TMTB Morning Wrap

QQQs +20bps to more new highs as market looks to extend its recent win streak (QQQs higher 9 straight sessions coming into the day, longest win streak in 2 years). AI continues to dominate news flow/price action. ORCL +5% early on more news they’ll be involved in a TikTok deal. We get WDAY analyst day today. Asian mkts mostly higher - NKY +0.3%, TAIEX +1.1%, KOSPI +1.2%, India +0.5%. Asian semis +2.8% led by Hynix+5%, Samsung+3.8%; TSMC+2.4%. Memory names continue to rip with Nanya+9.7%

Let’s get straight to it.

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SNOW/DDOG/MDB: BofA Flags Cloud and Desktop Weakness in August

BofA says August cloud usage data softened notably after July’s rebound, with average engaged visits up just 2.6% y/y versus 10.6% in July and falling 4.9% m/m, well below the normal seasonal lift of +4.8%. The firm highlights this as the third weak month in the past four, raising questions on Q3 momentum. Datadog saw visits slide 10% y/y and 9.5% m/m, though page views were a relative bright spot at +21.9% y/y. MongoDB Atlas held steadier, with visits up 5.1% y/y and flat m/m, its eighth straight month of in-line or better seasonality. Snowflake, however, saw a sharp reversal as page views dropped 7.9% y/y and 13.3% m/m after July’s strong surge. On the desktop side, BofA notes engaged visits fell 20.2% y/y, led by weakness at Microsoft 365 and Intuit QuickBooks, which the firm says could signal a softening SMB spending backdrop.

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Oracle could play key role in TikTok deal between Trump administration and China, sources say

CBS

Technology company Oracle is among a consortium of firms that would enable TikTok to continue operations in the U.S. if a framework deal between the United States and China is finalized, sources with knowledge of the negotiations tell CBS News.

The precise structure of the final deal was unclear Monday night, but will include multiple companies, the sources said. It's not clear what level of involvement Chinese firms — including TikTok's current parent company ByteDance — will have in the deal, and who will control TikTok's powerful recommendation algorithm. Presidents Trump and Xi are expected to talk on Friday.

Attempts to reach Oracle executives and a White House spokesperson were unsuccessful. A TikTok spokesperson declined to comment.

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GenAI: HOW PEOPLE USE CHATGPT

Getting passed around from NBER

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SPOT: BNP Starts at Outperform, Sees AI-Driven Growth and Audiobook Upside

BNP initiates coverage on Spotify with an Outperform and a $900 target (street high), calling it the largest media and internet stock in Europe after its sharp rally since late 2022. The firm highlights recent strategic shifts, stronger stakeholder ties, and product improvements that make Spotify more than just a premium consumer app. BNP argues new price hikes, audiobook diversification, and favorable label deals could all provide earnings surprise potential, with forecasts for FY25–28 mid-teens revenue growth and 35%+ EBITA CAGR. The firm calls Spotify a “rare European Gen AI winner,” benefiting from network effects, data, and AI-enhanced personalization, while trading at a notable discount to Netflix on forward multiples.

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SPOT: TheVerge: Spotify’s free users can finally play the songs they want (out yesterday)

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Digital Ads: UBS Has their first Ad Check Out; Shows Strength in GOOGL, META, PINS; SNAP Lags