Happy Sunday!
Last week, the market buzzed with speculation about no rate cuts this year—and even murmurs of potential hikes. This week, things took a turn.
Why? December CPI data came in below expectations for both overall and core inflation.
The news sent stocks soaring and Treasury yields tumbling, easing fears of hikes and boosting hopes for eventual cuts.
This serves as a stark reminder that while understanding macro trends is crucial, trying to predict them is close to impossible.
As Warren Buffett wisely put it, “The rearview mirror is always clearer than the windshield.”
On another note, I’ve updated my favorite investing tools list, now featuring over 20 of my favorite tools—some free, some paid.
These tools are absolute game changers and you’ll definitely find great value in them. Take a look!
Some key data bites from this week that you should know:
TSMC forecasts revenue growth from AI accelerators to reach a mid-40% CAGR over the next 5 years.
Eli Lilly will buy cancer drug developer Scorpion Therapeutics for $2.5B.
Johnson & Johnson will buy drugmaker Intra-Cellular Therapies for $14.6B.
Apple iPhone Sales fell 5% in the final quarter of 2024.
Lululemon is now projecting Q4 EPS of $5.83 at the midpoint, up from $5.60 prior.
Bill Ackman will spend $1B to increase Pershing Square’s stake in Howard Hughes.
Shake Shack wants to hit more than 1,500 restaurants in a few years.
SEC is suing Elon Musk for allegedly underpaying for Twitter shares by at least $150M.
Google is aiming for 500M users to use Google’s Gemini chatbot by year end.
Disney made up 25% of US box office receipts in 2024.
Goldman Sachs estimates companies could spend over $1T buying back stock this year.
China’s economy grew by 5.4% YoY in the most recent quarter, beating estimates.
Moderna plunged after they revised 2025 sales guidance down by $1B.
DOJ is suing KKR for over $650M over alleged premerger filing violations.
In today’s newsletter:
🎨 Adobe Is Near 52-Week Lows
🚪 Meta Lays Off 5% Of Staff
📈 BlackRock AUM Hits New Highs
🏦 Big Banks See Profit Boom
🇺🇸 How The USA Makes Money
Let’s jump right in.
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Not every software company is thriving—not even a big name like Adobe.
Shares of the creative software giant have fallen 30% over the past year, hovering near 52-week lows.
Last month, Adobe delivered quarterly earnings that beat expectations, but its forecast disappointed investors.
For Q1, the company projects revenue of $5.66B at the midpoint, below the $5.72B analysts expected.
Fiscal 2025 guidance wasn’t much better, with a projection of $23.5B falling short of $23.8B estimates.
Analysts at Third Bridge, per Barrons, note that while concerns about AI disrupting Adobe have subsided, the company hasn’t shown clear progress in monetizing AI.
This has prevented it from being seen as an AI leader.
Meta is looking to do some trimming.
According to an internal memo, Mark Zuckerberg announced plans to lay off 5% of employees, targeting underperformers.
With 72,400 employees as of last quarter, this translates to about 3,620 layoffs.
Zuckerberg mentioned these roles intend to be backfilled in 2025, emphasizing “an intense year.”
Meta’s workforce has already seen major cuts, dropping 16% from its 2022 count of 86,400 employees.
The biggest drop came during its "Year of Efficiency," when headcount fell 22% to 67,300 in 2023.
Another quarter, another record for the world’s largest money manager.
BlackRock’s assets under management (AUM) reached $11.6T last quarter, up 15% YoY.
The company saw $281B in Q4 inflows, pushing full-year net inflows to a record $641B.
Additionally, strong market performance, organic base fee growth, and higher performance fees drove full-year revenue up 14%.
CEO Larry Fink remains optimistic about the future, stating, “The economy is in very good shape.”
Banking giants had a banner year.
A strong economy bolstered profits, with many major banks seeing earnings soar 50% YoY and several reporting record annual profits.
Investment banking and trading played a key role, driving gains at Morgan Stanley, Goldman Sachs, and JPMorgan.
The outlook for banks also remains positive, with catalysts like a potential M&A boom and lighter antitrust regulation on the horizon.
Higher profits also meant big payouts.
Bank of America is splitting $1B in restricted stock among most of its staff, while Citi announced $20B in share buybacks.
The six largest US Banks returned more $100B through dividends and buybacks to shareholders in 2024—the most since 2021.
And at Goldman Sachs, the CEO and COO received retention bonuses worth $80M each after the strong quarter.
Will we ever fix the budget deficit?
As President Trump prepares for his inauguration today, he faces an uphill battle.
Last week, the U.S. Treasury released its final budget report ahead of Trump taking office.
In the first three months of the 2025 fiscal year, the government posted a record $711B deficit.
This represents a 39% increase, or $201B more than the same period last year.
Total revenue fell 2% YoY, while spending surged 11% for the quarter.
Meanwhile, the U.S. national debt has crossed $36.3T and continues to climb rapidly.
🔥 Thermal Bottleneck. Nvidia’s top customers are reportedly seeing delays due to overheating issues - TI
₿ Bitcoin Skeptic. JPMorgan CEO Jamie Dimon said he doesn’t feel great about Bitcoin and that it has no intrinsic value - QZ
🏦 Tariff Treasury. Trump announced plans to create an “External Revenue Service” to collect tariff income - AP
🤝 Gaza Truce. Israel’s government has approved a Gaza ceasefire - CNN
🎬 Short End. Hindenburg Research has announced that they will be shutting down - HR
💻 Yellen Breached. Chinese hackers breached US Treasury Secretary Janet Yellen’s computer - BB
Courtesy of our partner EarningsHub—I may earn a commission if you upgrade.
Notable Companies Reporting Earnings Week of January 20th, 2025:
Major Trades Published 1/13 - 1/17. Trades may be those of family members. [Source: 2iQ]
Buys
Josh Gottheimer (D)
Company: Microsoft ($MSFT)
Amount Purchased: $1M - $5M
Description: Call options; Strike price $230; Expires 9/19/2025
Company: Microsoft ($MSFT)
Amount Purchased: $1M - $5M
Description: Call options; Strike price $240; Expires 9/19/2025
Company: Microsoft ($MSFT)
Amount Purchased: $1M - $5M
Description: Call options; Strike price $225; Expires 12/19/2025
Company: Microsoft ($MSFT)
Amount Purchased: $1M - $5M
Description: Call options; Strike price $230; Expires 12/19/2025
Jonathan Jackson (D)
Company: O’Reilly Automotive ($ORLY)
Amount Purchased: $15K - $50K
Rick Allen (R)
Company: Rollins Inc ($ROL)
Amount Purchased: $15K - $50K
Sells
Josh Gottheimer (D)
Company: Microsoft ($MSFT)
Amount Sold: $1M - $5M
Description: Call options; Strike price $240; Expires 12/19/2025
Company: Microsoft ($MSFT)
Amount Sold: $1M - $5M
Description: Call options; Strike price $235; Expires 1/16/2026
Company: Microsoft ($MSFT)
Amount Sold: $1M - $5M
Description: Call options; Strike price $230; Expires 1/16/2026
Company: Microsoft ($MSFT)
Amount Sold: $1M - $5M
Description: Call options; Strike price $230; Expires 1/16/2026
Kevin Hern (R)
Company: Citigroup ($C)
Amount Sold: $500K - $1M
Company: Devon Energy Corp ($DVN)
Amount Sold: $250K - $500K
Company: Johnson & Johnson ($JNJ)
Amount Sold: $100K - $250K
Major Trades Published 1/13 - 1/17
Buys
Opko Health ($OPK)
CME Group ($CME)
Insider: William Shephard (Director)
# of Shares Purchased: 1,369
$ Amount: $312,041
SEC Forms: [1]
Sells
Meta Platforms ($META)
Airbnb ($ABNB)
Insider: Joseph Gebbia (Director)
# of Shares Sold: 214,285
$ Amount: $27,631,678
SEC Forms: [1]
Transdigm Group ($TDG)
Insider: Kevin Stein (President & CEO)
# of Shares Sold: 20,000
$ Amount: $25,344,186
SEC Forms: [1]
Reddit ($RDDT)
Insider: Steve Huffman (CEO & President)
# of Shares Sold: 124,408
$ Amount: $21,492,095
SEC Forms: [1]
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