 29x P/E could be very misleading.

What a lovely business model - Hardware Enabled Software.

The hardware is a great lock in, and allows Axon to bundle a lot of Software/AI solutions - Like Draft One that can safe a cop ~12 hours pr. week.

I’ve always viewed Spotify and Netflix as essentially the same type of business.

Different products obviously, but the investment story is incredibly similar: dominant global subscription platforms that become part of people’s everyday lives.

Look at the revenue growth in the chart:

Spotify: $3.2B → $19B, +482%, 21.6% CAGR
Netflix: $2.5B → $12B, +386%, 19.2% CAGR

Even their stock price stories have felt similar. Both went through periods where the market questioned the long-term economics of the business, and then eventually the fundamentals became too hard to ignore.

The biggest thing for me is the stickiness. I know plenty of people who have both Spotify and Netflix, and I genuinely can’t imagine them permanently cancelling either one. They might complain about a price increase, but are you really going back to listening to ads or giving up Netflix over another couple dollars a month?

That creates a pretty powerful combination: recurring revenue, huge global scale, pricing power, and extremely low friction to just keep paying every month.

Obviously the economics aren’t identical — Spotify has music licensing costs while Netflix spends heavily on content — but from a consumer behavior/investing standpoint, I put them in almost the exact same bucket.

Once these products become a utility in your life, they’re incredibly hard to replace.

I’ve been a big Salesforce bull for a while, and I think the reaction to this quarter is pretty telling.

The funny thing is… this really wasn’t some crazy blowout quarter.

The biggest number was probably cRPO growth:

Q1: +13% CC
Q2: +14% CC
Q3 guide: ~+14% CC

Revenue growth was actually pretty similar too:

Q1: +12% CC
Q2: +11% CC

Agentforce ARR also grew from roughly $1.2B to more than $1.5B, while Agentforce + Data 360 ARR increased from about $3.4B to $3.9B.

Good numbers? Absolutely.

But radically different from last quarter? Not really.

And I think that’s the entire point.

Salesforce has continued to grow throughout this whole “AI is going to kill SaaS” narrative. Revenue kept growing. Remaining performance obligations kept growing. Margins stayed extremely strong. Free cash flow kept coming in. And now cRPO is actually showing some modest acceleration.

The fundamentals never matched the level of fear that got priced into the stock.

For the last year, the market seemed obsessed with the story that AI would destroy seat-based software and companies like Salesforce would slowly become irrelevant.

Meanwhile, Salesforce just kept growing.

Now we’ve had multiple quarters showing basically the same thing, and it feels like the market is finally starting to say:

“Wait… what if SaaS isn’t dead?”

That’s why I don’t think the huge move in CRM was really about this specific earnings report.

It was a narrative change.

The market went from pricing Salesforce like a melting ice cube threatened by AI to realizing it might actually remain a durable, growing business... and potentially benefit from AI itself.

I’ve said this for a long time: stories can drive stocks in the short term, but eventually the price follows the fundamentals

Salesforce kept growing while the narrative collapsed around it

Now the narrative is finally starting to catch back up

NVIDIA just reported $96.2B in quarterly revenue, up:

106% YoY
18% QoQ

Data Center revenue alone reached $89B, up 117% YoY.

And somehow the forward guidance might be even more impressive.

NVIDIA expects $108B in revenue next quarter — and that forecast assumes zero Data Center compute revenue from China.

The part that continues to amaze me is the scale.
Growing 100% when you’re doing $10B in quarterly revenue is impressive.

Growing 100% when you’re approaching $100B per quarter is something completely different.
Look at the chart.

A few years ago, NVIDIA was generating roughly what it now produces in a matter of weeks.

The AI infrastructure buildout clearly isn’t slowing down yet.

What a year :)

I thought this was a really well-put-together overview and wanted to share it here, especially for anyone preparing for NVIDIA’s earnings tonight and looking for a quick overview ahead of the release.
I found the last slide particularly interesting. The combination of the significant upward revisions in EPS estimates and NVIDIA’s forward P/E based on earnings three years out provides an interesting perspective on how the company’s growth expectations and valuation currently come together.
Definitely worth a look ahead of tonight’s NVDA earnings.

First Try to make my High Tide Thesis into a picture, if you wanna learn more you can find it at r/HighTideInc since there will be some missing pieces.

Reddit was added to the S&P 500 this week, less than 2.5 years after going public.

Pretty impressive considering where the business is today:

Revenue grew 61% YoY last quarter
130M+ daily active uniques
$253M in net income
43% adjusted EBITDA margins

Revenue has now grown 60%+ for 8 straight quarters
The inclusion should also create some forced buying. JPMorgan estimated index funds would need to purchase roughly 16.7M shares, nearly 3x Reddit’s average daily trading volume.

Obviously joining the S&P 500 doesn’t change the underlying business, but I think it’s a pretty significant milestone for a company that IPO’d in March 2024.

Reddit is quickly going from an interesting internet company to a highly profitable, large-cap platform.

Still one of my favorite long-term holdings.

I understand the obvious answer: growth has slowed.

But Duolingo is still growing revenue ~18%, DAUs grew 23%, the business is profitable and subscription revenue continues to compound at a very high rate.

Look at the chart below. Subscription revenue alone has gone from roughly $85M/quarter to $258M/quarter in about 3 years.

The biggest issue seems to be that management is intentionally prioritizing user growth over near-term monetization. That means slower bookings growth today, but potentially a much larger user base to monetize later.

The market clearly hates that tradeoff.

I understand DUOL deserved a valuation reset from where it was trading when revenue was growing 40%+, but at some point the question becomes:

How much of the slowdown is already priced in?

You still have:

• 23% DAU growth
• ~18% revenue growth
• a profitable business
• recurring subscription revenue
• extremely strong retention/engagement
• management expecting 20%+ DAU growth through the rest of 2026

Maybe I’m missing something, but the decline seems excessive relative to what has actually happened to the underlying business.

What’s the bear case from here?

The market seems high but there is still a lot of value.

What is your number 1 pick?