LT Weekly: Sep 05, 2025
Summer is over and it is off to the races with an always busy September underway. It was rocky out of the gate post the Labor Day holiday, but the tech heavy Nasdaq ended closing the week up +1.1% (while the S&P 500 closed up only a modest +0.33%). Alphabet was a clear leader, up +10% for the week post the better than feared court ruling on search antitrust remedies (see Theme #1). There was a lot of macro focus on the labor market slowdown which resulted in market expectations moving to three 25bp cuts before YE. Trade headlines were also front and center.
Within the sector, see below for key themes and updates in this edition:
- The Rise of Gen AI Tools Changed the Course Of The Regulatory Hammer On Big Tech
- Data Shows That Specialty SVOD Growth Is Outpacing That Of Mainstream Svs
- The Post Summer TMT Conference Circuit Has Begun! Key Executive Soundbites This Week…
- Which Company Is Looking To Hire The Most AI Engineers? TikTok
- AI Will “Extend” SaaS Vs “Eliminate” SaaS, Per Salesforce CEO Benioff
- Grab Bag: NFL Hits Ad Rev Record / Apple’s Upcoming “Awe Dropping” Event / Lululemon Post-Earnings Plunge
Have a great weekend.
Best,
Leslie
The Rise of Gen AI Tools Changed the Course Of The Regulatory Hammer On Big Tech
It was a sigh of relief for Alphabet investors this week as the verdict regarding remedies associated with Google’s Search antitrust case was finally delivered…and the outcome was positive for the Co. There were minimal penalties and far less severe remedies than feared. Concerns about the Co having to split up and divest Chrome are now off the table. What helped change the course of the case is the rise of gen AI tools that have introduced new ways for users to retrieve information, “challenging” Google’s dominance in traditional search. Judge Amit Mehta said that these new tools “may yet prove to be game changers,” but their emergence made harsh structural remedies less necessary. Interestingly, “Generative AI” and “GenAI” was mentioned 220 times in the remedies ruling and “large language models” (LLMs) were mentioned 82 times.
The outcome of this ruling was an overhang on Alphabet’s stock, hence investors were relieved to move forward with certainty on this front. Now the focus moves purely back to fundamentals…
-> Alphabet shares rallied +9% and Apple’s rose +4% in reaction to the final ruling; YTD, the stocks are up +24% and -4%, respectively while Meta, Amazon, and Microsoft are up +15%, +6%, and +18%, respectively
A Brief History … (link)