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Public.com presents the rundown, your daily market update in under 10 minutes. My name is Zadan Moni, and Today is Monday, March 16th. And today's episode we'll tell you about Meta's latest AI infrastructure deal and potential layoffs at the company. We'll also break down Peloton's latest attempt to save the company, then stick around to the end of the show to learn a wild stat about Fox, FedEx and UPS. We got a great show for you today. Let's go. Markets are coming off their third weekly loss in a row. The S P 500 fell 1.6% last week, while the Nasdaq was down 1.3%. And zooming out, the S P 500 has lost more than 3% since the start of the year, while the Nasdaq is down nearly 5% for the year. Stocks are now at their lowest point since November, so it's not been a great stretch for the stock market. Obvious, the conflict in the Middle east is the main market story right now. We are now in the third week of the war with Iran and the Strait of Hormuz is still close to traffic, which is disrupting the global supply of oil and sending prices higher. Oil prices are back above $100 per barrel. Brent crude, which is the global benchmark, finished last week around $103, while the US benchmark WTI is sitting just under $100. So the war with Iran and the status of the Strait of Hormuz is going to continue to drive the market here. There seems to be some sort of development. On Sunday, President Trump called, like China, to help the US Secure and reopen the straight. So we'll see what ends up happening there. But as I record this episode on Monday morning, oil prices are starting to trade down a bit, so we're probably in for another volatile week of trading. The thing is, if oil prices continue to stay elevated, then it's going to make things more expensive. And higher oil prices could mean a resurgence of inflation, which is going to put the Federal Reserve in a tricky spot when it comes to cutting interest rates. We're actually going to be hearing from the Fed this week. There's a Fed meeting on Wednesday. Now, they're expected to hold interest rates steady at this meeting, but it'll be interesting to see what they have to say about their projections for the rest of the year, given the war and the rising oil prices. So we're going to be talking more about the Fed this week and keeping an eye on the oil markets. 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 Meta. Meta just announced yet another massive AI infrastructure deal. This time it's a $27 billion deal with the Neo Cloud provider Nebbyus to secure AI computing capacity for the next five years. This is one of the biggest single infrastructure contracts Meta has ever signed, and it comes on top of the $3 billion deal they signed with Nebius just last year. So investors love this for Nebby is the stock is up more than 10% this morning at the time of this recording. And if you zoom out, the stock has gone up 350% in the last 12 months. Now let's talk more about Meta, because they've been very aggressive with their AI spend. You know, they plan to spend $600 billion on data centers by 2028 and up to $135 billion this year alone. And it looks like in order to pay for some of this massive AI spend, the company is looking to reduce headcount. There was a report in Reuters this morning that Meta is looking to potentially lay off 20% of its workforce. Meta has around 79,000 employees, so we're talking potentially 15,000 jobs being cut. CEO Mark Zuckerberg has said he's seeing AI tools allows small teams to do work that used to require big teams. And by the way, this AI layoff isn't just a meta thing. Amazon cut 16,000 jobs in January. The message across the big tech companies is the same. They're spending more on AI infrastructure and spending less on people. Now, the other problem that Meta is having when it comes to AI is that their own AI model is apparently pretty bad. The New York Times reported that Meta's model, codenamed Avocado, is not performing as well as models from Google or OpenAI and anthropic. Meta's model was supposed to come out later this month, but now it's being delayed till at least May. So despite Zuck handing out nine figure deals to hire a ton of AI engineers last summer, it just hasn't led through the breakthrough when it comes to their own AI model development. In fact, there was a report that Meta's AI leadership is now discussing temporarily licensing Google's Gemini to power their products while they try to catch up and better build their own model. Now, I got to say, Meta stock hasn't taken much of a hit. It's flat for the year. You know, I think as long as Meta's underlying advertising revenue continues to grow at the pace that it does, investors will be okay with all of Meta's AI spending and give them time to figure out the AI stuff. You know, the same thing happened when Meta was spending all that money on the Metaverse and now it's happening with AI. Let's shift gears and talk about Peloton. Believe it or not, the company is still in business and they're still trying to turn things around. They just introduced a new bike and treadmill designed specifically for gyms. This product is part of Peloton's new lineup called the Peloton Commercial series. Now, these aren't going to be the same machines you see in people's living rooms collecting dust. The hardware is being built by Precor, which is the commercial fitness equipment maker Peloton acquired back in 2021 for $420 million. Precor will handle the hardware product development while Peloton will provide the software and these machines will start shipping to gym partners later this year across the us, uk, Canada, Germany, Australia and Austria. You know, Peloton has been trying to expand beyond its core at home fitness business, which exploded during the pandemic and then crashed just as quickly once people started going back to the gyms. The business continues to struggle. According to the company's latest earnings report, it missed on both revenue and profit estimates. The bright spot though has been the commercial side of the business. That unit grew revenues by 10% last quarter even while overall sales fell by 3%. Peloton has presence in commercial gyms thanks to partnerships with hotels like Hyatt and Hilton, but I feel like they're have a hard time getting mass adoption to commercial gyms. I feel like these gym classes are going to want to push their own classes or trainers or equipment. So it's an interesting pivot from Peloton. We'll see if it works, but at this point it they might as well try anything. It is pretty crazy looking back, seeing Peloton stock trading at a hundred and fifty dollars back in 2021 with a valuation of 50 billion. Today the company stock is trading under $4 with a market cap of less than 2 billion. Lets talk about some stocks making moves today. Micron shares are getting a pop this morning after the memory maker announced that it's expanding its manufacturing footprint in Taiwan with a second production site. Micron already purchased a chip facility in Taiwan earlier this year for $1.8 billion. And this new site will expand the company's capacity to produce DRAM and high bandwidth memory used in AI workloads and data centers. Now shipments from this new facility are expected to begin in 2028, so it's a couple years away. The price of memory has shot up over the last few months as demand from AI has surged. In Micron's most recent quarter, memory chip sales nearly doubled year over year. Now there seems to be no signs of a slowdown here. We're actually going to be hearing from Micron later this week when they report their latest earnings on Wednesday, so we'll see what they have to say. Investors seem to be pretty excited though. Shares of Micron are up around 5% this morning at the time of this recording. Now on the flip side, shares of Public Storage are dropping after the storage company announced a massive $10.5 billion deal to buy their rival National Storage Affiliates in an all stock transaction. New Public Storage is trying to expand their footprint and National Storage has more than 1,000 self storage facilities across 37 states, especially in the high growth Sunbelt markets like Texas, Florida and Arizona. Public Storage says they expect this deal to generate about 110 to 130 million in annual synergies with once everything is integrated. Investors aren't loving this for the company though. Shares of Public Storage are down around 3% this morning at the time of this recording, while shares of national storage are up 28%. Let's wrap the show with a fun fact. For the first time ever, FedEx is now worth more than UPS. Last week FedEx market cap crossed $84.9 billion, edging out UPS's $84.4 billion. Now I'll be honest with you guys, I had no idea how much bigger UPS was compared to FedEx. Like I always assumed they were pretty close in value. But no, until recently, UPS has been worth two to three times more than FedEx. But that's not the case anymore. Now UPS still delivers more packages, moving about 20 million parcels a day compared to 14 million for FedEx. But over the last couple of years, FedEx has been cutting costs and getting leaner and and spinning off their freight business and focusing on high margin deliveries like healthcare. And as a result the Stock has gone up 40% in the last two years. UPS on the other hand, has seen their stock drop 40% in the last two years as they deal with higher labor costs and uncertainty around the relationship with Amazon which has been their largest customer. Amazon is looking to cut off ups and just do their logistics by themselves. So now FedEx has overtaken ups to be the king of delivery. On a side note, I gotta say Fed. FedEx's logo goes so hard with the arrow embedded between the E and the X. I mean, that is just an incredible logo. Shout out to the logo designer there. Well, all right, guys, that's the rundown for today. Hope you guys enjoyed today's episode. If you did and you have like five extra seconds, consider giving us a five star rating on Apple, Spotify, YouTube, wherever you listen to your podcast. If you are listening on Spotify, don't forget to vote. And today's Spotify poll, leave us a comment on Spotify. 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.