Markets Drop As Uncertainty Rises… And Oracle Reports Results 6/10/26

19:45Joe Lavorgna:Yeah. And we sort of pontificate. Dan alluded to it. If you look at Oracle, I don't think a lot of people realize. It almost went up from the April lows 100 percent as, you know, as recently as a week and a half or so. I was trading in the mid to 50s ish. And now the pull off makes sense. Now, this is to me, you're betting on one thing. As I said earlier, Larry Ellison is pushing all his chips in the middle of the table. He's levering this thing and he's saying he's making a bet that Oracle is going to be sort of the epicenter of this whole A.I. craze. And he might wind up being right. But the market now is not rewarding people for that.

20:17And the environment we find ourselves in is very penalizing.

20:19Joe Lavorgna:And the software business, by the way, was not good in this quarter, according to. Yeah, nothing's good in this thing. And you talk about the conversion rate RPOs. This is a company that if the stock were to go back to where it's trading two months ago, literally the market cap is going to be nearly equal to that of the debt that they have after they're done raising this. And so when you think about all the rumors about delays and SEMA just had a lot of commentary about Sam Alton, what they're doing or whatever, they have stopped down the development of some data centers that exist for open AI.

20:48And that is part of the RPO. And so you think about what's going on here. There's nothing good going on here. And Oracle is so far behind some of the big hyperscalers. And you think about that negative free cash flow that they have. OK, so all the major hyperscalers have funded hundreds of billions of dollars of data center built based on their cash flow. Now they are raising equity and debt. So if Oracle has never been in the position to use cash flow to do it and they have deeply negative cash flow, in what planet do you think this is going to work out for Oracle? I mean, like, seriously, this is going to be the epicenter of whatever blow up happens from this data center build.

21:20So have a ball, you know. I mean, like, you know. He had a habit. He already had one earlier. You know, I'm just saying, OK, all right. Well, I mean, the planet CapEx, they missed it. I mean, they came in at 55.7. They're supposed to be just around 50. And we got those numbers on what they have to do, the capital markets. You don't think that there's not going to be a dollar for dollar proportionate relationship between every dollar spent on CapEx and every dollar going into the capital market. So, you know, the infrastructure business was up 93 percent. That's great. But it's still only a five billion dollar top line.

21:55Joe Lavorgna:The stock is after our session lows right now down more than seven percent. Coming up, an Elon Musk styled IPO, how SpaceX's market debut is breaking the norm and whether the unconventional process will be a boon or a barrier for the stock on Friday. Plus, Game 4, the NBA Finals and a World Cup to boot. How the two massive sports events are setting up to make history in the betting world and the stocks that could see the biggest bump from it all. Don't go anywhere fast when he's back in two.

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23:42Joe Lavorgna:Welcome back to Fast Money. We are counting down to Friday's Open when all eyes will be on SpaceX's market debut. Shares expected to start trading here at the Nasdaq, and retail investors getting an unprecedented chance to participate in what could be a historic offering. But the massive size isn't the only thing different about this deal. CNBC's Leslie Pickers got more on this. Leslie. Hey, Mel, SpaceX's books have officially closed a day early to give ample time to sort through allocations before Friday's debut. And as you mentioned, Elon Musk is doing the SpaceX IPO his own way. IPO conventions such as price ranges and minimal retail allocations and quiet periods have been thrown out the window.

24:23Joe Lavorgna:Both CEO Elon Musk and CFO Brett Johnson have done interviews posted on X during the roadshow. Some applaud Musk's simplification of the process and removal of the usual friction and gamesmanship that can be involved in IPOs. Others criticize it as risky and untested, especially since the$75 billion debut would be the largest of all time. Remember, Mark Zuckerberg famously showed up to the Facebook IPO roadshow in 2012 wearing a casual hoodie, and he faced major Wall Street backlash over it, rankling some investors who saw it as immature and disrespectful. Institutional investors have learned a lot about and embraced tech culture in the ensuing 14 years.

25:04Joe Lavorgna:They've come a long way. But IPOs can present this unique battleground where nonconformity can be either rewarded or punished. Mel. All right. Leslie, thank you. Leslie Picker. Another way he's rewriting the rules is being included almost immediately in the NASDAQ 100, which will be interesting for those who own the Qs, right? I mean, you'll immediately get exposure, almost immediately get exposure to SpaceX. But you won't get full market cap weighted exposure. So let's just clarify for people at home what this means. Yes, there are now rules because it will be a top 40 market cap that allows them to change the rules and get them in effectively within 15 days.

25:43But it's based upon free float. And then it's a function of free float. And there's a three times multiplier. And so this is not going to be a massive weighting in the Qs. It's just not.

25:53Joe Lavorgna:I think originally it's supposed to be something like 0.5 percent, which is bigger than the average weight, but it's still not going to dominate the index. And I think the bigger issue, I see these headlines, they make me nuts. Everyone is going to own this. Every retail investor, it gets dumped on them. It's not true. The S &P 500 is the benchmark people own. And it's like$20 trillion. The Nasdaq is$1.4 trillion-ish, right? That was the end of 2024. So it's a little off, but it's close. 14 times bigger. So if this were in the S &P 500, I'd say, yeah, the world now owns SpaceX. But this is not what's happening.

26:29Joe Lavorgna:So, yeah, I'm with you. Like, it's a big deal. There's going to be billions of flows going in. But let's not over-exaggerate it. I mean, you know, we hear about the foreign pension funds, the Danish pension fund, people that say that the governance is a big factor. And let's be clear. I mean, you know, opacity and that balance sheet is what you're taking on. Yeah, I said opacity. Wow. You're a Georgetown guy. And it's a case where we've seen one pocket fund the other pocket, this and that. And by the way, that is how Elon's done it. There's no hiding behind this. And by the way, 50 % of people that buy SpaceX, and I at least mean on the retail side, I won't speak for the institutions, that's why they're buying it.

27:06Because they trust in that. And they trust in the ability to let him run his structure. By the way, holding companies usually trade at a discount to the sum of the parts. And that's what we got here. We got at least three primary parts. So. 135 is the price. He set the prices we talked about last night. Obviously, that's where it's going to open or not as far as we priced at where it opens is going to be fascinating. But more than that, how quickly it trades down to that 135 level and how quickly the green shoe is sort of initiated, whatever the phrase is. That's what you're watching here. And by the way, I'll just throw this out there because why not?

27:42We're on a TV show.

27:43Joe Lavorgna:I know where you're going. Given current market conditions, it's not out of the realm of possibility that if what's happened today continues in tomorrow, you could get, you know what, market conditions dictate that we delay, which would be catastrophic. I'm not saying it's going to happen. It would be terrible for the markets. I think there's a chance that that happens. I think there's some good news for retail investors who are going to get access to this. And, again, 30 percent of that is going to be allocated. You know, oftentimes they don't get a lot and then they end up getting really excited and paying the opening price or afterwards and paying the big pop.

28:15So, you know, I can't endorse anybody going out there and paying a pop. We saw Sourbras, you know, had a huge pop and it, you know, really traded 100 percent higher or more, you know, for about a few days. And then it literally has come all the way back and it's probably trading where it should be. But a lot of folks bought in the aftermarket and now immediately they're down 30, 40 percent. So, you know, the idea of going out and buying it on the pop doesn't make any sense. But if you get it at 135, you might as well hang out.

28:41Joe Lavorgna:Coming up, more details on Oracle's after-hours move and all the details from its conference call. But first, Game 4 of the NBA Finals tips off in less than three hours. Yes. And the World Cup is on deck, too. How the two events are creating one of the biggest events in history. You're watching Fast Money Live from the NASDAQ Market Site in Times Square. Back right after this. Your data lives everywhere. On-prem, in the cloud, across apps, bring it all together with EverPure, the platform that acts like a living system, delivering the latest in data performance, security, and innovation without ever slowing you down.

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29:53That's Venture Global. That's unstoppable energy. Thursday, July 16th, CNBC Sport and Boardroom join Fanatics Fest for Game Plan, groundbreaking ideas shaping the future of sports and entertainment. Request your invite at CNBCEvents.com slash Game Plan.

30:16Joe Lavorgna:Welcome back to Fast Money. Ratings for Monday night's Game 3 of the NBA Finals just in. An average 23.8 million people tuned in to watch the New York Knicks take on the San Antonio Spurs. That's a 159 % jump from last year. and the most watched Game 3 since 1998. Tip-off for Game 4 is just a few hours away, and excitement is spilling out way past the seats at MSG. Watch parties and bars. Sports betting stocks have been surging. Take a look at the Roundhill sports betting ETF, up 3 % today. It's up nearly 10 % in the last two months. DraftKings, Flutter, Penn Entertainment, and Rush Street also seeing some outsized games today.

30:53Joe Lavorgna:So, Knicks plus World Cup. This could be a huge bump for these. Yeah, well, I mean, WXOU Radio Bar, 558 Hudson Street, New City, is my bar, and there will be a watch party. I think it's a dynamic where we see the power of sports. It's why, you know, when you start talking about Netflix getting involved in live events and sporting events, but back to online sports betting, I mean, they have these moments. They've also had these moments where they've been very worried about prediction markets. So here it is, sweet spot of everything you want in the online sports betting world. And World Cup, let's call it what it is, as much as I'm a Knick fan.

31:28I mean, it's the World Cup. I mean, soccer and football, as they call it in the rest of the world, is a lot more important and a lot more of a betting sport than basketball. So I think it's I just don't love the margin profile. I, you know, I was long DraftKings for a long time. It was never cheap, but it was a growth story. And now I'm not sure I see that. With everything you just said quickly, you would think a company like Nike, who makes sneakers or trainers and merchandise, apparel, we're doing extraordinarily well. Yet here we are finding it at a 13-year low. Fascinating how they've lost their way.

32:02By the way, I am rooting for seven games in a series, Melms. I was just about to move on. I know you were. So the NBA is too, by the way. Some would argue. No, I'm not arguing that, Tim. I know you guys are excited.

32:12Joe Lavorgna:Tim has his Knicks tie on, but we've got to move on. Coming up, we are keeping an eye on Oracle shares after hours listening in on the company's conference call, What We Are Hearing and What the Tech Analyst Gil Loria makes to the quarter with Fast Money Returns.

32:32Joe Lavorgna:Welcome back to Fast Money. Stocks tumbling for a second day and closing at the lows of the session. The Dow falling nearly 1 ,000 points. Its worst day since October. The S &P dropping more than 1.5%. The Nasdaq down nearly 2%. REIT ETFs hitting multi-year highs today. Vanguard real estate hitting highest levels since November of 2024. State Street First Trust and Alps active REITs all hitting their best levels since April of 2022 intraday. Gold, meantime, continuing its decline. A little water. We have time. Gold is continuing to decline. Thank you. Dropping another 3.5 % today. The precious metal down more than 21 % since the war began and settling at its lowest level since November.

33:14Joe Lavorgna:Casey's General Store surging more than 20 % for its third best day ever. After topping earnings and revenue estimates this morning, Casey is now up nearly 66 % this year. And Supermicro dropping nearly 20%. The company announcing$7 billion in equity-related financing deals to help cover the cost of hardware component purchases. Another check on Oracle. It's really been moving around in the after-hour session. It is now down by just about 5-plus percent. 30 minutes into the call, shares are coming off, as we mentioned, at the after-hours lows, which were down about 7 percent. For more, let's bring in DA Davidson, head of technology research, Gil Lauria.

33:47Joe Lavorgna:Gil, great to have you with us. What did you hear on the conference call so far that catches your attention? Why do you think the stock is down? This is the kind of quarter we called mixed, right? Revenue didn't accelerate from last quarter. It needs to accelerate for them to meet 2027 guidance. The beat was small. The guidance is only slightly above expectations. And then they announced their fundraise. What sounds like a new fundraiser really isn't. That's on the negative side of the ledger. On the positive side of the ledger, They did reaffirm that$90 billion revenue guidance, which implies high 20s revenue growth.

34:29And they grew their remaining performance obligations nicely. Interesting to note, Oracle's remaining performance obligation is now bigger than Microsoft's, Amazon's, and Google's. They have more AI backlog to deliver than any of the three large hyperscalers. So that's on the good side of the ledger. A lot of the back and forth now is about the capital raise. They said they're going to need$40 billion in the fiscal year. But they stayed consistent to their previous statement that there's no more debt raise in this calendar year, right? Their fiscal year just ended in May. So there's no debt raise until next calendar year.

35:11They have not issued all of their at-the-market offering. Remember, they announced a$20 billion at-the-market equity offering. They've only issued$5 billion of that. They still have$15 billion left. So they're actually planning to raise less capital next year than they did last year, in spite of the fact they have more CapEx next year than last year. So they're being more capital efficient by taking more prepayments and more customers that own their own GPUs. So that's what we would call a mixed quarter. All right. So, Gil, is it hyperbolic to say that Larry Ellison is basically betting the fate of the company, just pushing all the chips in the middle table, that Oracle's going to somehow be, maybe not the epicenter of this entire thing, but pretty damn close to it.

35:55Absolutely. He's been making an increasingly large bet on the Oracle cloud business. And OCI is going to go from being a quarter revenue in the year that just ended to being two-thirds or more of the revenue within three or four years. That will be the business in a couple of years. And that's why they intend or they guided to 30 % CAGR over the next three or four years. So that's really based on that big bet that they can be one of the leading providers of AI compute. Again, they used to be a distant fourth. Oracle Cloud used to be a distant fourth to Microsoft, Amazon, and Google. In AI compute, they'd like to be neck and neck with those guys.

36:36Joe Lavorgna:So there's going to be a dramatic change in the margin profile of this company, I would imagine, Gil. I mean, OCI is much, right, slimmer margins than a software business. And then also the financing costs are only going to get higher, I would think. Yeah, the margins are substantially lower. I would say the margins in the rest of this are probably 50 percent 5-0. And in this business right now, I would think of them as maybe 15-1-5. The good news is that for the last few quarters, they've been able to offset that mixed shift with cost cuts. They can't do that forever, but as long as they do that and they can have accelerated growth with stable margins, that's a good return on investment.

37:17So that can work out. And then on the cost of capital, again, they're now going very much. Bookings they added this quarter are either prepaying customers or customers that are bringing their own GPUs. So that's a less capital-intensive business. Now, that's likely also less profitable business, but at least it alleviates the pressure on capital. And that's why they can raise less capital the next year than they did last year, in spite of the fact they're going to have more capex this year than they did last year.

37:48Joe Lavorgna:Gil, thanks. You've got to leave it there. Gil Luria, Oracle shares down less than 5 percent right now. Breaking news here on Iran. Let's get back to Megan Casella. Megan. Melissa, those strikes that we spoke about at the top of the hour have now begun. the U.S. military, confirming they are now firing missiles against Iran. Here's the post, the U.S. Central Command posting on social media saying, U.S. CENTCOM forces began launching additional self-defense strikes today at 5.15 p.m. Eastern against multiple targets in Iran at the commander-in-chief's direction. The strikes are in response to Iran's unwarranted and continued aggression.

38:21Joe Lavorgna:I will note again using the term self-defense, they're trying to suggest this could be a targeted measure. But as I said before as well, Iranian sources are reporting, Iranian state media is reporting, that they will be targeting new U.S. interests, they say, that was if the U.S. took action. Now the U.S. has. Now we wait to see how Iran responds. Melissa. All right. Megan, thank you. Megan Casella. Coming up, blazing a trail. A cannabis company truly becoming the first U.S. company to list at the NYSE. CEO Kim Rivers will join us next to discuss the marijuana milestone and how it positions a company going forward.

38:52Joe Lavorgna:Fast Money is back in two.

38:59Joe Lavorgna:Welcome back to Fast Money. Trulieve Cannabis making its NYSE debut today under the ticker TRLV. The move making it the first U.S. cannabis company to trade on a major U.S. exchange. Shares ending the historic day just in the red. For more on what the listing means for the company and the marijuana industry, let's bring in CEO Kim Rivers. Kim, great to see you again. Great to see you as well. What does this U.S. listing enable you to do at this point? Well, first of all, it is a historic day for not only Trulie, but for U.S. cannabis. It allows us to have increased liquidity, increased shareholder participation, not only, of course, with our retail investors, but also with institutions.

39:37Joe Lavorgna:So we are just thrilled to be here today. Tim, congratulations. I'm almost as happy about this as you. And it's been a long haul. Now, let's talk about what this means to the margin profile of your business. So for folks at home that are not following this industry, effectively, you have put the medical business, which has effectively been federalized, and it's a higher margin business. And I think an issue for a lot of investors that now can buy Trulieve on the New York Stock Exchange for the first time, a U.S. cannabis company, the question for many is, what is the margin profile of the company?

40:10What is the multiple we should be paying for cannabis companies? This is what I do every day. Full disclosure, Trulieve is the largest position in my cannabis ETF. But I want to hear you talk a little bit about really why this is not only a game changer in terms of access for investors, but what this might mean truly to the valuation of the industry.

40:30Joe Lavorgna:Yeah, absolutely. So, I mean, we have been financially disciplined since day one. As you know, Tim, we have the best margins in the industry. So we're boasting approximately a 60 percent gross margin and we will take that forward. Our medical business, as you said, has incredibly strong margins. We're focused in Florida, Pennsylvania, Georgia and West Virginia with expansion coming in Texas, which is going to be a huge opportunity for us in the near term. So, yeah, I mean, it's a great company to invest in and I'm proud to lead it. And again, just a lot of growth ahead. Kim, you've been called the industry's Trump whisperer.

41:05Joe Lavorgna:And so I'm wondering at this point, you know, what that means for you, for your company in particular as an advantage over other companies in the industry. And what is the next sort of thing that you're looking to accomplish while the administration's here? Sure. So what we have today is in the TRL, TRLB listing is 100 percent DEA registered assets that are, again, ring fenced and separated from our adult use assets. That's very important, because when we talk about access to capital, when we talk about institutions being able to participate, when we talk about banking, we really do have that pathway because of what the administration moved forward as it relates to rescheduling immediately medical cannabis for state-licensed businesses.

41:46Joe Lavorgna:But they didn't stop there. We also have a hearing process that's been kicked off for the broader cannabis plant that will end in July with additional rescheduling news probably coming sometime this year. So it really is going to be the summer of cannabis in the U.S., along with, again, those growth initiatives that we talked about. So we're so excited to be positioned where we are as, again, the U.S. cannabis company that's listed on the NYSE. Kim, great to speak with you. Thank you. Thanks. Kim Rivers of Trulieve. Well, again, it's really important that this, you know, I don't think cannabis, I'm not sure cannabis will ever be federally legal in this country, but it does mean that medical cannabis is effectively and what it means.

42:27And Kim references there will be, I think, five or six cannabis companies listed on either the New York or the Nasdaq. All of that means is you've now given the ability for big institutions. First of all, the exchanges. But banks, the lower cost of capital is also a game changer. So I think it's an exciting time. Everybody's been here before. But this is real follow through. And this is far and away one of the biggest days we've seen.

42:51Joe Lavorgna:I worry a little bit about the rescheduling for the next step, the hearing that's about to start and the legal action that seems likely to follow. How much do you worry about that? I think the adult or the rec markets. So in states that have legalized that, it's a lot harder to get that through. I don't expect June 29th is going to be also a rubber stamp. In fact, I think it's going to take some time. But the reality is that the DOJ has put the DEA on this, and I think the right people are pushing for change. But this is a little more complicated. Coming up, Carter's Kava call with the Chartmaster sees in store for the Mediterranean food chain after its recent rebound.

43:31Joe Lavorgna:More Fast Money in two.

43:38Joe Lavorgna:Welcome back to Fast Money. Fast casual restaurant chain Cava jumping 7 % today after UBS upgraded the stock, citing a compelling growth story for the name. Shares are up more than 14 % over the past week. But where are they headed now? Let's get the technical take from the chart master, Carter Braxton Worth. Carter. Sure, let's get right to it. I got four charts, as always, same time frame, and we just look at them different ways. First of four iterations, what you'll see, of course, is a stock that's had a real boom and bust. since it interested in exactly two years. It was June 15, 2023. It came out at 22 a share.

44:13First print was 42, a high flyer. And if you look at the next chart, you'll see that surge, of course, the stock rallying basically a huge bull phase going from essentially 42 to 172, and then a bear phase in 2025, losing basically three quarters of its value going all the way back down to 44. And then one more iteration, three or four, you'll see, of course, we're in a new bull phase year to date. And finally, and this is the important part, last chart, it's a textbook bearish to bullish reversal buy. Over the past six weeks, the stock has down 30%, and it's touched its 150 moving average to the penny, and it bounced there beautifully.

44:58We like it long here. Play for about 110. All right.

45:02Joe Lavorgna:Carter, thank you. Cardo Braxton Worth on Kava. Guy. UBS. Now, I'm not nitpicking here. They upgraded the stock to buy from neutral. That's significant, right? They raised their price target from 85 to 90. That seems a bit tepid to me. So, yes, bullish to bearish, bearish to bearish, no question about it. Huge valuation, though, you have to deal with here. I just keep thinking about this Iran war, the fertilizer, the crops, the input inflation, a company like that, how much room do they have to raise prices when that comes? Because it's coming. Yeah. And those bulls are expensive. I mean, you would, I don't know.

45:37Joe Lavorgna:I feel like you would know. Is it 20, 25? I don't know. But there's something. They're up there. I'm sure they're expensive. I think the margin profiles is something to be concerned about. In fact, it's across the whole space. And some of the price action here is a little similar to what we're seeing with CMG or Chipotle, too. Again, massive growth, massive move lower. And now chart looks interesting. Carter's talked about that one, too. Up next, Final Trades.

46:13Joe Lavorgna:Final Trade time. Timbo. Pops, I know you're watching. Feel better. Truly, I think it's actually going higher. I'm long at my ETF, so full disclosure. Rebecca Patterson. IGF. I want global infrastructure. The war is going to cause it, and it's an inflation hedge. And good luck, Pops. Great to have you, Rebecca. Dan? Yeah, Mr. Seymour, get better there. SMH, it's the third day in a row, just sell Pops, Pop. Room for the next four, Mr. Seymour, without question. I mean, he's watching. GPCR, that's like the R in Karen's whatever. Thanks for watching Fast Mad Money starts right now. All opinions expressed by the Fast Money participants are solely their opinions and do not reflect the opinions of CNBC or its parent company or affiliates and may have been previously disseminated by them on television, radio, internet, or another medium.

47:01Joe Lavorgna:You should not treat any opinion expressed on this podcast as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of an opinion. Such opinions are based upon information the Fast Money participants consider reliable, but neither CNBC nor its affiliates and or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. To view the full Fast Money Disclaimer, please visit cnbc.com forward slash Fast Money Disclaimer. Thursday, July 16th, CNBC Sport and Boardroom join Fanatics Fest for Game Plan. Groundbreaking ideas shaping the future of sports and entertainment.

47:33Request your invite at CNBCEvents.com slash Game Plan.