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Public.com presents the rundown. Your daily market update in 10 minutes. My name is Zadud Mani and Today is Friday, May 1st. In today's episode, we're breaking down Apple's blowout earnings. We'll also tell you why Anthropic could soon be worth more than open Air. Then stick around to the end of the show to find out how the Iran war may have killed Liv Golf. We got a great show for you today. Let's go. What a way to end the month. Stocks rallied on Thursday with the S&P 500 climbing 1% to close at a new record high. And The Nasdaq gained 0.9%, also closing at a record. Google was one of the big winners yesterday, jumping 10% following their monster earnings. Google's market cap now sits at $4.65 trillion, which is a record high for the company and puts them in within striking distance of Nvidia's $4.8 trillion market cap to be valuable company in the world. We broke down Google's earnings on yesterday's show, so go check that out if you missed it. Overall for the month, the S P500 finished up 10% in April, making it the best performing month since November of 2020. And the Nasdaq did even better, up 15 its best month since April of 2020. So the enthusiasm around AI and strong corporate earnings is overshadowing the uncertainties around the Iran war and elevated oil prices. But in the meantime, the effects of elevated oil prices are showing up in the inflation data. The March CPI inflation report dropped yesterday, which is the Fed's preferred inflation gauge and headline. PCE was up 3.5% year over year in March. And core PCE, which strips out food and energy, was up 3.2%. You know that core number is the highest reading since November of 2023. So even when you remove the oil prices from the equation, it inflation is still creeping back up. And that's why the market is only pricing in a 10% chance that the Fed will cut interest rates this year. This is despite incoming Fed Chair Kevin Warsh hinting that he wants rate cuts. Remember, 12 Fed governors vote on interest rates. It's not just up to Kevin Warsh. I mentioned on yesterday's show that Jerome Powell announced that he plans to stay on as Fed governor even after his term as Fed chair expires on May 15. It means that President Trump doesn't get another vacancy to fill. So? So Jerome Powell is essentially blocking Trump from stacking the Fed board with his own people so, yeah, very interesting dynamic playing out at the Fed and the markets in general. You know, the straight of Hormuz is still closed, oil prices are elevated, inflation is creeping back up. We're getting a new Fed chair soon with a divided Fed. But despite all of that, markets are at all time highs. So we'll see if that momentum from April carries over into May as we work our way through the earnings season. Next week we're hearing from Palantir, amd, Uber, Disney and more. So, so make sure you guys are subscribed to the podcast and tuning in every day to stay in the loop. Let's run through some headlines, starting with Apple. Apple reported earnings after the bell last night, and the numbers were once again solid. Total revenues hit $111 billion, which is up 17% year over year. The iPhone 17 line has been a huge hit. IPhone revenues jumped 22% to $57 billion. And Tim Cook called the iPhone 17 lineup the most popular in the company's history. China was also a huge bright spot. Revenues there soared 28% to $20.5 billion, way above what Wall street was expecting. You know, for a while it looked like Huawei and other local Chinese brands were eating Apple's lunch. But Apple is finding its footing again in China now. Beyond the iPhone, max sales also beat expectations, coming in at $8.4 billion, thanks to the popularity of the new low cost MacBook Neo. Apparently demand is so strong that Apple is dealing with Mac shortages that could last for several months. And you know what caught my attention was Apple's gross margins, which hit 49.3% in the quarter. That's the highest in the iPhone era. A big reason for that is the services business. Services revenue was up 16% to $31 billion. That includes things like the App Store, Icloud, Apple Music, Apple Care, and those carry a higher margin. So that's pushing up Apple's overall profitability. Now, the one thing that could impact Apple's bottom line down the road is memory costs. Tim Cook warned that memory costs are going to be significantly higher going forward because of the supply shortages. Now, he wouldn't say whether Apple was going to raise prices as a result, but it might be on the table. Overall, though, it was another incredible quarter from Apple. Not only did they beat across the board, but they also raised their guidance moving forward. The company expects revenues to grow 14 to 17% this quarter. Analys were expecting about a 9% growth. And then on top of all of that, Apple announced a $100 billion share buyback program and bumped up its dividend by 4%. So they continued to return money to shareholders. By the way, upcoming CEO John Ternus was also on the earnings call. He said all the right things, and he said that Apple has an amazing product roadmap ahead. You know, the market seems to be optimistic. Shares of Apple are up more than 3% this morning in reaction to the report. And look, I think that Apple is in a good spot. The only question overhanging Apple is what their AI strategy will look like. They didn't really talk it much on the earnings call, but they did raise their R and D spending by 33% to $11 billion. But, you know, I'm still waiting for my Siri to not be completely useless. Let's shift gears and talk about Anthropic, the AI company behind Claude. According to a report from Bloomberg, the company is in talks with investors to raise money at a $900 billion valuation. If this deal gets done, Anthropic would overtake OpenAI as the most valuable AI startup in the world. OpenAI recently raised money at an 850 billion doll back in March. You know, Anthropic's growth this year has been absolutely insane. Anthropic is now doing $30 billion in annualized revenue. They did about $10 billion in total revenue last year, so they've essentially tripled their run rate in a matter of months. Plus, they're dominating the enterprise, which is a better business model in the consumer market that OpenAI currently dominates. And then, not to mention, Anthropic still hasn't released their Mythos model to the public, which is apparently so advanced that, that it's freaking out cybersecurity experts. In fact, the White House is telling Anthropic to not expand access to this model. So Anthropic seems to be firing on all cylinders right now, and they're on track to overtake OpenAI when it comes to valuation. And I just can't wait for these companies to go public. I'm not sure if I'd invest in them at these valuations, but I want them to be a publicly traded company. Let's talk about some stocks making moves today. Reddit shares are on the rise this morning after the company reported a stock 69% jump in revenue, topping analyst estimates. Profits also came in better than expected, with earnings per share soaring to $1.01, which is up nearly eight fold from a year ago. Reddit now has seven consecutive quarters of sales growth above 60%. Ad revenue accounts for 99% of the company's total sales and that increased by 74% in Q1. The Reddit stock took a beating this year. Leading up to the earnings, it was down more than a third, partly because investors were worried that AI chatbots would replace the need to brow Reddit threads for answers. But the earnings show that people are still showing up. Daily active users grew 17% year over year to nearly 127 million. So that's bringing some confidence back into the stock. Shares are up around 8% this morning at the time of this recording. Now on the flip side, Roblox shares are cratering after the company reported weaker than expected user growth. Daily active users came in at 132 million, well below the 144 million that wall street was expecting. In fact, this is the second straight quarter where user actually declined from the prior quarter. And the reason that users are declining is because Roblox is doubling down on child safety. They've rolled out age verification, they've restricted chat for kids under nine, and they've added a bunch of new guardrails. The company has been under fire for years over predators using the platform to target children. And they've even settled lawsuits totaling about $36 million just in the last month. With more lawsuits still pending, Roblox is basically telling investors that they're going to be taking a short term hit on growth to make the platform safer for kids in the long term. In fact, they even lowered their full year bookings guidance and they warned that users will continue to decline next quarter. Honestly, I think it's the right thing to do. But investors definitely didn't like hearing it. The stock is down nearly 20% this morning in reaction to the report. Let's wrap the show with a fun fact. The LIV Golf Tour might be coming to an end. The Saudi Arabia Public Investment Fund announced yesterday that they're pulling the funding from LIV Golf after this season. And without Saudi money, LIV is basically done. You know, LIV Golf came onto the scene back in 2022 as a rival to the PGA Tour. And thanks to all that Saudi money, they started offering massive paychecks to golf's biggest stars to ditch the PGA and move over to the LIV Tour. And many big time players did make the move to Live like Brooks Koepka and John Rom. But the Tour never became popular, the viewership numbers were terrible, and Live reportedly lost billions of dollars over the last four years. So now the Saudi Public Investment Fund said they're pulling the funding and they're basing that decision on investment priorities and current macro dynamics. You know, I think they might be referring to the Iran war. Oil markets are in chaos right now. The Strait of Hormuz is blocked, which is preventing the Saudis from exporting some of their oil. So the PIF is clearly tightening up on vanity projects that are losing money. So the LIV Golf Tour might be one of the casualties of the Iran war. Well, all right, guys, that's the rundown for today. That's the rundown for this week. You know, we covered a lot of stuff this week and we still have a lot more earnings to cover over the next couple of weeks. By the way, if you guys are enjoying this show and have like 5 extra seconds, consider giving us a 5 star rating on Apple, Spotify, wherever you listen to your podcast. All that engagement really does help us out and it helps other people find the show. Thank you guys so much for listening, watching, and commenting. Shout out to Mike and Connor for all the work behind the scenes and we'll see you guys back here tomorrow.