Sherri Davidoff

“Bloomberg reported that a small group of unknown, unapproved users have had access to the model Mythos for two weeks. They broke into the model the same day Anthropic launched Project Glasswing, a controlled rollout giving a select group of companies exclusive access to the model. Anthropic says it is investigating the security breach from these unidentified individuals but has found no evidence of malicious use so far.”

“The capabilities of Mythos Preview, according to Anthropic and those that have used it are, it's basically like a hacking ray. You can point it at software and even if you don't have the source code, it can still detect vulnerabilities and write code that will exploit it. So a human doesn't need to do anything to break into that software.”

“In the long term, it means we're going to completely change how we manage software vulnerabilities, because up until this point, at least in theory, you find out about a vulnerability, you work really hard, you patch it, maybe it'll take a few weeks, maybe it'll take a few months, and you hope that the bad guys don't manage to figure out the same thing and exploit it first, right? So we've had that lag, and now I'm sure this is a complete emergency for all the major tech companies.”

“And so where I see the government potentially being involved is maybe setting some standards for disclosure. If you have an AI that has certain capabilities, do we need to track that? Do we need to notify anybody? And how is this going to be coordinated?”

“With Tesla starting a heavy capital expenditure program, at least 20 billion, if not higher, to fund its transition to an AI and robotics company, I think the market was worried coming into 2026 of where would that cash come from and could Tesla still generate strong free cash flow or even some positive free cash flow while that program is ramping up. And so positive free cash flow in the first quarter puts them to a good start to the year.”

“Tesla was able to launch its RoboTaxi in two new markets by April, where we see them starting in Dallas and Houston. And interestingly, they're launching immediately into the unsupervised RoboTaxi. So if you remember, when they started in Austin, there was a human safety monitor who would ride in the front passenger seat of the vehicle. But with the Dallas and Houston launches, they're going directly to no safety monitor, which tells me that the software is progressing well, testing is going well enough to enter new markets and immediately not need the safety monitor.”

“Then if we look at factory expansion plans, the transition to take the factory that was making Model S and Model X vehicles and take that to produce the Optimus Humanoid Robots is still on track for to enter production by the end of this year. And so with Tesla's two big pillars in the future going to be self-driving cars and Humanoid Robots, both of those initiatives are on track with the positive free cash flow and that led the stock to rise after hours.”

“In other words, the original ceasefire wasn't actually a ceasefire. So to extend it doesn't actually mean anything, because there was no ceasefire to begin with. So as Iran said, yes, it means nothing. And we already have proof of this, because just yesterday we learned that Iran attacked another three ships in the Strait of Hormuz. They fired at one ship that was passing just off the coast of Iran, and then another two that were in the Gulf of Oman.”

“We are entering the next chapter of the story, which we ought to call news fatigue, where the headlines become overwhelming, the news becomes confusing, and eventually we get bored of it, and we decide to stop caring altogether. This is what happened with Iraq, it's also what happened with Afghanistan, and it is now happening with Iran, and we are seeing that reflected in the markets.”

“Bloomberg reported that a small group of unknown, unapproved users have had access to the model Mythos for two weeks. They broke into the model the same day Anthropic launched Project Glasswing, a controlled rollout giving a select group of companies exclusive access to the model. Anthropic says it is investigating the security breach from these unidentified individuals but has found no evidence of malicious use so far.”

“The capabilities of Mythos Preview, according to Anthropic and those that have used it are, it's basically like a hacking ray. You can point it at software and even if you don't have the source code, it can still detect vulnerabilities and write code that will exploit it. So a human doesn't need to do anything to break into that software.”

“In the long term, it means we're going to completely change how we manage software vulnerabilities, because up until this point, at least in theory, you find out about a vulnerability, you work really hard, you patch it, maybe it'll take a few weeks, maybe it'll take a few months, and you hope that the bad guys don't manage to figure out the same thing and exploit it first, right? So we've had that lag, and now I'm sure this is a complete emergency for all the major tech companies.”

“And so where I see the government potentially being involved is maybe setting some standards for disclosure. If you have an AI that has certain capabilities, do we need to track that? Do we need to notify anybody? And how is this going to be coordinated?”

“With Tesla starting a heavy capital expenditure program, at least 20 billion, if not higher, to fund its transition to an AI and robotics company, I think the market was worried coming into 2026 of where would that cash come from and could Tesla still generate strong free cash flow or even some positive free cash flow while that program is ramping up. And so positive free cash flow in the first quarter puts them to a good start to the year.”

“Tesla was able to launch its RoboTaxi in two new markets by April, where we see them starting in Dallas and Houston. And interestingly, they're launching immediately into the unsupervised RoboTaxi. So if you remember, when they started in Austin, there was a human safety monitor who would ride in the front passenger seat of the vehicle. But with the Dallas and Houston launches, they're going directly to no safety monitor, which tells me that the software is progressing well, testing is going well enough to enter new markets and immediately not need the safety monitor.”