Tech Stocks
We recently added back Microsoft as a LTBH position and we are now adding Alphabet as our second FAANG.
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The AI memory boom is one of the most controversial debates in the market, as investors weigh if the historical cyclical nature of memory means that Micron, SK Hynix and other memory stocks have put in a top. It’s no secret memory stocks have soared with both SK Hynix and Micron up 400% and 500% in a 1-year time frame. This follows high bandwidth memory (HBM) growing from a roughly $4 billion market in 2023, to a $34.6 billion market in 2025, with Micron now expecting the market to reach $100 billion in 2027.
Nvidia just posted one of its most impressive quarters in recent memory, but many investors likely missed the report’s critical implications for the company’s key software partner, Palantir. Sovereign AI and regional neocloud businesses were among Nvidia’s fastest growth vectors, rising 35% QoQ, 2.7X faster than hyperscalers, and more than tripling YoY. Notably, amid this dramatic growth, sovereign AI is the exact arena where Nvidia has just announced a strategic partnership with Palantir.
Palantir recently took shots at OpenAI and Anthropic’s business models, implying that they are a part of the “token industrial complex”. As token processing counts soar, OpenAI and Anthropic’s ARR figures are no doubt climbing rapidly. However, Palantir’s model of maximizing value per token, rather than needing to push customers to consume as many tokens as possible, is translating into high quality growth. And, as R&D labs struggle to sniff profitability, Palantir is putting up among the strongest margins in the tech sector.
