Q3 2026 mARKet Update Summary

Moderated by Portfolio Manager Dan White, CFA, ARK's October Market Update webinar opened with a macroeconomic overview by Cathie Wood, ARK's Chief Executive Officer and Chief Investment Officer. The broader discussion then turned to long-term fund performance, Kalshi and private company exposure in ARK's ETFs, Anthropic's rumored IPO valuation, catalysts across multiomics, the tokenization of the ARK Venture Fund, and the latest developments at SpaceX and Tesla's Terafab project. View the full webinar HERE

In light of the fund’s strong year-to-date performance, some comments have circulated about longer-term results across different periods. Could you speak to that and share how you’re thinking about performance over the longer term?

Cathie Wood, ARK's Chief Executive Officer and Chief Investment Officer, explained that the criticism of ARK's results centers on a single time period: the trailing five years. Across the year-to-date, three-year, ten-year, and since-inception periods through September, the ARK Innovation ETF (ARKK), ARK's flagship strategy, ranks near the top of its Morningstar category. The five-year window, Cathie noted, begins right after the surge from the COVID low to February 2021, a move that ARK cautioned at the time did not reflect the real world and that warranted keeping powder dry. Measured against that starting point, five-year results look weak, but in the context of ARK's full history, the team remains proud of its performance.

ARK recently added Kalshi to the ARK Innovation ETF (ARKK), ARK Next Generation Technology ETF (ARKW), and ARK Fintech Innovation ETF (ARKF), joining OpenAI as private company exposure inside ARK’s publicly traded, widely available ETFs. What makes Kalshi unique, how large can prediction markets become, and how does ARK think about holding private companies in an ETF?

Nicholas Grous, Director of Research, Consumer Internet and Fintech, described Kalshi as the second private company added to ARK's public funds, following OpenAI, and framed the decision around the growth of prediction markets, which he characterized as likely the second fastest-growing category outside of AI. Notional volume across prediction markets grew roughly 16x year-over-year in September, from $4.7 billion in September 2025 to ~$78 billion in the most recent month. Over the same period, competition intensified with the entry of Polymarket, Novig, and sports betting platforms launching their own products, yet Kalshi expanded its market share from 60% to 70%.

Anthropic is rumored to IPO this year at a valuation that could exceed SpaceX's record. What justifies this valuation, and how does it compare with OpenAI's recent rumored valuation?

Frank Downing, Director of Research, AI and Cloud, explained that reports suggest Anthropic could be public before Thanksgiving, with a reported valuation target of $2 trillion, above SpaceX's IPO valuation of a little over $1.7 trillion. He offered two ways to make sense of the figure. The first is ARK's long-term, top-down view: ARK's Big Ideas research suggests that revenues generated by AI companies could reach $7 trillion by 2030, penetrating the global knowledge work market, which ARK estimates at $30 trillion or more in annual wages. Frank emphasized that ARK expects these tools to make knowledge workers more capable rather than replace them. Because Anthropic and OpenAI own both the models and the agent applications with which end users interact, they are uniquely positioned to integrate the two and deliver a differentiated experience at a cost advantage, which supports their sustained share of the market through 2030 and beyond.

The second approach is bottom-up. Frank noted that Reuters reported Anthropic reached $65 billion in run-rate revenue in August, up from $9 billion at the start of the year, putting the company on pace to grow revenues roughly 10x again for the third consecutive year. Even assuming no further growth, that run rate implies ~30 times sales at a $2 trillion valuation, a multiple below that of Palantir, CrowdStrike, and Cloudflare, which are growing at accelerating but sub-50% rates compared with Anthropic's high triple-digit growth. On OpenAI, Frank said the company is reportedly looking at a $1.4 trillion round on nearly $70 billion in run-rate revenue, or 20 times sales, which might look inexpensive relative to public comparables, though opinions vary. ARK is happy to own exposure to both companies in the ARK Venture Fund.

ARK Genomic Revolution ETF (ARKG) has been one of the best performing ETFs this year, but it pulled back this week. How should investors read this week's move against the year-to-date run, and what do you see as the key catalysts from here for multiomics?

Cathie Wood described multiomics as the most profound application of AI, lowering the cost and time required to research, discover, and develop new drugs, enabling blood-based diagnostics that can detect cancer at stage one or earlier, and ultimately pursuing the cure of disease. 

Ovid Amadi, PhD, Multiomics Portfolio Manager and Director of Research, outlined several company-specific catalysts for the back half of 2026 and beyond. In gene editing, CRISPR Therapeutics expects early-stage readouts, most notably 12-month data for CTX310, an in-vivo editing program for cardiovascular outcomes whose phase 1 data showed reductions of 50% in LDL cholesterol and 55% in triglycerides at 30 days. Intellia has a Prescription Drug User Fee Act (PDUFA) date in March 2027 for its hereditary angioedema therapy, which could become the first FDA-approved in-vivo gene-editing treatment in the US. Absci expects 13-week proof-of-concept data for ABS-201 in hair loss by year end, an important test of whether its AI drug discovery platform can engineer a molecule with the desired properties that then performs in the clinic.

In tools, Ovid noted that investors will watch earnings from companies supporting AI drug discovery for new customers generating clinical data to train models. Twist recently announced Anthropic as a customer, and its AI drug discovery orders grew from $25 million last year to $50 million this year, with expectations that the figure will at least double again. In diagnostics, two blood-based colorectal screening assays, one from Guardant Health and one from Freenome, have now received FDA approval. Ovid pointed to multi-cancer early detection as a potentially transformative next step, adding that Natera received breakthrough device designation from the FDA that same day for its test based on data across 12 cancers. Technical, regulatory, and reimbursement hurdles remain, and that milestone will not play out by year end.

The ARK Venture Fund is now tokenized through Securitize. First, what does that mean? Second, does tokenization change anything for investors in the ARK Venture Fund?

Lorenzo Valente, Director of Research, Digital Assets, explained that tokenization is best understood as a change in ledger technology rather than a change in the asset itself. An investor holding the fund through the traditional book-entry system and one holding the tokenized version have the same rights and the same underlying exposure, much as moving from Excel to Google Sheets changes the tool rather than the data. Today, investors can subscribe and redeem on the Ethereum blockchain, and ARK expects to explore additional use cases as rulemaking from the Securities and Exchange Commission (SEC), Commodity Futures Trading Commission (CFTC), and other institutions develops.

What did SpaceX’s latest Starship launch prove from a technical lens, and how does it change the timeline for Starship's role in launch costs?

Tasha Keeney, CFA, Director of Research, Autonomous Technology & Robotics, explained that Flight 14 was the first time Starship reached orbit and deployed a commercial payload, releasing 26 V3 satellites. Each V3 satellite offers 1 terabit per second of bandwidth compared with 96 gigabits per second for the V2 Mini, and SpaceX ultimately plans to fit 60 on a single mission. The ship also deorbited on purpose. Tasha noted that the next major milestone would be catching both the ship and the booster, which SpaceX has said it intends to do but did not attempt on this flight.

Rapid reusability is the key to lowering costs, Tasha said. ARK estimates that launch costs are $1,000 per kilogram today and could fall to hundreds of dollars per kilogram and eventually $100 per kilogram. While SpaceX gathers more heat shield data with each flight, reusability is the piece that moves the cost curve. Dan added that, according to estimates including those of ARK's Chief Futurist Brett Winton, a fully loaded Starship launch with 60 satellites could deliver $1 billion in revenue, which Tasha confirmed assumes current pricing per unit of bandwidth holds constant.

Could Terafab evolve beyond internal use for Tesla and SpaceX and become a supplier to others, like Nvidia?

Tasha Keeney noted that SpaceX and Tesla have described Terafab as a project to serve their own needs, and that SpaceX's Chief Financial Officer (CFO) has said the companies would take every wafer produced. As a result, she views it as unlikely that Terafab would serve outside customers in the near term. Still, Tasha cautioned against ruling it out, pointing out that few would have predicted a couple of years ago that SpaceX and Tesla would pivot into a neo-cloud business. If the chip shortage persists and an opportunity emerges, outside supply could become possible, though she sees that as several years away.

Conclusion:

This month's webinar illustrates how innovation is moving from concept to measurable execution across ARK's platforms. Prediction markets are scaling at a pace few categories outside of AI can match; frontier AI companies are compounding revenue at rates that challenge conventional valuation frameworks; multiomics is delivering clinical, regulatory, and commercial proof points; and tokenization and reusable rockets are lowering the structural costs of access in finance and space. The common thread is that technological progress tends to unfold faster, and at greater scale, than point-in-time views anticipate. At ARK, we remain focused on the long-term opportunity, looking through short-term volatility to the platforms and companies we believe will define the next decade of growth.

Make sure to check out our In The Know video series for deeper insights.

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