TMTB EOD Wrap
QQQs -1.9% as AI vibes continue to cool in Tech. The weakness in Tech and AI stocks was mainly attributed to OpenAI’s CFO comments yesterday in the WSJ that suggested the company sought a Federal backstop to insure loans for DC expansions. To recap, she said OAI is ‘looking for an ecosystem of banks and private equity’ to support plans and hinted at a role for the US government to ‘backstop, the guarantee that allows the financing to happen’. On LinkedIn this morning, she clarified her comment was more around private sector and gov’t playing their part.
OpenAI CEO Sam Altman came out and clarified the comments on X in this post. It’s kind of long so the key points are:
OpenAI says it does not want government guarantees for its datacenters; opposes bailouts/picking winners, but supports government-owned AI infrastructure where benefits flow to the public (potentially via lower cost of capital).
Only “loan guarantees” discussed: U.S. semiconductor fab buildouts to onshore supply chains—distinct from private datacenter financing.
Funding plan: targeting >$20B 2025 run-rate, “hundreds of billions” by 2030; contemplating ~$1.4T over 8 years, plus selling AI-cloud capacity and raising equity/debt to meet demand.
Not “too big to fail”: firms that err should fail; government’s role is insurer of last resort only for catastrophic misuse, not overbuild; investing now due to severe compute constraints to deliver abundant, cheaper AI.
Seems a lot of PR massaging after the Sarah Friar’s comments. The key number here is >$20B 2025 run rate (although not new as Reuters had that # in an IPO article a week ago…the difference here being “greater than”). The last two datapoints we have gotten before then around run rate revs were $6.5B back in Dec ‘24 and $12B in July ‘25.
It would seem to be government intervention is bullish. But the market is reading it the opposite. How to reconcile the two?
I won’t go into it further, but a lot of good discussion in TMTB chat here
How is this affecting our positioning?
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