Market · No. 6

Thu, Oct 8, 2026

Highlights

Bearish

According to the Financial Times, OpenAI told investors its annualized revenue was around $50 billion as of the end of September, below recent media estimates of $70 billion
The gap reflects accounting differences: Anthropic includes sales through cloud partners such as AWS and Google Cloud in revenue; OpenAI excludes them
Investors previously extrapolated $70 billion from August's $40 billion annualized run rate and growth above 70%; OpenAI declined to comment
The news triggered the sudden intraday selloff

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Bearish

QQQ -60bp premarket, yields +4bp across the curve, crude +5%, as Axios/NBC/The Atlantic reported Trump was considering military action against Iran before the midterm elections and attacks on merchant ships in the Strait of Hormuz increased
Asia broadly weaker: KOSPI -2.62%, Nikkei -1.42%, Hang Seng -1.43%, Taiwan -0.99%; SoftBank -4%, Samsung/SK Hynix -2.5%; Samsung earnings missed consensus but slightly beat lowered expectations
GOOGL +1% (Gemini enterprise agents), TSM -1% (solid September data), U +2%
Goldman Sachs upgraded PLTR to Buy with a $230 price target, citing an expanding TAM driven by sovereign AI and other factors, plus another round of upward estimate revisions; YTD PLTR +16% vs NDX +24%
Raymond James upgraded U to Outperform with a $54 price target; Vector 2Q +23% sequentially; Rosenblatt initiated NBIS at Buy/$304, projecting roughly 98% revenue CAGR through 2030

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Bearish

QQQ -1.3%, SOX -3.4% (intraday low -4.6%): FT says OpenAI's annualized revenue is about $20 billion below prior indications, but TMTB sees a gross-versus-net reporting difference (September net ARR of about $50 billion versus the reported roughly $70 billion)
Bear case: revenue base revised down about 25-30%, with only about $20 billion of growth in August-September; bull case: growth rate unchanged (about 70%), with YoY growth rising to about +229% in September after bottoming at +131% in June
Rotation out of AI capex/financing-sensitive names: HUT -11%, CRWV -8%, NBIS -7.4%, COHR -9.6%, ALAB -9%, ORCL -5.6%, AVGO -4.3%, NVDA -3%; Firmus IPO setback adds pressure
'AI losers' rebound: ACN +6%, CTSH +5%, Z +7%, HUBS +5.3%, MNDY +6.5%; WTI +3.4% to about $91, 10-year Treasury yield briefly hits 5.35% before closing at 5.22%; rate-hike odds about 18% for 10/28 and about 69% for December
Technicals: NVDA, LITE and TSM show potential false breakouts; AMD holds its breakout; WDC breaks support. Memory stocks MU -4.8%, SNDK -4.9% (Samsung Q3 operating profit of KRW107.4 trillion slightly beats expectations); TMTB has taken risk-management measures in semiconductors without overreacting

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Bullish

Morgan Stanley (Lucas Wang et al., 10/8) says expectations for Taiwan's CPO supply chain have reset after recent months' pullback, warranting another look; industry view: Attractive
Ratings/price targets: ASE remains OW, target raised from NT$628 to 858; Allring remains OW, 1580 to 2000; KYEC remains OW, 338 to 348; WIN Semi upgraded from UW to EW, 300 to 600; FOCI downgraded from OW to EW, 708 to 688
Morgan Stanley expects Rubin Ultra NVL576 to use CPO for scale-up; the market worries TSMC's PIC supply could fall to 35 million units (versus Morgan Stanley's prior 60 million forecast), but its channel checks suggest total optical-engine output could still reach about 60 million in 2026, with about 17-18 million shippable units
Testing remains the key bottleneck for CPO volume ramp-up; the pace of capacity expansion in 2027 depends on testing, with processes still unsettled. Morgan Stanley sees continued benefits for TSMC, ASE, Hon Precision, MPI and Allring, and recommends building positions on pullbacks
FAU (fiber array unit) competition is crowded, with at least 10 companies shipping, sampling or in pilot production. Corning, Coherent and TFC may play larger roles than FOCI in NVIDIA's Rubin NVL576 generation, prompting the FOCI downgrade
China: Morgan Stanley expects near-packaged optics (NPO) to become the mainstream optical interconnect for Chinese AI computing from 2027, ahead of CPO

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