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Thursday's slide dragged MillerKnoll shares into negative territory for the year
Credit: MillerKnoll

Key Takeaways

• MillerKnoll shares plummeted Thursday after the furniture company gave a disappointing forecast for the current quarter.
• Executives said high fuel costs and difficulty shipping products to the Middle East will weigh on its results.

A furniture maker's stock is plunging after the company warned of risks to its outlook from the war in Iran.

Shares of MillerKnoll (MLKN) were down over 20% in recent trading after the company said it could take a $8 million to $9 million hit this quarter due to "minimal expected shipments to the region and higher logistics costs" caused by the conflict in the Middle East.

MillerKnoll forecast quarterly sales of $955 million to $995 million and adjusted earnings per share of 49 cents to 55 cents. Both ranges were well below analyst's projections compiled by Visible Alpha.

Why This Matters to Investors

MillerKnoll's disappointing outlook and the market's reaction could underscore worries about the impact to businesses from the ongoing conflict in the Middle East.

MillerKnoll CFO Kevin Veltman said in Wednesday's earnings call that the fourth-quarter outlook includes assumptions of higher fuel prices raising the cost of shipping, and that the company will send "only a minimal amount" of its $12 million in orders to customers in the Middle East, per an AlphaSense transcript.

The company reported third-quarter revenue of $926.6 million and adjusted earnings of 43 cents per share, both narrowly below analysts' expectations.

The company's results were impacted for much of last year as MillerKnoll was forced to raise prices in response to the Trump administration's tariffs lifting costs. CEO Andi Owen said the company doesn't expect the recent Supreme Court ruling striking down most of Trump's tariffs, and Trump's response raising tariffs under different legal mechanisms, "to result in any meaningful changes" to MillerKnoll's strategy.

With Thursday's drop, shares of MillerKnoll were dragged into negative territory for the year.

News of the day for March 26, 2026

The S&P 500 is on pace to post its biggest month of losses since last March.
Credit: Michael M. Santiago / Getty Images

Stock futures are lower and oil prices are higher this morning as investors digest the latest developments in the Iran war; Trump administration officials are reportedly evaluating scenarios as severe as oil reaching $200 a barrel; President Trump has reportedly told people close to him that he wants the war to end soon, preferring to focus on other priorities like the midterm elections coming up in November; a former CEO of Goldman Sachs is warning that the accumulation of unsold assets in private credit is creating a danger for markets; and furniture maker MillerKnoll said it expects its profits to take a hit because of the conflict in the Middle East. Here's what you need to know today.

Stocks Move Lower as Optimism About Possible End to Iran War Fades

Stocks are pointing to a lower open Thursday as a volatile week of trading continues amid a flurry of developments in the Iran war. Futures tied to the Dow Jones Industrial Average and S&P 500 were down 0.8% recently, while those connected to the Nasdaq fell 1%. All three indexes gained Wednesday amid optimism that the war could end quickly, as reports emerged that the Trump administration had sent a 15-point plan to Iran outlining what it would take to end the war. However, Iranian officials have been quick to reject claims from the U.S. that talks to end the war are ongoing. Brent futures, the global crude oil benchmark, were up 5% this morning at $107 per barrel, while WTI futures, the U.S. standard, rose 4% to $94. Gold futures were down more than 2% at $4,435 an ounce, while bitcoin was at $69,300, down from an overnight high of $71,500. The 10-year Treasury yield, which influences interest rates on a range of consumer loans, rose to 4.38% from 4.33% at yesterday's close, once again trading near its highest levels since last July.

As Prices Rise, Trump Administration Reportedly Weighs Impact of $200 Oil

While crude oil futures are surging again, officials in the Trump administration are discussing a range of scenarios, including oil reaching as high as $200 a barrel, according to Bloomberg. Oil prices have surged as a result of the war because the conflict has largely closed the Strait of Hormuz, a passageway that carries around 20% of the world's oil. Iran is reportedly looking to formalize its control over the Strait as a result of the war, as the Secretary General of the Gulf Cooperation Council said Iran is already starting to charge fees to allow ships to pass through safely during the war while its parliament drafts a bill that would make the tolls law, per the Associated Press.

Trump Wants Quick End to War While Iran Says No Plans to Negotiate

President Trump has said that Iran is ready to talk with the goal of ending the war, but Iranian officials have been quick to dispute claims that ceasefire talks are ongoing, and has outlined its own priorities necessary for ending the war. The Wall Street Journal reported late Wednesday that Trump has told people in the administration he wants the war to be over soon, with a goal of sticking to the original four to six week timeline that he initially estimated after the war started. Trump has reportedly told people close to him that the war is "distracting" his administration from some of its other goals, including this fall's midterm elections, which are vital for the White House as it could get more difficult to pursue Trump's priorities if Democrats win control of either or both of the House and Senate. Early Thursday, Trump said that the Iranian negotiators are "begging" the U.S. to make a deal. Meanwhile, Israel claimed it killed Iran's naval commander, Alireza Tangsiri, who had helped shut down the Strait of Hormuz.

Former Goldman Sachs CEO Warns of Risks in Private Credit Market

Another high-profile financial figure is warning about the risks in the world of private credit. Former Goldman Sachs (GS) CEO Lloyd Blankfein told Bloomberg in a recent interview that private assets accumulating without being sold by a number of major investors could be a signal that some of those assets are overvalued. Blankfein said that a re-evaluation of those assets could cause a big hit to the value of private credit funds, which have had a rough stretch recently, with some experts warning that the industry could spark the next financial crisis. Blankfein compared the number of risks that have grown since the last crisis to pieces of tinder accumulating on a forest floor waiting for a spark to set it all on fire, per Bloomberg.

Furniture Maker MillerKnoll's Outlook Hampered by War

Shares of MillerKnoll (MLKN) are tumbling after the furniture maker's latest quarterly results fell shy of estimates and the company warned of risks to its outlook from the ongoing conflict in the Middle East. MillerKnoll said it expects its fiscal fourth quarter results will take an $8 million to $9 million hit due to the Iran war because of "minimal expected shipments to the region and higher logistics costs" caused by the conflict. The company reported third-quarter revenue of $926.6 million and adjusted earnings of 43 cents per share, each coming in narrowly below the analyst consensus compiled by Visible Alpha. The stock, which through yesterday's close had gained 6% so far in 2026, was down 19% in recent premarket trading.

Solutions to save Social Security will cost taxpayers money one way or another.
Credit: Investopedia / Photo Composite by Elizabeth Guevara / Getty Images

Why This Matters

• The Social Security program is projected to run out of money by 2032, with benefit cuts starting as early as 2034.
• Proposed solutions include raising the payroll tax rate and increasing the amount of income that's subject to Social Security taxation.
• Another option would lower Social Security benefits for future beneficiaries.

The Social Security program is running out of money, and every proposed fix would require higher taxes, lower benefits, or some combination of both.

In 2032, the main trust fund that drives the program, the Social Security Old-Age and Survivors Insurance Trust Fund, will be depleted. Combined with the Disability Insurance fund, which together is called OASDI, the program is expected to run out of money by 2034, according to the Penn Wharton Budget Model, a nonpartisan initiative at the University of Pennsylvania that analyzes public policies.

After 2034, benefits would be cut by about 17% and would further diminish in the following years. To ensure benefits aren't cut, the government will need to raise more revenue or save more money.

Why This Matters

The federal government has continued to increase the program's deficit by enacting 'One Big Beautiful Bill' tax cuts and more generous Social Security policies. However, action must happen soon, as the majority of Social Security beneficiaries say they would not survive financially if their benefits were cut.

How These Solutions Would Impact You

The Penn Wharton Budget Model recently calculated the effects of different funding solutions that would either raise taxes or cut retiree benefits.

Here are some options and how they could impact your finances.

Increasing the Payroll Tax Rate

One approach would be to increase the payroll tax rate that funds Social Security and Medicare.

Currently, workers and employers split the 12.4% payroll tax rate, with each paying about 6.2% of wages earned. In one scenario, the Penn Wharton Budget Model looks at a percentage point increase, to a total of 13.4%, which would be split evenly at 6.7%.

For the average taxpayer, who in 2025 paid about $4,140 to the OASDI, raising the payroll tax rate to 6.7% would cost an additional $333.87 a year.

Raising the Taxable Maximum

Currently, taxable income above $184,500 is not subject to Social Security payroll taxes. Penn Wharton suggests raising the maximum taxable amount to $250,000, which would require taxpayers who earn that much to pay taxes on about $66,500 more of their income in 2026.

If the higher payroll tax rate of 6.7% would mean a higher-income taxpayer would pay about $4,388 more.

Taxing Higher-Income Individuals

Another alternative would make any income above $400,000 subject to payroll taxes. This would create a 'donut hole,' which refers to the earned income between the taxable maximum ($184,500 in 2026) and $400,000 that isn't taxed.

Penn Wharton proposes a half 'donut hole,' meaning earnings above $400,000 would be subject to half of the payroll tax, paid evenly by the worker and employer. Using the higher payroll tax rate of 6.7%, an individual's $400,000 income would be subject to 3.35%. For example, a taxpayer who makes $1 million would pay about $20,100 extra in payroll taxes a year.

Cost of Living Adjustment Change

Social Security benefits generally increase every year with the cost-of-living adjustment, also known as COLA. To measure inflation and calculate Social Security benefits, the Social Security Administration currently uses the Consumer Price Index for Urban Wage Earners and Clerical Workers, also called the CPI-W.

However, transitioning from CPI-W to a chained CPI would reduce COLA hikes and save money over time. This inflation index adjusts for changes in consumer spending patterns that follow significant economic changes, and generally grows more slowly than CPI-W.

Take a 65-year-old retiree who began collecting Social Security benefits this year, starting with $2,000 a month. If they live until 100, by 2060 their monthly benefit would be $4,145 under chained CPI, about $451 less than under CPI-W. In total, their benefits would be reduced by about $76,500, according to estimates from the Penn Wharton Budget Model.

The Best Solutions

Penn Wharton lays out the impact of six options that mix and match the above solutions.

The ideal solution would extend the OASDI trust fund's longevity until 2070. That would require increasing the payroll tax rate by 1 percentage point, raising the maximum taxable amount, closing the donut hole halfway and adopting the chained CPI for COLAs.

Other solutions include increasing the full retirement age, also called FRA. Americans can begin claiming Social Security as early as 62, but their benefits will be permanently reduced unless they wait until their FRA to do so. The current FRA is 67, but gradually increasing it to 69, starting with those born in 1983, could save significant money.

This change would mean workers need to work longer before claiming their full benefits at their FRA and may encourage more Americans to delay them.

Yet another option proposed by Penn Wharton would change how benefits are calculated for middle- and higher-earners. Penn Wharton suggests saving money by adjusting the benefit formula to reduce payments to middle- and higher-earners while keeping benefits for lower-income earners at a sufficient level.

Shares of Cheniere, one of Goldman's LNG picks, has gained nearly 50% since the year began.
Credit: Brandon Bell / Getty Images

Key Takeaways

• Goldman Sachs analysts said lasting damage to the world's supply of liquified natural gas could keep prices elevated longer than previously anticipated.
• That could mean more gains ahead for some producers, according to the analysts, who recommended buying Cheniere, Venture Global and Golar LNG.

Markets have been rallying lately on optimism about a possible end to the war in Iran. However, lasting damage to the world's supply of liquified natural gas could leave prices elevated long after a resolution is reached—and room to rise for some producers' stocks, according to Goldman Sachs.

Analysts at the bank recommed buying shares of LNG producers Cheniere (LNG), Venture Global (VG) and Golar LNG (GLNG), and raised their price targets, suggesting the stocks could be set to extend their torrid rally this year.

Though shares of Cheniere and Golar slid about 3% today amid a broader pullback in energy shares, they've surged more than 40% since the year began. Venture Global, which added close to 1% Wednesday, has more than doubled in value year-to-date.

Energy was among the few sectors that lost ground Wednesday as broader markets gained on reported signs of progress in talks between the U.S. and Iran.

Why This Matters to Investors

Investors who've watched LNG stocks surge in recent weeks on worries about supply disruptions may wonder whether there's still room for gains. Goldman's analysis would suggest there is.

Still, Goldman Sachs said in a note to clients earlier this week that even if the war is resolved soon, it could take three to five years to bring some damaged LNG facilities responsible for 3% of global supply back online. The analysts said they now expect supplies could could be squeezed well into the winter, with the potential for extended pressure the longer the war drags on.

The Goldman analysts said Cheniere and Venture Global, which expect to expand facilities raising their capacity, could be better equipped to "capitalize on tighter global gas demand balance," along with Golar, which they see growing its backlog.

The analysts lifted their price target for Cheniere to $312, suggesting roughly 10% upside from Tuesday's close. Their $18.50 target for VG is close to 11% above it's recent levels, while their $60 target for Golar would imply a 13% rise.

Credit: Getty Images

Key Takeaways

• United Airlines will introduce self-serve snack bars for economy passengers on select planes starting this summer.

• The airline plans to add 250 planes to its fleet in the next two years 2027, with upgrades for both premium and economy travelers.

United Airlines is here for the hangry.

The airline has put free snack bars in the backs of planes that are slated to hit the skies this summer. Economy travelers will have access to a self-serve bar—an area stocked with non-alcoholic beverages and small bites, United Airlines (UAL) said this week as it announced plans to add 250 planes to its fleet over the next two years. Many of the planes' new features focus on premium travelers, who—along with co-branded credit cards—have been propping up carriers, but United is extending upgrades like new screens, headphones and dining options, free wifi for members of United's loyalty program, and overhead bins that fit suitcases with wheels to economy passengers too, the carrier said.

The changes will affect seating, too. By 2027, some new aircraft models will come with Relax Rows– three economy seats with foot rests that can be configured into a makeshift mattress. Similar seats on Air New Zealand currently cost up to $1,400 to reserve on top of airfare, according to travel expert Gary Leff.

Why this News Matters for Consumers

Business has slowed for travel and hospitality businesses that cater to those on a budget. Some hotels and other players may pivot and focus more on high-end clientele.

“This fits United’s overall strategy of premium segmentation,” Leff wrote on his View from the Wing blog. “This gives them another sales point for people who would otherwise wind up in economy to spend more.”

Carriers have been reducing domestic, main-cabin capacity in recent months. Revenue from the coach section has fallen as low- and middle-income consumers curtail spending. Meanwhile, airlines are embracing those who are willing and able to pay more for the premium segments that have proliferated in recent years. Delta Air Lines (DAL) generated more revenue from premium tickets than from basic airfare last quarter.

Several major airlines have been losing money on the actual transportation of passengers, and losses tend to be larger in the main cabin, Delta President Glen Hauenstein has said. In response, carriers are increasingly catering to international travelers and customers who book first-class and other premium seats.

United's new regional jets will have luggage closets, rather than bins, in an attempt to create a more airy atmosphere for premium travelers, the company said. Aircraft ordered for international travel come with "studios" with seats that can be laid flat, an ottoman for visitors and a privacy door that slides shut. Passengers can recline on Saks Fifth Avenue bedding and order “exclusive meal service with wine pairings and caviar,” United said.

Credit: John Taggart / Bloomberg via Getty Images

Key Takeaways

• The U.S. economy is increasingly propped up by federal deficit spending, which, by one estimate, effectively adds about $15,000 per household to the economy each year.
• Federal deficit spending became an increasingly important source of capital after the Federal Reserve hiked interest rates in 2022.
• The growing national debt poses dangers to the financial system, including the risk of "fiscal dominance," where the debt becomes overwhelming.

Between tax cuts, the war against Iran, and the Supreme Court ruling against Donald Trump’s tariffs, the federal budget is headed further into the red. How much does that matter? Depends on which economist you ask.

In February, the Congressional Budget Office estimated the federal deficit would be 5.8% of the nation’s entire economic output in 2026, rising to 6.7% by 2036, well above the 3.8% average over the past 50 years. Since then, the Pentagon has reportedly asked for $200 billion to pay for the Iran war so far. And the Supreme Court dismantled Trump’s emergency tariffs and ordered refunds to be paid to businesses, which would push up deficits by an estimated $2 trillion over the next decade, according to the CBO.

What This Means For The Economy

The effects of the national debt on the economy are highly debated, but most mainstream economists see it as a growing problem with unknown effects should it reach a tipping point.

The U.S. economy itself only grew at an annual rate of 0.7% in the fourth quarter, meaning that if you trimmed spending to match revenues, the economy would be shrinking, not growing. In other words, the government is going rapidly into debt to prop up the economy. Although the effects of government debt are highly studied and debated by economists, many are looking at the trend with growing alarm.

"The current federal deficit represents a substantial injection of purchasing power into U.S. households," Christopher Thornberg, founding partner of Beacon Economics, wrote in a report last week. "The deficit amounts to roughly $15,000 per household annually, equal to about 9% of average disposable household income and nearly 6% of GDP."

As far back as 2024, after the Federal Reserve’s campaign of anti-inflation rate hikes raised borrowing costs, federal deficit spending had become "a crucial ingredient in maintaining money growth and thereby support for aggregate demand," Joe Seydl, senior markets economist at JP Morgan, wrote at the time.

Thornberg is among the experts who view the rising federal debt as risky and unsustainable for very long.

"Today, even a small increase in interest rates or a modest slowdown in economic growth could cause the fiscal outlook to deteriorate rapidly," he wrote. "If such a fiscal reset becomes necessary, the resulting policy adjustments would almost certainly trigger a recession and/or a nasty bout of inflation."

To be sure, other economists view the debt as less urgent. Adherents of Modern Monetary Theory, such as Stephanie Kelton, contend that the debt is relatively meaningless given the government’s ability to print money.

What Does This Mean For Your Money?

The rising debt is causing an invisible drag on household budgets by pushing up bond yields, which in turn affect mortgage rates and borrowing costs across all kinds of loans. Higher budget deficits since 2015 have added $2,500 in annual mortgage payments and $250 a year to typical car loan payments for the median household, the Yale Budget Lab estimated last week.

Seydl saw a risk that the rising debt leads to what economists call "fiscal dominance," when the national debt rises so high, and interest payments grow so steeply that they overwhelm the economy. Economists could discover this tipping point by research, or we could find out the hard way.

"The truth is that economists don’t know the limits of the U.S. fiscal deficit," Seydl wrote. "They don’t know what total debt stock, or interest expense, would tip the economy into fiscal dominance. There’s a Nobel Prize waiting for someone who can figure this out."

News out of Washington rocked shares of Circle on Tuesday.
Credit: Graeme Sloan / Bloomberg via Getty Images

Key Takeaways

• A new draft of the Clarity Act is said to restrict stablecoin rewards and disallows trading platforms like Coinbase from offering them at all. That news weighed heavily on some crypto players this week.
• Circle fell roughly 20% yesterday as details leaked to the public suggested banks got the upper hand in negotiations. Shares of exchanges including Coinbase, the Winklevosses' Gemini and Bullish also fell.

How sensitive are crypto-stock investors to news coming out of Washington, D.C., these days? Yesterday offered a clue.

Those listening for updates on the Clarity Act, legislation that would set a framework for how digital assets should be regulated, didn't like what they heard late Monday. Leaked details of draft legislation are said to limit rewards on stablecoins, cryptocurrencies that aim to stay pegged to fiat currency like the U.S. dollar. Trading platforms are said to be barred from offering rewards entirely. That spooked investors, who sent shares of stablecoin issuer Circle (CRCL) 20% lower on Tuesday and battered exchanges Coinbase (COIN), Gemini (GEMI), and Bullish (BLSH). Moves elsewhere in crypto markets were muted by comparison.

Circle appears to be recovering some of its losses so far Wednesday. But if the current working draft of the Clarity Act is the version that advances in the Senate and becomes law, the bill may not be as helpful for crypto markets as experts thought it could be.

WHY THIS MATTERS TO INVESTORS

Part of the appeal of stablecoins is the rewards or income users get through promotions or activities—like holding certain assets at an exchange. Disallowing them, some crypto experts say, could make stablecoins less attractive.

When the GENIUS Act was signed into law last July, it effectively allowed exchanges and third parties to offer rewards to stablecoin holders. (Crypto users can sometimes earn "yield," or more stablecoins, by holding those stablecoins, like Circle's dollar-backed USDC, at exchanges.) If stablecoin issuers offered inducements that investors considered superior to the rates banks offered, it could conceivably boost crypto adoption—and lead people to pull their money out of bank accounts.

When discussions earlier this year seemed to tilt in favor of banks, Coinbase chief Brian Armstrong walked away from the table, stalling a planned vote for the draft bill. The current state of things doesn't seem great for crypto either. "We attribute the negative reaction in CRCL shares to previously-building expectations that the White House would push a compromise more favorable to the crypto industry that would permit holding-based interest/rewards payments," Morgan Stanley equity analyst James Faucette wrote in a report published Wednesday.

Faucette observed that if stablecoin issuers can't offer yield, they could still benefit in a sense: Circle, for example, wouldn't have to pay out interest income it earns from its reserves to holders of USDC. But that same lack of rewards could drive investors away.

There was also another bit of bad news for Circle. Its biggest rival, Tether, yesterday announced that it tapped a "Big Four" accounting firm to conduct its first ever full independent audit. Audited financials was one of the things that Circle had that Tether didn't, which would explain Circle's relative success in the U.S.. To put that into perspective, the total value of Tether's stables are about $175 billion, and Circle's $75 billion, according to crypto analytics firm rwa.xyz.

"Regulatory clarity is progressing, but may come with trade-offs that pressure certain business models," Fundstrat's head of digital assets Sean Farrell said in a note published yesterday.

The latest move to hike prices comes after Intel and AMD already lifted prices multiple times earlier this year
Credit: Anadolu, CFOTO / Getty Images

Key Takeaways

• Shares of Intel and AMD surged Wednesday following a report the companies are raising chip prices.
• Intel and AMD told customers they're looking to hike prices across their CPU lines, Nikkei Asia reported Wednesday.

Intel and Advanced Micro Devices are leading semiconductor and other tech stocks higher following a report the two chipmakers are raising prices.

Shares of Intel (INTC) and AMD (AMD) were each up roughly 7% in recent trading, making them among the top performers in the S&P 500 on Wednesday. The PHLX Semiconductor Index was up 1%, as shares of AI investor favorite Nvidia (NVDA), Marvell Technology (MRVL) and Qualcomm (QCOM) also gained. (For more from Investopedia on today's market moves, click here.)

Intel and AMD told customers they're looking to hike prices across their CPU lines, according to a Nikkei Asia report Wednesday. An Intel spokesperson told Investopedia that its latest pricing changes reflect "sustained demand,  increased component and material costs, and evolving market dynamics.” AMD did not respond to an Investopedia request for comment in time for publication.

Why This Is Significant

Growing pricing power for chip companies as demand rises could boost their financial results, and their stocks.

The move to hike prices comes after Intel and AMD already lifted prices multiple times earlier this year amid tightening supply constraints. Delivery lead times have also climbed, according to the report.

Wednesday's gains add to a strong run for Intel's stock this year, amid optimism about benefits from the federal government's support and deal rumors. The shares were up nearly 20% in 2026 through the close of trading yesterday.

Meanwhile, AMD shares were down about 4% so far this year coming into Wednesday's session, amid lingering concerns about its ability to compete with rival Nvidia and some skepticism surrounding corners of the AI trade.

Arm unveiled its first in-house AI chip Tuesday
Credit: David Paul Morris / Bloomberg / Getty Images

Key Takeaways

• Arm shares soared Wednesday, a day after the chip designer unveiled its first in-house AI chip.
• The Nvidia design partner said it expects revenue to reach $25 billion by 2031, with $15 billion of that coming from sales of its own chips.

Arm shares are soaring after the Nvidia design partner said it plans to start selling its own chips.

Arm's (ARM) U.S.-listed shares were up nearly 20% around $161 in recent trading, a day after the chipmaker unveiled its first in-house AI chip, the AGI CPU, at its "Arm Everywhere" event. Executives projected the chip will start delivering revenue in fiscal 2028, and could drive some $15 billion in sales by 2031.

Combined with its current revenue streams licensing designs to tech giants including Nvidia (NVDA), Microsoft (MSFT), and Alphabet's (GOOGL) Google, Arm said it expects $25 billion in revenue and $9 in adjusted earnings per share in 2031. Arm's revenue is seen coming in just under $5 billion with adjusted EPS of $1.75 in its current fiscal year, according to Visible Alpha estimates.

Why This Matters to Investors

Wednesday's surge suggests investors are bullish on the company's plans to sell its own chips, amid booming demand for AI hardware.

Arm also announced a development partnership with Meta Platforms (META), which agreed to be the first customer for the AGI CPU.

Raymond James analysts upgraded their rating of Arm stock to "outperform" with a $166 price target following the event, expecting strong sales and profit growth from Arm's chip sales. Bank of America analysts also lifted their price target to $155 from $140, but kept a neutral rating, citing concerns that some of Arm's profit projections could be "too ambitious."

While ratings are still in flux, eight of the analysts tracked by Visible Alpha have recommended buying the stock, compared to four neutral ratings, and one "sell" rating. The stock's recent gains have already pushed it above their consensus price target of $152.

With Wednesday's rise, Arm shares have added nearly half their value since the start of the year.

Scrutiny of prediction markets has intensified in Washington.
Credit: Graeme Sloan / Bloomberg via Getty Images

Key Takeaways

• A raft of pushback from lawmakers threatens to upend the regulatory scheme for prediction markets at a time when companies offering them are seeing growth and opportunity in use and revenue.
• Meanwhile, markets operators themselves are seeking to reassure participants that information gained inappropriately isn't affecting bets on their platforms amid scrutiny from media organizations and the decision by some employers to prohibit their use.

What's next for prediction markets? These days, it's hard to say.

The popularity of contracts sold on platforms like Polymarket and Kalshi has exploded, with traders flocking to sometimes-unconventional, often binary bets on real world outcomes connected to sports, war, monetary policy and beyond. Trading volumes and revenues associated with the markets have surged, and executives like Robinhood (HOOD) CEO Vlad Tenev have touted the potential for revenue growth implied. Companies like Coinbase (COIN), DraftKings (DKNG) and Trump Media (DJT) have sought their piece of the pie; even ETF shops see opportunities ahead. Media organizations, meanwhile, have begun displaying prediction-markets odds alongside news reports.

There is, however, another side to the story. Gambling regulators, sports betting apps, casinos, policymakers and the media are offering up skepticism, scrutiny and outright pushback, framing them at different times as threats to established businesses, Americans' financial health, and national security, to name a few. Legislation introduced this week could tighten regulation around those markets, which briefly sent shares of competitors including DraftKings, FanDuel parent Flutter Entertainment (FLUT) and casino operator MGM Resorts International (MGM) higher.

Taken together, it appears that prediction markets' growth trajectory has hit a rough patch.

WHY THIS MATTERS TO YOU

Prediction markets are relevant to folks outside of traders and bettors, because they claim that they can accurately call the outcome of important world events. However, some seemingly unlikely wins have raised questions about how these platforms are fighting their version of insider trading, which some lawmakers say is a threat to national security as well as the reliability of those marketplaces.

Sports betting businesses and gambling regulators were among the first wave of opposition. Now they are in a legal fight with prediction markets operators, arguing over whether event contracts are gambling wagers and, therefore, subject to state oversight as well as that of the Commodity Futures Trading Commission.

Policymakers appear to be part of the second wave. The Prediction Markets Are Gambling Act, introduced Monday in the Senate, seeks to bar exchanges from offering contracts tied to sporting events and "casino-style games," including slots and bingo, on their platforms.

"Young people in Utah are getting exposed to addictive sports betting and casino-style gaming contracts that belong under state control, not federal regulators," Republican Senator John Curtis of Utah, a co-sponsor of the bill, said on social media earlier this week.

"Casino lobby hard at work," said Kalshi chief Tarek Mansour, who said such bans would only push activity offshore.

Prediction markets have also drawn scrutiny from the media after some bettors placed accurate and well-timed bets on geopolitical events including Nicolás Maduro's ouster, and the U.S's and Israel's strikes on Iran, profiting handsomely. One Polymarket trader made $1 million across a set of bets they made on U.S. and Israel military action; their rate of accuracy was reportedly over 90%, according to CNN.

The suggestion that insiders could be using privileged or misappropriated information related to national security and broadcasting them to the masses prompted Democratic lawmakers last week to roll out a bill called the Banning Event Trading On Sensitive Operations and Federal Functions or "BETS OFF", which bars wagers linked to government actions. Another Democratic politician has proposed banning prediction-markets use by federal employees.

Polymarket earlier this week updated "market integrity rules" across its international and CFTC-regulated exchanges, which among other things make clear that traders are not allowed to trade on stolen confidential information or illegal tips. Some private organizations are installing their own rules: Eurasia Group, a global risk consultancy, recently barred its employees from trading on prediction markets, citing among other things "a clear conflict" with its work.

The CFTC, which regulates prediction markets, has launched a task force and asked for comments aimed at updating rules around how those businesses should operate, a bid to head off those starting to tread on their jurisdictional territory. Polymarket did not respond to Investopedia's request for comment in time for publication.

Regulated entities, particularly Kalshi, are now going on the offensive with plans to roll out guardrails that could prevent the kind of manipulation that could give some traders an unfair advantage. In a blog post Monday, the company said it would launch new tech to block politicians, athletes, and other relevant people from trading in certain events related to their work.