🥷🏻 Coinbase got hacked?

Good afternoon! Apple is teaming up with brain-computer interface company Synchron to develop tech that lets users control iPhones and other devices with their minds. The technology is focused on helping individuals with conditions like ALS or spinal cord injuries navigate Apple products using brain signals captured by Synchron’s “Stentrode” implant.

MARKETS

• Stocks shrugged off a sluggish start Monday and finished strong after the U.S. and China agreed to pause tariff escalations. Traders cheered the truce, treating the absence of new trade drama as reason enough to buy the dip.

• Still, not everyone’s ready to pop champagne. Fed Chair Powell cautioned that lingering supply shocks could keep rates elevated, and JPMorgan's Jamie Dimon reminded investors that a recession isn’t off the table just yet.

STOCKS
Winners & Losers

What’s up 📈

• Foot Locker exploded 85.70% after Dick’s Sporting Goods announced a $2.4 billion acquisition. ($FL)

• Boot Barn surged 16.66% as the Western retailer forecasted better-than-expected same-store sales. ($BOOT)

• Ibotta rocketed 20.17% on strong earnings for the cash-back app. ($IBTA)

• Webtoon Entertainment jumped 10.31% after Citi initiated the stock at a buy rating. ($WBTN)

• Birkenstock rose 5.89% after beating profit estimates despite missing on revenue. ($BIRK)

• Under Armour gained 4.31% after issuing mixed earnings and withdrawing its fiscal guidance. ($UAA)

• Cisco climbed 4.85% after beating Q3 expectations and issuing strong forward guidance. ($CSCO)

What’s down 📉

• Dick’s Sporting Goods tumbled 14.58% on news it would acquire Foot Locker for $2.4 billion. ($DKS)

• Fiserv sank 16.19% after warning that its Clover unit’s growth would stay flat next quarter. ($FI)

• Coinbase fell 7.20% after revealing hackers bribed employees to steal customer data. ($COIN)

• Alibaba lost 7.60% after missing Q4 estimates despite a strong jump in net income. ($BABA)

• UnitedHealth dropped 10.93% after a WSJ report revealed the company is under federal investigation for Medicare fraud. ($UNH)

• DXC Technology declined 3.26% after issuing weak full-year guidance. ($DXC)

• Alcoa slipped 3.17 following a UBS downgrade on valuation concerns. ($AA)

• Walmart ticked down 0.50% after missing revenue expectations and warning of potential tariff-driven price increases. ($WMT)

• Meta Platforms fell 2.35% after delaying its flagship AI model, according to WSJ. ($META)

CYBER
Coinbase Says Cybercriminals Stole Customer Data, Sought Ransom

Just days before Coinbase is set to join the S&P 500, the crypto exchange is facing a brutal security scandal. The company revealed that hackers bribed overseas support staff to steal sensitive customer data—then demanded a $20 million ransom to keep quiet. Instead of paying up, Coinbase fired the rogue agents, alerted law enforcement, and offered a $20 million bounty for help tracking the perpetrators down.

The Breach Breakdown

The stolen data doesn’t include passwords or crypto keys—but it’s still serious. The breach exposed names, addresses, emails, partial Social Security numbers, and account snapshots of up to 97,000 users. Coinbase emphasized that customer funds weren’t directly accessed, though some users were duped into sending money to attackers via social engineering. The company promised full reimbursement for those victims.

Damage Control Mode

The financial fallout is steep. Coinbase estimates the cost of cleanup and customer reimbursement will hit between $180 million and $400 million. That’s not great timing for a company just announced as the first crypto firm to be added to the S&P 500 index. Shares of Coinbase dropped over 7% Thursday on the news, denting some of the gains from earlier this week. It’s also worth noting: Coinbase had already detected signs of this breach months earlier and began taking action before the ransom note ever arrived.

Big Promises, Bigger Scrutiny

In a video address, CEO Brian Armstrong didn’t mince words: “We will prosecute you and bring you to justice.” The exchange is launching a new U.S.-based customer support hub and boosting security protocols to prevent future insider leaks. But the breach isn’t the only cloud hanging over Coinbase—separately, the SEC is investigating whether it previously overstated user metrics, a probe the company called a “hold-over” from the last administration.

Coinbase’s big S&P moment may still happen, but this high-profile breach just reminded investors that even the biggest names in crypto aren’t immune to the industry’s oldest vulnerability: trust.

NEWS
Market Movements

• 🧸 Walmart warns of tariff-driven price hikes: CFO John Rainey said 30% tariffs could drive double-digit increases in prices for items like toys and furniture. Earnings beat estimates, but revenue slightly missed. ($WMT)

• 📈 Powell warns of lasting supply shocks and higher rates: Fed Chair Jerome Powell said long-term interest rates may stay elevated due to frequent supply disruptions and policy uncertainty. He also hinted the Fed may revise its inflation targeting framework.

• 🥗 Cava posts strong quarter with 10.8% same-store sales growth: The Mediterranean chain beat estimates and raised its store expansion plans, though shares dipped 5% on guidance concerns tied to tariffs and a cautious outlook. ($CAVA)

• 🧠 Meta delays “Behemoth” AI model launch amid exec frustration: Meta is pushing back the rollout of its Llama 4 model after internal doubts over readiness, prompting potential leadership changes. ($META)

• 🎮 Take-Two dips after “GTA 6”-less forecast disappoints: Despite beating Q4 revenue expectations, FY26 guidance fell ~$2B short as GTA 6 was delayed. Mobile games now account for nearly half of revenue. ($TTWO)

• 👟 Foot Locker surges 86% on Dick’s $2.4B buyout offer: Dick’s Sporting Goods proposed a $24/share cash acquisition, while Foot Locker struggles with Nike pullbacks and store closures. ($FL) ($DKS)

• 🚗 Tesla flipped leased vehicles after robotaxi plan fizzled: Despite promising robotaxi service by 2020, Tesla resold returned leases for profit, per Reuters. The network still hasn’t launched publicly. ($TSLA)

• 📦 Retailers race to stock up on China goods amid tariff pause: Walmart, Target, and Costco are scrambling to restock before the 90-day 30% tariff window closes. ($WMT) ($TGT) ($COST)

• 📈 Netflix ad-tier hits 94M monthly users: The streamer added 20 million users to its ad-supported plan since November, boosting its advertising reach. ($NFLX)

• 🇮🇳 Foxconn invests $433M in Indian chip plant: The move supports Apple’s China diversification and India’s semiconductor strategy. ($AAPL)

• 👕 Starbucks baristas strike over new dress code: Over 1,000 workers protested the policy change across 75 stores, though most locations remained operational. ($SBUX)

INVESTMENT
US Tech Firms Secure Billions As Trump Tours Gulf States

The red-carpet welcome in Riyadh was just the beginning—Trump’s Middle East swing rapidly morphed into a $600 billion power play across tech, defense, and AI. Behind the photo ops was a flood of jaw-dropping deals: Saudi Arabia pledged to invest $600 billion in U.S. tech and defense—anchored by a serious bet on artificial intelligence.

At the heart of it is Humain, a newly launched AI firm backed by Saudi Arabia’s sovereign wealth fund. The company is ordering 18,000 of Nvidia’s cutting-edge Grace Blackwell chips to power a 500-megawatt data center, part of a larger shipment totaling hundreds of thousands of GPUs over five years. Meanwhile, AMD inked a $10 billion deal to supply chips, and Amazon will co-build a $5 billion “AI Zone” filled with AWS infrastructure. Even Uber got in on the action, planning an autonomous ride-hailing service in Saudi by year’s end.

Loosening the Chip Leash

The deals were made possible by a major policy reversal. The Trump administration is scrapping the Biden-era AI diffusion rule, which tiered global chip access based on national security risk. In its place? Case-by-case deals with allies like Saudi Arabia and the UAE, with one catch: China can’t touch the tech. Export licenses will now come with security guarantees aimed at preventing any leaks to Beijing.

In tandem, the U.S. and UAE announced a massive 5-gigawatt AI campus in Abu Dhabi—the largest outside America. It will be built by Emirati firm G42 in partnership with unnamed U.S. companies and run entirely with American-managed cloud services. Nvidia, Cisco, SoftBank, and OpenAI were all in the UAE this week for the launch.

Who's Really Winning Here?

While the U.S. is ostensibly exporting “freedom chips,” some critics see a contradiction: Trump’s team is drafting the very AI rules, and American companies—led by Nvidia—are cashing in on the outcome. With $283 billion in tech deals, $142 billion in arms sales, and Boeing’s $96 billion Qatar order also announced during the trip, questions are emerging about whether this is industrial policy or just industry profiting from policy.

Either way, the Middle East just became ground zero for AI infrastructure, and U.S. firms are walking away with full shopping carts and front-row seats to the next tech supercycle.

Calendar
On The Horizon

Tomorrow

Friday wraps up with a whisper, not a bang—at least on the earnings front. Only a few companies are slated to report, and none are exactly lighting up the marquee.

Still, there are a couple of key economic check-ins worth watching. Import prices are due, and with tariffs stacking up like Jenga blocks, traders will be watching closely. Housing starts will give us a sense of whether builders are still breaking ground or hitting pause. And the big one? Early consumer sentiment numbers from the University of Michigan. It’s a pulse check on how Americans are feeling—but heads up, it won’t reflect this week’s tariff truce.

NEWS
The Daily Rundown

• 🔁 HBO Max Is Back—Max Name Reversal Announced: Warner Bros. Discovery is reversing its 2023 rebrand and renaming its streaming service back to HBO Max, signaling a shift back to prestige TV over broad content.

• 🤖 AI Is Reshaping College... But Not in a Good Way: With students and professors both using AI, college is devolving into bot-to-bot conversations. Complaints are rising on sites like Rate My Professors, and experts warn that students may graduate “essentially illiterate.”

• ☕ Starbucks Baristas Strike Over Dress Code: Over 2,000 baristas walked out over a new dress code policy. The union claims the change violates labor agreements. ($SBUX)

• 💊 US Drug Overdose Deaths Drop to 5-Year Low: Overdose deaths fell 27% in 2024, helped by naloxone and expanded treatment—but experts warn progress could be reversed by funding cuts and new synthetic drugs.

• ⚖️ SCOTUS Takes Up Birthright Citizenship and Executive Power: The Supreme Court is hearing a case on Trump’s order to end birthright citizenship—but the broader question is whether federal courts can issue nationwide blocks on presidential directives.

• 📊 Databricks Buys Neon for $1B in AI Agent Push: Databricks is acquiring cloud database startup Neon for $1B to power AI agents with real-time access to data.

• 🃏 Pope Leo XIV Has Topps' Best-Selling Trading Card Ever: 133,535 cards of the newly elected Pope Leo XIV sold during a 4-day run, beating out LeBron James and Wembanyama cards for Topps’ all-time record.

• ☮️ Ukraine and Russia Resume Peace Talks in Istanbul: Zelensky is attending, but Putin is not. Skepticism remains high as fighting continues and expectations for a breakthrough are low.

• 🕊️ Georgetown Scholar Freed After Free Speech Legal Win: Badar Khan Suri, an Indian national and pro-Palestinian advocate, was released from ICE detention after a judge ruled his arrest violated his rights.

• 🧑‍⚖️ Menendez Brothers Resentenced, Eligible for Parole: After more than 35 years, the brothers are now eligible for parole under a new California law for youthful offenders. Hearing set for June 13.

• ✊ Ben & Jerry’s Co-founder Arrested During Protest: Ben Cohen was arrested at a Senate hearing for protesting military aid to Israel and cuts to Medicaid. He faces up to 90 days in jail or a $500 fine.

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