The howls will begin the minute the FTC’s lawsuit against Amazon hits the clerk’s desk. “The FTC hates business!” “Lina Khan is a communist!” “This government is controlled by the far left!”
Of course that’s what most in the business community will say. It would be novel if they didn’t.
But they’re wrong.
I’m an early stage venture capitalist. My fund, Tusk Venture Partners, invests in seed and Series A startups, typically in highly regulated industries – think companies like FanDuel, Coinbase, and Lemonade, Ro, Bird, Wheel, Alma, Circle, Sunday and so on.
What you don’t see on that list is anything that could attempt to compete with Amazon or Meta or Apple or Microsoft or Google. Why? Because there is no way to compete if the incumbents’ dominance over their respective markets is allowed to grow, completely unchecked.
When we invest, we’re ultimately solving for the company’s exit. Typically, that comes from an IPO or an acquisition. While IPOs generate most of the attention, acquisitions are more common. When we think through our possible exit, the first question is “Would x (the larger competitor) be more likely to buy this company or build their own version?” The second question is, “Can x squash our startup before they even get off the ground?”
Whenever we look at a startup that would directly compete with a company like Amazon, the answer to the second question is always, “yes, definitely.” And we don’t invest.
I don’t have any animus towards Amazon. I order stuff from them all the time. I probably buy 75 books each year on Kindle even though I own an independent bookstore in Manhattan. I think Amazon is a great company. But I also think that allowing them to continue to dominate the entire retail market unimpeded is a death knell for the economy in 10 to 20 years.
Ultimately, every company, now matter how insurgent they once were, grows stagnant. They become a bureaucracy beset by internal politics and a CYA mentality. That’s why the behemoths of my childhood, companies like IBM and GE, are a second thought today. Luckily, as these earlier giants started to falter, companies like Apple and Microsoft took off, and companies like Google, Amazon and Meta came along.
The results have been staggering. Apple has increased its US employees by 1,500% since 1998. Between 2001 and 2018, Alphabet (Google’s parent company) grew its job count 347 times over.
But would Google, for example, have gotten as far had the Department of Justice not pursued antitrust litigation against Microsoft in the late 1990s? Unlikely. Microsoft’s overwhelmingly dominant market power and position would have allowed them to force computer manufacturers to use Internet Explorer instead of Google.
The same problem holds true today. Amazon, great as they are, will ultimately falter. They’re subject to gravity just like everyone else. And then either one of two things will have happened: it will have been feasible to invest in potential competitors to Amazon, dozens will have emerged, a few will succeed and they’re ready to replace Amazon as a major employer. Or, Amazon continued to amass so much power by controlling pricing, controlling the entire marketplace, that investors like me never felt comfortable backing a competitor and when Amazon lags, no one can fill the void.
That’s where the FTC comes in. Their job isn’t to wag their finger at big businesses and tell them that making money is evil (We already have AOC and Bernie Sanders for that). Their job is, yes, to protect current businesses who are forced to both advertise on Amazon and to accept far worse placement in each product search because they can’t afford not to be on the platform. But it’s also to look ten, twenty years into the future and see which industries may not have the openings for incredible new companies to emerge simply because the incumbents are too big to ever challenge.
When the case goes to court, Amazon will argue that none of their practices violate existing regulations. If they manage to make that case successfully, good for them. But as an early stage investor, I need to at least see that the government recognizes that new market entrants can’t compete if the existing giants are allowed to deploy whatever competitive practices they want. If there’s no rule of law, there’s no future market worth betting on.
Whether or not FTC succeeds in court, the lawsuit’s very filing shows that the agency at least recognizes that what’s good for tech giants and their current investors is not necessarily what’s good for tech startups and the economy’s long-term needs. That’s exactly the kind of regulation – and regulators – we both want and need.
Bradley Tusk is an early-stage venture capitalist.
Cisco Systems shares spiked higher Wednesday evening after the networking company delivered a quarterly beat and outlook raise. Another quarter of double-digit order growth proves Cisco is an underrated winner from the AI infrastructure buildout. Revenue in the company’s fiscal 2026 first quarter, which ended Oct. 25, increased 8% year over year to $14.88 billion, exceeding the LSEG-complied analyst consensus estimate of $14.76 billion. Non-GAAP earnings increased 10% on an annual basis to $1 per share, beating expectations of 98 cents, LSEG data showed. GAAP stands for generally accepted accounting principles. CSCO YTD mountain Cisco Systems YTD Look at the shares of Cisco go. They surged more than 7% in after-hours trading to just about $80 per share. That’s on top of a 3% move in regular trading hours. If the stock can take out $80.06, it will make its first all-time high since March 2000. Shares, as of Wednesday’s close, rose roughly 25% year to date. Bottom line It’s a deserving move after an excellent quarter, highlighted by accelerating product order growth, especially from artificial intelligence customers. During the post-earnings call, Cisco CEO Chuck Robbins attributed the strength in AI orders to a “deepening” relationship with existing customers. The company also called out that a “major multi-year, multi-billion-dollar campus networking refresh cycle” is underway. It wasn’t all perfect, however, as the security business missed estimates, with revenue falling year over year. According to management, some revenue recognition timing issues need to be sorted out. Security weakness was our main concern ahead of the quarter. The business also missed revenue estimates in the prior quarter, and we didn’t think a quick turnaround was likely. Our fear of this repeat was the main reason why we took some profits in this position Monday at around $71. Even though we were right to be cautious on security, the market was turning a blind eye to this issue because of how fast networking is growing. A rebound in security also isn’t needed for management to hit on its outlook, which was raised well above Street estimates Wednesday evening. Another concern of the bears entering earnings was that Cisco would be negatively impacted by the government shutdown due to its large federal agencies business. Despite the closed government, Robbins noted this business managed to grow orders by a high single-digit percentage in the quarter. He’s anticipating upside in orders once the government reopens. Why we own it Cisco Systems is an enterprise networking equipment provider that has made big strides to appeal to cloud customers. The company has also increased its presence in the security market through its acquisition of Splunk. In addition, Cisco’s long-term transition toward subscription software sales, which are sticky and come with higher margins, should help improve the stock’s undemanding price-to-earnings multiple. Competitors : Arista Networks , Hewlett Packard Enterprise , Juniper Networks Most recent buy : Aug. 19, 2025 Initiated : July 17, 2025 The story remains that Cisco has turned into a sleeper AI play thanks to the billions of dollars it is taking in from hyperscaler customers. That surge of orders is converting to big revenue. In fiscal year 2025, Cisco recognized roughly $1 billion of AI revenue from hyperscalers, which are the biggest of the Big Tech names, such as the major cloud companies. On the call, Robbins said he expects to recognize roughly $3 billion from hyperscalers in fiscal year 2026. Despite this accelerating growth and subscription revenue making up more than half of its total revenue, the stock still trades at a reasonable price-to-earnings multiple of about 19.5 times based on the new midpoint of management’s full-year adjusted earnings-per-share (EPS) outlook. We’re reiterating our 2 rating because we don’t like to chase stock spikes, but we are increasing our price target to $85 per share from $78. Commentary Total Product orders increased 13% year over year – an acceleration from 7% growth in the prior quarter – with growth across all geographies and customer markets. When we review Cisco, we always focus on orders because that’s the best leading indicator of where revenue is headed. Product revenue grew 10% year over year to $7.77 billion, beating estimates of about $7.47 billion. Starting with the Networking sub-segment, product orders increased by a high teens rate, representing the fifth consecutive quarter of double-digit growth. AI infrastructure orders from hyperscaler customers were a big driver of that growth. Cisco took in $1.3 billion of orders in the quarter, an acceleration from the more than $800 million in the prior quarter. The company also saw strong orders for enterprise routing, campus switching, wireless, industrial IoT, and servers. Credit Cisco’s close relationships with portfolio name Nvidia and Advanced Micro Devices for its recent AI success. Last month, Cisco announced the N9100, which they called the first Nvidia partner developed data center switch based on Nvidia Spectrum-X Ethernet switch silicon. “The N9100, available in the second half of fiscal year 2026, will provide the operational consistency and flexibility needed for sovereign and neocloud providers to build and manage AI at scale,” Robbins explained. Neoclouds are next-generation specialized clouds for accelerated computing. CoreWeave , which rents cloud-based Nvidia chips for AI tasks, is an example of a neocloud. Cisco is also helping G42, leading United Arab Emirates AI firm, with powering, connecting, and securing its large-scale AI clusters with AMD graphics processing units (GPUs) The enterprise AI story is starting to emerge, too. Cisco experienced strong demand for switching, routing, and wireless products, which Robbins said is an indication of customers “investing in the connectivity needed for AI deployments.” Across sovereign, neocloud, and enterprise customers, Robbins called out a growing pipeline above $2 billion for its high performance networking products. This comes after Cisco booked $200 million of orders in its fiscal first quarter from these customers. By division, Networking revenue increased 15% to $7.77 billion, beating estimates. The largest driver of this increase in sales was from service provider routing, which is mostly from AI infrastructure. Data center switches and enterprise routing were also up double digits, while campus switching revenue increased by a high single digit percentage. In the Security division, revenue fell 2% year over year and missed analysts’ forecasts again. It’s disappointing to see a sizeable miss in back-to-back quarters, but management attributed the decline to a timing issue. Robbins explained that more customers are using Splunk’s offerings through cloud subscriptions instead of on-premise deals, leading to a timing change of when revenue is recognized. Ultimately, this transition isn’t a bad thing. The company is in favor of more subscription-based revenue. Cisco completed its $28 billion acquisition of Splunk in March 2024. “We are actually pleased to see more cloud subscriptions for Splunk as they enable greater adoption and expansion, and allow us to deliver innovation faster to enable customers to unlock value from AI Now ” Robbins explained on the call. More broadly. Cisco said it continued to see order growth for some of it newer and refreshed security products, which make up about one third of the portfolio, while its order products are in decline. Importantly, management doesn’t believe Security’s stumbles will last long. They expect revenue growth to accelerate and end the year at a much higher rate. But even if that doesn’t happen and the results don’t materially improve from here, Cisco said it’s still confident in its ability to deliver on its fiscal Q2 and full year 2026 outlook. The Collaboration and Observability units saw revenue drop 3% and rise 6%, respectively, with Collaboration missing estimates and Observability matching expectations. Services revenue increased 2% year over year to $3.81 billion, slightly beating estimates. As always, we appreciate Cisco’s consistent approach to returning cash to shareholders. The company repurchased $2 billion worth of shares in the quarter at an average price of $68.28. That looks like a great trade since the stock is knocking on the door of $80 in after-hours trading. It has $12.2 billion remaining under its authorization. Cisco stock, as of Wednesday’s closing price, has a 2.2% annual dividend yield. Guidance Cisco expects fiscal 2026 second-quarter revenue of $15 billion to $15.2 billion, which is well above the consensus estimate of $14.62 billion. It also sees non-GAAP EPS of $1.01 to $1.03 cents, which is nicely above the consensus estimate of 98 cents. For full year 2026, Cisco now expects revenue of $60.2 billion to $61 billion, which is about a $1 billion increase from the prior outlook of $59 billion to $60 billion. This revised outlook exceeds the consensus estimate of $59.64 billion. On the bottom line, management raised its EPS forecast to $4.08 to $4.14 from its prior outlook of $4.00 to $4.06. This new midpoint of $4.11 is better than the consensus analyst estimate by 7 cents. (Jim Cramer’s Charitable Trust is long CSCO, NVDA. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
Traders work on the floor of the New York Stock Exchange (NYSE) on Nov. 12, 2025 in New York City.
Spencer Platt | Getty Images
The divergence between the performance of the Dow Jones Industrial Average and Nasdaq Composite on Wednesday stateside reinforces the suggestion that there are two markets operating in the U.S.: one of an artificial intelligence and another of “everything else.”
Not only did the Dow rise, it also secured its second consecutive record high and closed above the 48,000 level for the first time.
The index, which comprises 30 blue-chip companies, is typically seen as a marker of the “old economy.” That is to say, it is mostly made up of large, well-established companies driving the U.S. economy, such as banks, healthcare and industrials, before Silicon Valley became a minisun powering everything.
To be sure, new and flashy names, such as Nvidia and Salesforce, constitute the Dow too. But as the index is price-weighted, meaning that companies with higher share prices influence the Dow more, tech companies don’t exert as much gravity on it.
That’s in contrast to the Nasdaq, which is weighted by companies’ market capitalization, and dominated mainly by technology firms. The tech-heavy index fell as shares like Oracle and Palantir slipped — even Advanced Micro Devices’ 9% pop on its growth prospects couldn’t rescue the Nasdaq from the red.
It’s not necessarily a warning sign about overexuberance in AI.
“There’s nothing wrong, in our view, of kind of trimming back, taking some gains and re-diversifying across other spots in the equity markets,” said Josh Chastant, portfolio manager of public investments at GuideStone Fund.
But what investors would really like is if fork in the road merges into one. That tends to be the safer path to take.
Anthropic to spend $50 billion on U.S. AI infrastructure. Custom data centers will be first built in Texas and New York and go live in 2026, with more locations to follow. The facilities will be developed with Fluidstack, an AI cloud platform.
U.S.October jobs and inflation data might not be released. White House press secretary Karoline Leavitt told reporters that part of the fallout of the government closure could be lasting damage to the government’s data collection ability. But analysts think otherwise.
U.S. House of Representatives heading toward a vote. The House on Wednesday night stateside cleared a procedural hurdle required before the vote could begin on a bill that would end the government shutdown. Voting is expected to happen as of publication time.
[PRO] This U.S. mining stock is a top play: CIO. U.K. fundBlue Whale Capital’s Stephen Yiu said macroeconomic concerns, such as the U.S. fiscal deficit and the weakness of the dollar, could support the stock.
And finally…
People walk by the New York Stock Exchange (NYSE) on June 18, 2024 in New York City.
Private equity firms are facing a new reality: a growing crop of companies that can neither thrive nor die, lingering in portfolios like the undead.
These so-called “zombie companies” refer to businesses that aren’t growing, barely generate enough cash to service debt and are unable to attract buyers even at a discount. They are usually trapped on a fund’s balance sheet beyond its expected holding period.
Jason Kim, chief executive officer of Firefly Aerospace, center, during the company’s initial public offering at the Nasdaq MarketSite in New York, US, on Thursday, Aug. 7, 2025.
Michael Nagle | Bloomberg | Getty Images
Firefly Aerospace‘s stock surged 15% on Wednesday after the space technology company issued better-than-expected third-quarter results and lifted its guidance.
Revenues in the third quarter jumped nearly 38% to $30.8 million from $22.4 million in the year-ago period and nearly doubled from the previous quarter.
Firefly’s net loss totaled $140.4 million, or $1.50 per share. The company said net loss included costs tied to its IPO, foreign exchange and executive severance
The company also lifted its outlook for the year, saying it now expects revenues to range between $150 million and $158 million. That’s up from previous guidance in the range of $133 million and $145 million.
This is Firefly’s second quarterly report as a public company. Last quarter, shares slumped after it posted a bigger loss and lower revenues than analysts were expecting.
The Cedar Park, Texas, company went public on the Nasdaq in August during a period of heightened enthusiasm toward space technology. The U.S. government and NASA have leaned on more contracts with companies like Firefly and Elon Musk‘s SpaceX to support moon missions.
But shares of Firefly have lost 70% of their value since their opening day close, and the company’s market capitalization has plummeted from about $8.5 billion to about $2.7 billion on Wednesday.
In September, Firefly shares sank after a rocket exploded during a ground test at the company’s Texas facility, days after receiving clearance from the Federal Aviation Administration over a separate incident. Firefly has since put “corrective measures” in place, the company said on Wednesday. Shares dropped 35% in September and are down 24% this month.
