Themes

There’s a shift underway in how people use search and it’s not going in Google’s favor. Last quarter, 56% of total revenue was from Search, and I estimate the segment accounts for 90% of profits. The company is still dominant, but their Golden Goose is falling ill. From Eddy Cue's comments at the Google trial, Apple is seeing declining Safari searches (Google) to rising AI competition, the headwinds are real. The stock may look cheap, but without a clear plan for navigating the post-blue-links world, it's likely going to get cheaper.

  Deepwater was grateful to host the Deepwater AI Summit in Minneapolis recently with 120 business leaders in attendance representing startups to Fortune 500 companies. We had in-depth discussions on leveraging AI in the enterprise, investing in AI and what…

​Don't let the recent downturn in the AI trade mislead you. The reality is that AI-powered service providers are struggling to keep up with demand, and AI infrastructure providers are unable to build capacity fast enough. All the potential that drove AI stocks higher in 2024 remains intact. At Deepwater, we continue to believe there are still 2–3 years left in this bull market.​

Deepwater Frontier Tech Spotlight: Confluent Ticker: CFLT Market Cap: $7B Confluent is a software company that provides a real-time data streaming platform. This enables companies to stream, connect, process, and govern their data. What does this look like for customers? L’Oréal…

Deepwater Frontier Tech Spotlight: Vertiv Ticker: VRT Market Cap: $30B Vertiv is a global provider of power and thermal management solutions essential to the operation of data centers that are powering AI. As AI-driven workloads lead to exponential growth in…

The Deepwater Frontier Tech Index 2024 was a rewarding year for investing in disruption via our Deepwater Frontier Tech Index. We believe we are still in the early stages of the potential opportunity to make outsized returns in AI (~65%…

Deepwater’s second annual Frontier Tech Survey measures the American public’s viewpoint on emerging technologies, including AI, Electrification & Automation, the Creator Economy, and Relationship with Tech. Key Takeaways: AI – General usage is increasing but we are still early in the…

All four key hyperscalers guided CapEx spending in 2025 to grow at a faster rate than previously anticipated before the DeepSeek scare. This signals that the most advanced AI companies in the world believe the path to AGI will demand an obscene amount of hardware. Yet, despite this clear trajectory, many AI hardware companies are still struggling to recover from the losses triggered by DeepSeek.

What Does DeepSeek Mean for AI? Not as much as the market would have you believe. This past Monday, most publicly traded AI companies saw a sharp devaluation from the emergence of a new AI model called DeepSeek R1. DeepSeek…

The AI trade still has room to grow as the spotlight gradually shifts toward software, underscored by investors' reactions to Salesforce's comments following their most recent quarter. The bottom line is I believe that while software companies have yet to see significant AI-driven revenue acceleration, investors are increasingly confident that day will come. This is good news for my view that AI will continue to be the catalyst driving the market higher, until it eventually bursts.

The odds of Tesla successfully capitalizing on autonomy increased with the news that Trump's transition team is planning to make regulating self-driving vehicles a top priority. Tesla holds a unique position, as it can pursue autonomy through a combination of two business models: asset-light, focusing on vehicle hardware sales, or asset-heavy. I believe these strategies could significantly boost Tesla's operating profit by the end of the decade, with a wide range of potential outcomes—anywhere from a 10% to a 155% increase, depending on which model they pursue. My prediction: by 2030, autonomy will account for 40% of Tesla's operating income.

Today, Waymo alone is too small for Alphabet investors to care about. However, the management team is sharing more about their rapid progress, plans to expand operations, and has raised additional outside capital. I've modeled the business and found it to be surprisingly attractive. I believe Alphabet will spin out Waymo in the next 2-4 years, with a potential valuation of $350B to $850B by 2030, which could add between 12-28% to GOOG's current market cap, depending on Alphabet's ownership percentage.