Ives on the Tech Trade, Anthropic-Pentagon Spat
Speakers
Dan Ives — Managing Director, Wedbush Securities
— Wedbush analyst
Summary
- Dan Ives argues the recent "goose trade" (likely a transcription of "ghost trade" or fear-driven selloff) in software, sparked by fears that Anthropic's AI will replace traditional SaaS, is a "fictional tale" and a massive buying opportunity.
- He highlights a specific geopolitical catalyst: Anthropic has "touched the third rail" with the Pentagon, receiving a "supply chain designation order" similar to Huawei. This effectively blacklists them from government work, shifting immediate market share and trust back to established defense-tech incumbents like Palantir.
- While bullish on core tech, he concedes that "one-trick pony" automation models (specifically naming UiPath) face genuine disintermediation risks, unlike cybersecurity and data-layer giants which will see secular growth.
Trade Ideas
"The most disconnected of all the software [is] cybersecurity... nothing is replacing [it]... it increases the surface area and the models are going to have to be protected." The market wrongly sold off cyber stocks on the fear that AI writes its own code and doesn't need security. Ives argues the opposite: AI generates more code and threats ("surface area"), making CrowdStrike, Palo Alto, Check Point, and Zscaler more essential, not obsolete. LONG. Capitalize on the "misnomer" selloff. If AI agents become self-healing/self-securing faster than anticipated, legacy security seat-counts could compress.
"Nothing is replacing that layer and that data... salesforce, service now, Microsoft." Investors fear AI models will bypass traditional software interfaces. Ives argues that these companies own the *data layer* and the customer record. AI is a feature added *to* these platforms, not a replacement *for* them. LONG. These are the "core tech winners" to own through the volatility. Enterprise IT budget cuts due to macro headwinds (Iran conflict/inflation).
"Everything that's happened with Anthropic in the Pentagon, it's just going to increase the ability for Palantir... it's a plug and play... Anthropic... touched the third rail... supply chain designation order... essentially is the same as Huawei." Anthropic has effectively been blacklisted by the US DoD (compared to Huawei). This removes a major AI competitor from the government sector. Palantir, being the trusted incumbent with "plug and play" models, will absorb the vacuum of government AI spending. LONG. Immediate beneficiary of Anthropic's regulatory failure. Valuation concerns; potential for other competitors (like Google/Microsoft) to step into the government void.
"UI path, some others that have maybe more one trick pony business models that could be disintermediate." Unlike Salesforce or Microsoft (which own the data), UiPath focuses on task automation (RPA). Ives implies that Generative AI agents can inherently perform these tasks without needing specialized RPA software, making their business model existentialy vulnerable. AVOID (or SHORT). Differentiate them from the "winners" in the software stack. UiPath successfully pivots to becoming an AI-agent orchestrator, proving the bear case wrong.
"Military is going to have to rely more and more on technology players... names like Planet Labs." Escalating geopolitical conflict (specifically mentioning Iran) forces the military to increase CapEx on surveillance and data. Planet Labs (satellite imagery) provides the critical infrastructure required for modern warfare. LONG. A play on increased defense spending and reliance on commercial space data. High capital intensity of satellite businesses; government contract lumpiness.
