AnalytixInsight

Growth stocks performed well last week, Nasdaq was up 3.25%, S&P 500 rose 2.5%, and Dow Jones gained 1.4%. Arm will start conversations with potential IPO investors with a US$50 billion to US$55 billion valuation in mind, for at least a 56% increase from the price at which SoftBank bought Arm seven years ago. OpenAI is on pace to generate more than US$1 billion in revenue, up more than 35 times compared to last year. Nvidia-backed CoreWeave is seeking stake sale at up to a US$8 billion valuation, even as some employees are looking to cash out an astonishing US$500 million worth of shares, according to The Information. In Canada, Sophic Client Kraken announced a $2.7 million sonar & subsea battery order, and reiterated financial guidance for 2023 with Q2 results. The Company expects revenue to be in the $66 – $78 million range and adjusted EBITDA in the $12 – $17 million range. Mid-point of guidance range implies revenue growth of 76% over 2022 and adjusted EBITDA growth of 275%. Sophic Client, Clear Blue Technologies announced Q2 results, and is focused on revenue growth in H2 2023, net-zero cash burn and positive EBITDA. Private equity firm Veritas Capital made an offer to buy BlackBerry, months after the Company began a strategic review, its U.S-listed shares rose about 17% on the news. Amazon and Shopify announced a partnership Wednesday to allow Shopify sellers to offer Amazon’s Buy With Prime service on their e-commerce sites, Shopify also began quietly rolling out a TikTok integration. Toronto-based Cohere is being advised by JPMorgan and Goldman Sachs on a potential financing round. Cohere, a competitor to OpenAI, raised US$270 million in June at a valuation of up US$2.2 billion, recently Tiger Global was close to selling a stake in Cohere in a deal that would have valued the company at about US$3 billion.

Last week, markets were mixed, Dow Jones fell 0.45%, S&P 500 was up 0.8%, and Nasdaq rose 2.3%, after ending three-week losing streaks. Major indexes did see reversals on Thursday despite blowout Nvidia results, and stocks rebounded on Friday despite a hawkish comments from Fed chief Jerome Powell. Nvidia’s financial performance in the July quarter blew past its earlier projections. Shares rose nearly 10% in after-hours trading. Data and marketing automation company Klaviyo on Friday became the latest tech company to try to join the public markets. Instacart just filed for its IPO and revealed a plan to sell US$175 million in stock to PepsiCo. Arm, which is owned by SoftBank, filed for its initial public offering Monday. Arm is one of the most important companies in technology. Its chip designs found in nearly all the world’s smartphones, including Apple iPhones and most Android devices. In Canada, Sophic Clients Legend Power Systems, UGE International and Renoworks Software reported recent financial results. Sophic Client Clear Blue Technologies will report financial results on Tuesday. “Our focus this quarter remained around advancing sales opportunities and we currently have new late-stage large deals with very strong financial viability,” said Randy Buchamer, Legend Power Systems CEO. “The handful of late-stage deals could bring over $10 million in new potential bookings near term with the long term total pipeline now north of $100 million. The Company also closed a non-brokered $2.5 million financing. UGE ended Q2 with 3.8 MW of operating assets that contributed US$183.6K of energy generation revenue (+126% y/y) with 93% gross margins. The Company also closed its previously announced overnight marketed offering of debentures (the “Green Bonds”)for aggregate gross proceeds of US$5,749,655. The Offering was conducted by a syndicate of underwriters led by Canaccord Genuity, and iA Private Wealth.

Last week was another tough week for investors, Dow Jones fell 2.2%, S&P 500 lost 2.1%, and Nasdaq fell 2.6%. SoftBank is in talks to acquire the 25% stake in Arm it does not directly own. Arm’s revenue fell 1% to US$2.68 billion in its last fiscal year, Bloomberg reported. The chip designer’s revenue fell a further 2.5% in the June quarter. Instacart is aiming for a September IPO. Instacart last raised money in 2021 at a US$39 billion valuation, but is likely to go public around the US$10 billion mark. SpaceX profit hit US$55 million in Q1 on US$1.5 billion in revenue. In 2022, the company had US$559 million in losses on US$4.6 billion in revenue. Europe’s Stripe rival Adyen fell 39% after its slowest sales growth on record. Adyen attributed the tepid print to increased hiring, firmer wages and to a shift in its North American customers’ business prioritization from growth to cost savings in the first half of the year. Shares of Hawaiian Electric plunged as much as 41% on Monday and are down 49% since the devastating Maui fires broke out last week. Intel scrapped its US$5.4 billion deal to buy Israeli contract chipmaker Tower Semiconductor Ltd after their merger agreement expired without regulatory approval from China. Microsoft is planning a new AI service with Databricks, hedging its OpenAI bet. Gemini, Google’s answer to OpenAI’s core software, will launch this fall with the ability to generate conversational text as well as imagery. In Canada, Sophic Client OneSoft reported Q2 revenue of $2.5 million (+87% y/y). Annual recurring revenue increased q/q by 59%. Management reiterated its gross profit guidance of $7.6 million in Fiscal 2023. Squamish, BC-based cleantech startup Carbon Engineering has entered into a definitive agreement to be acquired by oil -and-gas company Occidental Petroleum for US$1.1 billion.

Last week, Nasdaq and growth names were more damaged as industrials, infrastructure, housing, energy sectors and some retail, travel, medical, transportation and financial names held up better. Dow Jones rose 0.6%, S&P lost 0.3% and Nasdaq fell 1.9%. SoftBank’s Vision Fund unit recorded quarterly investment gains for the first time in six quarters. Nikkei reported that chip design company Arm is set to go public on the Nasdaq later this year, with an IPO valued at more than US$60 billion. Apple, Samsung, Nvidia, Intel, and other leading chipmakers will invest in the IPO. Design App Canva was valued at US$25.5 billion in the secondary market, ~36% lower than its most recent financing in September 2021. WeWork warned it has ‘substantial doubt’ about whether it can keep going as a business. PENN Entertainment stock jumped 20% after striking US$2 billion sports-betting deal with ESPN. Nvidia revealed a new A.I. chip, and said costs of running LLMs will ‘drop significantly’. President Joe Biden signed an executive order on Wednesday aimed at regulating new U.S. investments and expertise that supports Chinese development of sensitive technologies. China’s internet giants ordered US$5 billion of Nvidia chips. Baidu, ByteDance, Tencent and Alibaba have made orders worth US$1 billion to acquire about 100,000 A800 processors. GM said all of its EVs will be able to power your home by 2026. In Canada, Algonquin Power & Utilities announced the resignation of its CEO and said it was considering a sale of its renewable energy unit, after activist firms urged action to reduce debt and boost earnings. Sophic Client Legend Power announced a proposed second tranche of its offering. Sophic Client OneSoft announced release dates for Q2 2023 results, as the stock hit a 52 week high. Vancouver fusion energy company General Fusion raised $33.5 millionin what it called the first close of its Series F raise.