Breakfast News: IBM Closes In On $11B Deal
December 8, 2025
| Friday's Markets |
|---|
| S&P 500 6,870 (+0.19%) |
| Nasdaq 23,578 (+0.31%) |
| Dow 47,955 (+0.22%) |
| Bitcoin $89,150 (-3.27%) |
1. IBM on the Acquisition Trail Again
IBM (IBM +0.55%) is close to acquiring Confluent (CFLT +29.36%), reports The Wall Street Journal, for around $11 billion. It comes as the computing giant plans thousands of layoffs by the end of the year, after beating expectations in the third quarter with a 9% revenue rise.
- Real-time data management: Confluent, which provides technology used in AI development, would add to the $6.4 billion acquisition of cloud software company HashiCorp, completed in February, as IBM pushes its AI ambitions.
- Confluent up more than 25% in pre-market trading, IBM stock mostly unchanged: IBM has beaten the S&P 500 by 30% since being recommended in Hidden Gems back in September 2024.
2. A Key Week For 3 Stock Advisor Recs
Lululemon (LULU 4.88%) reports Q3 Thursday, after Q2 contrasted international growth with a reset in the company's stalling U.S. business. Against a tough competitive environment, Fool analyst Sanmeet Deo, CFA, said at the time "While the short-term situation seems dire (and could worsen in the quarters ahead), there is acknowledgment that the brand worth hasn't deteriorated."
- 8% revenue rise in Q4 2025: Thursday also brings a Q1 update from Costco (COST 0.87%), as the low-price retailer joins others in a legal challenge to the White House over tariffs. Customer loyalty helped drive membership fee income up 10.4% in the previous quarter.
- Beating the S&P 500 by 65% since May 2024 Rule Breakers rec: Chewy (CHWY +3.02%) will post Q3 earnings Wednesday, after Q2 saw revenue rise 8.6% to beat management guidance. Watch for strong recurring revenue as a driver of long-term growth, along with Autoship subscription service takeup.
3. Next Up: AI Tech Stock Earnings
We'll have Q4 figures from Broadcom (AVGO +2.36%) Thursday, with AI demand helping boost the chip and software maker in Q3 – as AI semiconductor revenue climbed 63% year over year (YoY). It follows Wednesday's expected Q4 update from chip design software specialist Synopsys (SNPS 0.30%), after a miss against Q3 expectations led to a full-year guidance cut.
- Superscore of 67 on our Hidden Gems Primary database: Wednesday is Q2 time for Oracle (ORCL 0.05%), with optimistic analysts predicting a 15% revenue rise YoY to around $16 billion. Cloud infrastructure revenue climbed 55% in Q1, though rising costs led to $5.9 billion free cash outflow over the trailing 12 months.
- Record quarterly revenue in Q3: Adobe (ADBE 2.08%) reports Q4 the same day, as AI integration helped push Q3 revenue up 11% YoY to $5.99 billion.
4. Markets Steady Ahead of Fed Decision
Markets held level last week with the S&P 500 up 0.31% with the Nasdaq rising 0.91%. Futures for the two key indices edged up in early trading this morning, 0.2% and 0.3% respectively.
- S&P 500 changes set for December 22: S&P Dow Jones Indices revealed its latest quarterly rebalancing Friday, with CRH (CRH +5.16%), Carvana (CVNA +13.50%), and Comfort Systems (FIX +0.50%) set to join the benchmark index, with LKQ (LKQ 1.77%), Solstice Advanced Materials (SOLS.V 0.32%), and Mohawk Industries (MHK 1.50%) dropping out.
- CME FedWatch tool says 87.4% yes: The Federal Reserve's December interest rate decision is due Wednesday, with last week's weaker labor market data raising hopes for a 0.25% cut.
5. Your Take
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