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Record labels dip as Google adds AI music generation to its Gemini app

Google on Wednesday said it’s rolling out the ability for Gemini app users aged 18 and up to generate 30-second AI music tracks.

The tool is available globally, as Google launches beta access to its Lyria 3 generative-AI music model.

Addressing the potential for skirting the lines of copyright law (as seen in other recent DeepMind AI tools), Google said:

“If your prompt names a specific artist, Gemini will take this as broad creative inspiration and create a track that shares a similar style or mood. We also have filters in place to check outputs against existing content. We recognize that our approach might not be foolproof, so you can report content that may violate your rights or the rights of others.”

Shares of record labels including Universal Music Group and Warner Music dropped 2% on the news. Spotify briefly dipped before rebounding, and Sony shares also saw a slight decline.

Last month, Morgan Stanley published a survey that found up to 60% of Gen Z respondents listen to AI music, for an average of three hours per week. Earlier this year, Bandcamp banned all music wholly or substantially generated using AI.

Addressing the potential for skirting the lines of copyright law (as seen in other recent DeepMind AI tools), Google said:

“If your prompt names a specific artist, Gemini will take this as broad creative inspiration and create a track that shares a similar style or mood. We also have filters in place to check outputs against existing content. We recognize that our approach might not be foolproof, so you can report content that may violate your rights or the rights of others.”

Shares of record labels including Universal Music Group and Warner Music dropped 2% on the news. Spotify briefly dipped before rebounding, and Sony shares also saw a slight decline.

Last month, Morgan Stanley published a survey that found up to 60% of Gen Z respondents listen to AI music, for an average of three hours per week. Earlier this year, Bandcamp banned all music wholly or substantially generated using AI.

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SpaceX gets a wave of bullish ratings from Wall Street analysts

SpaceX received more than a dozen positive analyst calls on Tuesday — including from major Wall Street banks — as they initiate coverage on Elon Musk’s space and AI company.

SpaceX went public on June 12 at a $2.2 trillion valuation, the largest debut in history. While the company hasn’t yet posted a profit, it seems to have convinced Wall Street that it will get there and grow its valuation on the way.

Of the at least 17 analysts that gave a rating on Tuesday, all but one gave it a “buy” or “outperform” rating. MoffettNathanson was "neutral."

The ratings come as SpaceX joined the Nasdaq 100 index, a benchmark tech-heavy basket of companies that underpins millions of portfolios. The inclusion adds built-in demand for the stock from index funds and ETFs.

Still, SpaceX fell more than 5% on Tuesday amid a broader sell-off, and is currently effectively flat from its opening price of $150 a share.

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Nike sinks to lowest level since 2014 after warning of “challenged” sales environment in Q4 report

Did Nike do it?

Investors had a mixed reaction after the global sports apparel company reported its fourth quarter earnings on Tuesday after the bell. Shares initially rose 5% as Nike beat out Wall Street expectations amid a hefty tariff refund bonus. However, the stock then sank to its lowest level since August 2014 in postmarket trading.

Here are the Q4 numbers:

  • Revenue of $11.0 billion (estimate: $10.8 billion).

  • Adjusted earnings per share of $0.20 (estimate: $0.12).

Ahead of this report, Nike warned that results would be flattered by a one-time tariff refund (now estimated at roughly $0.52 per share for the bottom line). That gave the company an extra cushion in snapping its streak of seven quarters of year-over-year profit declines.

Over the past year, the company had been punished by tariffs on imported goods, stagnant consumer spending, and increasing competition from other footwear brands like New Balance, Adidas, and Hoka.

Outgoing CFO Matthew Friend deemed it an “increasingly challenging operating environment, where sell-through remains challenged.”

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