1. Strong Momentum in AI Demand Boosts TSMC's Growth
Taiwan Semiconductor Manufacturing (NYSE: TSM) recorded a 33% year-over-year increase in net revenue for December, marking a strong close to 2024 and positioning the company for its highest annual revenue since going public in 1994.
Impressive Stock Performance: TSMC’s stock has surged over 105% in the past year, reflecting investor confidence in its growth trajectory. With fourth-quarter earnings set to be released on January 16, the December revenue report and strong guidance suggest continued demand for AI chips and services into 2025.
Key Growth Drivers: According to Brady Wang from Counterpoint Research, TSMC’s advanced semiconductor chips are playing a crucial role in the rise of AI technologies. Products like Nvidia’s (NASDAQ: NVDA) GPUs, which rely heavily on TSMC’s cutting-edge chips, highlight the company’s pivotal role in the AI ecosystem.
2. Tesla Adjusts Production Priorities: Model Y Over Cybertruck
Tesla (NASDAQ: TSLA) has reportedly shifted resources at its Austin plant from Cybertruck production to focusing on the Model Y, signaling a strategic pivot.
Cybertruck’s Performance in Context: While the Cybertruck was the top-selling electric pickup in the U.S. in October and ranked third overall in Q3, total sales for the quarter were just 16,692 units.
Broader Market Challenges: Despite Tesla achieving 1.79 million vehicle sales in 2024, the electric vehicle market faces headwinds, including slowing demand and heightened competition. For Tesla, the Cybertruck remains a relatively small part of its overall financial performance, ensuring the company’s stability even as demand fluctuates.
3. Energy Sector Sees a Strong Start to 2025 Amid Cold Snap
After two years of underperformance, the energy sector is leading the S&P 500 in early 2025, with a 2.51% gain in January.
Tightening Oil Supply: A third consecutive weekly gain in oil prices is being driven by stricter sanctions on Russia and Iran, which have disrupted global oil flows, according to analysts at ING.
Weather-Driven Demand: A colder-than-usual winter across parts of the U.S. and Europe has significantly increased energy demand. Natural gas stocks such as EQT (NYSE: EQT) and Antero Resources (NYSE: AR) have responded positively, trading higher this week.
4. Start-Ups Delay IPOs, Opt for Extended Private Growth
Large start-ups are increasingly opting to remain private, as evidenced by SpaceX raising $1.25 billion in November and Databricks securing $10 billion in December.
Record Valuations: The seven largest private U.S. companies are collectively valued at $695 billion. These tech and AI firms are leveraging easy access to private capital, reducing the need for public offerings while avoiding the pressures of quarterly earnings and shareholder demands.
IPO Outlook: Although this trend limits retail investor access, most private companies will eventually pursue public listings. Provisions in private funding agreements and the publicity benefits of IPOs ensure that these firms remain poised for eventual market debuts.
Taiwan Semiconductor Manufacturing (NYSE: TSM) recorded a 33% year-over-year increase in net revenue for December, marking a strong close to 2024 and positioning the company for its highest annual revenue since going public in 1994.
Impressive Stock Performance: TSMC’s stock has surged over 105% in the past year, reflecting investor confidence in its growth trajectory. With fourth-quarter earnings set to be released on January 16, the December revenue report and strong guidance suggest continued demand for AI chips and services into 2025.
Key Growth Drivers: According to Brady Wang from Counterpoint Research, TSMC’s advanced semiconductor chips are playing a crucial role in the rise of AI technologies. Products like Nvidia’s (NASDAQ: NVDA) GPUs, which rely heavily on TSMC’s cutting-edge chips, highlight the company’s pivotal role in the AI ecosystem.
2. Tesla Adjusts Production Priorities: Model Y Over Cybertruck
Tesla (NASDAQ: TSLA) has reportedly shifted resources at its Austin plant from Cybertruck production to focusing on the Model Y, signaling a strategic pivot.
Cybertruck’s Performance in Context: While the Cybertruck was the top-selling electric pickup in the U.S. in October and ranked third overall in Q3, total sales for the quarter were just 16,692 units.
Broader Market Challenges: Despite Tesla achieving 1.79 million vehicle sales in 2024, the electric vehicle market faces headwinds, including slowing demand and heightened competition. For Tesla, the Cybertruck remains a relatively small part of its overall financial performance, ensuring the company’s stability even as demand fluctuates.
3. Energy Sector Sees a Strong Start to 2025 Amid Cold Snap
After two years of underperformance, the energy sector is leading the S&P 500 in early 2025, with a 2.51% gain in January.
Tightening Oil Supply: A third consecutive weekly gain in oil prices is being driven by stricter sanctions on Russia and Iran, which have disrupted global oil flows, according to analysts at ING.
Weather-Driven Demand: A colder-than-usual winter across parts of the U.S. and Europe has significantly increased energy demand. Natural gas stocks such as EQT (NYSE: EQT) and Antero Resources (NYSE: AR) have responded positively, trading higher this week.
4. Start-Ups Delay IPOs, Opt for Extended Private Growth
Large start-ups are increasingly opting to remain private, as evidenced by SpaceX raising $1.25 billion in November and Databricks securing $10 billion in December.
Record Valuations: The seven largest private U.S. companies are collectively valued at $695 billion. These tech and AI firms are leveraging easy access to private capital, reducing the need for public offerings while avoiding the pressures of quarterly earnings and shareholder demands.
IPO Outlook: Although this trend limits retail investor access, most private companies will eventually pursue public listings. Provisions in private funding agreements and the publicity benefits of IPOs ensure that these firms remain poised for eventual market debuts.