Weekend Update #258
Thank you for your continued support and engagement. Each week, we're sharing what companies we're researching and the what, the who and the how that we think makes the companies interesting and unique. This roundup is brought to you weekly by a group of interns, creative minds, artists and investors who believe that through best in class investing along with the democratization of financial education we can do great things together. Enjoy, Explore and Share.
The market finished the week lower, despite the largely anticipated Fed rate cut on Wednesday, as AI-related stocks slumped following softer-than-expected sales outlooks from Oracle and Broadcom. Broadcom CEO Hock Tan cited a $73B AI backlog slated for shipment over six quarters, but the figure was viewed as underwhelming even as he characterized it as conservative. Sentiment worsened after Oracle delayed several OpenAI-linked data centers to 2028 and Fermi disclosed a tenant exiting an AI-campus power deal, dragging tech stocks broadly lower.
In economic data for the week, the NFIB Small Business Optimism Index rose to 99 in November, beating expectations even as uncertainty increased, inflation concerns picked up, and supply-chain disruptions persisted; labor conditions remained tight but showed signs of stabilization with firmer hiring and compensation plans. ADP data meanwhile showed private employers adding an average of 4,750 jobs per week—the first positive stretch in a month—suggesting a tentative pickup in labor-market momentum. JOLTS data painted a mixed picture, with job openings jumping to 7.67 million and openings per unemployed worker rising to 1.00, even as hiring softened, layoffs hit a post-pandemic high, and quits fell to their lowest level since 2020.
The Fed cut rates by 25 bps to 3.50%–3.75%, signaling confidence that inflation risks have eased. Chair Powell noted the economy remains on a moderate growth path with consumer spending solid and policy rates now within a neutral range. While the median rate path was unchanged, officials emphasized rising unemployment risks, evidence the labor market has cooled more than reported, and limited inflation pressures outside tariff-affected goods. With reserves rebuilt and Treasury purchases resuming, the Fed judged the economy too cool for meaningful Phillips-curve inflation, supporting the decision to ease policy.
In stock-specific news, Disney and OpenAI unveiled a three-year partnership in which Sora will create user-prompted short-form videos featuring hundreds of Disney, Pixar, Marvel, and Star Wars characters—some of which will stream on Disney+—while Disney becomes a major OpenAI customer, deploys ChatGPT internally, invests $1 billion with additional warrants. Meanwhile, five cryptocurrency firms—Circle, Ripple, BitGo, Fidelity’s digital assets unit, and Paxos—received preliminary approval from the US Office of the Comptroller of the Currency for national trust bank charters, reflecting the White House’s growing support and further legitimizing the crypto industry.
Friday’s Close (Weekly Performance)
S&P 500 6,827.41 (-0.63%)
Nasdaq 23,195.17 (-1.62%)
Dow Jones 48,458.05 (+1.05%)
Thank you Blue Room Senior Analyst NICK PEART.
Federal Reserve Chairman Jerome Powell Good afternoon. My colleagues and I remain squarely focused on achieving our dual mandate goals of maximum employment and stable prices for the benefit of the American people. Although important federal government data for the past couple of months have yet to be released, available public- and private-sector data suggest that the outlook for employment and inflation has not changed much since our meeting in October . Conditions in the labor market appear to be gradually cooling, and inflation remains somewhat elevated.
In support of our goals, and in light of the balance of risks to employment and inflation, today the Federal Open Market Committee decided to lower our policy interest rate by 1/4 percentage point . As a separate matter , we also decided to initiate purchases of shorter-term Treasury securities solely for the purpose of maintaining an ample supply of reserves over time , thus supporting effective control of our policy rate. I will have more to say about monetary policy and its implementation after briefly reviewing economic developments.
Although some key government data have yet to be released, available indicators suggest that economic activity has been expanding at a moderate pace. Consumer spending appears to have remained solid , and business fixed investment has continued to expand . In contrast, activity in the housing sector remains weak. The temporary shutdown of the federal government has likely weighed on economic activity in the current quarter, but these effects should be mostly offset by higher growth next quarter, reflecting the reopening. In
On August 15, 2023, Imugene entered into a strategic transaction with Precision BioSciences to acquire Azercel.1 Imugene believes Azercel is a $2.5 billion opportunity. In exchange for global rights to Azercel, the manufacturing plant and cell therapy team, Precision BioSciences received $21 million upfront. Imugene recently paid $8 million after the successful re-dosing of Phase 1b patients in DLBCL. Upon commercialization, Precision BioSciences will receive $198 million in milestone payments and standard tiered royalties.
Welcome everyone to Imugene's webinar on our FDA announcement of the meeting minutes this week. Welcome to all of our shareholders. This represents an important moment
for Imugene with the FDA providing clarity on Azercel’s path to registration.
Dr. Leslie Chong
I really want to thank the team for putting the FDA briefing document together as well as their development and their experience. This goes a long way for the FDA to have provided such meaningful feedback, with ease actually. Dr. John Byon (Chief Medical Officer) and Ursula McCurry (Chief Clinical Operations Officer) are currently at ASH showcasing Azercel in our oral presentation. I am joined by Dr. Brad Glover here today.
THE STORY ABOVE IS A FOLLOW UP TO THE STORY BELOW, PUBLISHED FIVE YEARS AGO.
This patient had a high tumor burden. If you look closely at the left leg , which i s at the right side of the figure, you w ill see t he patient h ad lymphoma encasing the veins — with lymphedema a very swollen left leg in that context. Also had disease extending along the base of the liver , in the adrenal (gland) sic and extending upwards in the lower neck.
The patient has progressed a fter:
(L ine 1 ) Anthracycline b ased c hemo
(L ine 2 ) Cytarabine b ased c hemo
( Line 3 ) Yescarta
1 based chemo with only an eight month remission
Oracle is the Litmus Test for A.I. Capital Investment
On September 9, 2025, Oracle reported a massive 359% increase in contractual bookings for A.I. Infrastructure, led by a 5-year $300 billion deal from Open AI for infrastructure services for training A.I. models and running them. Initially, the market cheered this news, sending Oracle shares soaring by 36% to $328.33 and swelled Oracle's equity market value to $959 billion. Soon after Oracle's Financial Analyst Day, the rating agencies put the company's BBB corporate bonds on negative watch. Oracle will spend over $230 billion in capital investment to support this contract, and will cause additional indebtedness of approximately $70 billion.Beginning in 2015, Oracle used their balance sheet to reduce their balance sheet to reduce their share count from 4.8 billion to 2.9 billion, a 39% reduction over a decade, while maintaining a BBB investment grade rating.
Looking ahead to 2030, Oracle will have approximately $170 billion in debt. Market concerns have caused Oracle's cost of borrowing to increase significantly from 4.5% to ~6.0% factoring in the cost of Oracle specific credit insurance. This increases the annual interest service cost from $4.2 billion today, to $8.7 billion in 2030. However, by 2030, revenue will have from $67 billion to over $200 billion. EBITDA should grow to $85 billion, offering 10x interest coverage. It is a long valley of negative free cash flow in F2027 and F2028, but the business is there. Focus now turns of Open AI to demonstrate the monetization potential of its platform.
Company Participants
Ken Bond — Senior Vice President of Investor Relations
Douglas Kehring — Executive VP & Principal Financial Officer
Clay Magouyrk — Chief Executive Officer & Director
Lawrence Ellison — Co-Founder, Chairman & CTO
Mike Sicilia — Chief Executive Officer & Director
Conference Call Participants
Brad Zelnick — Deutsche Bank
Benjamin Reitzes — Melius Research LLC
Tyler Radke — Citigroup
Brent Thill — Jefferies LLC
Mark Moerdler — Sanford C. Bernstein
John DiFucci — Guggenheim Securities
Published in Blue RoomTM Newsletter Number 258: December 13, 2025
Note: On October 16, 2025, Oracle raised their outlook for Oracle Cloud Infrastructure.
Douglas Kehring, CFO
As it relates to the numbers we are about to present, the following apply to both the results for Q2 and to our guidance for Q3. First, we'll be discussing our financials using constant currency growth rates as this is how we manage the business. Second, we'll be presenting our numbers on a non-GAAP basis, except where we indicate otherwise. Finally, as it relates to currency, it had a 1% positive impact on revenue and $0.03 positive impact on earnings in Q2. For Q3, assuming currency exchange rates remain the same as they are now, currency should have a 2% to 3% positive effect on revenue and have a $0.06 positive effect on EPS depending on rounding.
In terms of the results for FQ2 2026, we had another excellent quarter of execution. Remaining performance obligations, or RPO, ended the quarter at $523.3 billion, up 433% from last year and up $68 billion since the end of August, driven by contracts signed with Meta, NVIDIA and others as we continue to diversify our customer backlog. RPO expected to be recognized in the next 12 months grew 40% year-over-year compared with 25% last quarter and 21% last year .
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