GS TMT SPEC SALES

GS TMT SPEC SALES: Meta litigation risk; German & French Telco consolidation; DSY’s exposure to industrial AI agents; AI adoption and infrastructure investment

GS TMT SPEC SALES – Tuesday 18th of August Overnight summary: Markets lower on rates yesterday and oil squeezing again this morning. Another vessel was hit exiting Hormuz and traffic remains a trickle. TMT saw a clear pro- momentum tone as memory strength continued from Friday and semis outperformed, helped by improving AI sentiment, Anthropic revenue/IPO commentary, and upcoming catalysts including NVDA earnings and the Jefferies Semi Conference. QQQs were slightly lower as factor whiplash returned, with Semis +1.6% while Internet/Software fell around 3%, led by META and MSFT weakness, though the move still felt orderly rather than a major narrative shift. Consumer was the main macro debate, down c.150bps despite the GS high-beta momentum basket rising 5%, with investors expecting this week’s bellwether results to be mixed and stock- specific rather than a clean read on the sector.

AI adoption and infrastructure investment: Anthropic: annual rev run rate topped $65bn in July vs $47bn ⁠in May and $9bn at the end of 2025. Link Highlighting very strong absolute growth while there is 2 way debate on the second derivative growth. Its still delivering ~18% MoM growth on a $65bn base. Separately Nvidia has agreed to provide a more than US$100bn backstop for a huge new OpenAI data centre in Ohio that is being developed alongside a SoftBank-led energy company, in one of the biggest AI infrastructure deals yet. (FT)

TELCOS: UTDI to acquire up to 6m additional shares in 1&1 (3.39%, would take stake from 86.46%-89.85% ish) between now and June 2027 at market conditions. Pretty sure this will excite German consolidation bulls despite making little difference the key question is would Ralph sell 1&1 or could he bid for TEFD or do a RAN sharing dealing with VOD ….seems to me Ralph has all the cards. While on French consolidation an interesting article that suggests French telco consolidation could drive material SFR job losses, with regulatory scrutiny likely centred on competition rather than employment protections. (Universfreebox)

DSY’s exposure to industrial AI agents : Devin is Cognition’s autonomous AI coding agent: users give it a plain-English software task, and it can write, test, debug and refactor the code before handing back a pull request that is ready for review. GE Aerospace is using it on the

software side of the business — route optimisation, fuel-burn models, anomaly detection and digital services that help engines and aircraft do more work without adding another plane, runway or pilot — with one team reportedly nearly doubling engineering output. For DSY, the point is that this is not a direct competitive threat at this stage: Devin does not replace CATIA, SIMULIA, 3DEXPERIENCE, PLM or high-fidelity virtual twins for the physical product, but it is a clean illustration of the broader theme that industrial companies are using AI agents to raise software engineering throughput while still needing a system of record for complex product design, simulation and collaboration. DSY’s bet is that virtual twins plus agentic companions become that system of record and collaboration layer, while pure coding agents like Devin remain complementary tools that sit outside, or loosely integrate into, the platform. Net, Devin is another data point that AI is accelerating software delivery in DSY’s end markets, but the real questions for DSY remain execution on its own agentic platform (increasing debate here is its weak and falling behind), the cloud/subscription transition, and whether Virtual Companions drive incremental seats and spend rather than simply defending the installed base.

META LITIGATION RISK (ended down 3.5% yesterday) investors may have been inclined to look through the current youth mental-health / “addiction by design” case as another theoretical legal overhang, but the multi-state attorney general trial starting today in a California federal court is likely to generate a lot of headlines and could become a real sentiment headwind. The states allege that Facebook…