11AM Hour: Unity CEO on Earnings, Block CFO on Layoffs & The Business of Shaq 8/6/26

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The board recommends approving...

**Carl Quintanilla** (0:01)
Regarding that seat on the committee, we're promoting...

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to most quarterly earnings...

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**Carl Quintanilla** (0:45)
Good Thursday morning. Welcome to Squawk on the Street. I'm Carl Quintanilla with Seema Modi here at Post 9 of the New York Stock Exchange. Sara Eisen's off today. Shares of Unity surged today. The CEO is going to join us to discuss what he says is arguably, in his view, the best quarter in its history as a public company.

**Seema Modi** (1:00)
And then SpaceX lock up period expiring today. We'll take a look at historical lock up expirations and what that could signal for the future performance of the stock.

**Carl Quintanilla** (1:08)
CFO is blocked. A block is with us as the stock falls despite a bead and raise after the company laid off roughly 40 percent, you may remember, of its workforce earlier this year in an effort to leverage some of those AI efficiencies. As for the market, a bit of a split day. Dow is a little bit negative, kind of an inside day, although we are still writing some solid gains for the week as we work our way into jobs Friday. Tomorrow yields pretty steady, 10-year holding 4.6, almost 4.65 and the long bond around 5.2.
Let's focus on tech this morning, the NASDAQ higher, but gains are limited as memory stocks today, like SanDisk and Western Dig are getting pummeled after reporting last night. Joining us to discuss is Round Hill Investment CEO Dave Mazza. Round Hill, you might know, runs the popular memory ETF DRAM. It's good to have you back. Thanks for coming on set. Yeah. Thanks for having me. What do you make of this? I mean, we've had obviously a bit of a reset. We're still in an environment though where the street is craving maybe more robust guidance than we're getting from some. Yeah.

**Dave Mazza** (2:07)
I think what these numbers are showing us is that just as we're seeing in software, the same with memory, beat and raise is not enough. You actually have to beat and really truly raise, right? So let's look at SanDisk. They did beat revenue, but not by what we've seen over the last recent quarters. So when you have expectations as high as they are, I think what we're now seeing is investors pull back and reassess, where does memory go from here, especially as they're trying to transition from cyclical businesses to one with these long-term agreements.

**Carl Quintanilla** (2:34)
Does that mean incrementally less demand for leveraged names or maybe more demand on the leveraged shorts?

**Dave Mazza** (2:41)
Well, what's interesting is so there's been a ton of leverage taken on the system. If you look at Korean retail investors, their margin balances, it was at $38 trillion won most recently at the peaks in June. That's actually come down to now $27 trillion, which is what the year started with, so that played a big role. Then what we're also seeing is, of course, the situational awareness situation where that fund was long a lot of these names and so now we're beginning to see a bit of a shakeout and repositioning of where the actual fundamentals look relative to positioning.

**Carl Quintanilla** (3:10)
JP Morgan earlier in the week argued that to your point about Korean leverage, that enough had been rung out to where maybe you could argue that you're back to some level of normal. You go along with that?

**Dave Mazza** (3:21)
I think that's most definitely true. If you just look at the data, it was astronomical how much leverage was in that system and now, again, we're beginning to reset. What's interesting though is if you look at DRAM flows, actually from the peak to the trough, there was 10.4 billion of inflows during that period. So investors are actually still allocating toward this theme and trade more broadly while certainly kind of, I think, reassessing some of the individual stocks.