Concerns over OpenAI revenue drop dismissed as accounting methodology difference; AI growth fears tempered.
Easing Middle East tensions stabilize oil prices, while anticipation of the earnings season provides a floor for equities.
Key Market Developments
① OpenAI Revenue Concerns Subside, AI Growth Debate Settled
The revenue controversy surrounding OpenAI, which pressured technology stocks the previous day, has largely dissipated within 24 hours.
The decline in the annualized revenue forecast from $70 billion to $50 billion is now interpreted as a change in accounting methodology rather than a deterioration in actual performance.
Analysts note that while OpenAI excludes revenue generated through partners, competitors like Anthropic include sales processed via AWS and Google, highlighting a fundamental discrepancy in how these firms aggregate data.
Bloomberg reports that OpenAI’s annualized revenue is still on track to reach or exceed $70 billion by year-end, with an increasing contribution expected from enterprise clients.
However, the fact that semiconductor stocks plummeted on a single news report highlights the market’s heightened sensitivity and underlying skepticism regarding the scale and profitability of AI investments.
② Middle East Tensions Ease; Oil Price Volatility Calms
Concerns over a regional war in the Middle East have receded following reports that the U.S. will not undertake military action against Iran prior to the midterm elections.
Oil prices also found support from news of China resuming refined oil exports and stabilized supply chains for Russian diesel.
Nonetheless, tensions remain unresolved, as evidenced by Iran’s warning that it will sanction vessels violating regulations even outside the strait.
International oil prices remain susceptible to renewed volatility at the slightest signal of potential military escalation.
③ Earnings Season Anticipation; 9 of 11 Sectors Post Gains
The U.S. third-quarter earnings season begins in earnest next week, led by major financial institutions.
With S&P 500 earnings projected to rise by approximately 31% year-on-year, the outlook for corporate performance is providing a buffer for equity markets.
Out of 11 industry sectors, 9 posted gains, with only energy and communication services ending in the red.
However, divergence remains prevalent, as major tech stocks—including Nvidia, Apple, Meta, and Micron—saw declines, suggesting a market focused more on specific sector and stock performance than index-wide trends.
Market Points
The concerns over OpenAI’s revenue that unsettled the market yesterday were largely resolved in a single day. As analysis clarified that the revenue outlook was adjusted due to accounting differences rather than a slowdown in business momentum, apprehensions regarding AI growth have calmed.
However, it is worth noting the market’s hypersensitivity to OpenAI-related reports. As AI investments have scaled rapidly, the market is now looking beyond mere growth rates to demand evidence of cash flow and profitability capable of sustaining such massive capital expenditure.
In the Middle East, the reduced probability of U.S. military action against Iran has eased pressure on oil prices. As the third-quarter earnings season for major corporations kicks off next week, market focus may shift from interest rates and oil prices toward corporate fundamentals.
While the domestic (Korean) market is currently closed for the holiday, the MSCI Korea Index rose 0.54%. Following the volatility U.S. semiconductor stocks experienced due to the OpenAI concerns, those fears are now subsiding. Once the domestic market reopens, investors should closely monitor how the cumulative overseas semiconductor trends and foreign capital flows are reflected in Samsung Electronics and SK hynix.
Source: Market Brief (Telegram: t.me/shmstory)
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