Pre Market Thoughts 8 Jul 26 Yields inched 1-2bps higher across the curve. Overnight geopolitical risk is back with news of US and Iran love taps during market hours. While oil has rallied on the back of the that, it is also pricing in a "supposedly glut" for next year. My thoughts on Oil after March 26? This is a market where even the so called experts get it wrong. Waddling here is probably deeply negative EV. Next, asia markets took a huge beating. KOSPI is down 5.5%, NKY is down 1.6%. Today on NY close is the end of the subscription period of $SKHY. At this price point, the case is either you believe in the earnings and the non cyclical case for HBM and DRAM or you dont. $SKHY is now back to the friday/thursday lows. This has dragged down $MU and $SNDK in thin overnight markets. Again, levels where i believe there is good r/r is ($MU 800-850, $SNDK 1500s). The caveat to this is that while i expect the momentum puke to be over already, it is currently still on going. If you want to bid this, you must be ready to hold for a while. In other news, semi analysis is writing about Anthropic and OAI not being able to serve their models because of a lack of compute. Also they estimate Anthropic's valuation to be at about 6trn at 20x 200b ARR in 2027. This is a gargantuan number and marks a massive payday for VCs. On the compute shortage, especially as OAI and Anthropic ramp up towards serving inference - this changes the risk in their business models. In AI usage, the power law distribution holds. AI is of tremendous value to some people (those with high agency - i strongly believe we will see the rise of billion dollar single man companies in the future) and of some value to most people. Compute market currently still remains in short supply, especially with Anthropic and other players gobbling up supply. Even the short term rental markets have no supply for many of them. A100s (i just checked) are renting for $1/hr....this is something that was launched 6 years ago - This means that for the people renting out A100s, they would have made back everything in 2years (rental was ~2.5) Every year after that is pure profit. Anthropic's 3Q26 profit was also leaked at 1B. The bear case for compute - that the frontier labs will collapse because of an inability to raise funding - that case is dead. The frontier labs are now profitable. To scale, they need more compute. Serving inference is a 70% gross margins business for them and the compute shortage will tighten even further as the labs jostle to get market share. Personally, i have rotated all my plays into neoclouds. This remains the most mis understood business (2 year payback periods) and the core inflection point now is the frontier labs turning profitable. NVDA providing credit support for neoclouds is extremely bullish for them because it reduces the interest cost in financing the build out. TLDR - while this was meant to be a market update, i could not help but to put this down as the biggest play for 2H'26. IMO, we are still in the very early innings because people do not yet have a grasp of the economics of the trade. This market is like memory in October 2025 - some people are seeing the vast need for compute and the inflection point that the frontier labs being profitable mean - while others point to an outdated bear case that sounds sexy but fails to live up to scrutiny. What neoclouds would i bid? $NBIS in my opinion remains the leader of the neoclouds in terms of execution. $CRWV is a strong contender, however 98% of its contracts are locked in and hence it will not be able to directly monetise on the spot shortage in compute. However, $CRWV has already been rumoured to hit its 30B ARR target exiting 2027. $IREN boasts power however, in terms of deal execution - this has been lacking. For the super speculative play, i like $SHAZ. Again, this trades at ~2B market cap. It has 40,000 GB300s which when rented out will be able to fetch $6-11/hr which means an ARR of 2-4B. If we apply a 6x ARR multiple to this, this is 12b-24b. Also $SHAZ capital structure is relatively clean with a thick equity cushion and also NVDA credit support for its GPU purchases. I like this play for the massive risk reward it offers. Now - does this mean that neoclouds will rerate upwards immediately? No. In a positioning wipe out, everything gets sold. However, cashflows and valuations will dominate in the longer run. For a generational trade like neoclouds (where i see at least a 3x rerating on $NBIS, $CRWV - because of Anthropic's profitability) As always, i welcome thoughts on the matter, especially to see where i may have gotten it entirely wrong. Good luck!

A quick overview of $SHAZ On the 23th of June, I posted on X that i think that Situational Awareness will likely file a form 13G for $SHAZ on 29 Jun I am writing this as a follow up to document what i have learnt while digging into the company. First off, Situational Awareness filed it yesterday What strikes me immediately is that Situational Awareness stake ballooned to 19.9%. This is significant for many reasons. 20% is the threshold where the stake crosses a major accounting and regulatory level. Under both IFRS and GAAP, owning 20% or more presumes “significant influence” and the fund has to use the “equity method” of accounting. (goosebumps, thank you accounting class) At 20%, the stake can hardly be called passive anymore. It becomes one of the largest singular shareholders and have extreme leverage in getting a seat on the board. Situational Awareness bought all the way till the limit. Next, in order to acquire such a stake, this means for the entire equity deal, Situational Awareness took 35%. Linking into the first quarter financial statements, we can see that Sharon AI only had ~164M of cash on the balance sheet. Post this deal, SHAZ -2.83%↓ will have an additional 1.6B of cash on its balance sheet to fund the build out. Also, back in January 26, USDai ($CHIP) approved a 500m debt facility for SHAZ -2.83%↓ This answers one of the most important question for SHAZ -2.83%↓ - Can this company build what it is promising to build. With access to about 2.1B of cash and debt - the build out is now financially realistic. Next, the revenue stream for SHAZ -2.83%↓ cannot be discounted anymore. It has a 2.2B backlog in a take or pay contract. Also, NVDA 0.28%↑ is making SHAZ -2.83%↓ a strategic collaborator in the 72MW deal in Australia. This secures the GPUs. In any neocloud buildout, the three questions i will ask is 1 - Can the company fund this in an equity accretive manner? 2 - Can the company deliver the compute? (Sourcing GPUs etc is a big part of the problem) 3 - Can the company continue to sign good contracts that are suitable for its capital structure Thus far, i see that SHAZ -2.83%↓ has significantly derisked the first 2 concerns i have for a starting neocloud. This brings the total capacity for SHAZ to 132MW. Which indicates about ~1.3B in ARR for SHAZ -2.83%↓ A neocloud is more like a bank for compute. It raises capital and deploys it into compute. The valuation of a neocloud is therefore the NPV of all the projects that it will ever deploy into. Currently, any neocloud operator will tell you that compute is sold out. Every neocloud project is +EV. Don’t believe me? Go rent out some GPUs yourself. Tell me what is the payback period. Non believers of neos often dont understand the real business of a neocloud and hence anchor valuation to current deployment. That misleads people. If it was any other anchor investor besides Situational Awareness, i would not put too much weight on the ability of SHAZ to execute. However, Leopold lending his name and weighting this deal heavily biases me towards that the execution for SHAZ will probably be good. He in all likelihood knows a great deal more than me. To recap, the latest funding deal has answered 2 crucial questions for SHAZ, whether it has the ability to raise capital for the build out and to procure the GPUs required. Leopold lending his name to SHAZ also heavily reduces any reputational taint that SHAZ might have. Hope you enjoyed this!

I have said it in my notes for the last week. But i will say again. Memory pooling and compute will lead the next rally. Memory pooling - $ALAB, $CRDO, $PENG, $MRVL, $CRDO was hit hard by the rebalancing flow last friday - i think these levels offer good value.