The Midterms Have Changed the AI Narrative: S&P Down 4.4%, Nasdaq Down 5.5% | The Weekly Wrap

Alphabet

Across the shows: 65 speakers in other episodes, 58 bullish and 41 bearish calls, past 30 days

• Steve Eisman · The Real Eisman PlaybookBullish

  Slower AI data center build could let Google return to cash-flow-funded construction; a big positive.

  Eisman thinks a slowdown in AI data center construction could be a major positive for hyperscalers including Google. Heavy construction has forced them to raise large sums of capital, and investors are tiring of it. A slower pace could bring Google back to positive free cash flow, possibly by late 2027, so it can fund data centers from operations at a sustainable pace. Google's free cash flow this quarter was negative $9 billion. Google fell only 1.9% on Thursday.

  “One of my preliminary thoughts is that a slowdown in AI data center construction could eventually be a positive, a pretty big positive actually for the hyperscalers [Microsoft, Amazon and Google].”at 5:20

• Steve Eisman · The Real Eisman PlaybookBearish

  AI chatbots are slowly replacing Google search; its search growth slowdown confirms it.

  Eisman fears AI search is replacing Google search. The search business is capital-light with a high moat, but the replacement is a capital-intensive, low-moat business, because switching costs between LLMs look inexpensive. Search revenue grew only 12% last quarter, versus 19% in Q1 2026, which he reads as evidence the replacement has begun. He says it is happening slowly but is still happening.

  “The Google search business is just a much better business and the results indicate that Google search is being replaced. Yes, slowly but replaced.”at 11:21

Anthropic

Across the shows: 108 speakers in other episodes, 134 bullish and 90 bearish calls, past 30 days

• Steve Eisman · The Real Eisman PlaybookBearish

  Anthropic's growth is slowing after token maxing ended, and its revenue-to-compute ratio is falling.

  Eisman argues Anthropic benefited from enterprise token maxing in the first half of 2026, and that ended in the summer. Sequential revenue growth fell from 147% in Q2 to 47% in Q3. The revenue-to-compute ratio fell from 2.08x to 1.72x, after rising from 0.69x in Q4 2025. Anthropic cut token prices by as much as 50% in October to spark demand, which he doubts demand will offset. Its $895B of leasing and other AI commitments imply about $100B a year in compute expense next year, so it will keep burning cash.

  “Token maxing is over. Anthropic is still growing but slower. Q3 twenty twenty six sequential revenue growth was 47% versus 147% in the second quarter. More alarming, the revenue divided by compute expense ratio in Q3 declined to 1.72 times versus 2.08 times in the second quarter. Growth has slowed.”at 13:52

• Steve Eisman · The Real Eisman PlaybookBearish

  The tech correction will hurt Anthropic's valuation in its IPO in a few weeks.

  Eisman says the tech selloff on Thursday will hurt Anthropic's IPO valuation, and the IPO is expected within a few weeks. He calls this obvious. His case rests on the broader market correction (S&P down 4.4%, Nasdaq down 5.5%) and on the weakening Anthropic growth and economics he laid out earlier.

  “Just to state the obvious, this tech correction is going to hurt Anthropic's valuation for its IPO which will happen in a few weeks.”at 15:07

Amazon.com

Across the shows: 43 speakers in other episodes, 56 bullish and 10 bearish calls, past 30 days

• Steve Eisman · The Real Eisman PlaybookBullish

  Slower AI data center build could let Amazon return to cash-flow-funded construction; a big positive.

  Eisman thinks a slowdown in AI data center construction could eventually be a major positive for hyperscalers including Amazon. The buildout has pushed these companies to raise large amounts of capital, which investors are tiring of. A slower pace could return them to positive cash flow, possibly by late 2027, letting them fund data centers from operations. Amazon's free cash flow this quarter was negative $33 billion, which is the core problem. Amazon fell only 2.2% on Thursday, holding up better than the AI infrastructure names.

  “One of my preliminary thoughts is that a slowdown in AI data center construction could eventually be a positive, a pretty big positive actually for the hyperscalers [Microsoft, Amazon and Google].”at 5:20

Microsoft

Across the shows: 40 speakers in other episodes, 48 bullish and 8 bearish calls, past 30 days

• Steve Eisman · The Real Eisman PlaybookBullish

  Slower AI data center build could let Microsoft fund construction from cash flow; a big positive.

  Eisman thinks a slowdown in AI data center construction could eventually be a major positive for hyperscalers such as Microsoft. The torrid build pace has forced these companies to raise large amounts of capital, and investors are growing tired of it. A slower pace could let them return to positive free cash flow, possibly as early as late 2027, and fund data center construction from operating cash flow at a more sustainable pace. A slower build that lasts longer would be a major positive in his view. He also notes Microsoft held up best on Thursday, falling only 3.6% versus 9.3% for Nvidia.

  “One of my preliminary thoughts is that a slowdown in AI data center construction could eventually be a positive, a pretty big positive actually for the hyperscalers [Microsoft, Amazon and Google].”at 5:20

CoreWeave

Across the shows: 85 speakers in other episodes, 25 bullish and 90 bearish calls, past 30 days

• Steve Eisman · The Real Eisman PlaybookBearish

  CoreWeave's debt repriced to 15%, making its AI data center build prohibitively expensive.

  CoreWeave's debt yield moved from about 9% to 15%, which he calls prohibitive for building AI data centers. He sees neoclouds such as CoreWeave, Nebius and IREN as the weak players: they have no other businesses, only raise debt to build data centers and rent them out, and compete with hyperscalers that have large businesses outside AI. Neoclouds therefore depend entirely on fixed income markets, which care about facts such as cash flow and math, not the AI story.

  “At a cost of debt of 15% building AI data centers becomes prohibitively expensive.”at 8:10

Oracle

Across the shows: 40 speakers in other episodes, 9 bullish and 36 bearish calls, past 30 days

• Steve Eisman · The Real Eisman PlaybookBearish

  Oracle's balance sheet and need to raise capital for AI data centers spook the market.

  Oracle began raising $10 billion in debt and equity to fund its AI data center programs. Eisman says the market has become petrified of Oracle's balance sheet and its need for capital, and the stock fell 9% on the news. He calls it a continuing and now very sad saga.

  “The market has become petrified of Oracle's balance sheet and its need for capital.”at 15:28

Verizon Communications

Across the shows: 3 speakers in other episodes, 0 bullish and 3 bearish calls, past 30 days

• Steve Eisman · The Real Eisman PlaybookBearish

  Verizon is uninvestable as Musk's Starlink mobile push challenges the big three carriers.

  SpaceX's Qualcomm deal for Starlink mobile service is a challenge to T-Mobile, AT&T and Verizon. Eisman thinks the big three are uninvestable. His only support is this new satellite-mobile competition, so the case is thin.

  “Looks like Elon Musk is going full in to challenge the three mobile providers which are T Mobile, AT and T and Verizon. And while this is going on, I think the big three are just uninvestable.”at 15:50

T-Mobile US

Across the shows: 1 speaker in other episodes, 0 bullish and 1 bearish calls, past 30 days

• Steve Eisman · The Real Eisman PlaybookBearish

  T-Mobile is uninvestable as Musk's Starlink mobile push challenges the big three carriers.

  SpaceX announced a deal with Qualcomm to provide key network technology for Starlink's mobile service, which Eisman reads as Musk challenging T-Mobile, AT&T and Verizon. He calls the three big carriers uninvestable. His only support is the new satellite-mobile competition, so the case is thin.

  “Looks like Elon Musk is going full in to challenge the three mobile providers which are T Mobile, AT and T and Verizon. And while this is going on, I think the big three are just uninvestable.”at 15:50

AT&T

Across the shows: 7 speakers in other episodes, 3 bullish and 3 bearish calls, past 30 days

• Steve Eisman · The Real Eisman PlaybookBearish

  AT&T is uninvestable as Musk's Starlink mobile push challenges the big three carriers.

  SpaceX's Qualcomm deal for Starlink mobile service is a challenge to T-Mobile, AT&T and Verizon. Eisman thinks the big three are uninvestable. His only support is this new satellite-mobile competition, so the case is thin.

  “Looks like Elon Musk is going full in to challenge the three mobile providers which are T Mobile, AT and T and Verizon. And while this is going on, I think the big three are just uninvestable.”at 15:50

Palantir Technologies

Across the shows: 15 speakers in other episodes, 17 bullish and 2 bearish calls, past 30 days

• Steve Eisman · The Real Eisman PlaybookBullish

  Palantir's strong results and data-layer positioning are sound, though the stock is a partial AI play.

  Revenue of $2.3 billion grew 96% and EPS beat, with nothing to criticize in the quarter. Eisman says Palantir helps enterprises organize their databases so they can use AI, and it is positioning itself to sit on top of enterprise databases to protect that data from LLM providers. These projects should take years. The stock still fell 8% after hours because Palantir is only a partial AI play and the market is nervous about all AI names.

  “Palantir's role in the AI world, at least at this point, seems to be helping enterprises get their databases in order so that the enterprises can then use AI.”at 17:12

Apple

Across the shows: 49 speakers in other episodes, 58 bullish and 37 bearish calls, past 30 days

• Steve Eisman · The Real Eisman PlaybookBullish

  Apple's iPhone platform lets it charge LLM providers for shelf space, a low-risk, high-reward strategy.

  Apple is not building its own LLMs, which is why it still has very strong free cash flow. Eisman thinks Apple will use its iPhone platform to get other LLM companies to rent space on it, a potentially low-risk, high-reward strategy. He notes the quarter was mixed: revenue rose 12% and EPS beat, but services growth slowed to 10% and guidance was light on memory cost inflation. He concludes Apple's results say nothing about the AI debate.

  “It is not building its own LLM models and that is why it still has very very strong free cash flow. It looks like Apple is going to use its iPhone position, its insurmountable iPhone position to make other LLM entities rent space on its platform. It's a potentially low risk, high reward strategy.”at 18:31

Eaton

Across the shows: 1 speaker in other episodes, 2 bullish and 0 bearish calls, past 30 days

• Steve Eisman · The Real Eisman PlaybookBullish

  Eaton's strong quarter and raised guidance show AI data center construction driving its growth.

  Eisman owns Eaton, an electrification company with about 20% of revenue from AI-related construction. EPS of $3.68 rose 20% and beat, and sales of $8.95 billion rose 28% and also beat. It raised 2026 guidance, and the stock rose 6% on Tuesday and was up 15% year to date before Thursday's correction. He calls these very good numbers.

  “Full disclosure, I have owned Eaton for quite a while. Eaton is electrification company with about 20% of its revenue coming from AI related construction.”at 18:55

Fiserv

Across the shows: 1 speaker in other episodes, 1 bullish and 0 bearish calls, past 30 days

• Steve Eisman · The Real Eisman PlaybookBearish

  Fiserv's relief rally is not enough; payments is too tough a space for a long-term investment.

  Fiserv's quarter was not a disaster: EPS of $1.75 beat $1.72, though revenue of $4.85 billion missed slightly and organic growth was 0%. The stock rallied 12% on relief. Eisman still says it is not a long-term investment. Outside Visa and Mastercard, payments has few barriers to entry, and companies keep entering each other's markets. Fiserv has lost share to newcomers, had a revolving door of CEOs, and fell from a $235 peak in March 2025 to about $62.

  “In my view, the payment space is just too tough. Outside of Visa and MasterCard, the payment space has few barriers to entry and the companies in the space are all entering each other's markets.”at 20:35

Fidelity National Information Services

• Steve Eisman · The Real Eisman PlaybookBearish

  FIS paused buybacks to deleverage and cut guidance; the stock is one to avoid.

  FIS paused buybacks and some deal making to deleverage, and will only resume buybacks at 2.8x gross leverage. Eisman says that math likely means no buybacks until sometime in 2028. The CFO stepped down immediately, and FIS cut its 2026 EPS guidance. The stock fell 24% on Wednesday. Eisman says Fiserv and FIS have been horrible stocks and it is best to stay away.

  “The news was that the company announced it was pausing stock buybacks and some deal making to focus on deleveraging the company.”at 21:09

Apollo Global Management

Across the shows: 2 speakers in other episodes, 3 bullish and 0 bearish calls, past 30 days

• Steve Eisman · The Real Eisman PlaybookUncertain

  Apollo's mixed quarter: fee earnings strong, but spread income missed on conservative credit.

  Apollo posted 23% fee-related earnings growth, $53 billion of inflows and 18% AUM growth, all good. Spread-related earnings from its Athene insurer, a key metric, rose only 7% and missed. Eisman thinks Apollo probably took a conservative credit approach to new investments. Apollo is now one of the largest financiers of AI data centers, so it is a partial AI play, which he thinks helps explain why the stock is down 19% this year. He calls the quarter mixed.

  “And here Apollo missed expectations with SRE up just 7% year over year as the company probably took a very conservative credit approach for new investments.”at 22:40

Booking Holdings

Across the shows: 2 speakers in other episodes, 2 bullish and 0 bearish calls, past 30 days

• Steve Eisman · The Real Eisman PlaybookBearish

  Booking's revenue fell and Q4 guide is weak; a weakening consumer is the real threat, not agentic AI.

  Investors fear agentic AI will erode Booking's brand because agents care only about price. Eisman says it is too early to see real impact from agentic AI, but it is not too early to see a weakening consumer. Booking's EPS rose 17% and beat, but revenue of $8.89 billion fell from $9.01 billion a year earlier and missed. Fourth-quarter revenue growth guidance of 0% to 2% reinforces the consumer weakness view.

  “Investors worry that the brand name of companies like Bookings will deteriorate because all Agentic AI cares about is price. It's too early however to see any real impact from AgenTik AI. However, it is not too early to see the impact of a weakening consumer.”at 23:10

Qualcomm

Across the shows: 7 speakers in other episodes, 5 bullish and 2 bearish calls, past 30 days

• Steve Eisman · The Real Eisman PlaybookBearish

  Qualcomm's guidance is light as memory-driven phone price inflation hurts handset chip volumes.

  Qualcomm's EPS was in line but down 28%, and revenue beat expectations but was down 8%. Guidance for the December quarter was a touch light. Cell phones are Qualcomm's biggest chip market, and a sharp rise in memory chip prices has hurt phone sales. Qualcomm raised chip prices, but lower phone chip volume hurt more, so handset chip sales fell 26%.

  “The guidance for the December quarter was a touch light. Why? Qualcomm's biggest market for its chips is cell phones.”at 25:13

Fair Isaac

Across the shows: 1 speaker in other episodes, past 30 days

• Steve Eisman · The Real Eisman PlaybookBearish

  FICO has lost its mortgage scoring monopoly within a year and needs new management.

  For the first time in company history except the financial crisis and Covid, FICO declined to give fiscal 2026 guidance, citing competitive pressure from VantageScore amid changes in mortgage scoring. Management said it is working on multiple pricing programs to retain volume. Eisman sees a company that lost its monopoly in less than a year, which he finds embarrassing and says needs new management.

  “In my view this is a company that has lost its precious monopoly in less than a year. That is embarrassing and FICO needs new management desperately.”at 26:46

AI infrastructure & data centers

• Steve Eisman · The Real Eisman Playbook

  Democrats slowing AI data center construction would hit many sectors, with a few potential positives.

  The midterm sweep by Democrats raises the risk they will slow AI data center construction. If they follow through, the implications are large and mostly negative, touching power suppliers (GE Vernova, Quanta), semiconductors (Nvidia, AMD, Micron), data center equipment (Dell, Super Micro, Arista, Cisco), data center industrials (Eaton, Vertiv, nVent), neoclouds (CoreWeave, Nebius, IREN) and Musk's companies. Eisman calls the list non-exhaustive. The market sold off sharply on Thursday largely for this reason. He also sees a few potential positives, detailed in his hyperscaler view.

  “If, and it's an if, Democrats go through with plans to slow AI data center construction, then the implications are quite large. Many of those implications are negative, but there are a few that are potentially positive.”at 3:38

US growth & recession risk

• Steve Eisman · The Real Eisman Playbook

  AI capex is at least half of US GDP growth, so an AI capex slowdown would slow the economy.

  AI capex accounts for at least 50% of GDP growth this year. Eisman concludes that a slowdown in AI capex means a slowdown in the economy. He qualifies this: it is not necessarily a recession, but at least a slowdown. That makes the midterm risk to data center construction a macro risk, not just a sector risk.

  “One more point AI CapEx accounts for at least 50% of GDP growth this year. A slowdown in AI CapEx means a slowdown in the economy.”at 7:23

Open-source AI models

• Steve Eisman · The Real Eisman Playbook

  Cheaper open-weight models let enterprises switch away from closed-lab AI after token maxing ended.

  Eisman says enterprise token maxing, where companies told employees to use AI and helped pay for it, ran through the first half of 2026. It ended in the summer when costs got out of control, and companies could then switch to cheaper open-weight models. This explains the slowdown in Anthropic's growth and pressure on closed-model pricing.

  “During the first half of this year I thought that Anthropic and OpenAI were benefiting from token maxing. That was where enterprises told their employees to use AI and to help with the cost. That ended the summer when costs got out of control and companies now had the option to switch to cheaper open weight models.”at 12:42

AI pricing & unit economics

• Steve Eisman · The Real Eisman Playbook

  A full-blown LLM token price war is underway, with Anthropic, OpenAI and Google cutting prices.

  Anthropic cut its token pricing by as much as 50% in October to spark demand. OpenRouter data shows Anthropic token demand rising, but Eisman doubts that increase offsets the price cuts. He believes OpenAI is following, and Google is following in pricing its new Gemini model. He concludes a full-blown price war is happening now, which pressures AI model margins.

  “It looks like a full blown price war is happening as we speak.”at 14:41