QQQs rose by 66 basis points, continuing last week's upward trend, as the government continued to ease restrictions on its trade policies, with the latest measures canceling part of the 25% auto tariff plan. Lutnick stated that a preliminary agreement has been reached and is awaiting final approval for announcement (I believe everyone will only believe it when they see it). Following the release of a series of weak economic data, yields fell by 4-5 basis points, with the market expecting the Federal Reserve to cut interest rates about 4 times this year.

After-Hours Earnings Reports:

SNAP fell 14%: Despite a solid performance in the first quarter (the only shortcoming being a decrease in monthly active users in the U.S.), SNAP was sold off due to a lack of guidance for the second quarter, stating: “Given the uncertainty of how macroeconomic conditions may evolve in the coming months, and the broader impact this may have on advertising demand, we do not intend to provide formal financial guidance for the second quarter. Although our total revenue continues to grow, we encountered some headwinds at the beginning of this quarter, and we believe it is prudent to continue balancing investment levels with realized revenue growth.”... The conference call mentioned that some advertisers were affected by changes in the minimum tax exemption... SNAP has never been the best barometer for other advertising stocks, but in this uncertain environment, META fell 1%, PINS fell 3%, RDDT fell 3%, ROKU fell 1%, etc., were all impacted.

BKNG fell 3% with a relatively solid quarter: RN grew by 7%, above the guidance of 5-7%; GBs grew by 10% (on a comparable basis), in line with the guidance of 9-11%... The second quarter guidance was in line with expectations/slightly weak: RN growth of 4-6% (market expectation 7%), GBs growth of 10-12%, with about 4 percentage points benefiting from exchange rates (i.e., on a comparable basis growth of 6-8%, market expectation 7%), EBITDA is projected to be $2.15-2.2 billion (market expectation $2.16 billion)..."

Key quote on travel trends: “We have observed significant changes in certain travel patterns. For example, we have seen a moderation in inbound travel trends to the U.S., particularly from Canadian bookers, as well as a milder trend from European bookers. However, we have also seen improvements in trends for other travel channels, such as travel from Canada to Mexico, achieving overall stable growth. We have noticed a decrease in the length of stay in the U.S., which may indicate that American consumers are becoming more cautious in their spending. We are also seeing signs of divergence in the U.S. economy, with high-end hotels appearing to be more resilient than lower-end hotels.”

SMCI fell 15%, with negative expectations stating that platform decisions from some customers have been delayed, with sales shifting to the fourth quarter. The company now forecasts net sales of $4.5 to $4.6 billion, below Wall Street's expectation of $5.4 billion and the previous guidance of $5 to $6 billion. Non-GAAP earnings per share are expected to be $0.29 to $0.31, below Wall Street's $0.55 and the previous guidance of $0.46 to $0.62 Management pointed out that the gross margin decreased by 220 basis points quarter-on-quarter (Wall Street expected 12.0%), mainly due to increased inventory reserves and accelerated transportation costs.

Artificial intelligence-related stocks took a hit: DELL down 4%, NVDA down 2%; AMD down 1%; MU down 2.5%, etc.

Visa data shows consumer spending remains stable, despite weak performance in travel and accommodation in the second quarter.

QRVO +9% thanks to strong performance and raised expectations :

• Q4 2025 revenue reached $869.5 million, exceeding the guidance of $850 million and market expectations.
• Gross margin was 45.9%, higher than the forecast of 43.5%.
• Earnings per share of $1.42, exceeding the expected $1.00.
• Q1 2026 revenue guidance of $775 million, with market expectations of $755 million.
• Guidance gross margin of 43%.
• Earnings per share guidance of $0.625, slightly above the market expectation of $0.61.

Internet

MELI +3% continues to attract buying interest from Latin America + tariffs/China safe haven... Yipit tracking shows Q2 GMV close to 20%, while market expectations were 14%.

AMZN down 20 basis points... Punchbowl (a Washington D.C. blog) reported this morning that AMZN is considering labeling "tariff impact" next to prices. A journalist asked at this morning's White House briefing, and the press secretary called it Amazon's "hostile and political behavior," holding up a Reuters article stating that the tech company collaborated with "Chinese propaganda agencies." The stock price immediately dropped 2-3%. It is said that Trump directly called Bezos to complain. AMZN then issued a statement: The team responsible for our ultra-low price Amazon Haul store had considered listing import costs on certain products. This was never a consideration for the main site Amazon and was not implemented on any Amazon platform ... Are you having fun?

ROKU +1.7%: Cleveland is optimistic ahead of quarterly earnings release later this week, stating that strong investment returns limit downside risks in the second half due to "lower CPM, broad coverage, and expanded access through DSPs."... Yipit previously issued a +8% platform growth estimate, which seemed too low, but has just retracted that estimate after the close.

SPOT -3.5% performed steadily, as bulls were not shaken by operational revenue missing expectations due to foreign exchange/social costs and lower-than-expected premium subscription guidance. The bullish view remains intact and is still one of the clearest tariff/China/recession stories in the internet sector... Management described the guidance as deliberately cautious due to macro "noise," rather than company-specific issues. Advertising growth will face about 500 basis points of headwinds in Q3, as Spotify cuts expensive owned/licensed shows (e.g., Call Her Daddy, DaxShepard) And launched ad-free premium video podcasts. Offsetting this is the growing programmatic demand: self-service tools, increased DSP integration, and stable CPM are expected to drive advertising momentum in 2025-26, with the leverage effect of gross margin most evident in 2026... The bullish reasons still exist: 1) Pricing power has not yet been fully monetized—the core packages are still cheaper than competitors in most developed markets, and management has ample room to drive ARPU growth—on Friday we learned they will announce price increases in Europe; 2) Multi-format flywheel effect—podcasts have validated this model; audiobooks and future learning courses will extend listening duration and advertising inventory; 3) Market leverage—the bilateral platform shifts negotiating power from record labels to independent labels and the expansion of self-service tools; 4) Room for margin growth—new formats will continue to drive gross margins—every one percentage point increase in gross margin almost entirely converts to net profit... Other catalysts: phased rollout of Deluxe / Superfan tiers in Q2/Q3 (higher quality audio, exclusive releases), regional price increases after establishing value recognition for the new tiers, and audiobook expansion into high-revenue EU/Asian markets, adopting on-demand upgrades.

NFLX +1.4% continues to climb to historical highs

RBLX flat despite M-sci noting that April's booking volume exceeded March

SHOP +40 basis points as some investors speculate that OAI will integrate with SHOP:

Cleveland also reported that Q1 performance exceeded expectations, with a slight slowdown in April due to tariff concerns

GOOGL down 30 basis points due to weak performance in the OAI shopping announcement—I believe this could pose a greater risk to GOOGL's revenue than any previous OAI event, but we still need to observe how they integrate this feature. Undoubtedly, this has made investors (including myself) more anxious about holding GOOGL long-term.

META +85 basis points as they announced a standalone META AI application (not good news for GOOGL..."It can search across networks, help you get recommendations, delve deeper into a topic, and stay connected with friends and family.")... also stated that META AI currently has 1 billion monthly active users, an increase from the previously disclosed 700 million. Zuckerberg and Nadella will have a dialogue today at 7 PM Eastern Time (thanks to Jack from JPM for the info)

Semiconductors

Reuters reports that Trump officials are considering revising Biden's AI chip export rules: The Trump administration is revising a rule from the Biden era that restricts global access to artificial intelligence chips, including possibly eliminating the practice of categorizing the world into different tiers to determine how much advanced semiconductor access each country can have Three informed sources stated.

"Some voices are pushing to abolish the tiered system," Wilbur Ross, who served as Secretary of Commerce in the first Trump administration, said in an interview on Tuesday. "I think this is still ongoing." He mentioned that intergovernmental agreements are an alternative...

Other possible changes include lowering the threshold for licensing exceptions. According to current rules, orders equivalent to about 1,700 Nvidia H100 chips or less do not count against national limits, and only require notifying the government without needing a license.

One insider said that the Trump administration is considering setting the cutoff for orders equivalent to 500 H100 chips. This is likely to be used as a bargaining chip in tariff negotiations. There has been some good discussion about this news in the TMTB chat. It is unclear how it will be implemented, but lowering the threshold for licensing exceptions would be negative for NVDA +25bps:

CDNS 6%: Bulls liked this earnings report: no tariff impact, strong AI orders from ByteDance and Alibaba, robust performance in the automotive sector, third-generation hardware in the early ramp-up stage, enhanced momentum in IP sales, better buybacks, sustained revenue showing its durability, and a conservative guidance, despite exceeding expectations this quarter, there are not many expectations for China, and it does not include the ARM Artisan IP acquisition... The next catalyst: CadenceLive on May 7, 2025... SNPS rose 4% in sync.

ANET +3% .. Rosenblatt upgraded their rating to a rather optimistic neutral, stating that their survey found major hyperscale cloud service providers (Microsoft, Oracle, and Google) performed far better than expected, with Microsoft's performance likely exceeding previous expectations by "hundreds of millions," and the other two also exceeded expectations (Rosenblatt originally expected NVDA to win a larger share from Microsoft).

NXPI fell 7% due to first and second-quarter gross margins not meeting expectations, weak automotive business, high channel inventory, and the CEO's departure. Previously, expectations were high after TXN/STM, but NXPI failed to meet the standard: second-quarter revenue guidance was $2.8 billion to $3 billion (a 2% quarter-over-quarter growth), while the market expected $2.86 billion—TXN/STM guidance indicated month-over-month revenue growth in the low to high single digits... Simulator performance was weak: ON fell 3% (exposed to automotive business); TXN fell 1%; ADI dropped 50 basis points.

Other artificial intelligence semiconductor performances were mixed: TSM +66 basis points ; VRT flat ; MRVL flat ; AVGO -70 basis points ; MU -2% QCOM fell by 50 basis points after JPM reinstated a buy rating. Investors believe that, given its low exposure in the U.S. Android market and TSM's outsourcing, QCOM is a relatively safe haven in the semiconductor sector.

TER -3% after decent performance: “ Visibility for the second half is limited, and the impact of trade policies on end-market demand is still changing ”

CRWV +2%

Software

Today's market is relatively flat, but following last week's SAP/NOW, the tech sector continues to attract buying interest, with investors more confident in deploying capital. SAP +2.5% nearly reached an all-time high today. PLTR +1.3% continues to perform strongly. The cybersecurity sector showed robust performance: PANW +2.6%; CRWD +2%; ZS +1.8%; OKTA +7.4%, as it is set to join the S&P MidCap 400 Index… CHKP/IBM +1.4% continues to rebound after disappointing earnings… Aside from that, news today is relatively quiet…

Other Places

TTWO +2.3% hits a new all-time high : The release date for Borderlands 4 has been moved up by two weeks (from September 23 to September 12). Promotion here… (Thanks to JPM's Jack)… Bulls see this as a positive signal for the release date of GTA 6 (adjusted to align with the release of GTA 6 by the end of the year… recalling management's mention of "fall release" in the last conference call)… This is our view on the situation of GTA VI from last week's weekly report:

PYPL +2% as investors favor TM$'s better-than-expected performance, despite a decline in brand revenue.

UPST +2.5% due to BofA's upgrade.

TSLA +2% as Morgan Stanley released a bullish long-term robotics report, with board members making internal purchases for the first time in five years (though the amount is small, only $1 million), and Trump announced a slight cancellation of tariffs on some U.S. manufactured auto parts.

Bullish and Bearish Weekly Options Flow