December 2025 mARKet Update Webinar Summary

During ARK’s final mARKet Update Webinar of 2025, the team shared their views on macro risks, AI spending and valuations, geopolitical technology dynamics, and upcoming catalysts across genomics, mobility, and space. The conversation reflected both a sober view of current risks and a high-conviction belief in the transformative potential of innovation across global sectors. Below is a summary of the team’s responses to investor-submitted questions. For further insights, please view the full December mARKet Update Webinar here.

What Are The Biggest Fiscal And Monetary Risks In 2026?

Cathie Wood, Chief Executive Officer and Chief Investment Officer, opened the webinar by describing a base case for a “Goldilocks” economy in 2026—strong growth and falling inflation—driven by a productivity boom. She also acknowledged that risks remain. On the monetary side, much depends on whether incoming Federal Reserve leadership embraces the idea that growth is not inherently inflationary. On the fiscal side, if growth falters, political pressure could derail pro-growth tax policies. If deficits begin to spook bond markets, investor confidence could erode.

What Is Your Latest Thinking On AI CapEx, Revenue, And Valuations?

Frank Downing, Director of Research, AI and Cloud, emphasized that while AI capital expenditure (CapEx) is reaching historic highs—over $500 billion¹ projected across hyperscalers in 2026—the fundamentals supporting that investment are far stronger than during the dot-com era. Current CapEx is just 46% of operating cash flow, compared to 75% at the peak in 2000. Valuations are more grounded: Nasdaq 100 Index price-to- earnings (P/E) ratios stand at 28x, far below the 89x bubble peak. Revenue growth from AI-native companies is staggering. OpenAI is reportedly on a $20 billion run-rate, Anthropic $9 billion, and Replit and Cursor are growing 10x year over year.² ARK holds OpenAI, Anthropic, and Replit in the ARK Venture Fund (ARKVX).

What Is Your Latest Thinking On The AI Race Between The USA And China?

Jozef Soja, Research Analyst, Next Generation Internet, and Frank Downing highlighted that Chinese labs like DeepSeek have gained traction with open-weight models, but performance still lags the West. China faces major hardware limitations—Taiwan Semiconductor Manufacturing Company (TSMC) outproduces China’s leading fab 38-fold in transistors. Moreover, China’s chips reportedly underperform in the field. Without access to high-performance NVIDIA chips or a rapid ramp-up in domestic semiconductor capacity, China risks losing share to Western models once again.

On The AI Power Side, ARK Holds Several Companies With Exposure To Nuclear Power. How Do You View Utilities That Handle Transmission And Distribution Tied To Nuclear Power Generation?

Daniel Maguire, Research Analyst, Autonomous Technology & Robotics, explained that transmission and distribution utilities are tightly regulated and tend to be capital intensive but not particularly innovative. By contrast, nuclear power generation—especially advanced small modular reactors—is experiencing a renaissance. Factors include executive orders supporting nuclear, hyperscaler demand for 24/7 power, and grid interconnection delays that push data center developers toward off-grid power. The future of energy for AI may bypass traditional utilities entirely.

When Do You Think Tesla Share Price Will Reach The Next Breakthrough Moment?

Tasha Keeney, Director of Investment Analysis & Institutional Strategies, pointed to a key milestone: Elon Musk recently suggested Tesla could remove the safety operator from its autonomous service in Austin within weeks. That would mark true driverless operation. While Waymo is expanding city-by-city, Tesla can scale production rapidly, with over 500,000 vehicles produced last quarter alone. ARK continues to believe Robotaxis will account for the majority of Tesla’s enterprise value by 2029.

Despite Strong Performance Year-To-Date, The ARK Genomic Revolution ETF (ARKG) Fund Has Struggled Over Longer Time Periods. What Potential Catalysts Might Drive Continued Performance?

Cathie described how a multi-year base has formed in the ARKG portfolio—typically a prelude to either a major breakout or breakdown. She cited major changes in the regulatory environment, including the elimination of double-blind trials for rare diseases and the growing use of AI to collapse research and development (R&D) timelines and costs. Strategic mergers and acquisitions (M&A) are returning, offering price discovery in a previously illiquid market. She emphasized that while autonomous mobility may generate the most revenue in the next decade,  healthcare could be AI’s most profound application.

What Are Your Thoughts On The Abbott Labs Acquisition Of Exact Sciences? Do You Think This Signals More M&A Activity In The Genomics Space?

Ovid Amadi, Director of Research, Multiomics, noted that Abbott’s $21 billion acquisition validates the massive total addressable market in cancer diagnostics. Exact Sciences brings products like Cologuard and multi-cancer early detection assays. Abbott’s global footprint and diversified diagnostics business make this a strategic bet. Ovid cited similar M&A waves in proteomics and diagnostics, including recent moves by Natera and Illumina, and sees more consolidation ahead. As Cathie Wood added, inefficiencies in public market valuations increase the risk of takeouts before companies realize their full growth.

How Does The ARK Venture Fund (ARKVX) Balance Liquidity With Private Holdings?

Cathie explained that ARKVX is a crossover interval fund, targeting 80% private and 20% public exposure. The fund allows quarterly redemptions up to 5% of net asset value (NAV), and daily pricing at NAV eliminates the risk of premium/discount swings seen in other private vehicles. She cautioned that some funds holding private companies—especially SpaceX—may trade at massive premiums to NAV, creating risk for investors not aligned with true asset value.

What Are Your Thoughts About The Rumored Spacex IPO?

Sam Korus, Director of Research, Autonomous Technology & Robotics, confirmed ARK’s excitement around SpaceX, the largest position in the ARK Venture Fund. The firm has modeled SpaceX’s value based on Starlink and launch services, but a rumored pivot to space-based data centers could unlock another massive market. Given regulatory gridlock in terrestrial data center development, orbital power and compute capacity could leapfrog traditional infrastructure. Sam noted that SpaceX’s mastery of reusable Starships gives them a structural advantage in this new frontier.

Conclusion

ARK remains focused on identifying and investing in the technologies and companies shaping the future. From AI and autonomy to genomics and orbital infrastructure, innovation is accelerating. Thank you for your continued trust and support as we navigate what we believe is one of the most important periods of technological transformation in modern history.

Make sure to check out our In The Know video series for deeper insights about inflation, innovation, and macroeconomic developments.

Important Information

Investors should carefully consider the investment objectives and risks as well as charges and expenses of an ARK Fund before investing. This and other information are contained in the ARK Funds’ prospectuses and summary prospectuses, which may be obtained by clicking here. The prospectus and summary prospectus should be read carefully before investing. 

An investment in an ARK Fund is subject to risks and you can lose money on your investment in an ARK Fund. There can be no assurance that the ARK Funds will achieve their investment objectives. The ARK Funds’ portfolios are more volatile than broad market averages. The ARK Funds also have specific risks, which are described in their respective prospectuses. 

The information provided in this material is for informational purposes only and should not be used as the basis for any investment decision and is subject to change without notice. It does not constitute, either explicitly or implicitly, any provision of services or products by ARK, and investors should determine for themselves whether a particular investment management service is suitable for their investment needs. All statements made regarding companies or securities are strictly beliefs and points of view held by ARK and are not endorsements by ARK of any company or security or recommendations by ARK to buy, sell or hold any security. Historical results are not indications of future results. 

Certain of the statements contained in this material may be statements of future expectations and other forward-looking statements that are based on ARK's current views and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. ARK assumes no obligation to update any forward-looking information. ARK and its clients as well as its related persons may (but do not necessarily) have financial interests in securities or issuers that are discussed. Certain information was obtained from sources that ARK believes to be reliable; however, ARK does not guarantee the accuracy or completeness of any information obtained from any third party.

“CapEx” refers to capital expenditures, the funds companies allocate to acquire, upgrade, and maintain essential physical assets like property, technology, or equipment, crucial for expanding operational capacity and securing long-term economic benefits.

The Nasdaq 100 Index comprises the 100 largest nonfinancial companies trading on the Nasdaq exchange, excluding the financial sector.

The price-to-earnings ratio (P/E ratio) is calculated by dividing the market value price per share by the company's earnings per share (EPS).

“M&A” refers to mergers and acquisitions, which is the process of consolidating companies or major assets of companies through financial transactions.

“R&D” refers to research and development, which is the series of activities that companies undertake to innovate.

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