✊ $2.4 billion company, four employees

It’s rare that a note on accounting disclosures gets Wall Street’s attention, and even rarer still that a complex visual rendering of tentacle-like corporate linkages goes semi-viral. 

But a recent report, which included a chart detailing the web of relationships between major AI players, by a team of accounting analysts at Morgan Stanley seemed to achieve this feat. Published last Wednesday, it focused on a growing concern for many in the markets: the hundreds of billions of dollars’ worth of AI-related deals swirling between Microsoft, Nvidia, Oracle, CoreWeave, and OpenAI. 

• Todd Castagno, who headed up the team that worked on the report, told Sherwood “I think the potential worry is that with some of these relationships, you have a contract and one of the players may not be able to deliver on that promise. That’s essentially the risk.”

• It’s not exactly unheard of, Castagno assured us: “This kind of intertwining is not completely unfamiliar, to be honest. The best example is the leap into the avionics and aerospace industry in the 1920s through 1950s. Boeing funded its customers. It funded its suppliers. It owned its suppliers. Douglas, which then became McDonnell Douglas, did the same thing. Lockheed. Raytheon.”

• So, what’s the problem? “I think the opacity,” said Castagno. “We have published work from some of my colleagues that suggests a lot of the numbers from a certain player are maybe somewhat aspirational. We just don’t see that clarity, which is kind of the reason why we wrote this note.

Who “a certain player” is is left as an exercise for the reader. 

The Takeaway

At its heart, this isn’t precisely skepticism about the AI trade as a whole, but more the way that these deals are being carried out. This is going to be a liability when established publicly-traded blue chip companies rub shoulders with swashbucking startups and have to find out how to talk the same financial language. 

“The reason we wrote it is that the disclosures are not as sufficient as some would expect,” he said. “Now, I don’t think any of these companies are skirting accounting rules. But I think there could be more transparency, particularly with related party disclosures.”

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Since President Trump’s interest in the sector kicked off a flurry of buying activity, the hottest trade on Wall Street has been in rare earth stocks.

With China recently stepping up restrictions on exporting rare earth metals, those bets have turned out to be well made. Now granted, most of those stocks took a bath yesterday, but the overall surge has led to some pretty fascinating situations in this emerging market.

• Critical Metals Corp., which engages in the mining, exploration, and development of lithium metals via its Wolfsberg and Tanbreez projects, has been one of the biggest beneficiaries. 

• From a market cap in early May that was below $150 million, the company’s stock has soared, turning it into a more than $2 billion entity as of yesterday’s close. That’s more than what embattled fitness equipment maker Peloton is worth.

• The most astonishing part? “As of June 30, 2025,” the company reports, “we had 4 full-time employees with a significant number of personnel engaged on a contractor basis.”

A good example of just how far investors are willing to bet on the future, Critical Metals reported revenue — technically “other income,” which was from European Union grants or interest on cash sat on deposit — of just ~$560,000 (a typical McDonald’s restaurant does about 7x as much in a year) in its most recent fiscal year, ended June 30, 2025.

The Takeaway

That is, obviously, a remarkably low headcount for a billion-dollar company. But what’s more astonishing is that it doesn’t seem to preclude a major deal from happening: Trilogy Metals, which has surged alongside Critical Metals and the rest of the rare earth winners, secured a $35.6 million strategic investment from the US federal government on October 6. Trilogy Metals reported just five full-time employees in its most recent filings. As we observed at the end of September: why follow the Fed when you can follow the feds?

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POET Technologies CEO on the “sweet spot” for the company in the AI boom

Everyone knows the big players in the AI boom, but investors have been focused on discovering smaller, emerging companies that have the potential to benefit from this rising tide as best supporting actors. Enter POET Technologies. Sherwood talked with its Executive Chairman and CEO Dr. Suresh Venkatesan, about why he sees its optical communications as fundamental to AI’s explosive growth and his laser-focus on scale.

His plans for the future, too

Citizens of which countries are the most excited about AI?

Check your answer.

• Hims & Hers surged after announcing that it will now offer treatments for perimenopause and menopause.

• ASML rose after the Dutch semiconductor equipment maker’s Q3 bookings came in 10% ahead of estimates, offsetting a weak outlook in its China business

• CoreWeave rose after it announced a partnership with Poolside to provide more than 40,000 Nvidia GPUs to bolster the development of Poolside’s AI models.

We’re winding down this section of Snacks after today, so if you want the biggest movers of the day right after market close, subscribe to The Wrap here! 

• Thursday Night Football: Traders on Robinhood’s* prediction markets are pricing a Pittsburgh win trading around $0.71 to win as of market close, with Cincy trading for $0.31

• The US government seized 127,271 bitcoin, worth roughly $15 billion, in what it calls the DOJ’s “largest ever forfeiture action”

• That’s a lotta dough to spend on pizza: Apollo Global Management makes a bid to take Papa John’s private

• Apple TV is now minus the plus as streamers keep pulling back on originals

• A Reddit user looked up Rigetti Computing’s HQ on Google Maps and the internet did not like what it found