For years, investors have raised eyebrows at big tech’s mind-boggling infrastructure spending—and Meta Platforms heard the message loud and clear. Today, Bloomberg reported that the company is planning to build a new cloud venture that could bring in billions to offset its massive capex spending.

Shares of Meta popped 8.81% on the announcement.

The deets: One business model Meta is reportedly considering is selling access to developers, allowing them to use the AI models that already exist on the company’s infrastructure, like Meta’s Muse Spark. Another option is for the company to just sell its excess computing capacity directly to other businesses, a la CoreWeave.

Speaking of which, shares of CoreWeave sank 13.92% today, while Nebius Group, another neocloud provider, fell 17.01% following the news.

The AI race is expensive

For years, Mag 7 companies have been rushing to build data centers, the key infrastructure powering the artificial intelligence boom. AI models like ChatGPT, Claude, and Gemini need huge amounts of power, creating a massive scramble for computing.

But winning the AI race takes some serious cash, and Mark Zuckerberg has been forced to pony up: In April, Meta told investors it was planning to spend $145 billion on capex this year, up from roughly $72 billion in 2025. Overall, Meta, Google, Amazon, and Alphabet are expected to spend a staggering $725 billion on AI infrastructure in 2026 alone.

Those numbers spooked investors, and shares of Meta sank over 14% year to date through yesterday’s close. But renting access to cloud computing power could help Meta recoup some of those massive costs, while simultaneously raising the profile of its nascent LLM Muse Spark.

Just don’t forget: Fellow Magnificent Seven members Amazon, Microsoft, and Google are already in the cloud, and have spent many years and billions of dollars to establish their positions there. It remains to be seen how much market share Meta can take from them, but if you thought the AI race was already red-hot, you ain’t seen nothing yet.—LB

🟢 What’s up

• Lime, the e-bike and scooter rental backed by Uber, rose 4% after raising $167 million in its IPO today.
• Bending Spoons, the new owner of AOL (yes, that AOL) soared 39.66% on its first day of trading.
• Salesforce and ServiceNow rose 4.19% and 6.57%, respectively, after Guggenheim upgraded them both to buy.
• Nike had a wild day, ending the session up 4.9% despite reporting that sales plummeted 12% in China last quarter.
• Robinhood Markets rallied 8.35% as the trading app launched its new tokenized stocks.

What’s down

• Getty Images plunged 10.47% on the news that it’s terminating its merger agreement with Shutterstock.
• Constellation Brands lost 1.59% even though the alcohol maker beat Q4 revenue expectations.
• Aluminum company Alcoa dropped 8.94% after it agreed to acquire some of mining firm South32’s assets.
• Sandisk fell 10.62% and Micron dropped 10.57% as investors took profits, given the two companies more than tripled during Q2 trading, which wrapped up yesterday.
• Caterpillar lost 6.87% following Michael Burry’s announcement that he’s shorting the construction equipment manufacturer.

GLP-1 drugs are a dime a dozen these days—and soon they’ll cost pennies.

What’s happening: Today, Medicare is launching an 18-month “Bridge” program that will cover most of the cost of obesity drugs like Novo Nordisk’s Wegovy injection and pills, as well as Eli Lilly’s Zepbound injection and its Foundayo tablets. While some US seniors got their GLP-1 drugs covered by Medicare if they treated things like diabetes, the new program covers the treatments for obesity, and reduces the price of these products from upward of hundreds of dollars to a mere $50 copay.

Why it matters: Novo and Eli estimate that up to 20 million of the 69 million Americans on Medicare will take advantage of the program, opening a big new market for these pharma companies. Just don’t expect their stocks to pop anytime soon: Wall Street thinks it will take time for people to sign up, and it won’t boost their bottom lines for a few quarters. And don’t forget, the program is scheduled to conclude by the end of 2027 unless Congress changes the laws behind Medicare.

But between now and then, analysts believe the program could add about a billion dollars in annual revenue for each company, particularly now that their more-tolerable pill versions are widely available. It’s another win for weight-loss drugmakers, which continue to bulk up the market for their hit products as America keeps trying to slim down.—MR

The AI trade first made winners out of chipmakers like Nvidia. As investors realized AI startups would need to build data centers for their LLMs, they poured money into infrastructure companies like Vertiv. Then, they noticed all those data centers will need electricity, so utilities like Oklo became the new hot way to play AI. And today, it’s all about memory and data storage stocks like SanDisk that allow tech companies to train new AI models.

There’s a logical train of thought behind each new phase of the AI trade, and Bank of America analysts believe that they’ve found the next angle before the rest of the market: catering companies.

“The rapid global expansion of data centers represents a new source of structural, multi-year growth for the scaled food service providers,” analysts wrote in a recent note. “We believe the food service providers are in the very early stages of offering fully integrated services (food, hospitality services, transportation, etc) for the build outs of these data centers. In total, we estimate a potential TAM of nearly $100bn in the US, comprised of ~$70bn for construction and ~$20bn for the post-build market.”

Catering to the AI trade

As you read in our first story today, hyperscalers are shelling out hundreds of billions of dollars to build massive data centers. One of the most high-profile of these is the $100 billion Stratos data center that might soon be built in the middle of nowhere in Utah. Clocking in at 62 square miles, this mammoth facility will take years of work from thousands of construction workers in the middle of nowhere, and they all need food, water, and shelter.

Enter companies like Aramark, which BofA says has experience catering to buildouts in remote environments and has created a one-stop shop business that can handle all of a hyperscaler’s needs. If Aramark can secure even a fraction of the massive total addressable market for data center construction, its revenue can soar—which is why the analysts just raised their price target for the company. They’re also bullish on similar companies like Compass Group and Sodexo.

They say that selling shovels is the best business to be in during a gold rush. These days, selling a hearty breakfast burrito might be a better bet.—MR

• President Trump made $2.2 billion in personal income, including $1 billion in crypto deals, in the first year of his second term. Our friends at Good Work helpfully explain why that’s unusual.
• The Trump administration won’t renew the USMCA, the US’s trade pact with Canada and Mexico.
• Private payrolls grew by 98,000 in June, lower than forecasts of 110,000.
• A Swedish court ruled that Google must pay Klarna $1.97 billion after the buy now, pay later firm won an antitrust case.
• The world’s top economists and central bankers have some stark warnings about AI.
• The head of BlackRock’s private credit fund is exiting after months of losses, failed loans, and regulatory probes into the beleaguered unit.

Earnings announcements: No earnings worth mentioning, so maybe get your long holiday weekend started early?

Economic reports: Then again, it might be worth sticking around for a double dose of labor market news. We’ve got the usual weekly initial jobless claims, and the US June jobs report is arriving a day early since markets are closed on Friday.