"Amazon beats Q2 earnings expectations, as AI, chip businesses see $25 billion run rate" (AMZN)

In after-hours trading the stock is up $18.37 (+7.80%) at $253.87.

From Yahoo Finance, July 30:

Amazon (AMZN) reported its second quarter results after the bell on Thursday, beating expectations on the top and bottom lines, as its AWS AI and chip units both surpassed annual run rates of $25 billion.

Amazon stock jumped more than 9% following the news. 

"AWS is booming, growing 36.7% year-over-year in Q2—our fastest growth in 18 quarters—and our AI and Chips businesses each eclipsed run rates of more than $25 billion," Amazon CEO Andy Jassy said in a statement....

....MUCH MORE 

The negative we will see tomorrow, pointed out in the Yahoo story, is the company is spending all their cash flow rather than returning it to shareholders.

As our earlier GeekWire link, "Ahead Of Today's Amazon Report GeekWire Looks At The Behemoth (AMZN)", quoted:

“We’re not investing approximately $200 billion in capex in 2026 on a hunch,” CEO Andy Jassy wrote in his April shareholder letter.

The GeekWire article had the Bezos story at Fortune as a sidebar: 

Jeff Bezos says this business is becoming Amazon’s next ‘pillar’

Amazon’s next pillar could be built on a foundation of silicon.

In a new interview with Fortune, Amazon founder and Executive Chair Jeff Bezos says the company’s custom chip business is on track to become one of Amazon’s most durable businesses, placing it alongside Marketplace, Prime, and Amazon Web Services as a core pillar of the company.

“A few of our offerings have become durable pillars, things like Marketplace and Prime and AWS,” Bezos told Fortune. “What I see right now is that our chips business, our silicon business, is lining up to be our next pillar.”....

....MUCH MORE, including links to the Fortune article.

"Earnings call transcript: Quanta Services posts big Q2 2026 beat, lifts outlook" (PWR)

The stock is changing hands at $642.27 up $81.13 (+14.46%) after getting as high as $678.98 on a burst of enthusiasm or, more likely terror from someone caught short.

From Investing.com, July 30:

Quanta Services reported stronger-than-expected second-quarter 2026 results, with adjusted earnings of $4.24 a share on revenue of $9.56 billion, topping Wall Street forecasts and sending the stock sharply higher in premarket trading. The company also raised its full-year outlook for revenue, earnings and free cash flow, citing broad-based organic growth, a record backlog and improving margins. Shares rose 15.86% to $650.13 from the previous close of $561.14, moving closer to the top of their 52-week range.

Key Takeaways

• Adjusted EPS of $4.24 beat the $3.29 forecast by 28.9%.
• Revenue of $9.56 billion beat the $8.61 billion estimate by 11.0%.
• Management raised full-year 2026 guidance for revenue, adjusted EBITDA, adjusted EPS and free cash flow.
• Quanta said organic growth drove the quarter, while recent acquisitions contributed only modestly because of timing.
• The company ended the quarter with a record $53 billion backlog and improved leverage metrics.

Company Performance
Quanta Services said the second quarter was one of its strongest periods on record, with broad-based growth across utility, generation, technology and infrastructure markets. The company posted adjusted EBITDA of $1.1 billion and said revenues, EBITDA and adjusted EPS all grew at double-digit rates.

Management stressed that the quarter was driven mainly by organic growth rather than acquisitions. Four deals closed during the period — Phalcon, Enerfab, Percheron and PSD — but they contributed only about $11 million of adjusted EBITDA because of timing. The company said the acquisitions are expected to add scale and capabilities later in the year.

The results extend a long run of strong execution. Quanta said it has delivered record adjusted EPS for nine consecutive years, supported by an 80% to 85% self-perform rate and a workforce of more than 85,000 employees.

Financial Highlights

• Revenue: $9.56 billion, up sharply year over year and above the $8.61 billion forecast.
• Adjusted diluted EPS: $4.24, above the $3.29 forecast.
• Net income attributable to common stock: $451 million, or $2.96 per diluted share.
• Adjusted EBITDA: $1.1 billion.
• Acquisition contribution: about $11 million of adjusted EBITDA in the quarter.
• Full-year 2026 revenue guidance: $39.3 billion to $39.7 billion.
• Full-year 2026 adjusted EBITDA guidance: $4.1 billion to $4.2 billion.
• Full-year 2026 adjusted EPS guidance: $16.45 to $16.95.
• Full-year 2026 free cash flow guidance: $2.0 billion to $2.5 billion.
• Debt-to-EBITDA ratio: 1.7x at the end of the quarter, down from 1.95x at the end of 2025.
• Market capitalization: $97.3 billion.
• P/E ratio: 88.81, reflecting premium valuation expectations.
• Revenue growth over the last twelve months as of Q1 2026: 21.1%.

Earnings vs. Forecast
Quanta’s adjusted EPS beat expectations by $0.95 a share, or 28.9%, while revenue came in $950 million above estimates, an 11.0% surprise. That is a large beat for a company already viewed as a steady performer in infrastructure services.

The size of the EPS surprise is especially notable. Management said the quarter reflected broad organic strength across all segments, which suggests the outperformance was not driven by a single project or a one-time item. The company also lifted its full-year outlook, reinforcing the message that the second-quarter results were part of a broader trend rather than an isolated spike....

....MUCH MORE, including: 

Outlook & Guidance 

Executive Commentary

Risks and Challenges

Q&A

Full transcript 

U.S. Drought Monitor: Some Increse In Intensity In The Nation's Breadbasket

From the University of Nebraska-Lincoln, July 30: 

This Week's Drought Summary

This U.S. Drought Monitor (USDM) week saw very hot and dry conditions across areas of the Western U.S. and the Plains states where average temperatures soared well above normal levels—significantly elevating evaporate demand, especially across the Upper Midwest, Northern Plains, Colorado, and the Texas Panhandle where conditions deteriorated rapidly. Elsewhere, heavy rains across areas of the Mid-Atlantic states, Southeast, and the South, led to widespread improvements on the map in drought-affected areas. In North Carolina, rainfall totals for the week ranged from 3 to 8+ inches across the state leading to a significant improvement in drought-related conditions statewide. In the Northeast, recent isolated shower activity helped to improve drought conditions; however, the impacts of the longer-term drought continue to affect groundwater conditions in areas of Rhode Island and Massachusetts. In the Upper Midwest, drought expanded and intensified on the map, especially across Minnesota and Wisconsin where composite flash drought indicators were showing severe to extreme flash drought conditions during the past week. Out West, the Four Corners states continued to receive beneficial monsoonal rainfall with isolated areas receiving 2 to 4 inches. In portions of Arizona and western New Mexico, precipitation during the past 30-day period has been above normal, boosting streamflow and soil moisture levels while improving vegetation health. In the Pacific Northwest, short-term dryness has led to a dip in soil moisture and streamflow levels in areas of western Oregon and Washington. In the Great Basin, recent monsoonal rains have provided some minor relief to drought-affected areas of eastern Nevada.

In terms of reservoir storage in the West, California’s reservoirs continue to be at or above historical averages for the date (July 28), with the state’s two largest reservoirs, Lake Shasta and Lake Oroville seeing slight decreases over the past week, at 99% and 108% of average, respectively. In the Southwest, the U.S. Bureau of Reclamation is reporting (July 26) Lake Powell at 23% full (33% of average for the date; lowest on record for the date in the last 30 years), Lake Mead at 27% full (45% of average for the date; lowest on record for the date in the last 30 years), and the total Colorado River system (July 26) at 33% of capacity (compared to 39% of capacity the same time last year). According to the Salt River Project, the Salt River reservoir system in Arizona is currently 48% full, Verde River system 59% full, and the total reservoir system at 50% full (compared with 59% full a year ago)....

....MUCH MORE

Published July 30

 

Published July 23

 

Because of the decrease in intensity and coverage in the eastern U.S. the experimental Drought Severity and Coverage Index (DSCI) only ticked up three points to 155 on the 0 - 500 scale.

However! Our interest is in the effects upon foodstuff commodities so the east coast doesn't matter as much. Using wheat as an example, bread wheat (winter) could be setting up for reduced yields in the next harvest;

 

Whereas pasta wheat (Durum) looks to be keeping your rigatoni abundant:

 

Kansas has been attempting to return to its wheat roots by planting the higher value durum but apparently not enough to show up on the map, yet. From the Lawrence (KS) Times, July 26: 

A new Kansas-grown wheat could soon be in your box of noodles 

A new type of wheat dotting Kansas fields has a special use: making pasta. Wheat acres have continuously declined in Kansas. The noodle-focused wheat variety could change that. 

Kansas farmers could soon play a role in spaghetti night or be the source of macaroni salad for the community cook out....

Ahead Of Today's Amazon Report GeekWire Looks At The Behemoth (AMZN)

From Seattle's own, GeekWire, July 29:

Amazon earnings preview: Wall Street looks for more cloud growth as AI spending hits a record 

Amazon reports quarterly earnings Thursday afternoon, facing the same test as every other big tech company right now: whether it’s generating enough business to justify its massive AI spending.

Wall Street expects revenue of about $196.4 billion, up 17% from a year ago, and earnings of $1.82 per share. That’s essentially the midpoint of Amazon’s own forecast for the second quarter.

Part of that growth is due to the calendar. Prime Day ran June 23-26 this year, during the second quarter in the U.S. and most large markets. Last year it ran July 8-11, in the third quarter. That gives Amazon’s retail numbers a boost this time that the year-ago quarter didn’t have.

Another factor is the cloud. AWS grew revenue 28% last quarter, its fastest rate in nearly four years, and analysts expect the acceleration to continue with revenue of roughly $40.5 billion for the second quarter, up 31%, according to Zacks Consensus Estimates.

The company plans a record $200 billion in capital expenditures this year, nearly all of it for data centers, servers and chips to support increased capacity for training and running AI models.

Amazon is making those investments based in part on demand from big AI companies including OpenAI and Anthropic, which have signed commitments to AWS worth $138 billion and more than $100 billion, respectively, for the coming years.

“We’re not investing approximately $200 billion in capex in 2026 on a hunch,” CEO Andy Jassy wrote in his April shareholder letter.

In the meantime, the spending is absorbing nearly all of the cash from Amazon’s operations. Free cash flow fell to $1.2 billion over the past 12 months, from $25.9 billion a year earlier....

....MORE

And more to come after the close.  

"QUANTA SERVICES REPORTS SECOND QUARTER 2026 RESULTS" (PWR)

From the company via PR Newswire, July 30: 

....HOUSTON, July 30, 2026 /PRNewswire/ -- Quanta Services, Inc. (NYSE: PWR) today announced results for the three months ended June 30, 2026. Revenues in the second quarter of 2026 were $9.56 billion compared to revenues of $6.77 billion in the second quarter of 2025, and net income attributable to common stock was $451.4 million, or $2.96 per diluted share, in the second quarter of 2026 compared to net income attributable to common stock of $229.3 million, or $1.52 per diluted share, in the second quarter of 2025. Adjusted diluted earnings per share attributable to common stock was $4.24 for the second quarter of 2026 compared to $2.48 for the second quarter of 2025.

"Quanta delivered an exceptional first half of the year, highlighted by second-quarter results that meaningfully exceeded expectations and reflect the compounding strength and momentum of our operating model. Revenue, adjusted EBITDA and adjusted diluted earnings per share all achieved strong double-digit growth, cash flow was robust and total backlog reached a record level at quarter end. These results demonstrate the power of our differentiated, solutions-based operating model, as well as the execution certainty our self-perform capabilities and craft-skilled workforce deliver for customers every day. Given this outperformance, our improved visibility into the back half of the year, and the expected contribution from recently completed acquisitions that strengthen our platform, we are significantly increasing our full-year 2026 financial expectations across all metrics. We believe these results, and our long-term track record, are a clear differentiator of Quanta's ability to compound profitable growth as our customers accelerate investment in the electric grid, power generation and mission-critical infrastructure that underpin the economy," said Duke Austin, President and Chief Executive Officer of Quanta Services....

....MUCH MORE 

The earnings call is set to begin at 9:00 AM EDT:

Second Quarter 2026 Earnings Conference Call 

The stock is trading at $632.00 up $71.93 (+12.84%) in late pre-market trade. 

Most recently:

Chartology: Ahead of Quanta Services July 30 Earnings Release (PWR)

Inflation: Personal Consumption Expenditures Price Index, July 30, 2026

The PCE Price Index decreased 0.1% for the month of June, 2026 and increased 3.7% over the twelve months.

From the Bureau of Economic Analysis, July 30: 

EMBARGOED UNTIL RELEASE AT 8:30 a.m. EDT, Thursday, July 30, 2026

BEA 26—36

Personal Income and Outlays, June 2026

Personal income increased $54.9 billion (0.2 percent at a monthly rate) in June, according to estimates released today by the U.S. Bureau of Economic Analysis (BEA). Disposable personal income (DPI)—personal income less personal current taxes—increased $48.3 billion (0.2 percent), and personal consumption expenditures (PCE) increased $65.2 billion (0.3 percent).

Personal outlays—the sum of PCE, personal interest payments, and personal current transfer payments—increased $70.0 billion in June. Personal saving was $646.1 billion in June, and the personal saving rate—personal saving as a percentage of DPI—was 2.7 percent.

The increase in current-dollar personal income in June primarily reflected increases in compensation, personal income receipts on assets, and government social benefits that were partly offset by a decrease in farm proprietors’ income.

The $65.2 billion increase in current-dollar PCE in June reflected increases of $58.2 billion in spending on services and $7.0 billion in spending on goods.

 

Real PCE increased $68.0 billion (0.4 percent at a monthly rate) in June.

From the preceding month, the PCE price index for June decreased 0.1 percent. Excluding food and energy, the PCE price index increased 0.1 percent.

From the same month one year ago, the PCE price index for June increased 3.7 percent. Excluding food and energy, the PCE price index increased 3.3 percent from one year ago.

Personal Income and Related Measures [Percent change from preceding month]
	May	June
Current-dollar personal income	0.7	0.2
Current-dollar DPI	0.7	0.2
Real DPI	0.2	0.3
Current-dollar PCE	0.9	0.3
Real PCE	0.4	0.4
PCE price index	0.5	-0.1
PCE price index excluding food and energy	0.3	0.1

Table 2.8.7. Percent Change From Preceding Period in Prices for Personal Consumption Expenditures by Major Type of Product, Monthly 

"Federal Reserve's Thunder and no Rain Weighs on Dollar "

From Marc Chandler at Bannockburn Global Forex:

The decision to standpat on a 9-3 vote at the FOMC yesterday looked like a hawkish hold but it seemed like the more Chair Warsh affirmed the central bank’s commitment to achieving the inflation target, the more short-term interest rates and the dollar fell. The expected year-end effective Fed funds rate fell 15 bp from the session high yesterday. The 2-10-year yield curve steepened by 12 bp, completely unwinding the flattening of the last six consecutive sessions, and is now near 44 bp is the steepest since the end of May. The Bank of England, as widely expected, stood pat today, and the swaps market is discounting about 50% chance of a hike at the next meeting in September. There were three dissents. The Bank of Japan meets tomorrow, but it is also widely understood to be on hold. 

The US two-year yield remains soft today and the dollar is consolidating with a softer profile against most currencies. The US Nasdaq has been unable to sustain upticks and has fallen for the past six sessions coming into today. Better tech earnings (Microsoft and Samsung) appear to be encouraging investors to try again today. Meanwhile, despite the new hostilities in the Middle East, oil prices are narrowly mixed, with WTI slightly lower and Brent slightly higher. 

Prices...  

....MUCH MORE 

Chartology: Ahead of Quanta Services July 30 Earnings Release (PWR)

During July 29's trading action the stock completely filled a gap on the chart from April 7 - 8.

On April 7 the stock closed at $555.57 and opened at $573.27 on the eighth.

 

TradingView 

Today's price ranged from $591.59 to $554.12 before closing at $561.14, completely filling the gap. We included one more gap on the chart from February but I'm not sure it matters, the two larger and more recent gaps having filled.

Earnings tomorrow before the open.

High-Speed Rail: Florida's Brightline Misses Another Debt Deadline

From The Bond Buyer, July 27:

Brightline Florida bondholders have agreed to yet another short-term debt extension while the train line continues to negotiate a debt restructuring. 

The struggling company has until the end of the week to make the payments, negotiate another extension, or reach a comprehensive restructuring deal. The latest delay follows a week-long extension that bondholders granted in mid-July.

The brief payment postponement was granted by holders of the $1.2 billion of unrated, or AAFOH, tax-exempt bonds and $985 million of "commuter" bonds, which are linked to a separate project that would establish commuter rail rights for three Florida counties.

Each grace period since January has gotten shorter as Brightline Florida apparently continues to negotiate with its creditors in what most in the muni market expect will end in a comprehensive capital restructuring. If the situation lands in bankruptcy court, it would mark one of the largest in the municipal market's history.

The Fortress Investment Group-backed company operates a 235-mile train in Florida that's the nation's only privately owned intercity rail line. Saddled with $5.5 billion of debt and revenue performing under projections, Brightline has spent the last year trying to raise new financing.

A securities notice posted Friday outlines the latest delay. It pushes the July 15 AAFOH debt payment to July 31, and gives the company until July 30 to make a mandatory redemption on the commuter bonds. The commuter holders also gave the company until July 31 to make an interest payment that was originally due Feb. 15.

It's the fifth supplement for the AAFOH bonds and the 14th supplement to the commuter indenture.

First Eagle, Nuveen, Invesco, BlackRock and Macquarie are among the largest Florida muni holders....

....MUCH MORE 

Previously:

June 2023 - The U.S. Has High-Speed Rail

It's not as fast as the trains in France, and about the same speed as Japan's Tokyo - Osaka run, but it is quicker than California's.*

From ConstructionDive, June 22:

Brightline’s $5B Orlando high-speed rail extension complete 

May 3, 2026 - Florida High Speed Rail: "The Great Train Bankruptcy"

May 13, 2026 - High Speed Rail: "Florida’s Ailing $6 Billion Rail Line Has Debt Vultures Circling"

Capital Markets: "Hump Day: War and the FOMC"

From Marc Chandler at Bannockburn Global Forex:

New hostilities in the Middle East have lifted oil prices for the first time in four sessions and is snapping the three-day decline in European and US bond yields. The US dollar is mostly narrowly mixed against the G10 currencies.  Softer than expected CPI has reduced the perceived chances the Reserve Bank of Australia will hike rates again this year, after delivering three hikes in H1 26. The Australian dollar is at more than two-week lows today and is off almost 0.5%; the weakest in the G10. Among emerging market currencies, despite the continued volatility in the equity markets, the South Korean won and the Taiwanese dollar are among the strongest today. The PBOC set the dollar’s fixing at a new three-year low.

The outlook for today’s FOMC meeting is among the most uncertain it has been for some time. This may become a new feature with Chair Warsh, who eschews “forward guidance”.  Most observers lean against a hike, but at the last meeting half of the “dots” implied a rate hike this year. And despite the softer June CPI and PPI, the war and tariffs continue to underpin price pressures.  The Fed funds futures have almost 44 bp of tightening discounted before the end of the year....

....MUCH MORE  

Not Very Diplomatic: "U.S. Walks Out In Protest During France's United Nations Remarks. Here's Why"

 From Time Magazine, July 28:

The U.S. delegation briefly walked out of a United Nations Security Council meeting during France's address in protest on Monday after the European ally criticized America’s human rights record.

Dan Negrea, an alternate U.S. representative to the U.N., accused France of feigning “moral outrage” while pretending to lecture the world about the Ukraine conflict and human rights in general.

“That is why we walked out during France's intervention,” he said during a meeting on Russia's war in Ukraine. “This disingenuous grandstanding is tiresome, but we have tolerated it out of a sense of camaraderie and mutual respect as P5 members.” Negrea was referring to the five permanent members of the Security Council.

“We have stood by this member state through every conflict in which their freedoms have been imperiled, and today I remind them that it is the United States that remains the beacon of liberty for the world,” Negrea continued. "We will not be affording them the benefit of listening to their politicized drivel until they renounce their condescending and disrespectful rhetoric and behave in a manner commensurate with their seat on this council.”....

....MUCH MORE 

Mr. Negrea should, at least, have raised a tip of the 'ol chapeau to 1775 - 1783 following the 'politicized drivel' bit.

That said, I will probably purloin 'politicized drivel' in some future post.

Who Will Buy Memory Chips? "Nvidia Partner SK Hynix Misses Q2 Sales Target But Profit Surprises"

Investor's Business Daily is the only outlet (so far) to headline revenue vs expectations.

On South Korea's market the stock traded down 9.61%, with the KOSPI down 5.98%.

From IBD, July 28:

South Korean memory-chip maker SK Hynix (SKHY) late Tuesday missed sales estimates for the second quarter. But its net profit was greater than its revenue in the period due to investment gains. SKHY stock advanced after the report.

The company said its Q2 revenue rose 257% year over year to 79.3 trillion won ($54.4 billion). However, analysts polled by FactSet had expected second-quarter revenue of 84 trillion won ($57.6 billion).

SK Hynix said its operating profit surged 557% to 60.5 trillion won ($41.6 billion). Meanwhile, its net profit rocketed 1,242% to 93.9 trillion won ($64.5 billion), fueled by gains related to investment assets, which it didn't specify. Last month, SK Hynix completed the sale ​of its stake in Japanese Nand flash memory maker Kioxia.

The company did not provide per-share earnings in its news release.

The quarterly report was the company's first since its U.S. trading debut on July 10. The IPO was priced at $149 per American depositary receipt. Every 10 ADRs traded on the Nasdaq represents one common share of SK Hynix stock listed in South Korea. The company's ADR climbed as high as 194.80 on July 14 before retreating. On Tuesday, it fell 9% to close at 130.17 during a broad semiconductor stock sell-off....

....MORE

This raises the question of demand destruction if the ever-increasing price of memory is not enough to fuel the top-line hopes and dreams of analysts and investors despite (or because of) the astounding profitability of the chips.

Agence France-Presse caught some of this interplay in their reporting.

From AFP via France24, July 29: 

SK hynix posts 1,200% net profit boost on AI chip boom

Seoul (AFP) – South Korea's SK hynix said Wednesday second-quarter net profit soared a whopping 1,242 percent year-on-year, driven by the artificial intelligence industry's explosive demand for its advanced memory chips. 

SK hynix is a specialist supplier of high-bandwidth memory chips to US industry behemoth Nvidia, and a pillar of South Korea's tech-led economy.

The global race to build data centres hosting AI infrastructure has seen a meteoric rise in the firm's fortunes, despite concern the sector may be overvalued in a market bubble.

Wednesday's earnings figures, including quarterly net profit of 94 trillion won ($64 billion), were described in a statement by the Icheon-headquartered firm as "an all-time high quarterly performance".

"We are aware of concerns that AI infrastructure investment might be slowing down," marketing chief of the AI microchip division Park Joon-deok said on a call with investors and reporters.

He cited jitters over firms exploring data centre rental -- rather than construction -- and the emergence of new high-efficiency AI requiring a lower memory taskload.

"We view these developments not as a scaling back of AI investment, but rather as a process of maximising the utilisation of the massive AI infrastructure built to date and accelerating its monetisation," he said....

....MUCH MORE 

Here's CNBC with the overview of the report, July 28/29:

SK Hynix shares tank as exponential earnings growth fails to satisfy AI-charged expectations

• SK Hynix hits another record milestone on AI demand.
• Second-quarter profit and revenue both missed estimates.
• Revenue more than tripled from a year earlier.  

SK Hynix shares nosedived on Wednesday as exponential second-quarter earnings and revenue growth still failed to satisfy analysts’ supercharged expectations for an artificial-intelligence darling.

Here are SK Hynix’s second-quarter results compared with LSEG SmartEstimates, which are weighted toward forecasts from analysts who are more consistently accurate: 

• Revenue: 79.32 trillion won ($54.55 billion) vs. 84 trillion won expected
• Operating profit: 60.54 trillion won vs. 64 trillion won expected

After falling as much as 15% earlier in the session, the stock trimmed its losses to close 9.6% lower on Wednesday.  

Revenue jumped 257% year on year in the quarter ended June from a year earlier, while operating profit soared nearly 557% year on year, the company’s release showed. 

Compared with the previous quarter, revenue increased 51% while operating profit gained 61%. 

The company said it saw sustained demand growth from expanding AI infrastructure investments, while high-performance products for AI servers led price increases that set a fresh record....

....MUCH MORE 

There Is Not Enough Insurance Capacity Willing To Cover All The Data Centers Being Planned

When you have perils that could trigger payouts that are extremely large combined with a relatively new class of insureds (hyperscale data centers), the actuaries chew their pencils before saying yes.

From Artemis, July 10: 

Insurance capacity constraints for data centres to drive ILS use: S&P 

With capacity constraints likely to limit the insurance industry’s ability to fully insure hyperscale data centre projects, given their scale and complexity, a new report from S&P notes that this will drive greater use of self-insurance through captive insurers, and potentially, alternative capital such as insurance-linked securities (ILS). 

The rating agency’s latest report suggests that rising demand for data centre insurance coverage could generate $10 billion in new premiums in 2026, highlighting how significant the data center market could become and the scale of the opportunity for the global re/insurance industry.

At the same time, S&P also indicated that annual investment in data centres could surpass $300 billion by 2027, highlighting the industry’s explosive growth and the growing insurance requirements associated with large-scale infrastructure development.

For background, S&P pointed out that insurance coverage limits of $5 billion to $10 billion are usually needed for the biggest infrastructure construction projects, like bridges or tunnels. By comparison, some hyperscale data centers are estimated to represent total insurable values of $10 billion to $30 billion for construction alone....

....MUCH MORE 

"AI companies are reportedly shredding millions of books after using them to train AI models — tech giants outsource to middlemen to secretly buy up books for training material"

Bringing to mind a 2023 post, "So Why Were The Chinese Plundering British Shipwrecks Off The Coast Of Malaysia?". * 

From Tom's Hardware, July 28: 

Buy. Scan. Destroy. Repeat. 

Having contributed to the growing shortage of memory and storage, AI companies seemingly have a new target in their sights: humanity's literary history. A recent investigative report from 404 Media reveals that these companies are reportedly purchasing millions of secondhand books through intermediaries to source high-quality training data for their AI models, avoiding public backlash. 

AI relies on vast amounts of data to advance, but not just any data. It has to be high-quality data. The problem is that mediocre AI-generated content, commonly referred to as "AI slop," has proliferated across the Internet. This type of content contaminates the data pool and is counterproductive for AI to train on. As a result, leading AI companies have turned to human-authored sources for knowledge, specifically print sources that predate 2022 and are more likely to contain original, uncontaminated content.

There is precedent for AI companies turning to physical books for training AI. For instance, Anthropic, one of the leading AI companies involved in a lawsuit, reportedly invested millions of dollars in extracting information from countless printed books to build its Claude AI models and then destroying them. The company bought books from Better World Books. Although the court decision affirmed that using books for AI training falls under fair use in copyright law, Anthropic faced a staggering $1.5 billion fine for maintaining a repository of seven million pirated books that infringed the copyrights of authors and publishers. Similarly, a coalition of publishers recently filed a lawsuit against Google, accusing the tech giant of allegedly and illegally using millions of copyrighted books to develop its Gemini AI models.

ISBNdb, an online database that reportedly has over 111 million cataloged books, has been a long-favorite platform for booksellers, libraries, and distributors to sell books. With the explosion of the AI industry, ISBNdb has pivoted its business to offer specialized services to bulk-purchase books for AI companies. According to 404 Media, the orders range from 1,000 copies to as many as one million books in a single transaction.... 

....MUCH MORE
*And the shipwrecks in Malaysian waters recollection, July 7, 2023:  

You may remember the news from last month:

Chinese ship detained for plundering WW2 wreck

Here's the rest of the story, from Ed Conway's Material World substack, June 10:

The Eerie Story of Low Background Steel
Bandits are plundering metal from old shipwrecks, in search, it seems for the world's rarest, and strangest, metal. 

The other week a Chinese vessel was detained by Malaysian authorities off the coast of Johor, under suspicion of having plundered old WWII era shipwrecks in the region.

HMS Repulse and HMS Prince of Wales, both of which sank in Malaysian waters in 1941, have had large sections of their bodies and armaments stolen in this way. The practice has been going on for years - these raiders targeting shipwrecks which are also effectively war graves - but this was one of the rare occasions when someone was seemingly caught in the act.

But why, you might be wondering, would anyone go to these lengths to obtain scrap metal. The price of steel hardly merits this kind of effort and risk. So what are these raiders really after? Gold? Silver? Stolen artworks?

The answer, it turns out, is far more interesting: a very, very rare form of metal. Something called “low background steel”.

Steel itself is one of the cheapest types of metal (an alloy technically) but the type of steel we’re talking about is one of the rarest substances in the world. For low background steel doesn’t contain radionuclides, traces of radiation such as cobalt-60. These trace amounts don’t matter for most uses but when you’re making products highly sensitive to radiation - eg special scientific equipment or Geiger counters - you need this steel.

And here’s the thing: all steel made since 1945 contains radionuclides....

....MUCH MORE

Which was referenced in June 2025's "The launch of ChatGPT polluted the world forever, like the first atomic weapons tests"; along with the search for dark matter, synthetic data and AI model collapse. 

Capital Markets: "Oil Falls Further, China Claims Chip Break-Through, and Market Contemplates Fed Hike Tomorrow"

From Marc to Market:

There are three developments to note today. First, the lack of hostilities in the Middle East has oil prices continue to unwind this month’s surge. This has also taken some pressure off major bond markets. Second, reports that China has started to mass produce its own chipmaking tools and has developed DUV lithography tools that etch chip patterns onto silicon weigh on the equities in this space, which had already been hit with profit-taking. South Korea’s Kospi fell nearly 11% today and Taiwan’s Taiex slumped a little more than 4.5% today. The Nasdaq is poised to gap lower today. 

The third development is the heightened speculation of a rate hike by the Federal Reserve tomorrow. On July 16, the Fed funds futures were pricing in about a 10% chance of a hike and now about a 33% chance. The US dollar itself is trading with a clear firmer bias. It is made a new high for the month against several pairs, including the euro, sterling the Australian dollar....

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"China’s reported chip breakthrough comes with some big caveats"

From CNBC, July 28: 

• A report emerged Monday that China has produced a key chipmaking tool, entering a market that has long been dominated by ASML.
• However, analysts told CNBC ASML is unlikely to be heavily impacted as lots of questions remain about China’s technology.
• These questions include performance versus ASML and China’s ability to scale production.  

ASML’s stock fell Tuesday after a report that China is mass-producing a critical tool that the Dutch tech giant has long held a monopoly over.

The decline came amid a steep sell-off in global semiconductor stocks as investors continued to grapple with uncertainty about the sector. ASML was last trading down 1.8%, but the stock is up over 123% this year.

Analysts told CNBC that while reports on China entering a market that ASML dominates may raise some concerns, the developments are unlikely to shake the Dutch company’s dominance, adding there are some big caveats to the story.

“I would take this with a pinch of salt as what [China does] could be limited to the very low end,” Stephane Houri, head of equity research at ODDO BHF, told CNBC.

What happened?
The Information on Monday reported that an unnamed Chinese company has begun manufacturing an immersion deep ultraviolet lithography (DUV) machine, citing people familiar with the matter. 

The tools are expected to be delivered this year to China’s biggest chip manufacturers, including Semiconductor Manufacturing International Corp. and Changxin Memory Technologies (CXMT), which went public this week.

Why did it spark a sell-off?
Investors are concerned that if China continues to build out its homegrown semiconductor technology, it could cut off some of the biggest U.S., European and other Asian firms from the huge market.

An immersion DUV machine is a tool that is used to etch circuit patterns into silicon wafers. It is a critical part of the semiconductor manufacturing process that is purchased by foundries such as Taiwan Semiconductor Manufacturing Co. (TSMC) and Intel. 

However, it is used for less-advanced chips. In contrast, an extreme ultraviolet (EUV) lithography machine is used for the most leading-edge chips, such as those designed by Apple and Nvidia.

ASML dominates the market for DUV and EUV lithography tools. No other company has been able to replicate what ASML does, which is why it is a big deal that a Chinese firm has reportedly done so. Nevertheless, questions remain as to what impact the latest developments will have on the company.

Scale and performance questions 
When it comes to the performance of China’s DUV machines, semiconductor manufacturers focus on a term known as “yield” which refers to the number of usable chips that come out of the process. All foundries aim for maximum yield.

It is currently unclear whether a Chinese manufacturer using the homegrown DUV machine will deliver a chip yield close to or above that of a machine from ASML. If the yield is not close to what ASML machines can provide, that might hamper the adoption of China’s machine....

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All that being said, Korea's KOSPI was down 10.84% on the day which brings the cumulative decline to 35% from the June 18 high. 

 

6 months of action via TradingView 

"AI Stocks Crash After NVIDIA Plans to Finance $250 Billion OpenAI Buildout Are Reported" (NVDA)

Nvidia is down $10.00 (-4.84%). That's a lot of billions of market capitalization.

From 24/7 Wall Street, July 27: 

NVDA fell 5% and AMD dropped 8% after the WSJ reported NVIDIA may guarantee $250 billion for OpenAI's data-center buildout.

Dell slid 4% on AI-server demand fears while Oracle has fallen 20% over the past month on overlapping data-center exposure.

NVIDIA guides $91 billion in Q2 revenue and AMD's data center revenue grew 57% YoY, keeping the fundamental bull case intact despite today's selloff....

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Our post after the WSJ exclusive crossed the tape:

Not Good - "Nvidia in Talks With OpenAI to Guarantee $250 Billion Financing for Data Center"
Not good at all....

Also at 24/7 Wall Street:

SanDisk Sinks 12%, Micron Drops 5%, SK Hynix Falls 8% as China’s CXMT IPO Rattles Memory Stocks

And the earlier:

"China memory chipmaker CXMT skyrockets 470% in Shanghai debut"

"Point72 hires AI expert to predict weather for traders"

From Financial News, London, July 24: 

Former Citadel engineer Alex Alifimoff has joined the rival hedge fund as head of AI weather amid growing demand for alternative data 

Steve Cohen’s multi-strategy hedge fund Point72 has hired an AI expert to help forecast weather patterns for its money managers.

Alex Alifimoff, who previously worked at Citadel as an engineer, has joined Point72 as head of AI weather in the firm’s global macro team, according to people familiar with the matter.

In his new role, Alifimoff will build AI-based models to forecast weather patterns to help trading teams, including macro and commodity portfolio managers, the people added. He will be based in the firm’s Stamford office.

For years, hedge funds have looked for alternative data sources in a bid to steal a march on their competition, turning to everything from satellite imagery to social media posts in a bid to better predict economic patterns. However, as this data has become more available in recent years, AI experts are now at a premium to stay ahead of the curve.

Hedge funds are offering lucrative pay packages of up to $1m to attract top weather modelling experts, Bloomberg reported last year. Traders, mainly across commodities desks, require weather expertise to predict price fluctuations....

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The funds are playing catch-up to Cargill.

And Cargill has the data advantage of over 100 years of proprietary observations, a treasure trove of AI training material. 

So while the speculative mice can skim some grain/cocoa/almond etc. profit from the commercials, the commercials will, and must, win overall. If they don't the entire game stops. 

Ayatollah "Mojtaba Khamenei has no contact with any person or institution, father-in-law says"

From Iran International, July 26:

Iran's Supreme Leader Mojtaba Khamenei is not in contact with any person or institution, says his father-in-law.

“For the time being, due to certain issues, he is not in contact with any person or institution, but God willing, he is healthy,” Gholamali Haddad-Adel said, according to ILNA news.

He was responding to a question about Khamenei’s absence from the funeral ceremony for his father, former Supreme Leader Ali Khamenei.

Asked about reports concerning Mojtaba Khamenei’s alleged economic activities before becoming the supreme leader, Haddad-Adel dismissed them as false and said he had been a cleric whose only income was the standard stipend paid to seminary students.

Iran International's liveblog for July 27. 

Ahead of July 29's Fauci Hearing Senator Rand Paul Has Released 1100 Pages of Fauci's Diary.

Although it is easy to get caught up in the "Dear Diary, I am so pretty. And popular!" stuff (hundreds of the things), on his tweet announcing the drop the Senator leads with one of the more disgusting entries:

1/9 — My investigation uncovered that Anthony Fauci kept a diary.
What he wrote privately and what he told the country are two different stories.

Today I'm releasing his entries from December 2019 through December 2022. 🧵 pic.twitter.com/58LvmeYkCN

— Senator Rand Paul (@SenRandPaul) July 25, 2026

2/9 Jan. 26, 2020. Fauci writes in his diary: "Now we know the market was not the source, it was the amplifier."

That is January of 2020. The wet market was already off the table in his own private notes. pic.twitter.com/mz0OzcPHgg

— Senator Rand Paul (@SenRandPaul) July 25, 2026

3/9 Feb. 1, 2020. The call that produced Proximal Origin. Twelve scientists.

Only 2 concluded it was natural. Per Fauci's own notes, "the rest felt that deliberate insertion was possible."
This was never a 50/50 room. pic.twitter.com/vFg79if4oB

— Senator Rand Paul (@SenRandPaul) July 25, 2026

....MORE (9 tweet thread at Threadreader) 

And at the Reading Room: 

New Documents

Tony's Diary: What He Wrote Privately vs. What He Said Publicly

July 25, 2026 – Fauci’s personal diary reveals that as early as January 31, 2020, he was told by top virologists that the virus’s furin cleavage site raised real doubts about a natural origin, with about half the scientists on that initial call believing it looked “constructed.” Despite this early private uncertainty, Fauci spent the following years publicly and confidently dismissing the lab leak theory while insisting the science was settled. The diary also documents his private frustration and defensiveness over gain-of-function funding questions tied to EcoHealth Alliance and the Wuhan Institute of Virology — even as he told Congress under oath that no such research had occurred.

Read Tony's Diary 

Also new since our last visit:

New Documents

Fauci's Side Hustle: How NIH Lined Dr. Anthony Fauci's Pockets with Prize Money

July 24, 2026 – Records released today reveal that Dr. Anthony Fauci, the highest-paid federal official in the U.S. government, stacked up cash prizes worth hundreds of thousands of dollars during COVID, with NIH’s number two official serving as his personal awards manager and his taxpayer-funded staff writing the nominations for him. Some of the prizes came from American institutions, but the largest came from a foreign institution that wired him $900,000.

Read the Documents 

New Documents

NEW: Federal Officials Intercepted Undeclared Biological Materials Tied to a U.S. – China Coronavirus-Research Network as Early as 2018

July 24, 2026 – Undeclared coronavirus materials moved between U.S. and Chinese labs as far back as 2018 — years before COVID-19. A courier was caught twice, three years apart…first with a few hidden vials, then with 132 more and a laptop that wasn’t his.

Read the Documents 

Previously:

July 23 - Ahead Of Next Week's Fauci Hearing, Senator Rand Paul Has Opened A Reading Room Stocked With Documents

Following on July 21's "Heads Up From Senator Rand Paul". 

Senator Paul, in his position as the Chairman of the U.S. Senate Committee on Homeland Security and Governmental Affairs will be convening the hearing to take Fauci's testimony on  Wednesday July 29 at 8:30AM ET.

Here are the additions to the background information/documents