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Southwest Airlines just posted one of its strongest quarters in years. Revenue hit a record, margins expanded, and earnings per share nearly doubled from a year ago.But there’s a catch. Jet fuel is getting more expensive, and it’s eating into the airline’s bottom line faster than expected.Southwest (LUV) CEO Bob Jordan and his team walked investors through the numbers on the company’s second quarter 2026 earnings call, held July 23. The message was mixed but honest: Demand is strong, the business is changing for the better, and fuel prices are still a real problem heading into the rest of the year.Southwest slashes full-year profit guidanceSouthwest now expects full-year 2026 adjusted earnings per share of $3.25 to $4.25. That’s a meaningful cut from its earlier guidance of at least $4.The reason comes down to one thing: fuel. Chief Financial Officer Tom Doxey said the company is looking at an estimated year-to-date fuel headwind of about $1.33 per share. Jet fuel averaged $3.92 per gallon during the second quarter, and that pushed fuel expense up by nearly $900 million compared to the same period last year.Even with that pressure, Jordan tried to frame the new range as a win, not a setback.”Even with an estimated year-to-date fuel headwind of approximately $1.33 per share, Southwest remains positioned to generate earnings that are broadly in line with our guidance at the beginning of the year.”In other words, the airline still expects to land close to where it originally promised investors, just with fuel eating a much bigger slice of the pie than planned.

Southwest Airlines CEO Bob Jordan is wary of fuel price hikes.Bloomberg/Getty Images

Fuel costs are a headwind for LUV stockFuel is one of the biggest expenses any airline carries, right alongside labor. When prices spike, it doesn’t take long to show up in profit numbers, since airlines can’t always raise ticket prices fast enough to keep pace.Doxey explained that Southwest doesn’t guide fuel prices directly. Instead, the company gives investors a snapshot based on the forward market on a specific day, in this case July 17, and lets people estimate from there.Related: Morgan Stanley resets Southwest Airlines stock price targetThe airline’s fuel procurement team has been working to soften the blow. Southwest gets roughly half its fuel from the Gulf Coast, and during the quarter, when West Coast prices spiked, the team shifted lower-priced Gulf Coast fuel out west to cut costs.”I love that our team did that,” Doxey said, crediting the strategy for helping keep Southwest’s fuel costs below some competitors’ during the quarter.Strong demand is helping offset the painEven with fuel costs rising, Southwest’s revenue engine is running hot.Adjusted unit revenue jumped 20.1% year over year in the second quarter, an all-time quarterly record for the company. Managed business revenue, which covers corporate travel, grew 30% year over year. And the airline’s loyalty program hit close to 100 million members, with new sign-ups up 35% from a year earlier.Jordan pointed to this as proof that Southwest’s product overhaul, including assigned seating, extra legroom options, and bag fees introduced over the past year, is working and not just a temporary bump.More Airlines:Airline shuts down, all flights grounded after accidentAnother global airline cuts US flights due to low demandAnother low-cost airline files for Chapter 11 bankruptcy”There is no deceleration in the strength and the demand, no deceleration in the strength in the revenues and the fares,” Jordan said, addressing concerns that momentum might be fading.He added that the company is seeing strength “across all sectors, all geographies,” which he called the broadest demand environment he’s seen in his career at the airline.What this means for the rest of 2026Southwest is guiding to third-quarter unit revenue growth of 17.5% to 19.5%. The number looks lower than it did in the second quarter, not because demand is slowing, but mainly because the airline is now comparing against the higher revenue base created by last year’s bag-fee rollout.On the cost side, the airline expects third-quarter costs per available seat mile, excluding fuel, to rise 3.5% to 4% year over year, with capacity remaining flat or down slightly.Southwest also reported liquidity of $5.3 billion, well above its target of about $4.5 billion, and generated close to $2 billion in operating cash flow during the first half of the year, despite the higher fuel bill.The bigger picture is that Southwest’s turnaround story is real. Revenue diversification, loyalty growth, and cost discipline are all showing up in the results. Still, fuel prices remain the wildcard that could keep shaping how much of that progress actually reaches shareholders by year-end.Related: Southwest Airlines leaves rivals flat-footed as bankrupt carrier folds

Wall Street usually takes a few days to digest a product event. However, UBS took less than one.Advanced Micro Devices (AMD) concluded its Advancing AI 2026 keynote in San Francisco on July 23. By the following morning, UBS analyst Timothy Arcuri had already raised his price target on the stock to $730 from $700, keeping a buy rating.The speed of his response says something. The event gave analysts enough hard information to rebuild their models on the spot.AMD shares traded near $532 on Friday, July 24, up about 3.2% over five days and up roughly 138% year to date. The stock carries a market value of about $867 billion and a price-to-earnings ratio above 170, which means the bar for justifying any target is high.Why UBS moved its AMD price target within a day of AI DayArcuri did not raise his target because AMD showed a faster GPU. He raised it because AMD gave him a bigger number for the server processor business, and that business carries better margins than anything else the company sells.UBS now believes AMD’s server CPU gross margin runs roughly 1,000 basis points, or 10 percentage points, above the company’s corporate average.That margin figure is the whole argument. If the highest-margin product line is also the fastest-growing one, every extra dollar of server CPU revenue lifts company-wide profitability, rather than just company-wide sales.Arcuri told clients this could create a margin cushion that lets AMD price its 2027 MI500 accelerator aggressively and take more GPU share without wrecking profits, TipRanks reported.

AMD CEO Lisa Su used the Advancing AI 2026 keynote to raise the company’s server CPU market forecast to $220 billion by 2030.SOPA Images / Getty Images

What UBS now expects AMD to earn in 2027 and 2028The revised model runs well past next year, which is unusual for a note written overnight.UBS projects AMD server CPU revenue of approximately $35 billion in calendar 2027, rising to roughly $60 billion in calendar 2028. For context, according to AMD’s earnings release, the entire company’s revenue in the first quarter of 2026 was $10.3 billion.Here is how the UBS earnings math stacks up.UBS earnings per share estimates for AMD2027: Approximately $19 per share, roughly in line with the Street2028: About $27.57 per share, with Arcuri suggesting the figure could approach $302027 data center GPU revenue: Approximately $44 billionThe 2028 estimate carries almost all the weight in this target increase, since UBS is roughly in line with Wall Street’s consensus on 2027 but well above it on 2028.The AI Day disclosures that changed analyst modelsAMD did not just show slides. It moved several timelines forward and put a much larger number on the market it plans to serve.CEO Lisa Su told the audience during AMD’s press release that the server CPU market will grow to about $220 billion by 2030, up from roughly $25 billion today. AMD already holds 46% of server CPU revenue share.The company also confirmed its Helios rack-scale system has entered full production, with shipments starting at the end of the third quarter and a broader ramp in the fourth.The customer commitments behind the forecastForecasts are cheap. Signed capacity is not.OpenAI: Up to six gigawatts of AMD GPUs, starting with MI450 deployments in the second half of 2026Meta: A separate six-gigawatt agreement on a similar timelineAnthropic: Up to two gigawatts of Helios capacity, with the first gigawatt beginning in the first half of 2027Microsoft (MSFT): Azure instances built on both the MI455X and the Venice CPUThose commitments give the $220 billion figure something to stand on, though most of the revenue arrives in 2027 and later.Why the server chip business drives AMD earnings more than GPUs doThis is the part most investors miss, and it explains why five separate firms raised targets after the same event.A GPU handles the heavy parallel math behind AI model training. A CPU handles the general-purpose work that surrounds it, including the logic that decides what an AI system does next.Agentic AI, where software takes multi-step actions on its own, leans heavily on that second category. Related: The new Chinese AI model rattling U.S. tech investorsMore agents running means more CPU sockets, not just more accelerators.AMD’s data center segment generated $5.8 billion in the first quarter, up 57% year over year. It was driven by EPYC processors and Instinct GPU shipments, the company’s SEC filing shows. The CPU half of that segment carries the fatter margin.How AMD stock compares with its peers and the broader marketHere is where AMD sits against the names investors most often compare it to.AMD versus the field, year to date 2026AMD: Up about 138%Philadelphia Semiconductor Index: Up 72.7% as of July 21Nvidia (NVDA): Up 11%S&P 500: Up 8.07%, closing at 7,408.30 on July 23AMD has outrun both its sector index and its largest competitor by a wide margin this year. The stock traded as high as $584.73 over the past 52 weeks and as low as$149.22, a range that shows how quickly sentiment on this name moves.That performance is also the risk. A stock priced at 170 times earnings has already banked a large share of the good news UBS is forecasting.What still has to happen before AMD reaches $730Arcuri’s target implies roughly 35% gains from current levels over 12 months. Several specific things need to go right first.4 milestones the bull case depends onHelios ships on schedule. Initial shipments must begin at the end of the third quarter, with the fourth-quarter ramp holding.Supply keeps up. UBS cited TSMC’s recent capital spending increase as the reason it grew more comfortable, so any advanced-node bottleneck reopens the question.Gigawatt commitments convert to revenue. Stage announcements from OpenAI, Meta, and Anthropic have to appear in reported results starting in 2027.Second-quarter results confirm the pace. AMD guided to about $11.2 billion in revenue with a non-GAAP gross margin near 56%, and the company reports on Aug. 4.That August report is the nearest checkpoint. It covers the first quarter in which the 2nm EPYC Venice ramp begins contributing.Where the UBS view could go wrong for AMD investorsNo analyst target is a guarantee, and this one carries specific vulnerabilities.The 2028 estimate carries most of the weight in this model. It leans on a market size AMD itself provided, plus a share assumption that stretches three years into the future. Su said the company is still targeting more than 50% of the server CPU market, a goal that requires Intel and Arm-based competitors to keep losing ground.More AI Stocks:Micron stock jumps as investors look beyond GPUs in AI chip tradeAMD stock gets a new reason to watch from Bank of AmericaMicron gives Wall Street reason to rethink AI winnersAnalyst views also vary widely. Recent targets range from Jefferies at $640 and Benchmark at $685 to KeyBanc at $725 and Arcuri’s $730. That’s a difference of roughly $90 on the same company after the same event.Investors who already own AMD have watched a 138% gain this year and may reasonably choose to trim rather than add. Those looking to start a position have a defined checkpoint on Aug. 4, rather than a reason to rush.The takeaway for AMD investorsUBS raised its AMD target to $730 from $700 because AI Day gave the firm two things it did not have before: a $220 billion server CPU market forecast for 2030, and confirmation that Helios is in production with named gigawatt-scale customers. The server processor line carries real weight in that estimate, alongside the accelerator business. UBS puts server CPU gross margin to roughly 10 percentage points above AMD’s corporate average.That means every dollar of server CPU growth lifts company-wide earnings more than a dollar of lower-margin revenue would. Arcuri has also framed that margin cushion as the factor that gives AMD room to price its 2027 MI500 aggressively, using the CPU business’s profitability to support share gains on the GPU side.UBS is betting on nearly $30 in 2028 earnings per share, on a stock that already trades above 170 times earnings.Second-quarter results on Aug. 4 will show whether the Venice ramp is delivering the required revenue.Related: SoftBank CEO offers stinging critique of Musk’s AI bet

Jensen Huang has been one of the most prominent voices in technology for years, but he had never once posted on X (the former Twitter). On July 24, he did. What he chose to say with his first-ever post on the platform says a lot about the fight now underway over who controls the future of AI.Huang backed a letter titled “Open Weights and American AI Leadership,” signed by 25 organizations including Nvidia, Microsoft, and Meta, calling on U.S. policymakers to support open-weight AI models rather than restrict them. Satya Nadella and Mark Zuckerberg both added their own statements on X. Elon Musk amplified the message. And two of the most visible companies in frontier AI, OpenAI and Anthropic, were not on the list.What Zuckerberg, Nadella, Musk, and Huang actually said about open AI modelsNadella offered a clear policy argument. “Together with others across our industry, we are outlining a path for open-weight models to strengthen American competitiveness and expand economic opportunity, while protecting national security,” he posted on X.Zuckerberg was more direct. “Open source is a positive and important force for both empowering people and preventing centralization. Proud to support this,” he posted on X. Musk reshared Zuckerberg’s post and added three words: “Overwhelming support for open source.”Huang’s first X post made the same argument. Open models, he wrote, “strengthen safety and cybersecurity, accelerate innovation and diffusion, and enable sovereignty.” For a CEO who has never used the platform publicly before, choosing this particular moment to start says something about how seriously the industry is treating this debate.More AI:Workers just sent AI companies an ultimatumPalantir CEO has a blunt verdict on OpenAI and AnthropicElon Musk pulls no punches with AI rivals as Grok 4.5 debutsTo understand why this fight matters, it helps to know what open-weight actually means. When a company releases a model as open-weight, it publishes the underlying numerical parameters: the billions of values that define how the model thinks and responds. Anyone can download those parameters, run the model on their own hardware, and modify it for specific tasks without paying API fees or asking permission.A business can deploy the model inside its own data center and keep its data off third-party servers entirely. A foreign government can take that model and run it without depending on any American company at all. That last part is where the geopolitical argument gets interesting, and where the two sides in this debate start talking past each other.Why OpenAI and Anthropic staying off the letter is the real storyOpenAI and Anthropic weren’t just absent. Both companies have reportedly been pushing U.S. policymakers in the opposite direction, advocating for tighter restrictions on Chinese open-source AI and arguing those models are easier to misuse once released publicly. The commercial interest behind that position is pretty clear.OpenAI and Anthropic charge for API access to models they control. Developers who can run equally capable models on their own infrastructure don’t need to pay those fees. The open-weight push doesn’t just put these two companies on the wrong side of a policy letter. It threatens a core part of how they make money.Critics of the letter are quick to point this out. They describe the industry push as lobbying dressed up as public interest. The argument that open models are harder to control once widely released is a legitimate one, and it’s the issue OpenAI and Anthropic are raising with policymakers.

The letter from Zuckerberg, Nadella, and 23 other organizations is a direct attempt to influence those decisions before they become law.Sven/Getty Images

What China’s Kimi K3 launch has to do with the timingThere’s a specific reason the letter came when it did. On July 16, Beijing-based Moonshot AI put out an open-weight model called Kimi K3. It reportedly hit near-frontier performance levels. Chip stocks slid on the news.The release made something concrete that had been theoretical for months: Chinese labs can now build open-weight models that are genuinely competitive with what U.S. labs produce, and release them publicly for anyone to download. White House adviser Michael Kratsios accused Moonshot of using distillation to copy a U.S. model in building Kimi K3, adding another layer of tension to the debate, Fortune reported.For the tech leaders backing the letter, that development strengthens their case rather than weakening it. Their argument is that if China can produce and globally distribute competitive open-weight systems, the U.S. response should be to accelerate its own open ecosystem, not restrict it. Locking down open models in the U.S. would slow American innovation while doing nothing to stop Chinese models from spreading.Why the policy fight over open AI models is just getting startedThe policy stakes are real. Policymakers are currently weighing whether to restrict how openly AI models can be released, who can train on large amounts of compute, and how much access foreign entities should have to frontier systems.The letter from Zuckerberg, Nadella, and 23 other organizations is a direct attempt to influence those decisions before they become law. It argues that regulators should target specific harms and misuse cases rather than restricting the model format itself. The tech leaders signing it are betting that an open-weight ecosystem ultimately serves American interests better than a controlled one does.The ones who didn’t sign are making the opposite bet. That divide is now public, and it will play out in committee rooms and policy briefings over the months ahead. Jensen Huang waited a long time to make his first X post. The fact that he used it on this issue is the clearest signal of how seriously the biggest names in the industry are taking this fight.Related: Scott Bessent sends unprecedented warnings to China on AI models

TheStreet aims to feature only the best products and services. If you buy something via one of our links, we may earn a commission.Why we love this dealWith summer finally in the air, it’s time to let your feet breathe in the sunshine. You can give the running shoes and slick sneakers a break to try something new. For example, Amazon is selling a pair of KuaiLu Leather Flip Flops for a cozy discount.The sandals are usually priced at $20, but you can get them on sale for as little as $10. You can choose between 17 different styles and find them in sizes seven to 16, all at different discount prices. Whatever style you pick, you’ll get a set of sandals that are as supportive as they are stylish. KuaiLu Leather Flip Flops, From $10 (was $20) at Amazon

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TheStreet aims to feature only the best products and services. If you buy something via one of our links, we may earn a commission.Why we love this dealWith back-to-school season here, you might be on the lookout for a great deal on a new laptop or tablet for a refresh, but electronics can be overwhelming to shop for. You don’t want to overspend, you don’t want to buy the wrong thing, and you want to love what you choose. But browsing around and hunting for the best deal might be just the ticket to a less stressful tech shopping session.In fact, you could save a whopping $273 today and get new tech you’ll treasure. Whether you’re in the market for a laptop or a tablet, Walmart is selling a $529 Hyyuo 2-in-1 Laptop Tablet Combo on sale for only $256 right now. You can effortlessly switch between laptop, tablet, and stand-up modes with it to suit the task at hand.Hyyuo 2-in-1 Touchscreen Laptop, $256 (was $529) at Walmart

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The earnings season has kicked off with a bang, though not the kind that investors have been hoping for. Two Magnificent 7 members turned in their disappointing earnings on the same day.Alphabet (GOOGL) and Tesla (TSLA) both reported earnings on July 22, and both stocks dropped the following day. Microsoft (MSFT) and Meta (META) are next in line to report earnings on July 29.The theme for the year has already been set, when all the hyperscalers increased their capital expenditures (capex) plans as if spending more guarantees winning the AI race.The trade-off is that this serious cash burn will negatively affect free cash flow. The only Magnificent 7 members that won’t have this problem are Apple (AAPL) and Nvidia (NVDA).Despite this elephant in the room, Morgan Stanley is still bullish on Microsoft. In a research note shared with me, Morgan Stanley analysts Adam Wood and Josh Baer updated their opinion on Microsoft stock ahead of the fourth quarter (Q4) earnings.

Morgan Stanley believes the Q4 report will be a positive catalyst for MSFT stock.Shutterstock

Morgan Stanley believes the Q4 report will be a positive catalyst for MSFT stockAnalysts said that Azure and Copilot are key drivers for the stock, and they believe that the sentiment about them is about to improve.They see approaching Q4 results as the first catalyst that will support their thesis.They noted that Q3 was strong and that Microsoft exceeded consensus estimates across all three segments, delivering approximately 1% total revenue upside, driven by 39% constant-currency Azure growth.Analysts believe that Azure growth will continue into fiscal year 2027, as Microsoft continues with its plan to approximately double its total datacenter footprint over the next two years.Wood wrote: “We believe this expanding infrastructure footprint should continue easing capacity constraints, allowing Azure to capture robust AI and cloud demand while providing further evidence that Microsoft’s significant AI infrastructure investments are translating into durable revenue growth.”Analysts expect Azure AI to achieve approximately 100% year-over-year growth in Q4 fiscal year 2026, or 18% quarter-over-quarter growth.They noted that Microsoft’s management has said that a significant portion of capex is for longer duration assets like land and buildings, which could generate revenue for more than 15 years.Wood reiterated an overweight rating for Microsoft stock, and a price target of $600, based on a 25x multiple and EPS estimates for fiscal year 2028.He noted that this multiple represents a premium to large-cap software peers, but he believes it is justified by strong positioning and execution.Analysts noted downside risks:Weak macro impacting IT spendingOn-premises cannibalization by CloudIncreased investments hurt margin expansionAI adoption proves limitedUpside potential:Cloud adoption accelerates, with Azure as convincing winnerAI leadership results in substantial revenue contribution over-timeOperational efficiencies leading to greater than anticipated economies of scale and margin expansionWhile Morgan Stanley believes that high capex will work in Microsoft’s favor, investors need to watch carefully what happens to OpenAI, as it is a major driver of that capex.Microsoft’s $100 billion friendship with OpenAI is showing cracksMicrosoft revised its partnership with OpenAI in April, stating that it no longer has an exclusive license for its models.It was also absent from the last OpenAI funding round.This news sounds a bit different when taken along with the amount of money Microsoft spent on OpenAI. We can thank Elon Musk’s lawsuit against OpenAI for this important information.Michael Wetter, who runs the company’s corporate development, testified in court that the company has spent more than $100 billion on its OpenAI investments and its costs of building data centers and hosting, according to Reuters.After spending so much money on OpenAI, it is hard to break out, and Microsoft keeps making one step forward and one step back, as we can see from what is going on with the Copilot front.Microsoft made major leadership changes to improve its AI strategy, with the most important being the naming of Jacob Andreou as EVP for Copilot.The company launched Copilot Cowork in March for Frontier (early access program), and it became generally available in June.The most recent effort was the launch of MAI-Image-2.5-Pro and MAI-Voice-2-Flash AI models, which reduce GPU usage significantly.Despite these serious efforts, OpenAI’s GPT‑5.6 is the preferred model in Microsoft 365 Copilot.Not only is Microsoft competing with its partner on the model front, but it has already built and is building additional data center capacity, driven by OpenAI’s insatiable demand.The problem is that OpenAI’s leaked financials show it is not profitable.Tech writer and prominent AI skeptic Ed Zitron published leaked OpenAI’s audited financial statements, which were verified by the Financial Times. This revealed an increase in OpenAI’s net loss, from $5.09 billion in 2024 to $38.53 billion in 2025.OpenAI’s way to get more investor money was to pursue an IPO, but this IPO is now in question.On July 10, Apple filed a lawsuit in a federal court in Northern California, alleging trade secret theft by former employees and OpenAI.Related: AI agents can now open bank accounts and move your moneyThe lawsuit could be trouble for the IPO, but OpenAI was already considering postponing it until 2027, even before the lawsuit, The New York Times reported.As if the era of tokenmaxxing ending, and OpenAI having problems, wasn’t enough, Kimi K3’s release only made things worse for frontier model developers.The issue here is the one that Alex Karp, Palantir (PLTR) CEO, raised, that companies are starting to realize they need more control over the models and to have security of their data. This is how these open-weight models might lead them to invest in their own infrastructure.If we add to the picture Meta entering the cloud business, which will also sell AI capacity, Microsoft could end up with excess capacity.In conclusion, Microsoft’s capex might look good for Morgan Stanley analysts, but one domino falling could unravel it all.Related: Microsoft CEO’s Anthropic criticism reveals bigger AI power struggle

Wall Street spent most of July arguing about how much SpaceX stock is worth. On Friday, July 24, HSBC became the first major bank to tag it as worth slightly less than the market is already paying.The bank initiated coverage of Space Exploration Technologies (SPCX) with a hold rating and a $115 price target.That target sits below July 23’s close of $118.24 and $20 under the $135 IPO price from June.Shares fell about 4% on July 24 to trade near $113, extending a decline that has taken the stock down roughly 27% in a month.What makes the note worth reading isn’t the rating; it’s what HSBC had to do to arrive at it.Why HSBC’s $115 SpaceX price target is lower than it looksHSBC reached a $115 price target after being unusually generous.The bank valued SpaceX by pricing each business separately and adding them together. Then it applied a 2x “innovation premium” on top.That premium exists to account for Elon Musk’s record of building companies that reshape industries, CNBC reported. HSBC used Tesla’s first decade as a public company as its benchmark, so the math already assumes Musk pulls off something extraordinary. Yet, it still lands under the current price.That is the troubling part for shareholders. Double the company’s worth for the founder alone, and the stock is still fully valued.HSBC did model a best-case scenario. It put a sky-high valuation at $293 per share, assuming Starship commercializes, Starlink adoption accelerates, and AI revenue arrives faster than expected.The bank simply doesn’t treat that outcome as the base case, and the $115 target is where its base case lands.

Starship Flight 13 launched on Friday evening, July 24, one of two dates that will settle the argument over SPCX stock.Walter Cicchetti / Getty Images

The $106 billion number SpaceX investors should focus onMost analyst notes fight over revenue growth. HSBC’s forecast doesn’t dispute the growth at all.The bank expects revenue to more than double to $38.2 billionin 2026 from $18.7 billion in 2025, driven by the AI segment and Starlink.The problem sits further down the page. HSBC expects SpaceX to keep posting GAAP losses through 2027 and doesn’t see free cash flow turning positive until 2030.Reaching positive free cash flow costs roughly $106 billion in cumulative cash.For a reader deciding whether to buy, that figure matters more than the price target. Free cash flow is the money left after a company pays its bills and funds its equipment, and it’s what eventually pays shareholders.HSBC is saying SpaceX will burn through more than $100 billion before it produces any.What HSBC’s forecast implies for the next 4 yearsRevenue roughly doubles in 2026, then keeps climbingLosses continue on a GAAP basis into 2027Cash usage runs to about $106 billion before it reversesPositive free cash flow arrives around 2030Why the AI business is where HSBC pushes back hardestHSBC called SpaceX the clear leader in commercial launch and credited Starlink’s lead in satellite internet.The skepticism starts where SpaceX stops being a space company.The company absorbed xAI in February 2026, bringing in the Grok model, the Colossus data centers, and the X platform (formerly Twitter).HSBC believes xAI trails the leading AI developers in both enterprise adoption and computing scale. To close that distance means spending against Amazon (AMZN), Microsoft (MSFT), and Google.Related: Morgan Stanley sends strong signal on SpaceX stock price targetThe bank also questioned whether orbital data centers can become economically viable within the next decade, and said Starlink’s addressable market is likely smaller than SpaceX’s own estimate.SpaceX told the SEC its total addressable market runs to $28.5 trillion, with $26.5 trillion of thatin AI.HSBC is essentially arguing the market has priced a slice of that $26.5 trillion into the stock before anyone has proven it can be reached.What SpaceX’s own numbers say about the burnThe filings back up the caution. SpaceX generated $4.69 billion in revenue in the first quarter of 2026 and lost $1.94 billion from operations, according to Reuters.Starlink is carrying the company. The connectivity segment brought in $3.26 billion of that quarterly revenue with $1.19 billion in operating income.More Space Stocks:SpaceX stock defies latest Wall Street forecastsCathie Wood buys more SpaceX stock after selloffSpaceX investors may be ignoring troubling trendThe AI segment produced $818 million in revenue and a $2.47 billion operating loss in the same three months.Capital spending in Q1 hit $10.1 billion, and $7.7 billion of it went to AI, CNBC reported.There’s a signal in there that’s worth noticing: SpaceX is spending the majority of its capital on the one segment HSBC says it’s least likely to win.The one metric bulls tend to skipStarlink added subscribers fast, reaching 10.3 million by the end of the first quarter from 5.0 million a year earlier, SpaceNews reported.Average revenue per user, or ARPU, fell to $66 a month from $86 over the same stretch, as SpaceX pushed into lower-priced markets in Africa, Southeast Asia, and Latin America.That trade works only if subscriber growth keeps outrunning the price decline.How SPCX stock compares to the market since its IPOThe gap between SpaceX and the broader market since June is clear.SPCX from its $135 IPO price: down about 16%SPCX from its $225.64 June 16 peak: down about 50%SPCX over the past month: down about 27%Nasdaq 100 over the past 12 months: up about 23%, Stocktwits reportedShort sellers have collected roughly $15.5 billion in paper gains since the IPO, with short interestnear 31% of the tradable float, Investing.com noted.The two August dates that matter more than any price targetSpaceX reports its first quarterly results as a public company after the close on Aug. 4. Two trading days later, on Aug. 6, the first lock-up tranche expires. Up to 911.5 million shares become eligible to sell, lifting the public float from about 4.9% to roughly 12%, CNBC reported.Musk’s stake stays locked until mid-2027.For an investor, the sequence is what counts. The earnings report gives the first clean look at cash burn, and 48 hours later, the supply of tradable shares more than doubles.If the report disappoints, the selling arrives into a market that just got a lot more sellers.The Falcon 9 decision that raised the stakes on StarshipThere’s one more development alongside HSBC’s caution.SpaceX has begun turning away satellite operators seeking dedicated Falcon 9 launches beyond 2028 and stopped taking new Falcon 9 rideshare reservations, Bloomberg reported.It has also halted production of some expendable Falcon hardware, including upper-stage components.Falcon 9 is expected to keep flying NASA and Defense Department missions, and the plans could change if Starship slips further.Starship’s Flight 13 launched on Friday, July 24, from Starbase after a July 16 abort and a weather delay, carrying 20 Starlink V3 satellites.What SpaceX investors should actually do with this noteHSBC’s hold is not a sell call, and it does not say the business is broken. It says the price already reflects the good outcome.For most investors, that means waiting until after Aug. 6 to buy, since both the first earnings report and the float expansion land inside 48 hours.Anyone already holding SPCX should size the position for a stock that has moved 50% in six weeks and carries 31% short interest. A strong quarter could push it up just as fast.The bull case needs three specific things: Starship flying often enough to cut launch costs, Starlink adding subscribers faster than ARPU falls, and xAI converting computing contracts into repeat revenue.HSBC’s $115 target is a bet that at least one of those slips. The Aug. 4 report is the first chance to find out which, if any.Related: Jeff Bezos doubles down on Blue Origin with $2B

In much of the country, the most affordable homes for sale are also the oldest. Buyers reaching for a lower price increasingly find themselves looking at houses built well before the wiring standards, materials, and layouts that exist in newer construction.As home prices continue to climb, that calculation has become even more challenging. The median existing-home price hit $440,600 in June, an all-time high and the 36th consecutive month of year-over-year increases, according to the National Association of Realtors. Total inventory slipped to 1.56 million units, a 4.6-month supply, leaving fewer cheap, newer listings for buyers to work with.On Wednesday’s episode of the BiggerPockets Real Estate Podcast, host Dave Meyer and co-host Henry Washington took a question from an investor in Columbus, Ohio, who had spent years refusing anything built before 1964 and watched that rule wall off more and more affordable deals. The two spent much of the episode on whether a cutoff like that has quietly become its own kind of mistake.”I really like this question because I don’t think there’s a right answer,” Meyer said.What NAR’s record median home price means for buyersThe new median home price record did not arrive alongside a collapse in demand. Existing-home sales ran at a seasonally adjusted annual rate of 4.09 million in June, down 2.4% from May but up 2.8% from a year earlier, and properties went under contract in a median of 28 days. Supply is what has not kept pace, and NAR’s chief economist framed that as the variable dictating where prices go next.”The median home price has reached an all-time high,” said NAR Chief Economist Lawrence Yun. He added that progress on long-term affordability could stall if inventory growth does, and that prices can accelerate without consistent gains in supply.This dynamic drew national attention again Saturday, when CBS News aired a segment on buying a home during the affordability crisis.More on housing market and real estate investing:Homeowners face selling decision after housing market shiftAmericans face major decision after housing market newsAmericans are leaving their jobs for unexpected income streamThin supply at a record price does most of its damage at the bottom of the market, where the move-in-ready listings that once anchored a search have priced out of reach. What is left is older, and Meyer’s warning is that screening that stock out on the calendar alone removes a large share of what is actually available.”If your buy box starts in the 1960s, you’re filtering out a huge chunk of inventory, including some potential home runs,” Meyer said.The Columbus investor had set a personal floor at 1964, a line drawn to avoid the knob-and-tube wiring common in older builds. The rule did its job on wiring, but it had also begun closing off affordable properties, and that is the tradeoff Meyer is asking buyers to reopen. Widening the search reaches inventory a stricter cutoff would bury, but it also hands the buyer a set of risks a 2015 build does not carry, and those risks are where the decision gets uncomfortable.

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The tradeoff BiggerPockets hosts see in older homesWashington’s answer was not to avoid older houses but to price them correctly before signing anything. He works the same five systems on every older property he looks at.”I’m always looking at the big five,” said Washington. “I’m looking at plumbing, electrical, roofs, HVAC, and foundation.”Cost is what separates a bargain from a mistake, and by Washington’s estimates the range is wide. New electrical runs roughly $5,000 to $10,000. A roof lands around $10,000 to $15,000 depending on the size of the property. A routine HVAC swap runs $5,000 to $8,000, but a house that has never been ducted pushes that to $16,000 to $20,000 or more. Foundation work is the line item that worries him most, at $20,000 to $50,000 with no guarantee the house sits level afterward.”But plumbing and foundation, you can get up there into almost six figures and having to fix some of those problems,” Washington said.Meyer’s caution runs alongside it. The cheap-fixer version of the pitch, he said, tends to come apart once the renovation actually starts.”A lot of people look at these older homes and say, ‘Oh, that’s a great value-add opportunity.’ And there is if you can execute it,” Meyer said.Meyer said his own whole-house re-plumb is costing about $80,000 and has been running for roughly nine months.That leaves buyers two workable paths rather than one. The first is an older home someone else has already upgraded, where the foundation and plumbing have been handled, the electrical ideally with them, and the layout works as it stands. The second is a narrower window. Washington named 1970 to 1975 as his sweet spot, and Meyer agreed on the reasoning, pointing to construction quality in that stretch, minimal knob-and-tube risk, and less asbestos exposure than 1960s stock.”A lot of the quality of the construction was really good back in the ’70s,” Meyer added.Neither path changes the condition underneath. Yun’s caution was that prices can keep climbing Before closing on anything older, both hosts advised paying for a foundation specialist’s assessment and a re-plumb quote, the two line items most likely to reshape the math after the sale.Key takeaways for 2026 homebuyersRecord prices are pushing buyers toward older inventory: NAR put the June median existing-home price at $440,600, an all-time high and the 36th straight month of year-over-year gains, with total inventory down to 1.56 million units and a 4.6-month supply.A calendar cutoff carries a cost: Meyer said a buy box that starts in the 1960s screens out a large share of what is listed, including some of the best deals. The Columbus, Ohio investor who raised the question had held a 1964 floor and watched it shrink her options.Inspect the big five before the cosmetics: Washington, who says he has done hundreds of deals, checks plumbing, electrical, roofs, HVAC, and foundation on every older property. New electrical runs roughly $5,000 to $10,000 by his estimate, and ducting a house that never had it can reach $16,000 to $20,000 or more.Foundation and plumbing hold the six-figure risk: Washington said foundation work runs $20,000 to $50,000 and can still leave a house sitting uneven, and that plumbing and foundation together can approach six figures. Meyer said his own re-plumb is costing about $80,000 over roughly nine months.The hosts point to the early 1970s: Washington named 1970 to 1975 as his sweet spot, and Meyer cited stronger construction quality in that era, minimal knob-and-tube risk, and less asbestos exposure than 1960s builds. Before closing on anything older, both advised paying for a foundation specialist’s assessment and a re-plumb quote.Related: Homeowners face selling decision after housing market shift

SpaceX (SPCX) gave investors something of a spectacle on Friday.Reuters reports that Starship’s 13th test flight lifted off from Texas, released 20 Starlink V3 satellites, endured the reentry with its cleanest heat-shield performance yet, and completed an upright splashdown in the Indian Ocean. According to The Washington Post, CEO Elon Musk talked about the data haul, arguing SpaceX got everything it needed from the heat-shield experiment “and then some,” while engineer Kate Tice called it “lucky flight 13.” The management’s imagery and cheering made it seem like the mission was a clean sweep.In reality, though, it wasn’tThe satellites were temporary test articles on a suborbital path, burning up as planned instead of joining the Starlink network. Perhaps more importantly, five Super Heavy engines failed to relight during descent, which sent the booster into the Gulf of Mexico quicker than intended.SpaceX spokesperson Dan Huot even said that SpaceX targeted a much softer return. The flight advanced upper-stage reentry, payload deployment, and communications testing, but problems with booster reliability and full reusability dampened much of the enthusiasm. The mixed showing is unlikely to go much for the stock that’s experienced a ton of headwinds of late. Morgan Stanley’s Adam Jones, though, feels the market is overlooking a critical part of SpaceX’s future value amidst greater scrutiny on launch setbacks, capital spending, and near-term selling pressure. 

SpaceX shares fall as investors question the value of its AI business Michael Gonzalez/Getty Images

Why Morgan Stanley say SpaceX’s AI business is worth nothing at $100Jones believes that the market is beginning to value SpaceX almost entirely as a launch-and-connectivity company, assigning little or no value to its AI assets as reported by Bloomberg.More SpaceX:Elon Musk’s startling claim to SpaceX investorsCiti sends powerful sign to SpaceX investorsBeaten-down stock lets you buy SpaceX below market priceAccording to Jones,”Many ascribe zero or even negative value for AI given the high capex requirements relative to Space & Connectivity, largely uncertain economics, and the high degree of management time devoted to the business.”Consequently, he believes that the disconnect offers a far more attractive entry point with investor sentiment deteriorating sharply.SpaceX shares approached $110.85 on the back of concerns of an upcoming insider lockup expiration, elevated AI spending, and macro uncertainty, along with a broader rotation away from high CapEx technology companies. Yet Morgan Stanley feels the company’s operating fundamentals remain “largely unchanged.”Morgan Stanley applies a sum-of-the-parts framework, where basicallySpace and connectivity value + AI value = SpaceX equity valueJonas’s $300 price target (one of the highest on Wall Street) accounts for over 50% of SpaceX’s valuation to AI. That shows Morgan Stanley values the company’s AI operations at over $150 per share, with the rest coming from launch services, Starship, satellite connectivity, and related space infrastructure.Not surprisingly, all four banks that helped underwrite SpaceX’s offering agree with Morgan Stanley. Goldman Sachs, Bank of America, Citigroup, and JPMorgan have all issued buy ratings. How has SpaceX stock performed since its IPO?As of the latest available Yahoo Finance data, SpaceX (SPCX) stock closed Friday, July 24, 2026, at $115, down 2.7% for the session. For perspective, according to Forbes, SpaceX priced its IPO at $135 per share on June 11, 2026, closing the first day at a gain of about 19.2% from the $135 IPO price. Moreover, SpaceX reached its all-time intraday high of $225.64 on June 16, 2026, only two trading sessions after its debut. At that level, the shares were up 67% from the $135 IPO price and 50.4% from their $150 opening trade. Additionally, Yahoo Finance lists SpaceX’s all-time and 52-week intraday low at $110.85. That was 17.9% below the IPO offer price and 26.1% below the first public trade of $150. How high could SpaceX stock go?According to Seeking Alpha data, Wall Street’s consensus puts SpaceX’s average 12-month target at $236.71, implying 105.7% upside from roughly $115. Forecasts range from $62 to $800, indicating a remarkably wide spread, underscoring disagreement over execution and valuation.Morgan Stanley carries one of the more audacious mainstream $300 targets on SpaceX. Its bull case assigns substantial value to SpaceX’s orbital AI opportunity.Goldman Sachs rates SpaceX a Buy with a $205 target, reflecting growth across launch, connectivity, and AI, but offers a far more restrained valuation than Morgan Stanley.Bernstein’s $239 and Citi’s $200 targets sit nearer the broader consensus, while Macquarie’s recent $250 target suggests roughly 117% upside.Raymond James’ Street-high $800 target assumes exceptional Starship and AI execution, according to Barrons.
Sources: Yahoo Finance, Barron’s, Seeking Alpha.
What does Morgan Stanley’s AI valuation mean for SpaceX investors?The AI debate matters a ton because it’s the bulk of Morgan Stanley’s SpaceX valuation.Hence, if the AI business generates the value the bank’s analyst expects, SpaceX stock might appreciate substantially even without a major re-rating of its launch, Starship, and satellite-connectivity operations.Morgan Stanley believes that the traditional space businesses offer a valuation foundation, while Grok, Cursor, and the wider AI platform offer most of the potential upside. At $100 per share, investors might be assigning little or no positive value to that AI opportunity.Nevertheless, it seems investors aren’t discounting the AI side of its business on the back of massive capital requirements, uncertain long-term margins, intense competition, and the risk of consuming cash for years without offering meaningful returns. That disagreement essentially defines the investment case. Morgan Stanley sees a valuable AI platform that investors might receive for free. Bears, on the other hand, see a capital-intensive operation that deserves a negative value, as it’s likely to absorb cash generated by SpaceX’s stronger businesses.That is perhaps the clear weakness in the “free AI” framing. An unprofitable business isn’t genuinely free if it requires multiple capital injections, raises borrowing, causes shareholder dilution, or weakens execution elsewhere. In that scenario, slapping a zero value on AI could actually be generous.The bull case thesis, therefore, depends on two conditions.SpaceX’s launch and connectivity businesses must independently support something close to a $100 share value, and the AI division must eventually produce returns above its cost of capital. If either of those assumptions doesn’t come to fruition, $100 might not represent a valuation floor. For investors, the question is not simply whether AI has potential, but whether that potential could create quicker value than it consumes cash.Related: Bank of America says Alphabet stock investors are missing the bigger signal

While the name was born out of a 2010s-era internet joke about slapping misbehaving tourists with an extra fee, the “tourist tax” has in the ensuing decade become a presence in many cities and destinations seeing large numbers of foreign visitors.The name itself is a bit of a catch-all term that refers both to the entry fee that some countries charge arrivals at the airport and the daily levy that many European cities add to the price of the nightly hotel or rental property rate.The city of Amsterdam just raised the latter to, at 12.5% of the cost of one’s room rate, one of the highest in the world. Other cities with this type of tourist fee include Paris in France, Berlin in Germany as well as most major cities in Italy and Spain. In the U.S., New York City and Los Angeles also charge a similar levy that is presented as a hotel occupancy and sales tax.Edinburgh starts charging travelers to Scotland a daily hotel taxThe latest city to start charging a visitor levy is the Scottish capital of of Edinburgh. Voted in by the city’s councillors in 2025, the 5% addition to the cost of the nightly stay at any hotel, hostel, bed-and-breakfast or property rental in the city came into effect on July 24 for all visitors booking accommodation in the city.The good news is that this tax is capped after five nights spent at the same location and does not rise during peak periods of the year like in certain other European cities.Related: Australia will make it easier for everyone to visitCity councillors presented the fee as a way to redirect funds to keep the city clean, maintain infrastructure and otherwise mitigate the effects of rising numbers of tourists amid limited resources to manage them.

Those who book a hotel in Edinburgh now need to pay an additional nightly tax of 5%.The Edinburgh Grand

“The city’s popularity comes at a cost”: What else to know about the new Edinburgh city taxReports from city authorities show that the numbers of international visitors to Edinburgh increased by approximately 10% in the first part of 2026 compared to the previous year.This is the first such tax put in place in Scotland and does not apply to Glasgow or other destinations in Scotland; when similar efforts to put in place first started being pushed forward in Wales, many tourism industry representatives worried that it would drive visitors away from more rural destinations that rely on tourism.More Travel News:Airline to launch unusual new flight to Cayman Islands from the U.S.There is a very cool Irish version of swimming pigs in the BahamasUnexpected country is most luxurious travel destination for 2026Low-cost airline launches easier way to get to Sri LankaThe hotel tax is also sometimes presented as a way to encourage tourists to go beyond major cities and come to other parts of the country.”We know that the city’s popularity comes at a cost through the pressure it puts on our services and on the people who live and work here all year round,” Edinburgh Council Leader Jane Meagher said in a statement on the new levy. “This small new contribution from overnight visitors will help improve the services and public spaces we all depend on, while better managing the effects of tourism and major events.”Related: Popular cruise, tourist destination will triple entry tax