🎰 The AI bet paid off

What’s going on here?

Tech manufacturing giant Foxconn broke out the party hats this week, reporting record revenue in its fourth quarter.

What does this mean?

The Taiwan-based assembler of Apple and Nvidia gadgets blew past analysts’ forecasts in the latest period, with its December sales alone up a staggering 42% over the previous year. And that’s not a blip: the company says it’ll put up even bigger numbers when this period is said and done. It’s no secret what’s driving these wins, with demand for its AI servers and other products through the roof. And as long as giants like Microsoft and Alphabet keep splashing out on AI data centers – despite the fact that those investments are taking their sweet time to pay off – revenues are likely to keep revving.

Why should I care?

Zooming out: AI BFFs.

The buzz around AI and its world-changing potential is still very much alive, and that’s got investors fired up. The stock opportunities aren’t just about semiconductors these days: companies making cooling systems and electrical gear for data centers are turning people’s heads. The boom has even exploded into nuclear energy. Data centers need tons of clean, reliable electricity to operate, see – and with zero emissions, nuclear neatly fits the bill.

The bigger picture: Vegas, baby.

There’s probably never been a better time to tune into the Consumer Electronics Show in Las Vegas: it’s one of the biggest annual events for new tech gadgets, touting everything from wearables to robots. The shindig kicks off this year with a keynote speech from Nvidia’s visionary founder, which is expected to include plenty of hype about “physical AI” – a.k.a. humanoid robots. With two legs, two arms, and an AI brain, those human-shaped gadgets might just be the future.

What’s going on here?

Private equity selloffs could get the US initial public offering (IPO) market blooming this year, after an extended dry spell.

What does this mean?

You can think of private equity firms as the market’s master gardeners. They buy neglected, underperforming companies – or young ones with potential – and nurture them, waiting for the right time to sell (for a profit, of course). And now, after years of twiddling their green thumbs, it looks like selling conditions may finally be favorable. US stocks just had a strong year, the central bank cut interest rates three times, and the mood is decidedly pro-business. Familiar names like Medline and Genesys are expected to list their shares, along with buzzy players like buy-now-pay-later star Klarna, digital banking firm Chime, and AI cloud startup CoreWeave. And if the optimism keeps flowing, plenty more companies may follow.

Why should I care?

For markets: IP-whoa.

Private equity firms have been sitting on promising companies for years, and theoretical future profits just aren’t cutting it anymore: their elite investors want cold, hard cash. That’s big news for regular folk. It means stable, established businesses will be going public – not just loss-making, overvalued “unicorns”. Still, there’s reason to be cautious. This lower-interest-rate, business-friendly vibe might get the party started – but if interest rates suddenly climb or the economy hits a bump, IPO festivities could come to a sudden, mood-killing stop.

Zooming out: Three-two-one…

The stock launch thrills might be biggest in America, but they don’t stop at the US border. India recently out-hustled China as the number two IPO champ, with razzmatazz debuts from companies like Swiggy and a crew of renewable energy stars minting new billionaires and keeping valuations hot. That said, slower economic growth could see India’s star dim: foreign investors have been hitting the exits, and the country’s important solar industry has been facing a “scale or fail” moment. It’s a good reminder that what goes up eventually does come down.