June 01, 2025: Great Month, But Always One Tweet Away From Volatility

Last week, Dow Jones rose 1.6%, S&P 500 gained 1.9%, Nasdaq composite rose 2%. For the month, Dow Jones rose 3.9%, S&P 500 gained 6.15% (best May return in 35 years), and the Nasdaq was up almost 10% (largest monthly gain since November 2023). That said, tariff related headlines once again pressured markets on Friday. Chime is targeting a US$11B IPO valuation, while Shein is now considering a Hong Kong IPO after regulatory delays in London. Discord, anticipating an IPO, introduced “Orbs,” virtual rewards designed to boost ad engagement. SoftBank proposed a joint US$300B U.S.-Japan sovereign wealth fund to finance technology and infrastructure projects. Salesforce will acquire Informatica for US$8B to bolster its AI capabilities. Nvidia forecasted a US$8B revenue hit from stricter U.S.-China export controls, despite robust growth elsewhere. The U.S. government also recently ordered American vendors that sell software for chip design to obtain export licenses first before selling to China. Mary Meeker, the most famous internet analyst of the dot-com boom era, says AI is growing faster than anything that came before it, in a new 340 page report. Meta and Anduril partnered to create VR devices for the U.S. military, while Anthropic’s CEO warned AI could eliminate half of entry-level white-collar jobs within five years, urging preparedness from government and industry leaders. Billionaire Chamath Palihapitiya has a blunt warning about quantum computing being able to break common encryption much sooner than expected. In Canada, Bell plans to invest hundreds of millions to build six AI-focused data centres. Sophic client, Kraken Robotics reported Q1 results and reiterated its full-year guidance, expecting significant revenue and EBITDA margin expansion driven by its recent subsea LiDAR acquisition and new subsea manufacturing facility in Nova Scotia. Sophic client, American Aires, reported record Q1 revenue of $5.38M, up 164% year-over-year. Management anticipates profitability improvement in upcoming quarters, reaffirming 2025 revenue guidance of $28M–$32M, and adjusted EBITDA guidance of $2M loss to a $2M profit.

Bell (BCE-TSX, BCE-NYSE) to build six AI data centres in Canada as telcos compete on infrastructure.

Telecommunications giant Bell is tossing its hat into the artificial intelligence (AI) infrastructure ring as its competitors invest in AI data centres in anticipation of a growing demand for AI compute. The Bell AI Fabric project aims to build six AI data centres in British Columbia (BC), which the company says make up the first “supercluster” of a planned national network. Bell declined to disclose the value of the project to BetaKit, but said it was in the hundreds of millions (“nine-figure”) range. American computing hardware company Groq will be providing the chips that power the data centres. Canada is home to roughly 240 data centres, according to the Canada Energy Regulator. AI data centres, which can power training and inference of large-language models (LLMs), are significantly more energy-intensive. While traditional data centres require between five and 10 megawatts (MW) of power, one AI “hyperscale” data centre typically demands more than 100 MW, according to the International Energy Agency (IEA). https://tinyurl.com/xu7cnv79

Sophic Client Kraken Robotics (PNG-TSXV, KRKNF-OTC) reports Q1 2025 financial results and reiterates 2025 guidance.

Consolidated revenue in Q1 2025 decreased 23% to $16.1 million, compared to $20.9 in the prior year. The decrease was driven by a year-over-year decline in Product revenue. Product revenue in the quarter decreased 42% to $9.2 million, compared to $15.8 million in the prior year. While the quarter saw significant growth in our SeaPower™ subsea battery business, our sonar related revenue declined as the acquisition part of the Canadian Navy system integration project nears completion. As in the past, quarterly revenue can fluctuate significantly due to the timing of product orders and shipments. Service revenue in the quarter increased 38% to $7.0 million compared to the prior year due to the continued demand for Sub-Bottom Imager™ and Acoustic Corer™ services. Just after the quarter ended, we completed the acquisition of subsea LiDAR services company, 3D at Depth. Combined with the recent introduction of our KATFISH subsea survey platform into the commercial offshore service market, we have a growing complement of solutions to offer our expanding Services customer base. Gross profit in the quarter increased 8% to $10.1 million, compared to $9.3 million in the prior year, implying a gross margin of 62.7% compared to 44.8%. Gross margin percentage was impacted by several one time items in the quarter. Future quarters are expected to be reflective of our historic gross profit margins. Adjusted EBITDA for the quarter decreased 32% to $2.8 million, compared to Adjusted EBITDA of $4.1 million in the comparable quarter, implying an adjusted EBITDA margin of 17.3% compared to 19.6% in the comparable year. Total assets were $178.8 million on March 31, 2025, compared to $73.5 million on March 31, 2024. Cash at the end of the quarter totaled $58.3 million, compared to $1.5 million in the prior year, while working capital totaled $94.6 million, compared to $6.5 million in the prior year. Capital expenditures/intangible assets purchased were $2.7 million in the quarter, compared to $0.8 million in the comparable quarter. The increase is related to our new battery facility in Canada as well as growth in internal assets to drive service revenue growth. Net income for the quarter was $0.2 million compared to a profit of $2.2 million in the comparable quarter. Basic and diluted earnings per share were $0.00 compared to $0.01 in the prior year. Annual financial guidance remains unchanged from the guidance provided on April 28, 2025. In 2025, we expect revenue between $120 million and $135 million and Adjusted EBITDA1 margin in the $26 million to $34 million range. The midpoint of guidance represents 40% revenue growth and 45% Adjusted EBITDA growth. Capital expenditures in 2025 are expected to range from $13 million to $17 million with approximately $10 million of this spending related to a new subsea power manufacturing facility that is expected to be operational in Nova Scotia near the end of 2025. Consistent with prior years, revenue is expected to be more weighted toward the second half of calendar year 2025. https://tinyurl.com/4f3u4k27

Sophic Client American Aires (WIFI-CSE, AAIRF-OTCQB) announces record first quarter 2025 revenue of $5.38 million & 164% yoy sales growth.

During the three months ended March 31, 2025, the Company’s reported sales increased by 164% year-over-year, for a first quarter record of $5.38 million compared to combined sales of $2.04 million in the year ago quarter. The quarter’s increase in reported sales was driven largely by the efficient deployment of scaled-up advertising and marketing budgets, which included strategic partnerships the Company entered into during 2024 with the UFC, the WWE, Canada Basketball, and high profile athletes, including NHL star John Tavares and NBA star RJ Barrett; to note, 2025 will mark the Company’s first full year of leveraging its partnerships with UFC, WWE, and Canada Basketball. The quarterly performance extends the Company’s multi-year trend of strong revenue growth through widening its user base, opening new market segments, and expanding its overall reach and brand name recognition. To date, Management is pleased with its ability to maintain the strong sales momentum created in late 2024 through the seasonally slow first quarter, which was a key part of the Company’s overall strategy for 2025. Cash as of March 31, 2025 was reported at $1.55 million, and Inventory was reported at $2.20 million. Continued investments in scaling up promotional efforts contributed to increased advertising and marketing expenses in Q1 (see details below), which resulted in an adjusted EBITDA loss reported at $1.56 million compared to a combined adjusted EBITDA loss of $0.88 million in the year ago quarter. Management anticipates adjusted EBITDA to improve over the coming quarters as the Company continues to realize incremental benefits from the partnerships mentioned above and from multiple line items that the Company has renegotiated to lower Aires’ Cost of Goods, including lowered product and fulfillment costs. Taking into account the traditional seasonality of the Company’s performance, where order volumes and sales generally increase progressively over Q2, Q3 and Q4, Management reconfirms 2025 guidance ranges announced on January 27, 2025, with the expectation of Sales in the $28 million to $32 million range and adjusted EBITDA in the range of a $2 million loss to a $2 million profit. https://t.co/nrpfGhRBkm

Chime discusses US$11 billion valuation in IPO.

Banking app Chime has discussed about an US$11 billion valuation with investors ahead of its initial public offering this month, The Information reported. That would rise from the about US$8 billion its bankers were discussing earlier this month, but down from the US$25 billion mark at which it raised in 2021. It would be the latest in a string of venture-backed companies to go public at lower valuations than their previous private round of financing. The company expects to set an initial price range Monday for its IPO, before setting out on about a week of an investor road show. The company improved growth and profits last year, and has gotten deeper into lending its customers money. https://tinyurl.com/yhc53br4

Shein weighs Hong Kong IPO after London efforts stall.

Shein is considering switching its planned initial public offering from London to Hong Kong, according to news reports Wednesday. The fast-fashion giant is weighing the switch because its Chinese securities regulators haven’t yet approved a London IPO, the reports said. Shein had received signoff from the U.K.’s Financial Conduct Authority and was waiting for approval from the China Securities Regulatory Commission, Reuters reported in April. Shein, which was founded in China and is now headquartered in Singapore, had sought to go public in the U.S., in part to help shed its image as a Chinese company. Shein scrapped those efforts and focused on a London listing amid mounting scrutiny of its supply chain and labor practices from U.S. lawmakers. Even though Shein is no longer headquartered in China and doesn’t sell to Chinese consumers, it still has extensive Chinese supply chain operations and must register with the China Securities Regulatory Commission for an overseas listing. https://tinyurl.com/fhr3ptze

Discord explores virtual rewards for its ad product as it prepares for a potential IPO.

Discord announced on Wednesday that it’s experimenting with a new virtual reward system aimed at encouraging more users to engage with its interactive ads. This new feature, called “Orbs,” comes on the heels of the company preparing for a potential IPO. Users can earn Orbs by completing “Quests,” Discord’s ad format where advertisers incentivize users to watch product videos or play games by rewarding them with virtual items. The addition of Orbs gives users the chance to redeem exclusive digital items from Discord’s Shop, including Nitro credits, profile badges, avatar decorations, profile effects, and items from main collections. It’s clear that the goal of Orbs is to encourage more interaction with Quests as Discord seeks to demonstrate to partners that it can offer a scalable ad business. The company has reportedly discussed a possible IPO with investment bankers, per The New York Times. https://tinyurl.com/yz7n995h

Mary Meeker has a lot to say about AI.

Mary Meeker says artificial intelligence is growing faster than anything that came before it. The technology has spread rapidly across the globe and “AI leadership could beget geopolitical leadership.” The most famous internet analyst of the dot-com boom era says that and a lot more in a 340 page report on AI called “Trends – Artificial intelligence.” With colleagues at Bond, the venture capital firm she founded, Meeker reprises her 1996 “Internet Report,” for the AI era. Like other Meeker reports, this one covers a lot of ground, including the invention of the printing press and the introduction of the Roomba robot vacuum cleaner, and some things in between. It has little clear focus but provides lots of material to digest. Some of the sharper takeaways: Rising AI performance and falling costs is causing an explosion of users; momentum is growing for open-source models; ChatGPT has great expectations for its own future powers. And finally this: “AI is a compounder – on internet infrastructure, which allows for wicked-fast adoption of easy-to-use broad-interest services.” https://tinyurl.com/bdcuardm

SoftBank’s Son proposes joint U.S.-Japan sovereign wealth fund.

SoftBank Group founder Masayoshi Son has floated the idea of creating a U.S.-Japan sovereign wealth fund for investments in technology and infrastructure in the U.S., the Financial Times reported. The move could help the U.S. Treasury Department earn revenue without raising taxes, the newspaper said, citing a person briefed on the situation. Son, who knows President Donald Trump personally, discussed the joint fund idea with U.S. Treasury Secretary Scott Bessent. Top government officials in Washington and Tokyo also are aware of the proposal, according to the newspaper. For the fund to be effective, its size would have to be “enormous,” with potentially US$300 billion in initial capital, the newspaper reported, citing another person familiar with the discussions. The fund would be jointly owned and operated by the U.S. Treasury and Japan’s Ministry of Finance. But it could also accept investments from limited partners, including retail investors in the U.S. and Japan, it said. https://tinyurl.com/2adjyj27

Musk raised US$600 million for Neuralink following third implant.

Elon Musk’s Neuralink raised US$600 million at a valuation of US$9 billion, Semafor reported Tuesday, citing anonymous sources. The brain-computer interface company implanted its third chip last month into the brain of an Arizona man with ALS. The Food and Drug Administration cleared Neuralink for human clinical trials in early 2023 and in May of this year gave the company “breakthrough device designation,” which will speed its development. Competitor Precision Neuroscience also received FDA clearance for the main component of its own brain implant. Neuralink previously raised millions from Peter Thiel’s Founders Fund, Google Ventures, Valor Equity Partners and Gigafund, a Founders Fund spinoff that has also funded Musk’s Boring Company and SpaceX. Bloomberg reported in April that Neuralink was looking to bring in another US$500 million at a valuation of US$8.5 billion. https://tinyurl.com/yc8664j6

Elon Musk’s xAI enters US$300 million deal with Telegram.

Telegram founder Pavel Durov said Wednesday that his messaging app will offer access to Grok, the AI chatbot from Elon Musk’s xAI. The deal expands Grok’s distribution to Telegram’s more than one billion users. XAI will pay Telegram US$300 million in cash and equity as part of the deal, as well as a 50% cut of revenue from xAI subscriptions sold on the platform. “Together, we win!” Durov wrote. Grok has long been available on X, Musk’s social media app, allowing users to request more background on posts. A standalone tab allows people to chat directly with the artificial intelligence model, which cites its sources and was originally billed as a less filtered alternative to ChatGPT and Google Gemini. Telegram was started with a similar goal of allowing uncensored conversations. https://tinyurl.com/3t5td6e9

Salesforce to buy Informatica for US$8 billion.

Salesforce struck a deal to buy data management firm Informatica for US$8 billion in cash, as the subscription software company looks once again to acquisitions to accelerate its growth. The acquisition is the first big deal struck by Salesforce since it bought Slack in 2021 for US$28 billion, capping a string of ever-larger purchases. Under pressure from activist investors over Salesforce’s weak profit margins, the company focused on improving the efficiency of its operations and pulled back on acquisitions as a growth strategy. Salesforce’s topline growth decelerated to 9% in the year to January and it forecast even slower growth this year. Informatica isn’t growing quickly: its first quarter revenues expanded just 3.9%. The company is in the middle of a transition from one that sells traditional software running in private data centers to one that runs in the cloud on a subscription basis. The cloud subscription segment grew at 32% in the first quarter. Salesforce said the deal will strengthen its AI-agent offerings. https://tinyurl.com/yc4y25pp

Nvidia says new China controls will cost it US$8 billion in Q2.

Nvidia on Wednesday projected that the Trump administration’s new export controls, preventing it from selling chips to the Chinese market, would cost it US$8 billion in revenue in its second quarter ending July, roughly 15% of what its revenue would have been otherwise. Even so, Nvidia projected US$45 billion in revenue for the second quarter, which would still be a 50% increase from the same period last year. The maker of specialized AI chips, which has seen its business explode in the past two years, reported 69% growth in revenue to $44.1 billion in the quarter ending in April, continuing a streak beating its own growth projections. The strong result was despite the imposition of the tighter export controls during the quarter. Nvidia said it sold US$4.6 billion worth of those chips before the new controls were introduced and was unable to ship an additional $2.5 billion worth of chips to China. The company said it took a charge of US$4.5 billion due to excess inventory it could no longer sell. The Information previously reported that Chinese firms placed at least US$16 billion in orders for Nvidia’s H20 chips in the first three months of the year. Nvidia said the charge lowered the firm’s margins to 60%. Had it been able to sell the H20 chips, Nvidia said its margin would have been 71.3%. Nvidia’s stock was up more than 4% in afterhours trading. https://tinyurl.com/mszmzv3y

U.S. toughens rules for chip design software sales to China.

The U.S. government recently ordered American vendors that sell software for chip design to obtain export licenses first before selling to China, the Financial Times reported, citing people familiar with the move. The new policy could further hurt American chip-design software companies and their Chinese customers, which still rely on U.S. vendors for the software, known as Electronic Design Automation. Since 2022, the U.S. government has restricted the sale of some types of the software meant for designing cutting-edge chips, but the new rules have been expanded to include all products. Reuters separately reported that Commerce will review the licenses to China on a case-by-case basis. Commerce sent notices about the new rules to some of the major players in the industry including Cadence, Synopsys and Siemens EDA, the newspaper reported. But not all vendors said they received the notice. Synopsys’ CEO Sassine Ghazi said in an earnings call Wednesday that the company hadn’t received any official communication from the Commerce Department’s Bureau of Industry and Security, which handles the U.S. semiconductor industry’s export regulations. However, Ghazi said Synopsys expected revenue from China to decline because of the tighter export controls. Cadence’s stock price fell by 11%, while Synopsys’ dropped by 13% after the Financial Times report. https://tinyurl.com/3ws6a42f

Meta and Anduril partner on VR devices for U.S. military.

Meta Platforms and Anduril, a defense technology startup, on Thursday announced a partnership to design and build augmented and virtual reality devices for the U.S. military. The devices will use Meta’s artificial intelligence models, as well as a software from Anduril called Lattice, which has been used for surveillance. The partnership will help “American servicemembers that protect our interests at home and abroad,” Meta CEO Mark Zuckerberg said in a statement. Meta and Anduril have jointly bid on a U.S. Army contract for VR devices, worth up to about $100 million, The Wall Street Journal reported. The social media company is trying to make inroads with the Defense Department. In November, it started allowing U.S. government agencies and contractors working on defense and national security to use its AI models for military purposes. The partnership marks a reunion for Meta and Anduril co-founder Palmer Luckey. Meta bought Luckey’s virtual reality startup Oculus VR in 2014, but the two had a messy breakup in 2017, following Luckey’s 2016 donation to a group opposing Hillary Clinton. https://tinyurl.com/436j9cwt

Billionaire Chamath Palihapitiya has a blunt warning about quantum computing.

Billionaire investor Chamath Palihapitiya has warned that Google revealed breaking common encryption might be closer than we thought. “If this is even remotely true, combined with everything else happening rn, the only safe trade are hard assets and, dare I say, gold,” Chamath posted on X. “Sheesh.” In a blog post on May 23 titled “Tracking the Cost of Quantum Factoring,” Google researchers announced they’ve drastically lowered the bar for what it would take to break RSA encryption, one of the most widely used security systems on the internet. “Yesterday, we published a preprint demonstrating that 2048-bit RSA encryption could theoretically be broken by a quantum computer with 1 million noisy qubits running for one week,” wrote Craig Gidney and Sophie Schmieg from Google Quantum AI. Just five years ago, that number was 20 million qubits. Before that? A billion. https://tinyurl.com/567kz7t7

Perplexity’s new tool can generate spreadsheets, dashboards, and more.

Perplexity, the AI-powered search engine gunning for Google, on Thursday released Perplexity Labs, a tool for subscribers to Perplexity’s $20-per-month Pro plan that can craft reports, spreadsheets, dashboards, and more. Perplexity Labs is available on the web, iOS, and Android, and coming soon to Perplexity’s apps for Mac and Windows. “Perplexity Labs can help you complete a variety of work and personal projects,” Perplexity explains in a blog post. “Labs is designed to invest more time — 10 minutes or longer — and leverage additional tools [to accomplish tasks], such as advanced file generation and mini-app creation.” Labs, which arrives the same day as viral AI agent platform Manus released a slide deck creation tool, is a part of Perplexity’s effort to broaden beyond its core business of search. Perplexity is currently previewing a web browser, Comet, and recently acquired Read.vc, a social media network for professionals. Perplexity Labs, powered by AI, can conduct research and analysis, taking around 10 minutes and using tools like web search, code execution, and chart and image creation to craft reports and visualizations. Labs can create interactive web apps, Perplexity says, and write code to structure data, apply formulas, and create documents. Perplexity has increasingly invested in corporate-focused functionality, last summer launching an enterprise plan with user management, “internal knowledge search,” and more. The moves could be in part at the behest of the VCs backing Perplexity, who are no doubt eager to see a return sooner than later. Perplexity is reportedly in talks to raise up to US$1 billion in capital from investors at an US$18 billion valuation. https://tinyurl.com/4kz95bth

Anthropic CEO says AI could wipe out half of all entry-level white-collar jobs.

After spending the day promoting his company’s AI technology at a developer conference, Anthropic’s CEO issued a warning: AI may eliminate 50% of entry-level white-collar jobs within the next five years. “We, as the producers of this technology, have a duty and an obligation to be honest about what is coming,” Dario Amodei told Axios in an interview published Wednesday. “I don’t think this is on people’s radar.” The 42-year-old CEO added that unemployment could spike between 10% and 20% in the next five years. He told Axios he wanted to share his concerns to get the government and other AI companies to prepare the country for what’s to come. “Most of them are unaware that this is about to happen,” Amodei said. “It sounds crazy, and people just don’t believe it.” Amodei said the development of large language models is advancing rapidly, and they’re becoming capable of matching and exceeding human performance. He said the US government has remained quiet about the issue, fearing workers would panic or the country could fall behind China in the AI race. Meanwhile, business leaders are seeing savings from AI while most workers remain unaware of the changes that are evolving, Amodei said. He added that AI companies and the government need to stop “sugarcoating” the risks of mass job elimination in fields including technology, finance, law, and consulting. He said entry-level jobs are especially at risk. Amodei’s comments come as Big Tech firms’ hiring of new grads dropped about 50% from pre-pandemic levels, according to a new report by the venture capital firm SignalFire. The report said that’s due in part to AI adoption. A round of brutal layoffs swept the tech industry in 2023, with hundreds of thousands of jobs eliminated as companies looked to slash costs. While SignalFire’s report said hiring for mid and senior-level roles saw an uptick in 2024, entry-level positions never quite bounced back. In 2024, early-career candidates accounted for 7% of total hires at Big Tech firms, down by 25% from 2023, the report said. https://tinyurl.com/mr35cv35

Temu parent PDD growth slows, profits plunge amid U.S.-China war.

PDD Holdings’ revenue growth slowed and profits plunged in the first quarter, the Chinese e-commerce giant reported Tuesday, as U.S.-China trade tensions battered the company’s overseas discount bargain site Temu. PDD shares were trading down 15% on Tuesday morning. PDD, which doesn’t break out Temu’s financials, said overall revenue grew 10% to US$13.3 billion in the first quarter, the slowest growth in three years. Net income fell 47% year-over-year to US$2.0 billion. The January through March results do not include effects of steep tariffs on China and other countries that the U.S. announced in April, though the results do include a 10% tariff on Chinese goods that went into effect in February. The U.S. also briefly eliminated a duty-free trade loophole used by Temu for packages from China in February, then reinstated it before eliminating it again in May. In response to tariffs, Temu has focused more on shipping orders from warehouses within the U.S. On a call with analysts, PDD Chairman Chen Lei cited a “rapidly changing external environment” and said the company was “helping more local merchants grow on our platform and enabling more orders to be fulfilled from local warehouses.” https://tinyurl.com/3r3ws8uc

Trump Media company raises US$2.5 billion to invest in Bitcoin.

President Donald Trump’s media company is raising US$2.5 billion from big investors to buy bitcoin, deepening the president’s involvement in cryptocurrency. Trump Media & Technology Group, which operates Trump’s social media company Truth Social, will be following the lead of several other big players in crypto including Strategy, formerly Microstrategy. The companies’ stocks have been driven much higher than the value of the bitcoin they hold, giving them an incentive to sell stock to buy more bitcoin. Shares of Trump Media & Technology fell more than 10% on Tuesday. The company is selling US$1.5 billion worth of company stock and US$1 billion in convertible bonds that pay 0% in interest and are due in 2028. Bitcoin purchases by companies like Strategy as well as popular bitcoin exchange-traded funds have pushed the price of the cryptocurrency to record levels. Trump’s money-losing company stands to benefit if it holds bitcoin when the president launches his promised bitcoin reserve. Trump Media and Technology is separate from World Liberty Financial, a crypto company backed by his two sons. World Liberty started a stablecoin that is valued at more than US$2 billion. https://tinyurl.com/v57nxk3k

Nvidia to launch cheaper Blackwell AI chip for China after US export curbs.

Nvidia will launch a new artificial intelligence chipset for China at a significantly lower price than its recently restricted H20 model and plans to start mass production as early as June, sources familiar with the matter said. The GPU or graphics processing unit will be part of Nvidia’s latest generation Blackwell-architecture AI processors and is expected to be priced between US$6,500 and US$8,000, well below the US$10,000-$12,000 the H20 sold for, according to two of the sources. https://tinyurl.com/5an893a8