☕️ Google delays its most powerful AI model

Hi there, this is your daily ☕️ Finpresso.

In today's newsletter:

🤖 Google delays its most powerful AI model

🇪🇺 EU forces Google to open Android to AI rivals

📉 Netflix drops 8% on weak forecast

🇪🇺 ECB to pause now hike once more in September

🔌 Mitsubishi eyes power-chip merger with Toshiba

🏦 Fed's Logan calls for higher rates

Plus: 🌍 9 macro news, 🏢 8 corporate news, 💰 9 deal flow, and 📑 5 research & reports.

📊 Before The Bell

• Google is months behind on releasing Gemini 3.5 Pro, its most capable AI model, which had been expected at its May developer conference but remains in testing as engineers work to sharpen its coding skills, Bloomberg reported.
• The holdup stems from Google's layered internal approval process, its push to make 3.5 Pro's code-writing competitive with rivals, and internal teams separately building their own AI coding tools, according to the report citing unnamed sources.
• The delay sits against a backdrop of heavy adoption of the already-launched Gemini 3.5 Flash, with the Gemini app serving more than 900 million monthly users across 230 countries and daily queries up sevenfold, as Google races to stay cost-competitive.

• EU regulators ordered Alphabet's Google to open its Android system and share search data with OpenAI and other AI rivals, part of Digital Markets Act rules aimed at loosening Big Tech's grip on the market.
• Google must open 11 Android features so rival AI assistants can be triggered by voice to book taxis or find places, competing with its Gemini service; the changes reach EU users from July 2027 in the next Android version.
• Google must also share anonymised search-optimisation data with rival AI chatbots from January, priced by a set formula, though it can first screen rivals for security risks; Google warned the rulings threaten user privacy and security safeguards.

• Netflix shares fell more than 8% after second-quarter results merely matched its own modest guidance, adding to a 31% slide over the prior three months as Wall Street questions how much room the streamer has left to grow.
• Revenue rose 13.4% to $12.56 billion, just shy of the $12.58 billion expected, while earnings of $0.80 a share narrowly beat the $0.79 forecast — leaving little to reassure investors worried about growth.
• Netflix will cut its viewership reports to once a year from 2027 to keep focus on revenue and profit, even as global viewing rose just 2% to 97 billion hours amid competition from free apps like YouTube and TikTok.

• The European Central Bank is expected to hold interest rates steady next Thursday before delivering a quarter-point increase in September, lifting its deposit rate to 2.5% once fresh economic forecasts are in hand.
• Every respondent in a Bloomberg survey sees no change next week, with most anticipating the September hike that could make the ECB the most hawkish among Group of Seven central banks after it first raised rates following the Iran war last month.
• The main swing factor is the Iran war and its effect on oil and gas flows, as economists say June's slowing euro-area inflation removed the urgency to act while high commodity prices keep a September move on track.

• Mitsubishi Electric is negotiating a joint venture to merge its power-chip business with Toshiba and Rohm, aiming to announce a plan by September that would create a single company capable of leading the global market.
• The three Japanese firms each hold less than 5% of the power-chip market, trailing Germany's Infineon, which controls nearly a fifth, so combining forces offers a shot at becoming the world's No. 1 supplier.
• Demand is being driven by AI infrastructure, as complex systems like Nvidia's next-generation Vera Rubin platform consume more power, though the partners disagree over whether the venture should include a broad range of analog chips or focus solely on power chips.

• Dallas Fed President Lorie Logan called publicly for an interest-rate increase, becoming the first of new Chair Kevin Warsh's colleagues to do so and signaling a possible dissent at the July 28-29 policy meeting.
• Logan argued that inflation has been "too high, for too long" and is not clearly heading back to the Fed's 2% target, warning that acting now with "modest restriction" avoids "severe restriction later" if higher prices become entrenched.
• Her stance may crack the unity behind June's decision to hold rates at 3.50%-3.75%, with risks she flagged including Middle East tensions threatening fuel prices and an AI-investment surge lifting demand faster than supply.

🌍 Macro News

• Xi Jinping calls for global cooperation on AI development and governance. LINK
• IEA warns China's rare-earth export curbs threaten $6.5 trillion in production. LINK
• Senate advances crypto bill as Trump's $1.4 billion crypto earnings spark ethics concerns. LINK
• BP and ConocoPhillips plan major new energy investments in Iraq. LINK
• IMO urges ships to avoid the Strait of Hormuz amid US-Iran tensions. LINK
• US retail sales rose only 0.2% in June, missing forecasts. LINK
• US existing home contracts fell 5.4% in June amid high rates. LINK
• India emerges as global swing supplier of refined fuel exports. LINK
• Senate votes against any pardon for FTX founder Sam Bankman-Fried. LINK

🏢 Corporate News

• Morgan Stanley's ETRADE launches spot crypto trading for retail clients. LINK
• Brightline bondholders grant Florida rail operator another short debt extension. LINK
• Robinhood's new blockchain sees memecoin trading dominate over tokenized stocks. LINK
• Polygon Labs cuts jobs again while finalizing Coinme acquisition. LINK
• Citadel Securities invests $400 million in Crypto.com at $20 billion valuation. LINK
• Verizon to sell 274 stores, cut about 500 corporate jobs. LINK
• Uber agrees to buy Delivery Hero for $14.8 billion. LINK
• Filing reveals Chinese AI startup DeepSeek valued near $51.8 billion. LINK

📈 Stocks

📑 Research & Reports

• Goldman cuts PC shipment forecasts citing memory-chip shortage and costs. LINK
• Citi projects Alphabet, Meta, Amazon to spend $801 billion by 2027. LINK
• EY-Parthenon: ending U.S. reliance on China would cost $13.7 trillion. LINK
• Standard Chartered warns Southeast Asia risks missing the global AI boom. LINK
• Visa and Artemis say stablecoins will power small AI agent payments. LINK

💰 Deal Flow

• Fireworks AI raises $1.5 billion as open-source AI demand grows. LINK
• Bloom Energy shares fall despite securing $1.7 billion data-center financing deal. LINK
• AST SpaceMobile shares drop 17% after $1 billion convertible notes pricing. LINK
• Tradable to move up to $1 billion in credit assets onto Stellar. LINK
• Wonder plans early 2026 IPO after $650 million funding round. LINK
• SoftBank sells remaining Boston Dynamics stake to Hyundai for $325 million. LINK
• Quantum startup Photonic raises $200 million Series E, lacks paying customers. LINK
• Alpaca raises $135 million plus debt to build blockchain trading systems. LINK
• Eli Lilly to buy AtaiBeckley for $2.8 billion in psychedelics bet. LINK

📅 Market Calendar

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