Outlook

Google is poised for a tremendous year. While many still view them through the lens of search, they have evolved into a cloud and silicon powerhouse. Cloud revenue is projected to surge toward $90 billion as long-term contracts from 2025 begin to hit the balance sheet. Just as Amazon became a cloud company with an e-commerce "side hustle," Alphabet is now an AI-infrastructure company with a search "side hustle." We predict that Google will start selling its TPU chips and become a major competitor to NVIDIA in the AI infrastructure race. Combined with Waymo reaching an exponential 1-million-ride weekly milestone, Alphabet’s diversified bets are finally all paying off at once. Additionally, its investment in SpaceX will be a huge driving factor for this year's performance. 

The cost of reaching orbit has hit a "floor" that allows for radical new business models. We have seen SpaceX prove the ability to launch multiple times in under 24 hours, and with Starship soon to be complete with testing, the cargo capacity to the Moon and Mars is increasing tenfold. This has birthed a new sub-sector: Orbital Data Centers. As terrestrial centers face power grid and cooling constraints on Earth, the vacuum of space provides a natural heat sink for the massive computing needed for AI. 2026 is the year space moves from a "launch" industry to an "infrastructure" industry, with companies like Rocket Lab scaling to meet the demand for this new economy.

The "AI Bubble" is effectively a circular loop that must eventually close. We’ve seen a pattern where OpenAI invests in Nvidia, and Nvidia reinvests in the very ecosystem that buys its chips. This "deal wheel" has inflated valuations to unprecedented levels. We believe 2026 will see a market-wide correction as investors demand a shift from "spending" to "unit profitability." If the private funding for OpenAI’s trillion-dollar "Stargate" data centers hits a wall, the contagion will force a repricing of the entire tech sector. Only the "cash-flow kings" with integrated stacks will survive the fallout.

While OpenAI had the first-mover advantage, Alphabet had the distribution advantage. With the release of Gemini 3.0, Google proved it has superior AI talent and, more importantly, the ability to weave that intelligence into every layer of the digital world. Because Gemini is natively integrated into Google Workspace and 3 billion Android phones, it has become the "path of least resistance" for the average user. By the end of 2026, Gemini’s active user base will surpass ChatGPT, as the world moves from "visiting" an AI to "living" inside one.

The job market for the Class of 2026 isn't just "tough"—it’s undergoing a structural reset. A combination of aggressive global tariffs and a post-AI-hype hiring freeze has left entry-level talent in the cold. Even though new grads are relatively cheap, they are "expensive" in terms of the time and oversight required to make them productive. In a high-cost economy, corporations are choosing to "overspend" on AI agents that can do 80% of a junior analyst's job today, rather than investing in a human who might not be useful for six months. This freeze will likely last through 2027 as the economy "digests" the new automation tools.

Look at the most recent election cycles; prediction markets weren't just "right"—they were the most liquid and accurate news source available. In 2026, this moves beyond politics into the mainstream of gambling. Platforms like Polymarket and Kalshi are transitioning from speculation to a mature component of the capital markets. Whether it’s betting on the next Fed rate hike, the success of a movie, or the outcome of a space launch, the "gamification of truth" has become a multi-billion-dollar industry. Investing is becoming more like gambling, and gambling is becoming more like information-trading.

Anduril is approaching defense differently than the "Big Three" legacy contractors—Lockheed, Northrop, and Raytheon. While the primes typically wait for government-issued specifications to build slow, expensive hardware, Anduril uses a Silicon Valley "software-first" model, developing solutions like their Lattice AI platform at its own expense to stay ahead of the threat curve. This proactive strategy has allowed them to move from clean-sheet design to flight testing in record time—their Fury collaborative combat aircraft (CCA) went from a concept to its first semi-autonomous flight in just 556 days, a pace unheard of for traditional fighter programs.

From the Dive-LD autonomous underwater vehicles to the EagleEye AI-powered helmet, Anduril is proving that autonomy is the future of the battlefield. They aren't just building drones; they are building a "Mission Autonomy" network that coordinates swarms of uncrewed assets across air, land, and sea. While we do not foresee an IPO this year—especially as they continue to raise private capital at a $52 billion valuation—we are watching them closely. As the Pentagon shifts toward "affordable mass" and autonomous systems to counter near-peer threats, Anduril is the only player with the manufacturing speed and software backbone to deliver at the scale required for 2026 and beyond.