Broadcom's $10B OpenAI Deal + Musk Chases $1T Payday | The Rundown September 5, 2025

Public.com presents The Rundown, your daily market update in under 10 minutes. My name is Zaid Admani, and today is Friday, September 5th. In today's episode, we'll recap the latest jobs report and tell you what it means for the markets. We'll also tell you about Elon's new trillion dollar pay package from Tesla. Then stick around to the end of the show for some listener Q&A, including the origin story of this podcast. We got a great show for you today. Let's go. Stocks continue to rally on Thursday with the S&P 500 and NASDAQ both adding about 0.9%. That rally was enough to push the S&P to record highs again. Now let's talk about the job support because we've been looking forward to it all week. And the numbers just came out this morning and. It's not looking good. According to the report, the U.S. economy added just 22,000 jobs in August, which was way below the 75,000 jobs that was expected. The unemployment rate ticked up to 4.3%. On top of that, there were more revisions to the previous months, with June being revised down again to show a net loss of 13,000 jobs. That was the first negative month of job growth since 2020. The signs seem to be clear that the labor market is slowing down. And I think this pretty much. Guarantees that the Federal Reserve will be cutting interest rates later this month. So we'll have to see how the markets react to this over the next few weeks and months, because with inflation still sticky and labor market conditions starting to slow and a rate cut coming soon, you might start hearing the stagflation word being thrown around a lot more. So yeah, the economy just got a lot more interesting. We're going to keep an eye on all this for you guys as this all plays out. So make sure you guys are tuning into the podcast every day to stay in the loop. Let's run through some headlines, starting with Broadcom. Broadcom struck a $10 billion deal with OpenAI to co-design a new AI chip. This would be OpenAI's first in-house chip, following the same playbook of Google, Amazon, and Meta, who all built custom silicon to cut down on their reliance on NVIDIA. The first ships for OpenAI are expected to ship next year and OpenAI will use them internally to power chat GPT and their models. And for Broadcom, this is a huge deal. Their CEO, Hawk Tan, confirmed the deal, but didn't use OpenAI's name and said he called them a mystery customer, but most people are reporting it to be OpenAI. The orders here are so large for Broadcom that they raised their 2026 AI revenue outlook beyond the 50 to 60% growth they were already forecasting. So investors are loving this news. Broadcom shares are up nearly 15% this morning on this news and their market cap has crossed over $1.5 trillion. You know, I feel like Broadcom doesn't really get talked about that much, but they've been a big beneficiary of the AI boom. I mean, NVIDIA is still a king of AI chips, but... Broadcom is becoming a serious competitor, especially with these custom-made chips. Now, speaking of trillions, let's talk about Tesla, because the Tesla board of directors just proposed the biggest CEO pay package in history to keep Elon Musk as their CEO. They want to pay him $1 trillion. Over the next decade, the way this would work is that Elon would get 12 tranches of stocks over the next decade, but only if Tesla hits major milestones and some of these milestones are pretty aggressive. Like Tesla's market cap would have to hit over $8.5 trillion for Elon to get the full pay package. It's currently at around $1 trillion today. They would also have to deliver 20 million cars a year. They currently deliver less than 2 million cars a year. So that's a 10X jump from today. Tesla would also have to 20X their profits. They would have to get millions of robots and robo-taxis in service. So again, aggressive milestones. Tesla's board says they want to give Elon this pay package to keep him motivated. Now, this deal does have to get approved by shareholders. So we'll see what they end up voting. That's happening on November 6th. You know, when I first saw the headline, it was pretty shocking, When you dig into it, I don't think that Elon is going to see the full $1 trillion payout because I don't think that Tesla is going to be able to hit some of these milestones. But you know what? Maybe this pay package gets Elon to lock in for the next decade and maybe spend less time on Twitter and he might become the world's first trillionaire. Sounds crazy, right? That's why I think that Tesla shareholders are going to end up approving this pay package. Let's talk about some stocks making moves today. Good day. Good day. DocuSign shares are higher this morning after the company raised its sales outlook thanks to momentum from their new AI tools. Revenues in Q2 came in at more than $800 million, which was up 9% year over year and ahead of Wall Street estimates. The big story for DocuSign is their intelligence agreement management platform, which is basically an AI that summarizes and analyzes contracts. I'm pretty sure Chad GPT can do the same thing, but DocuSign says they're seeing adoption of this tool with small and mid-sized businesses and also some larger enterprise customers too. So investors like the sound of that and DocuSign shares are up more than 7% this morning. In reaction to the earnings, you know, I know that DocuSign has been the butt of a lot of jokes, but their stock has gone up over 30% in the last year. Now, speaking of butts, let's talk about Lululemon because their stock is tanking after the company reported disappointing sales and slashed their outlook for the year. Comparable sales for the retailer grew by 1% in the second quarter. Missing Wall Street expectations of a 3% growth. And the story for the U.S. market was pretty bad. Same-store sales dropped 4%. Lululemon CEO Calvin McDonald admitted that their lounge and social products have gotten stale. I mean, just anecdotally speaking, I'm seeing a lot more people rocking Aloe or Viore these days. So yeah, Lululemon stock is down more than 15% this morning in reaction to the earnings. The stock has now lost more than half its value this year. Let's wrap the show with some listener questions. The first question we got is from Chris Fernandez on Spotify. Chris asks, what are all of your guys' backgrounds and how did you guys come to making this podcast? That is a great question, Chris. In order to save some time, I'll cover our backgrounds for another episode. Maybe Mike and Connor and I will do like a joint deep dive about it. As for the origin story of the rundown, I got connected with Mike, who is the head of content at public.com. In late 2023, he had this idea of doing a quick five-minute market recap show for the public app. So we started posting these daily audio-only recaps of the stock market within the public app starting in October of 2023. And we got some great feedback on that show from people listening to it within the public app. So we decided to spin it out as a dedicated podcast feed in early 2024. And from there, the show expanded from five minutes to eight minutes and Now we're up to 10 minutes with video and graphics, and we also have a deep dive episode on the weekends, and we just started doing interviews. We kind of come a long way in a relatively short amount of time. The show went from just being an audio-only market recap within the public app to now being one of the top business podcasts on Spotify. Our goal is to keep you guys informed on what's happening in the markets without being super stiff or serious. Trying to share a laugh along the way. And we're going to keep trying to improve the show every day. So thank you guys again for all the support. This would not be possible without you guys tuning in. Now, speaking of markets, we got a question from Landon McGee on Spotify. He asked, everyone says we are in a bubble, like the dot-com bubble. What are some similarities and or differences between now and then? That is a great question. And before I answer it, I just want to say that I was nine years old at the peak of the dot-com bubble, which was March of 2000. So I wasn't exactly watching CNBC every day, but I've read a lot about the dot-com bubble and the similarities are pretty obvious, right? In the nineties, if you had a dot-com in your company name, your stock went parabolic. Now it's kind of the same thing with AI, but there is a key difference though. The dot-com bubble was mostly fueled by new companies. That didn't really have an established proper business model at the time. And these companies were taking on a ton of debt to expand, but the internet wasn't mature enough for their business to work and be profitable. Pets.com is a good example of that. Amazon is also a good example of that. So once the bubble popped, a lot of these companies went bankrupt and didn't have a chance to figure things out until the internet matured. Some of them did, like Amazon, they came out of the dot-com bubble. They were able to become profitable and become one of the biggest tech companies in the world today. So that's what happened in the dot-com bubble. Today, though, this AI boom is being led mostly by established big tech players. You know, NVIDIA, Microsoft, Google, Amazon. These companies have been big beneficiaries of the AI boom, but they're not going away anytime soon, even if the AI bubble pops. Sure, their valuation might be high because of the AI potential, but they all have legit cash flowing businesses outside of the AI stuff. So even if we are in an AI bubble, which I think we are. I don't see the AI bubble popping will be as devastating to the stock market as the dot-com bubble was. When the dot-com bubble popped, the NASDAQ dropped 75% from its peak in March of 2000 to its bottom in October of 2002. I just don't see that happening with the NASDAQ today if the AI bubble was to pop. But that's just my opinion, though. Curious to see what you guys think, especially for those of you guys that were invested and lived through the dot-com era. Let me know in the comments and what you think the difference between the AI bubble and the dot-com bubble is. I want to get to more questions, but we only have 10 minutes per episode. And so I'll have to answer some of these questions in a future Q&A session. Well, all right, guys, that's the rundown for today. That's the rundown for this week. Hope you guys enjoyed the show this week. As a reminder, we do have a deep dive episode coming out tomorrow about the Kalarna IPO. And then on Sunday, we're posting an interview that I did with Nick Maggiuli is a fantastic finance blogger and author. Really had a great conversation with him. So keep an eye on your podcast feed this weekend for those episodes. Thank you guys again for listening and watching. Shout out to Mike and Connor for all the work behind the scenes. And we'll see you guys back here this weekend for the deep dive.