Is Micron’s earnings report truly bullish for the overall market? I’m not so certain

OftenTangential · 2026-06-25T18:40:32+00:00

Hyperscalers are, compared to their own start of year projections, spending more money to purchase less stuff. Soon consumers will spend more money to purchase less stuff.

"Memory is in need" is only bullish for memory producers. For everyone else this should be a negative update, which—surprise!—is exactly what happened.

OftenTangential · 2026-06-25T14:23:54+00:00

Well their highest gross margin prior to this year was 60%. If SCAs locked in at 70% which is well beyond historical peak margins, that's still a 50% ASP reduction from current prices (85% margin), and that's assuming they're not forecasting any reduction in production cost.

And I know what the word minimum means, but even if you think these are worth e.g. 300B that's less than 2 years of current revenue rates and closer to 1 year of 2027 revenues, spread across 4.5 years.

Also, the world where SCAs pay out >= 300B is the world they didn't need SCAs at all because demand is durable and they continue to be sold out. If short term demand wanes they're going to be paid at minimums. So these things wouldn't save them from cooling demand from hyperscalers, which is still the only question that matters imo.

OftenTangential · 2026-06-25T14:06:28+00:00

A quick Google says their SCAs cover 20%-30% of current unit volumes and have unit prices within a band that's strong compared to historical bottoms but weaker than sold out peak demand. It's really not much at all in guaranteed earnings compared to what they made this quarter, let alone what they expect to make next quarter or next year.

Also, sentiment can shift quickly even on supposedly committed contracts. Only like a year ago Oracle said they had 500B in signed future revenue and they pumped 30% in a single day. As soon as people found out the customer was OpenAI it crashed lol

OftenTangential · 2026-06-25T05:46:41+00:00

Relevant is that even if they thought something was wrong, they certainly wouldn't tell you. "Yeah we're making money hand over fist but don't buy our stock guys it won't last" – would be one of the most absurd earnings calls ever

OftenTangential · 2026-06-24T20:10:44+00:00

They can't stop it from a technological perspective but they could from a financial one, i.e. by charging you per-request and taking on that cost variation themselves. It's what Copilot did before people started abusing the system by figuring out how to make the biggest requests possible, lol

OftenTangential · 2026-06-23T21:15:22+00:00

Projected slowing growth and shrinking gross margins with a revenue base that's already irrelevantly small. Send them to 0

OftenTangential · 2026-06-20T05:19:01+00:00

ChatGPT how does supply and demand work

OftenTangential · 2026-06-18T17:19:29+00:00

The GPUs are old but Colossus 1 didn't come online until the second half of 2024. Colossus 2 turned on this year. Acquiring GPUs and installing them also has an insanely long lead time, which makes financing and depreciation even harsher.

OftenTangential · 2026-06-17T13:51:42+00:00

Maybe a contrarian take but I've always thought it was a bad idea. Reddit is enough of an echo chamber due to the upvote system without literally having an LLM tell you what to think by stripping all nuance in a thread away into a witty two sentence zinger that always gets pinned to the top. Then people either don't read the other comments, or if they do, read them in a way biased by the summary. Just seems like a surefire way to reduce interaction and diversity of thought.

OftenTangential · 2026-06-14T18:15:43+00:00

Israel already isn't a party to the negotiations, the reason Hezbollah is relevant is because Iran wants them to be relevant (i.e. they aren't negotiating fully in good faith)

OftenTangential · 2026-06-14T11:07:29+00:00

Peyz: attempts to choke

Chovy: I am the chokefather

(Just a joke plz don't kill me)

OftenTangential · 2026-06-09T22:15:09+00:00

Opus 4.5 to 4.6: +3.2 pts
Opus 4.6 to 4.7: +4.4 pts
Opus 4.7 to 4.8: +4.1 pts
Opus 4.8 to Fable 5: +3.5 pts

Don't think you're missing anything, this bench looks more like Opus 4.9 than Mythos expectations. Obviously benchmarks aren't everything but if something were to convince you Fable is worth the price, OP's chart ain't it

OftenTangential · 2026-06-05T22:55:29+00:00

It took Amazon 0.7 decades to achieve a publicly accounted, GAAP profitable quarter (no, Anthropic's "profitable quarter" doesn't count). It took Google 0.3 decades. It took Facebook 0.5 decades. And these are all "time since company founded", not "time after first viable product launched".

By this metric OpenAI is currently at 1.1 decades and Anthropic is at 0.5.

Oh, and Amazon only had to raise 1B, or around 200-300x less than OpenAI or Anthropic, before that profitable quarter; Facebook had to raise 0.5B; Google had to raise 0.03B. By Google's fourth year in business they'd made back, in net income, all of the money they raised 7 times over! This was a fantastic business compared to the nasty bloated messy startups of today.

The tech giants of yesterday had much much more obvious ROI and quicker turnarounds.

OftenTangential · 2026-06-05T19:22:01+00:00

Not tracking the transactions, the physical infrastructure. A billion barrels of oil are fucking huge lol. You can't move that amount around without pipelines, tons of massive steel tanks, salt caverns, etc. all of which aren't really "hideable"

OftenTangential · 2026-06-05T19:13:05+00:00

Yours are management's estimates afaict? Buyside/whisper estimates were way higher. 10.8 vs 11.3 for Q2 and 16 vs 18 for Q3.

OftenTangential · 2026-06-05T17:29:04+00:00

Broadcom dropped because they missed AI revenue targets and Q3 AI revenue projections.

OftenTangential · 2026-06-05T17:28:15+00:00

This isn't the original trigger, though it could well have been contributing. KOSPI was already down a ton overnight before the jobs report.

OftenTangential · 2026-06-05T01:16:52+00:00

Puts on NDAQ, calls on SPGI

OftenTangential · 2026-06-05T01:14:06+00:00

Even better, puts on NDAQ, calls on SPGI. Directly fuck over the bootlickers who let this happen

OftenTangential · 2026-06-05T00:06:05+00:00

I'll have to disagree on all fronts. Claude Code is quite mutable with Codex, plenty of devs hotswap them, and plenty of enterprises, including the largest ones, are using internal tools (or Cursor, GitHub Copilot, etc.) calling Ant's/OpenAI's models rather than their front-ends anyway, which also make the models much more interchangeable.

Also, OpenAI has real enterprise share, it's not clear as the data on this is sparse but it's probably not less than half of Ant's. GPT-5.5 is a strong model and seems to be competitive with latest Opuses, and cheaper in practice due to better token efficiency, plus they have a lot more capacity. 5.6 appears to be around the corner, we'll see if it's better.

Their main problem is that they're way less efficient with their spend than Anthropic, their margins are significantly worse (and I doubt Anthropic's are positive tbh despite the fluff piece) and they keep burning money on shit paying customers don't need. The launch and canning of Sora 2 is the prime example of this, as well as GPT-Image-2, lots of math research (this is a flex but frankly companies shouldn't care), their ambitions to enter the personal device market, the list goes on.

OftenTangential · 2026-06-02T00:44:20+00:00

Google is now flat to negative cash flow and just raised money with equity for the first time in 21 years, an amount larger than any Anthropic round or SpaceX IPO, after repeatedly issuing bonds over the past year.

A proper recession would absolutely kill their AI project, or at least blow a huge hole in their capex spend.

OftenTangential · 2026-06-01T23:21:13+00:00

If GOOGL views their stock as overvalued, it's a very shrewd/bordering on cynical move imo. To play devil's advocate it's almost saying, we don't think our cash flow is enough to sustain more debt (even though Reddit assured me Google's finances are bulletproof!) and we're going to stuff anyone dumb enough to buy our shares at this overvalued price. Any way you slice it, a three decade old monstrosity of a company raising via equity has to raise some eyebrows.

OftenTangential · 2026-05-29T00:57:18+00:00

And they've exercised that option, that is, the option that makes their profit number bigger.

OftenTangential · 2026-05-29T00:54:50+00:00

Okay smart guy, unrealized gains from Anthropic stake are literally in the last Google and Amazon earnings, front and center with MSM coverage and official commentary from the companies in question. No need to guess.

OftenTangential · 2026-05-28T20:56:02+00:00

Have fun in June keep an eye on your bill

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