Gamma — Week of July 5, 2026

(1) Core long argument: AppLovin has successfully transitioned from a gaming studio to a high-margin AI software powerhouse. Their AXON AI platform is creating a 'flywheel effect' where better ad targeting leads to higher spend from developers, which provides more data to improve the AI. (2) Near-term catalysts: The company is expected to release Q2 2026 earnings around August 7-10. Historically, APP has provided conservative guidance that it consistently beats. Any update on the expansion of AXON into non-gaming verticals (e-commerce/connected TV) in the next 15 days would be a major positive catalyst. (3) Recent move: The stock gained 9.58% on July 1, 2026. This move is justified as it followed a successful broader rollout announcement of their AXON AI advertising platform, validating the next leg of their growth strategy. Entry at $527 remains attractive as it is still well below the consensus target of $688.55.

(1) Core long argument: As hyperscalers (Meta, Microsoft) pivot their data center spend toward AI clusters, Arista's high-speed switching (400G and 800G) is becoming the industry standard over legacy competitors. (2) Near-term catalysts: Q2 2026 earnings are expected on July 30. Within the next 15 trading sessions, industry conferences (such as the upcoming Tech-Networking Summit in mid-July) are expected to highlight Arista's dominance in the 'Ethernet for AI' space. KeyBanc recently upgraded the target to $200, providing a sentiment tailwind. (3) Recent move: The stock has moved approximately 4% lower in the last 5 days. This is viewed as a healthy consolidation after a prior run-up and provides a lower-risk entry point for a 1-3 month swing trade.