11AM Hour: Chips Challenged, DC Guardr(AI)ls, Energy Prices Pullback 6/26/26

Carl Quintanilla (0:06)

Good Friday morning, welcome to Squawk on the Street. I'm Carl Quintanilla with Leslie Picker here at Post 9 of the New York Stock Exchange. Sara Eisen's off today. Continued pressure on tech, although trying to shave off some losses from the open. Mag-7 names, though, year to date, are underperforming the S&P.

NASDAQ seeking to stave off its worst week in more than a year. We're gonna talk to one growth investor who says it's not time to count out the hyperscale as just yet.

Leslie Picker (0:29)

Plus Bitcoin prices hovering at their lowest level since October 2024

We're joined by the CEO of blockchain and digital assets provider Ripple. Why he blames the market, chaos on Michael Saylor and strategy.

Carl Quintanilla (0:42)

We continue to watch these SpaceX trade. Couple weeks now into public trading, Bob Greifeldt will join us while he says the next big test for the stock will in fact be those lockup expirations. As for the markets, trying to come off some opening lows here, basically back to flat. Of course, big Russell rebalancing today, which we'll watch.

Generally, though, a bit of a defensive crouch. Healthcare is the best performing sector. Consumer discretionary not far behind. VIX has come back from above 20 to about 19 and a third today.

Leslie Picker (1:13)

And we begin with the IPO timeline or maybe lack thereof for OpenAI with sources saying that the company has not begun testing the waters yet, Carl. So this is something people have been watching very closely after they said they filed confidentially about a month ago. And basically, the expectation when you do something like that, when you file confidentially, especially if you're a big, buzzy tech company and something that people have been kind of waiting on is that you'll operate on an accelerated timeline. You'll go back and forth with the SEC privately and then you will flip your S1 public, you will market your deal, you will set an IPO price and start trading as fast as possible. That's what we saw with SpaceX, essentially. I think people were surprised it only took about seven weeks to go through that process. Well, with OpenAI, the notion has long been in chatting with sources and people familiar with this company that they're not necessarily operating on that expedited timeline quite yet. I think the word of this IPO process is really just about optionality in terms of timeline. There is a case to be made that there's an open window right now for companies like OpenAI, but we don't know what their financials look like yet. They're also a much newer company than SpaceX. It takes time to get things like internal controls in operation and financials.

They're kind of at this pivot and flexion point with their business model as well. So how that story resonates with investors. And speaking of investors, Carl, we've learned that they haven't started those testing the waters meetings yet. Those would begin when there is a much firmer sense of the timeline because you have those meetings with big investors. They're very busy. And if you ask for their time to get a sense of demand and pricing and all sorts of other dynamics, you kind of want to make sure that that will be reflective in the process. And you can't do that now if you're planning on maybe going next year. But that's kind of where it stands right now. Things can obviously change, but as we're kind of waiting for this IPO parade of mega caps, that's the latest of what we know.

Carl Quintanilla (3:20)

How common is it to file confidentially and then wait for six months or more?

Leslie Picker (3:25)

It's not that common, I think, because oftentimes, if you file confidentially, you see a window. You see a reason to go public.

But we've never seen these mega caps, companies seeking a trillion dollar valuation. SpaceX was able to go public decently well. It's still trading above its issue price. By the time, say, an open AI or Anthropic works its way through that SEC process and ultimately gets the green light to even jumpstart and do something to give them the option. We don't know where SpaceX will be trading. So I think there's a bit of hedging going on.

But right now, there's clearly an open window for financing of AI. The question is just what their actual financials look like, how the market receives them. And a lot of that valuation question and the market reception won't really be known until they have those official kind of testing the waters meetings where they have those conversations and get a sense.

Carl Quintanilla (4:22)

And big implications for their investors and their vendors.