December mARKet Update Webinar Summary

In ARK Invest’s December mARKet Update Webinar, CEO and CIO Cathie Wood, alongside members of the ARK investment team, addressed key questions about market dynamics, emerging technologies, and investment strategies as we approach 2025. The discussion covered a range of topics, from the sustainability of the market rally to updates on specific companies and industries. This article summarizes our perspectives on key questions asked prior to the webinar. For additional insights, we invite you to view the full mARKet Update Webinar here.

Is the market rally in innovation sustainable?

Cathie Wood began by highlighting the shifting market dynamics that have transformed three headwinds into tailwinds: rising interest rates, market concentration, and valuation compression. She emphasized that the resolution of these factors has broadened the bull market, extending investment time horizons and reigniting risk appetite. Cathie noted that the innovation platforms driving this rally—robotics, energy storage, artificial intelligence, blockchain technology, and multiomic sequencing—are converging in ways that are reshaping industries. She expressed confidence that this market rally is sustainable, driven by these transformative forces and increasing investor recognition of their potential.

How will the evolving relationship with China affect ARK’s funds?

Cathie explained that, while China has shifted its focus toward innovation, its dual goals of new productive forces and common prosperity may create challenges for private-sector margins. She acknowledged potential tensions between the US and China, particularly those associated with intellectual property and semiconductors, but expressed optimism that trade negotiations could provide a balanced outcome. Cathie predicted that any tariffs imposed on Chinese goods likely would be offset by yuan depreciation, as seen in past trade conflicts, minimizing overall economic disruption.

Does ARK Invest favor Joby Aviation or Archer Aviation more, and why?

Sam Korus, ARK’s Director of Research, Autonomous Technology and Robotics, outlined the differences between Joby Aviation and Archer Aviation, two leading players in the eVTOL (electric vertical takeoff and landing) space. He highlighted Archer’s exclusive partnership with Anduril, a defense contractor that gives Archer a strategic advantage and diversification into public-private partnerships, as a key differentiator. While both Joby and Archer show promise, Sam noted that Archer’s faster development timeline and lower valuation make it the more compelling investment at this time. Cathie added that defense partnerships are becoming increasingly important for emerging technologies, further bolstering Archer’s position.

How do you think about Trade Desk when compared to Roku?

ARK’s Associate Portfolio Manager, Nick Grous, emphasized Roku’s purpose-built operating system, which optimizes performance and lowers costs for its partners, as a key advantage over Trade Desk’s newly announced CTV (connected TV) operating system, Ventura. While Trade Desk aims to scale by offering its platform for free, Nick pointed out that this strategy introduces higher maintenance costs and potential delays in reaching scale. Roku’s established partnerships and licensing model provide a competitive edge, and Nick noted that Trade Desk’s full market entry is unlikely before 2026, giving Roku a significant lead.

What are your thoughts on Cerebras?

Frank Downing, ARK’s Director of Research, Net Generation Internet, highlighted Cerebras as a standout in the AI chip market, particularly for its wafer-scale chips that are optimized for large language model inference. Cerebras chips offer significant performance advantages, processing tokens up to 75 times faster than unoptimized Nvidia chips. Frank noted that Cerebras’ ability to compete in both training and inference markets positions it uniquely in the rapidly evolving AI hardware landscape. While Nvidia remains dominant, Frank predicted that competition from Cerebras and other players will diversify the market and create opportunities for new entrants.

Any thoughts on investing in nuclear companies or uranium through any of your ETFs?

Daniel Maguire, a member of ARK’s Autonomous Technology and Robotics Research Team, explained ARK’s existing exposure to nuclear through the ARK Autonomous Technology and Robotics ETF (ARKQ). The fund has holdings in companies like Cameco, BWX Technologies, and Oklo. Daniel noted that nuclear power offers a compelling solution for clean energy, particularly for powering AI data centers. Daniel emphasized that while regulatory hurdles have slowed nuclear’s cost declines in the past, renewed interest and advancements in small modular reactors could drive significant growth in the sector. Cathie Wood added that deregulation under the new administration could accelerate nuclear innovation and adoption.

Can you share your updated thesis on UiPath?

Frank Downing provided an update on UiPath, noting the company’s improvements in execution following sales-side challenges and a CEO transition earlier in the year. UiPath now is focused on expanding into AI-powered, unstructured automations, leveraging its integrations with legacy systems and its library of processes. While competition in the automation space is intensifying, Frank emphasized UiPath’s unique positioning and long-term potential, if the company continues to execute on its strategy. Cathie added that UiPath’s deep relationships with traditional corporations should give it a key advantage as AI-powered agents become more prevalent.

Are you still bullish on PacBio?

Nemo Marjanovic, a member of ARK’s Multiomics Research Team, provided a bullish outlook on PacBio, citing its superior long-read sequencing technology and recent breakthroughs in combining genomic and epigenomic data. Those capabilities are critical to advancing oncology and neurological research. Despite challenges in the broader genomics sector, PacBio has shown resilience through consumables growth and cost reductions, including achieving sub-$500 genome sequencing. Cathie reiterated that the convergence of sequencing technologies, AI, and CRISPR positions genomics to cure diseases, making it a transformative and undervalued platform.

What are your thoughts on MicroStrategy?

Frank explained that MicroStrategy’s strategy of acquiring bitcoin has made its stock highly correlated with bitcoin’s price and its premium over net asset value. While the premium has attracted investor interest, Frank expressed caution, noting the risks of volatility in both bitcoin and the premium itself. Cathie added that MicroStrategy’s CEO, Michael Saylor, has played a pivotal role in improving bitcoin’s accounting treatment, a development that could encourage broader corporate adoption.

What is your take on cryptocurrencies beyond bitcoin?

Lorenzo Valente, a member of ARK’s Digital Assets Research Team, discussed the broader digital asset ecosystem, emphasizing Ethereum and Solana as platforms driving the financial revolution through smart contract capabilities. He highlighted the growing adoption of layer-2¹ solutions like Base and Optimism, which improve scalability and reduce costs for blockchain applications. Lorenzo expressed enthusiasm for stablecoins and tokenized real-world assets, noting their role in expanding blockchain utility beyond speculative use cases.

Conclusion

The December Market Update Webinar provided valuable insights into the evolving investment landscape and ARK’s strategies for navigating these changes. With advancements in AI, blockchain, genomics, and automation, ARK remains focused on supporting the companies driving those transformative trends. As we look ahead to 2025, we are confident in the continued potential of disruptive innovation to create long-term value.

Stay tuned to our In The Know video series for deeper insights about deflation, innovation, and macroeconomic developments.

Important Information

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.

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