TMTB Morning Wrap

Good morning. Futures +55bps to start the day with Oil -3% as US/Iran considering another round of direct negotiations later this week and Saudi Arabia pressuring US to end blockade and return to negotiations.

AI Vibes in full force this morning with BE +12% after expanding their partnership with ORCL and CRDO +18% after their Dustphotonics acquisition. Feels like the good ol’ days of last year’s HOT AI SUMMER — even ORCL is catching a bid these days!

Stocks generally green in Asia: TPX +0.87%, NKY +2.43%, Hang Seng +0.82%, HSCEI +0.81%, SHCOMP +0.95%, Shenzhen +1.42%, Taiwan TAIEX +2.37%, Korea KOSPI +2.74%. SK Hynix +8%, Softbank +12%; Smasung +4%

Lots of good stuff this morning so let’s get right to it…

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CRDO: Will acquirde Dustphotonics, a leading developer of Silicon Photonics Photonic Integrated Circuit (SiPho PIC) technology for optical transceivers.

The acquisition will position Credo with a vertically integrated connectivity stack spanning SerDes, Digital Signal Processing (DSP), Silicon Photonics and system integration for scale out and scale up networks — addressing both electrical and optical interconnects across the full AI infrastructure buildout." “DustPhotonics has developed a differentiated portfolio of SiPho PICs spanning 400G, 800G, and 1.6T, with a roadmap extending to 3.2T, that integrates key optical functions onto a single chip.

Importantly, company not saying Optical will be >$500M in revenues in 27, which is 20%+ and pushes back against a key bear point which is that CRDO didn’t have much optical exposure — remember, many were short this as a copper play so this helps significantly in regard to the narrative as the addition of CPO/NPO content via Dustphonics means they can be seen as an optical player. Bulls will also say this helps them get to mid 60s GMs on transcievers.

Company is hosting a call today at 1pm est to discuss the transaction

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CRDO: William Blair Reiterates OP — DustPhotonics Acquisition Fills Critical Optical Gap, Targets $500M+ Combined Optical Rev by FY27

William Blair views CRDO’s ~$870M acquisition of DustPhotonics as strategically well-aligned, bringing silicon photonics integrated circuits (SiPho PICs) in-house to complement SerDes, DSP, and the growing ZeroFlap module lineup. SiPho PICs are foundational for emerging NPO and CPO architectures at 1.6T/3.2T, opening an estimated $6B TAM by 2030. Management now targets $500M+ in combined optical revenue by FY27 (vs. William Blair’s prior $60M FY26 estimate), with the deal expected to be non-GAAP EPS accretive in FY27. This follows the Hyperlume (MicroLED) and CoMira (link layer, security IP) tuck-ins, extending CRDO’s content opportunity across both copper and optical.

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TSLA: UBS Upgrades to Neutral/$352 PT — More Reasonable Entry After Recent Weakness

UBS upgrades TSLA to Neutral (from Sell) at $352 PT (150x 2027E P/E), arguing current levels more evenly balance near-term demand challenges with the long-term physical AI opportunity. The firm forecasts 1.6M 2026 deliveries (-1% Y/Y) with deliveries growing at a 7% CAGR to 2.1M by 2030 (~3M below consensus), and attributes the 1Q26 energy miss to timing while forecasting ~26% storage deployment CAGR through 2030. On robo-taxi, Austin could begin scaling later this year with TSLA positioned to offer lower $/mi vs. peers. Optimus Gen3 is expected to start production this summer with high-volume in 2027.

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GOOGL: Citi Adds Upside 90-Day Catalyst Watch Ahead of Dense Event Calendar

Citi puts an upside Catalyst Watch on GOOGL (expires 7/13/26) with a stacked event path: Cloud Next (4/22-24), 1Q26 earnings (4/29), Google I/O (5/19-20), YouTube Brandcast (5/13), and Google Marketing Live (5/20). The firm sees a healthy online ad macro driving accelerating Search revenue as Gemini’s product strategy evolves for consumers (750M+ MAUs) and enterprise, with robust Cloud/AI demand suggesting Google could report revenues and operating income above consensus as new products roll out over the coming weeks. Buy maintained.

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BE: RBC Reiterates OP/$143 — Oracle Partnership Expands to Up to 2.8GW of Fuel Cell Deployment