TMTB Morning Wrap

Good morning. Futures -10bps on a relatively quiet morning. Oil +3.5% early. War news overnight included Iran launching strikes to target energy infrastructure including the Shah gas field in UAE & an Iraqi oil field; Iraq in talks w Theran on allowing some of its tankers through Hormuz; Trump threatening to expand strikes on Kharg Island; Israel reporting that Iran’s security chief/top official Larijani was killed; & Trump requesting to delay his meeting with China’s Xi for a month so he can stay in DC given Iran.

Asia mixed overnight: TPX +0.45%, NKY -0.09%, Hang Seng +0.13%, HSCEI +0.12%, SHCOMP -0.85%, Shenzhen -1.87%, Taiwan TAIEX +1.48%, Korea KOSPI +1.63%

NVDA’s GTC kicked off with Jensen’s keynote yesterday. Key takeaways included: 1) an update on the Blackwell/Rubin revenue trajectory, now tracking to >$1T cumulative through CY27 (only includes Rubin and BW, not networking, Groq, CPU/LPUs, CPX, etc.); 2) Groq 3 LPU chip, mfg by Samsung, is ramping in Q3. Mgt mentioned a scenario where up to 25% of a Datacenter capacity could be Groq LPX for ultra-low latency workloads and when combined with Rubin can reportedly deliver 35x better throughput; and 3) the next-gen Feynman architecture (1.6nm chip from TSM) set to ramp in 2H28, featuring both copper and optics for scale-up interconnect.

Investors Q&A with NVDA’s Jensen and Colette at noon est today.

We get some investor days at OFC today with LITE 1pm est, COHR 4pm, FN 6pm, & AAOI 7pm. Optical names lower to start (LITE -4%; COHR -4%; CIEN -2%) following through on some sell the news actoin post NVDA conference (see our quotes from Jensen in EOD Wrap)

Let’s get to it…

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OpenAI: to Cut Back on Side Projects in Push to ‘Nail’ Core Business

Per the Wall Street Journal, OpenAI is planning a major strategic pivot to refocus on coding and enterprise customers, pulling back from last year's "do everything" approach that included Sora, a web browser, and hardware. CEO of applications Fidji Simo told staff that Anthropic's success in coding and business—driven by Claude Code and Cowork—should serve as a "wake-up call," and that the company "cannot miss this moment because we are distracted by side quests." OpenAI has clawed back some ground with its updated Codex app (now at 2M+ weekly active users) and GPT 5.4, but Simo made clear internally that the company is operating in "code red" mode.

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OpenAI: OpenAI in Talks for $10 Billion Joint Venture With PE Firms - Bloomberg

Per Bloomberg, OpenAI is in advanced talks to form a ~$10B joint venture with PE firms including TPG, Brookfield, and Bain Capital, with the investors committing ~$4B to build out a deployment arm focused on driving enterprise AI adoption. Anthropic is reportedly pursuing a similar playbook, in discussions with Blackstone about a JV to sell Claude to businesses.

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MU: Micron in High-Volume Production of HBM4 Designed for NVIDIA Vera Rubin, PCIe Gen6 SSD and SOCAMM2 - PR

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AKAM: KeyBanc Says GPU Inference Cloud Could Drive Material Revenue Upside