🕟 Practically profitable

Good Afternoon. On this day in 1964, Mary Poppins had its world premiere in Los Angeles. The musical turned familiar children’s stories into a new kind of Disney spectacle, blending live action, animation, and songs that audiences couldn’t stop repeating.

The production was ambitious, but the business lesson was simple: imagination only becomes valuable when the execution works. A big budget can create possibility; a finished product that people actually use creates a franchise.

Wall Street got a similar proof point today. Nvidia showed that AI infrastructure is generating enormous revenue, while Salesforce and CrowdStrike demonstrated that software companies can turn the technology into contracts and cash. The rally was powerful but narrow, and results from retailers and consumer brands showed why investors still need to separate real demand from one-time help.

—Rosie, Wyatt, Evan & Conor

🔥 What’s Hot: 🔥

🥶 What’s Not: 🥶

🔢 Big number: $96.2 billion — That’s Nvidia’s quarterly revenue, more than double a year earlier and a loud answer to doubts about whether AI demand is still accelerating.

Nvidia reported quarterly revenue of $96.2 billion, up 106% from a year earlier, as demand for computing systems built around its newest chips kept growing. The shares were up close to 8.9% in afternoon trading, making the company the biggest force behind the broader market’s gain.

The news: Data-center revenue reached $89.0 billion, up 117%, while gross margin held at 75.0%. That combination matters because investors had started questioning whether giant AI budgets would keep producing enough work to justify more hardware. Nvidia’s results showed customers are still expanding capacity, and management’s outlook indicated the order stream hasn’t hit a wall.

Bottom line: One strong quarter doesn’t prove every AI project will earn an attractive return, but it does show the infrastructure layer is converting enthusiasm into sales at remarkable scale. The next test moves downstream: software companies and corporate buyers need to show that their own productivity gains can support another round of spending without weakening margins.

Source: Nvidia

Salesforce posted quarterly revenue of $11.3 billion, up 11%, and raised its full-year outlook as customers adopted more of its data and AI products. It’s the kind of result that sent its shares up close to 21.6%, showing how much skepticism had been built into expectations for enterprise software.

The news: Current remaining performance obligations reached $33.5 billion, up 14%, while subscription and support revenue rose to $10.8 billion. Salesforce now expects full-year revenue of $46.1–$46.4 billion, including contributions from Informatica and pending acquisitions. The important signal wasn’t simply that AI appeared in the presentation; it was that newer products helped generate bookings and supported a higher forecast.

What’s next: The acquisitions add growth, so investors should keep separating purchased revenue from demand created inside the existing platform. If Agentforce, Data 360, and Slack keep producing renewals without a matching surge in selling costs, Salesforce can prove that AI is improving the economics of its customer base rather than just giving the company another feature to market.

Source: Salesforce

CrowdStrike’s quarterly revenue rose 26% to $1.47 billion, while record net new annual recurring revenue climbed 51% to $333 million. The stock was up close to 18.8%, reflecting relief that customers are still consolidating more security work onto its platform.

The news: Subscription revenue increased 27% to $1.40 billion, and Falcon Flex ending annual recurring revenue reached $2.29 billion, up 101%. It’s also producing cash: operating cash flow was $530 million, with $377 million of free cash flow. Management lifted its full-year revenue outlook to roughly $6.0 billion, giving investors both stronger current demand and a better view of the year ahead.

Big picture: Cybersecurity spending is easier to defend than many technology budgets, but vendors still have to win consolidation decisions and prove that more modules reduce risk. CrowdStrike’s growth suggests flexible platform contracts are pulling customers deeper into the product. Watch retention and cash conversion next, because rapid bookings matter most when they become durable, profitable revenue.

Source: CrowdStrike

Dollar Tree grew quarterly sales 7.0% to $4.9 billion, and comparable-store sales rose 3.7%. That’s a strong-looking result, but the shares fell close to 3.9% as investors looked past the headline profit and focused on how much came from tariff refunds.

The news: The comparable-sales increase included a 3.3% gain in average ticket and only 0.4% more traffic. Earnings reached $2.70 per share, including a $1.31 benefit from the net impact of refunds, while operating margin expanded by nine percentage points with a 6.5-point contribution from the same factor. It’s raising full-year earnings guidance, but management also plans to reinvest part of the benefit during the third quarter.

Bottom line: Multi-price stores and better assortment are helping, yet traffic remains the cleaner measure of whether customers are choosing Dollar Tree more often. Refunds can fund improvements, but they can’t become recurring earnings. The retailer now has to convert that temporary cash into stronger stores, faster visits, and a sales mix that holds up after the benefit disappears.

Source: Dollar Tree

Hormel Foods reported quarterly net sales of $2.96 billion, with organic sales down 2%, as lower commodity pricing and softer demand weighed on parts of its retail portfolio. That’s why the shares dropped close to 9.7%, even though management raised the lower end of adjusted earnings guidance.

The news: Retail organic sales fell 3%, hurt by commodity turkey and private-label snack nuts, while foodservice organic sales grew 2% for a 12th consecutive quarter of expansion. Adjusted operating margin improved to 9.0% from 8.4%, and operating cash flow increased 54% to $241 million. It’s now expecting adjusted earnings of $1.45–$1.51 per share, but Hormel reduced the top end of its sales outlook.

What’s next: Cost control can support profit while sales reset, but the brand portfolio still needs more volume. Hormel’s foodservice momentum provides a useful counterweight; the question is whether premium prepared proteins and priority retail brands can offset weaker commodity categories without leaning on lower spending or portfolio sales for the improvement.

Source: Hormel Foods

The Bank of Korea raised its base rate by 0.25 percentage point to 3.00%, choosing to restrain inflation even as the domestic economy grows faster than expected. It’s also lifted its 2026 growth forecast to 3.3% from 2.6% in May.

The news: Strong semiconductor exports and investment are supporting growth, while consumption is recovering as income conditions improve. The central bank expects inflation to remain above target for a considerable time, partly because energy prices are elevated, and it doesn’t want those pressures to spread. That left policymakers with a rare combination: better growth made a rate increase easier to absorb, even as global uncertainty stayed high.

Big picture: South Korea shows why rate cycles won’t move in perfect sync. A powerful chip sector can improve national income and demand, but it can also give the central bank less reason to tolerate inflation. Borrowers and exporters should prepare for policy to stay restrictive until price pressure clearly fades, even if other major economies start discussing easier settings.

Source: Bank of Korea

Profits at China’s major industrial companies rose 17.6% during the first seven months of 2026 to 4.58 trillion yuan. The improvement was broad enough to look encouraging, but the sector breakdown showed that technology and materials did much of the lifting.

The news: Manufacturing profit increased 18.8%, led by gains of 110% in electronics, 91.8% in nonferrous metals, and 56.6% in chemicals. Mining profit rose 34.9%, while electricity, heat, gas, and water suppliers saw profit fall 5.8%. The data suggest stronger pricing or utilization in favored industries, but they don’t mean every producer is benefiting equally.

Bottom line: Faster industrial profit can support investment and wages, yet concentration matters. Suppliers should watch whether gains spread beyond electronics and resource-linked businesses, while global competitors shouldn’t assume profitable Chinese manufacturers will stop adding capacity. A stronger profit pool becomes more durable when it reflects wider demand instead of a few booming categories.

Source: State Council of China

Pernod Ricard’s annual organic sales fell 3.9% to €9.4 billion, with weakness in the United States and China outweighing growth elsewhere. The distiller defended cash flow and margin better than the sales decline suggested, but consumers and distributors are still buying carefully.

The news: U.S. sales fell 14% as a slower spirits market was amplified by inventory adjustments, while organic sales outside the United States and China grew 0.5%. Free cash flow increased 6%, and cost reductions helped limit the decline in recurring operating profit to 5.2%. The company’s already delivered half of its €1 billion efficiency target and expects to finish the program by fiscal 2028.

What’s next: Leaner distributor inventory can eventually make reported sales track consumer demand more closely, but it doesn’t guarantee a rebound. Pernod expects medium-term organic growth of 3%–6%, so premium brands, ready-to-drink products, and cost savings will have to carry more weight until confidence improves in its two most difficult markets.

Source: Pernod Ricard

Q: Why’d the AI server bring a calculator to dinner?

A: It’d promised to process the bill.

Sales mix: the share of revenue coming from different products, customers, or regions. In a sentence: Hormel’s uneven sales mix helped foodservice growth soften weaker retail demand, showing why a company’s total revenue rarely tells the whole story.

📬 Need more smart reads? See newsletters we recommend →
You can choose one, a few, or none. Completely up to you.