TheChek News Flow

It is demonstrating an Earnings Before Iran, Tariffs and Dubious Announcements (ebitda) mentality

The Iran war is “the greatest global energy security threat in history”, according to the head of the International Energy Agency. The US tariff rate is at its highest level since the early 1940s, and could rise further. President Donald Trump’s caprice shows no sign of letting up. And yet, after a powerful rally, the S&P 500 has hit a new record.

Stockpickers have not entirely ignored Trump’s protectionist agenda or the Middle East conflict. But much like investors use earnings before interest, taxes, depreciation and amortisation (ebitda) to focus on the core value of a business, the market as a whole appears to be trading on another adjustment. Call it Earnings Before Iran, Tariffs and Dubious Announcements. What explains this?

First, it is never easy to price uncertainty. But between ever-changing tariff rates, evolving war scenarios and Trump’s Truth Social feed, it is harder than usual to separate signal from noise.

This is illustrated by the decoupling of the Vix — which measures the market’s expectation of volatility in the S&P 500 — and the economic policy uncertainty index. Both typically move in tandem.

But since the US president’s second term began, the former has been comparatively tame, while the latter has shot up. The only time this has happened as starkly was during Trump’s first term, according to data stretching back to 1990.

A study by Luboš Pástor and Pietro Veronesi at Booth Business School concluded that markets had largely failed to react to uncertainty during the first Trump administration because White House messaging was “difficult for investors to interpret”. Pástor told me the same holds in Trump’s second term, “just on steroids”.

The S&P 500’s surprising resilience today could then, in part, reflect the difficulty of pricing a wide range of policy and war outcomes. In turn, it is simpler to look through the uncertainty until clearer signals emerge.

“Reacting to daily social media posts is a recipe for significant capital destruction, unless one has insider knowledge,” said Renaud Saleur, chief executive of hedge fund Anaconda Invest, which has adopted an “ignore Trump” investment strategy.

Second, while there are of course traders attempting to profit from the daily movements, a substantial proportion of the market consists of passive investors with a longer time horizon.

Indeed, structural market themes have kept US equities buoyant. Last year, the AI investment boom helped to offset the negative impact of US tariffs on stocks. For now, the long semiconductor and Magnificent Seven trades appear insulated from broader uncertainties and validated by strong earnings forecasts.

With the IT sector accounting for roughly one-third of the S&P 500’s market capitalisation, tech optimism has helped to sustain upward momentum in the index. This has also been a key driver behind the disconnect between the tougher economic reality facing US households and businesses and ever-rising stock values.

Andrew Lapthorne, global head of quantitative research at Société Générale, adds that investment flows from higher interest rates amplify this dynamic. “Investors are generating record levels of asset income, so there is a lot of money continuously searching for a home.”

Finally, the market is itself acting as a brake on policy. For example, adverse market movements following “liberation day” forced Trump to delay and dilute his tariff measures.

Similar dynamics have been in play during the Iran war. Investors have not expected the shock to last long, partly because they believe the White House has a limit on the level of disruption in US bond and equity markets it will accept. This is encapsulated by my colleague Robert Armstrong’s acronym Taco (Trump always chickens out). Markets have not been pricing in a sustained oil price shock, betting that the US president will be compelled to prevent one.

Simon Ree, founder of online education provider Tao of Trading, explains that, in this way, investors have become conditioned to buy the dip. “Every policy reversal is getting absorbed faster than the last. This might look like resilience, but it’s actually desensitisation.”

Of course, investors aren’t completely ignoring the turbulence. Higher volatility has pushed up bank earnings and Wall Street’s stock prices. As the war escalated, the energy sector jumped on the prospect of higher oil. And some auto and consumer business valuations have been hit by tariffs and the prospect of higher fuel prices.

Still, the upshot of all the noise, AI enthusiasm and Taco is that overall the market appears to be looking through Trump’s term. For now, the Earnings Before Iran, Tariffs and Dubious Announcements approach prevails.

BlackRock warns of hit to European stocks from energy crisis

World’s biggest asset manager had been more bullish on the region at start of year but says stocks are no longer cheap

BlackRock has warned that surging energy costs and higher valuations mean European equities are no longer the attractive bet they were just a few months ago. 

Helen Jewell, international chief investment officer for fundamental equities at the $13.9tn-in-assets firm, said the economic hit from high oil and gas prices, as well as a shrinking gap in valuations with US stocks after strong relative performance in recent months, means she has reined in her recent optimism on European equities.

“It is difficult to be quite as bullish on Europe as we had been,” Jewell told the FT, pointing to the region’s exposure to the impact of the global energy price shock on consumer spending in the continent.

“You can’t make these big proclamations that Europe looks cheap now,” she added. “A year ago you had this really interesting valuation gap. The valuation gap has closed, and from an energy perspective, Europe is just a lot more exposed . . . so we are having to be a bit more selective about where we see opportunities.” 

European stocks have underperformed Wall Street for years, but were back in vogue at the start of this year as investors hunted for alternatives to pricey US tech stocks, with the region’s equity funds enjoying record inflows.

But, after a strong end to last year and opening two months of the year, European equities tumbled following the outbreak of the Iran war, with the Stoxx Europe 600 losing almost 12 per cent from its pre-conflict level by its March nadir. Wall Street’s S&P 500, on the other hand, only fell as much as 8 per cent, and has already rebounded to new record highs.

Jewell said her bullishness on Europe at the beginning of the year was in part because she anticipated a “broadening” out of returns from strongly performing sectors such as banks and defence to other parts of the market. But that broadening out has since “retracted” due to the conflict in the Middle East, she said. 

“In Europe, broadening out was about the pockets of the market like quality growth which suffered in 2025,” Jewell said. She highlighted sectors including healthcare, luxury and industrials that had suffered under both US President Donald Trump’s sweeping tariff blitz last year and the strengthening euro, but which were expected to rebound this year as pressure from tariffs eased.

But those sectors are suffering once again, this time due to higher oil prices, soaring borrowing costs and weaker consumer spending, she said.

“We are very nervous about the consumer as a whole,” she said. “[They are] being squeezed on interest rates, inflation. They will start to get thoughtful about what they are spending. 

“Global funds just see more interesting opportunities for companies in the US at the moment”, in part because the US is less exposed to a global energy supply shock, she added. The BlackRock Investment Institute switched to a bigger-than-benchmark position on US stocks this week.

Jewell, who oversees portfolios with a focus on picking individual stocks, said she remains positive on some pockets of the European market including defence, banks and semiconductors.

But she added that there is a risk that investor positioning becomes “crowded” in a few stocks in those sectors, meaning that negative news for one or two sectors could trigger a sharp sell-off for the broader market.

“The market structure is fragile,” she said. “If something happens in one of those sectors, the entire market will hurt quite badly.”

The world’s biggest asset manager is not alone in turning more cautious on Europe since the conflict started. Data from EPFR shows that flows to European equity funds have fallen away sharply since the conflict started. On the other hand, US stocks have already attracted more net flows in April than in any other month so far in 2026.

“The war is just a reminder that Europe is vulnerable, and a price taker on everything,” said Emmanuel Cau, head of European equities strategy at Barclays. The bank this week recommended clients should position for US stocks to outperform Europe.

Nevertheless, there could still be reasons to be optimistic, if the crisis eventually leads to more investment spending by European governments, Cau added.

“If you want to be positive, then maybe long-term, this is going to force more investment in Europe and reinforce its strategic autonomy,” he said.

The AI startup will likely decide on a new round in May.

Anthropic has received expressions of interest from investors who want to put money into the AI startup at an $800 billion valuation, but the company has no current plans to raise money.

Those were among the details in a profile of Anthropic Chief Financial Officer Krishna Rao published by The Information. A decision on raising more money likely won’t happen until after Anthropic’s May board meeting, a person with knowledge of the company’s plans told The Information. Some Anthropic investors believe the company could fetch a $1 trillion valuation, which would represent more than 2.5 times its $380 billion valuation in January.

Rao has guided Anthropic through multiple fundraising rounds since he joined Anthropic in 2024. He has also pushed the company to expand its relationship with multiple cloud computing and chip providers.

Recently, a close friend of mine introduced me to another of his friends, a tech investment banker, and now this banker and I have become friendly, too. I’ve enjoyed learning a bit about his life. We’d not met before because he’s not around very much, with AI and tech and FOMO what they are these days. He lives right by one of the nicest beaches in California and has bought himself an expensive car. But he seldom seems to spend much time enjoying his seaside abode, and he’s burning the gas in his G-Wagon mostly to get back to the airport. He travels often for work, sometimes several times a week.

By his telling of it, investment banking sounds like an arduous, go-go-go profession. I don’t buy it, though, because it seems simple enough to me, and as it happens, over the past few days I’ve come up with a bunch of very plausible deals I think should happen.

Here’s the most straightforward one: xAI should buy Cursor. The two already have a blossoming relationship, with xAI agreeing to sell computing capacity to Cursor. That makes sense. The compute crunch is real. The fine folks at SemiAnalysis, the AI research outfit profiled in our latest Big Read, recently likened acquiring AI processing power to “trying to book airplane tickets on the last flight out.”

Joining up with xAI would give Cursor access to xAI’s “stockpile” of compute, as Business Insider termed it. (Imagine having a stockpile of compute! That’d be like laying out a smorgasbord in front of Tom Hanks in “Castaway.”) xAI, meanwhile, would get a leg up in the AI coding wars and gain its first real access to the enterprise market.

My second idea is slightly less plausible but still very fun to consider. I think Snap CEO Evan Spiegel should sell the company to OpenAI. Snap is slashing its staff in yet another attempt to engineer a turnaround, and it won’t work. None of Spiegel’s other turnaround efforts have. He should accept the inevitable and take the years he’s spent focusing on consumer hardware to a place that really, really wants to do consumer hardware. An added incentive: Whatever he came up with at OpenAI would have a much better chance of torpedoing Meta Platforms’ efforts to produce similar technology. And surely he would still like to take Zuck down a peg or ten.

At Snap, Spiegel has total power over the stock thanks to his supervoting shares. He’s the only one who can make the decision on a sale, and he has seemed resistant to the idea even as the stock has dropped and dropped and dropped. (A CEO with less control of the stock would’ve been ousted long ago.) But I think OpenAI’s recent acquisition of TBPN is real proof that it can win over founders who wouldn’t sell to anyone else.

Finally, let’s ponder what will happen to poor ol’ Vox Media, which will reportedly begin selling itself piecemeal. Vox owns more than 10 media brands, including New York Magazine, itself a collection of brands. If someone hasn’t already called Jay Penske, who owns a portion of the Vox parent company, they should—and they should talk him into buying Vulture, New York’s beloved outlet devoted to entertainment and Hollywood. Puck News says Karli Kloss has been interested in possibly buying The Cut, another beloved New York sub-brand. I find her interest intriguing: A couple years ago, I predicted that Vox Media would need to do a sale like this one and would sell New York Magazine to her husband, Josh Kushner. Clearly, my crystal ball tuned into the wrong corner of the Kushner-Kloss living room.

Vox also owns The Verge, the tech news site. I’m sure the same set of people who keep loudly talking about wanting to buy Wired might be interested in The Verge. They’d be buying it to profoundly change it, and I wonder if Vox CEO Jim Bankoff would want to be the one to push those brands into their hands. I also wonder if much of the Vox brands would get sold off to owners who seem to apparate out of nowhere, as Jeff Lawson did when he bought The Onion.

I’m gonna stop here and go try to track down that banker I mentioned. I expect a fat finder’s fee.

Gold.com stock has pulled back after a yearlong rally, creating an entry opportunity.

Gold.com controls about 30% of the North American online retail market.

Gold.com acquired Sunshine Minting, increasing capacity to three million ounces weekly, and secured a $150 million investment from Tether.

Analysts forecast double-digit earnings growth through 2027, with the stock offering a potential 7% buyback yield and 1.8% dividend.

The bull market in precious metals isn’t confined to companies digging ore from the ground.

The sharp rise in gold and silver prices has been a boon for an entire industry, including often overlooked businesses such as retail sales, wholesale trading, and metals financing. Gold.com aims to dominate these categories.

The company is involved in the entire downstream precious-metal supply chain—from refinery operations, the minting of investment-grade numismatic bullion, worldwide transportation, and storage services to online precious-metals retail. That closed loop—a compelling business in the current environment—appears undervalued, with Gold.com sporting a $1.3 billion market capitalization and trading at just 13 times earnings.

The stock has more than doubled over the past year, helped by record transaction volume. After a 33% pullback in recent months, the pieces are in place for Gold.com to shine again. We recommend buying the dip in this category leader, positioned to rebound back to $66 from its Wednesday close of $44.99, corresponding to a potential return of nearly 50%.

According to the World Gold Council, total gold demand “smashed records” in 2025, exceeding 5,000 metric tons for the first time, driven by investment flows. Purchases of physical bars and coins grew 30% year over year in the fourth quarter, supplying a tailwind for Gold.com’s business. In the company’s latest fiscal second quarter, revenue surged by 136% year over year to $6.5 billion, while net income of $11.7 million was up from $6.6 million in the prior year.

Unlike miners, whose growth is tied to commodity pricing, Gold.com’s core earnings are driven by the spread it captures on each transaction—the difference between what customers pay and the metal’s spot price.

In a report this month, D.A. Davidson analyst Michael Baker wrote that “market volatility, including for precious-metals pricing, is continuing to lead to wider spreads,” a setup that should drive strong profit growth and carry Gold.com stock higher. Baker maintains a Buy rating on the stock with a $60 price target, implying 33% upside from the recent levels.

Formerly known as A-Mark Precious Metals, the Costa Mesa, Calif.–based company rebranded after acquiring the flagship website domain and relisted on the NYSE last year. The move unifies a portfolio of more than 20 brands that has expanded as part of a continuing roll-up of smaller competitors.

Gold.com now provides a home for leading online dealers such as JM Bullion, GovMint, Stack’s Bowers, Pinehurst Coins, and Monex, together commanding an estimated 30% share of the online North American precious-metals retail market. The company also has a major presence in Asia and exposure to Europe. It also owns Silver.com.

With each brand pulling in a loyal following, Gold.com now counts 4.4 million direct-to-consumer customers, including 96,100 more this past quarter. Within that customer base, the company served 229,100 active customers during the quarter compared with 147,300 in the period last year, though the increase includes new customers added through acquired brands. The expectation is that all customers will continue to log return visits at regular intervals.

Central to Gold.com’s leadership is its status as an authorized distributor for high-profile sovereign mint products, such as American Silver Eagles and Canadian Gold Maple Leafs—government-backed coins that routinely sell out during limited production runs. That dynamic is not a problem. As CEO Greg Roberts pointed out on the most recent earnings call, “When Silver Eagles go on allocation and become scarce, customers tend to buy our other private mint products.”

These proprietary bars and coins, valued for their metal content and collection appeal, represent a higher-margin engine for the business. Gold.com is attempting to capitalize on this segment by completing a takeover of Sunshine Minting this month, making it the sole owner of one of North America’s largest private mints. This move expands the company’s finished product capacity to more than three million ounces a week, allowing it to reach more customers and shift the product mix toward higher-margin branded bullion.

What ties the consumer-facing businesses together are two less visible, if high economic moat, divisions. A-M Global Logistics operates a network of distribution hubs and secure depositories, capable of moving physical bullion at scale. Its Collateral Finance subsidiary offers commercial loans secured by precious metals. By generating interest and fee income, the services arms, which contributed approximately 40% of the company’s gross profit last fiscal year, represents an important source of cash-flow stability independent of the commodity price.

Gold.com has also taken steps to broaden into financial technology. In February, the company received a $150 million strategic investment from stablecoin issuer Tether, establishing a gold-leasing facility to handle the logistical infrastructure for Tether’s gold-backed stablecoin offering. The two companies plan to collaborate on tokenized real-world assets, representing an ownership stake in physical bullion traded on Tether’s blockchain technology that leverages Gold.com’s existing CyberMetals digital investing accounts network. This category is seen as a growth driver for the company aiming to bring in younger, digitally native customers.

Gold.com is scaling up and doing so profitably. The consensus among Wall Street analysts is for the company to achieve organic top-line momentum and double-digit earnings growth through 2027. Reinforcing its strong fundamentals, it recently expanded its share-repurchase authorization, which now represents a potential buyback yield of 7.1%. Separately, Gold.com pays a regular quarterly dividend yielding 1.8%.

Without a directly comparable publicly traded competitor that matches Gold.com’s positioning, the company stands out as a high-growth retailer, commodity trader, and fintech innovator. Shares should command a much higher valuation premium than its current multiple, returning to a price/earnings ratio that peaked above 20 times in 2021 as the market begins to recognize the platform’s potential. For now, the stock looks like a bargain, and for investors who already own mining stocks, a Gold.com holding can act as a portfolio diversifier that could outperform to the upside.

The main risk isn’t so much its direct exposure to precious-metals prices, but how sharply lower gold or silver prices might limit sentiment toward the asset class and hold back transaction volumes, affecting earnings. Historically, gold has been sensitive to interest rates, and a scenario of sharply rising real yields limiting the appeal of nonyielding assets could also pressure shares. As a small-cap stock, wide swings of volatility can be expected, as was the case at the start of this year.

Ultimately, the bet is that precious metals remain a trusted store of value and a global monetary anchor, fueling demand in the physical bullion that Gold.com manages. It’s a coin worth stacking.

Payments scheme pushes for ‘co-badging’ that allows French bank cards to run on both international and local networks

French payments network CB is seeking to lead a fightback against US giants Visa and Mastercard, amid concerns by European officials that the groups’ dominance could be weaponised against the bloc.

The network’s head Philippe Laulanie said CB had started to reverse a years-long decline that had cut its share of payments in France from more than 90 per cent five years ago to 75 per cent, according to the company’s own figures.

Laulanie said CB, which operates on a “co-badging” system that allows French bank cards to run both on international and local networks, had about 30 candidates to join its network.

“CB has become very attractive again,” Laulanie said, after Russia’s invasion of Ukraine highlighted issues around “strategic dependencies” and the need for sovereignty over payment systems.

“Current tensions with the US under Donald Trump have underscored the idea that some services could be cut off or subject to conditions,” he added.

CB was set up in the 1980s with the backing of France’s biggest banks to mutualise some of their costs, and operates as a non-profit association.

But it lost market share as US rivals dangled exclusivity deals that encouraged banks to drop the co-badging system, and lured fintechs with incentives that allowed them to give users free cards.

French President Emmanuel Macron has thrown his weight behind CB’s co-badging initiative, describing the French payments network as the “last kilometre of our economic sovereignty”.

There is no cross-border card scheme in the bloc that serves as an alternative to Visa or Mastercard, although there is now a European rival to Apple Pay called Wero, which is expanding. 

Macron, who has made France one of the biggest advocates for Europe to decouple from the US on everything from weapons systems to technology, called on “all the financial actors in the national and European payments space” to adopt a dual model combining Visa and Mastercard with a domestic payments alternative.

Foreign banks such as JPMorgan Chase have joined the network in recent years, as their presence in France has grown, in large part because CB’s fees are lower for local businesses like restaurants. 

“Unfortunately, many European countries abandoned their domestic networks and it’s going to be a harder path for them,” Laulanie said. 

But the recent co-badging campaign has irked some online banks that have chosen not to work with CB to date, according to people from two fintechs operating in France. The French network was slow to adapt to the era of mobile payments, and has only recently become compatible with phone payments.

London-headquartered fintech Revolut, French online bank Qonto, BNP Paribas-owned fintech Nickel, and BoursoBank, Société Générale’s rapidly growing online bank, are among those that use just Visa and Mastercard.

Guillaume Petipas, a payments specialist at KPMG, said using just one network was logical for start-ups in expansion mode, which might not want to juggle schemes in different countries until they were more established.

From Moon buggies to new materials, Michelin reinvents its future

The company is focusing on high-end products to keep manufacturing in France, but workers fear Chinese competition

Michelin’s French tyre factories were once so strategic that allied forces bombed those in Nazi-occupied France during World War Two, before they were later rebuilt.

Today, only a subset of Michelin’s global manufacturing remains in its historic home of Clermont-Ferrand. But the tyres developed there for the Moon buggy, endurance racing and other high-spec products are the buttress the company is counting on to keep its plants in France alive, as Chinese rivals start to encroach on the industry.

“Historically, Michelin went from Clermont to conquer the world. Today that model is no longer possible,” said Michelin’s chief executive Florent Menegaux, warning of a gulf in production costs with Asia which had made exporting mass market products from Europe “virtually impossible”.

To fight back, Michelin is focusing on high-end production in France and also expanding its research into new areas, including polymer composites or materials used in sealants or to coat fabrics, with new investments worldwide.

Although a seemingly niche market, these materials have applications spanning aviation to energy and construction, giving them “immense” potential, Menegaux said.

Michelin’s strategic focus comes as Europe prepares measures to combat Chinese imports of cheaper tyres with potential tariffs, as well as its “Buy European” framework that would boost the bloc’s automotive suppliers by establishing thresholds for local component requirements.

But while companies like Michelin are undeniably in favour of trade barriers, Menegaux also warned the protections should not become a form of “stipend” that would stifle European manufacturers’ incentive to innovate and compete.

At Michelin, part of that effort is made at Ladoux, an enormous light-filled research site just outside Clermont-Ferrand in the rural Auvergne region, the group’s base for nearly 140 years.

The laboratories here straddle test tracks for motorbikes and sports cars trying out the wear and tear of racing tyres. Several thousand engineers and scientists have contributed to the latest generation of materials that will be used in aeroplane landing gears and the tyres Michelin hopes Nasa will select for the moon rover for its Artemis missions.  

Nearby, another factory also makes tyres for races like the Moto Grand Prix, using a production technique resembling 3D printing.

This specialisation has not protected all of Michelin’s sites in recent years. The company closed two truck and van tyre plants last year, at Vannes in Brittany and Cholet in western France, with over 6 per cent of its French workforce, or 1,200 jobs, disappearing.

Clermont, where the company’s founding brothers André and Édouard Michelin built their industrial empire, employs about 10,000 people, a third of staff levels in the 1980s. The Cataroux plant that was once razed and rebuilt, has been largely disused for years and is being converted into a start-up hub, part research centre.

Romain Baciak, of the left-wing CGT union, said employees feared more cuts could happen as the rest of its factories around France are running below capacity, with only the aeroplane tyre factory at Bourges doing well. 

“The Chinese will get into aeroplane tyres and it will be over,” Baciak said, adding he disagreed with Michelin’s decision to pursue higher price points and what he called “luxury” tyres. “They’ll keep the research here as long as the state gives out research subsidies,” he added. 

Menegaux said focusing on cutting-edge technologies and high value-added products was its only way of keeping manufacturing in France given that the country’s employment costs, inflation and energy prices had “exploded” compared to Asia in the past six years.

“If we don’t stay at this level of excellence, we’ll disappear,” he said.

France remains Michelin’s biggest manufacturing base in Europe, home to half its 30 factories in the region. It has roughly as many plants in the Americas today and 15 in Asia. 

Tyre-making is one corner of the auto industry where Chinese rivals have yet to completely upend the world order. Though China has long been a big player in truck tyres, its breakthrough into homegrown passenger cars through electric vehicles has been recent.

Like its big rivals Continental of Germany, Italy’s Pirelli or Goodyear of the US, Michelin has been around almost as long as the first cars, and along with Bridgestone of Japan, the five groups dominate global volumes and revenues.

But smaller Chinese groups such as Zhongce Rubber and Sailun Group are snapping at their heels, and in passenger tyres, cheaper Chinese imports have made big inroads in Europe.

Kepler Cheuvreux analyst Thomas Besson said the risk from China was that “some consolidation or national champion could arise, though this has been expected over the last decade and still has not happened”.

Diversification strategies like Michelin’s suggested they believed this could “be the case in 10 to 15 years’ time”, he added.

Michelin made three polymer composite acquisitions in the US last year, for a combined enterprise value of around €1bn, and planned to make at least as many every year globally, Menegaux said.

The division accounted for €1.3bn in sales in 2025, or €1.7bn when including Michelin’s latest purchases — still a fraction of the group’s €26bn revenues for 2025. However, the unit, with 15 per cent in margins last year, is the most profitable across its business. Michelin’s revenues fell 4.4 per cent in 2025, largely on a softer truck market in the US.

“We’re not leaving tyres,” Menegaux said of its diversification. “But this strategy will allow us to better resist the ups and downs of cycles by positioning us well beyond just the mobility sector.”

Fusion start-up Helion stands by 2028 timeline despite rivals’ doubts

Venture backed by OpenAI’s Sam Altman and tech billionaire Peter Thiel says it is on track to deliver electricity to Microsoft

Helion Energy, the nuclear fusion start-up backed by OpenAI’s Sam Altman, has insisted it is on course to supply Microsoft with electricity by 2028, despite industry scepticism as its ambition timeline draws nearer.

Chief financial officer Pragav Jain told the FT that the company “remains on track” to meet key milestones, including its agreement to deliver power through the grid by 2028, something no fusion company has achieved.

Fusion companies are seeking to replicate the reaction that powers the Sun by forcing atomic nuclei to combine in a superheated plasma.

However, while US government scientists have achieved the key milestone of “net energy gain” — generating more electricity than is consumed to make fusion occur — no start-up has yet done so, let alone build a commercially viable power plant.

Helion, valued at $5.4bn in its latest fundraising, has raised $1bn from investors including Altman and his fellow US tech billionaire Peter Thiel. But despite being one of the best-funded fusion start-ups, its ambitious timeline has fuelled scepticism.

One rival fusion executive said the company’s target “doesn’t add up”, citing in particular a lack of explanation over how it would manage high-energy neutrons, which can damage reactor structures.

Helion said in a YouTube video that it was developing a material with “its own kind of healing mechanism”, based on a physical process in which atomic defects migrate and recombine within the damaged structure.

But it has drawn criticism for disclosing relatively little about its scientific progress, although Jain has previously said this was to protect the company’s intellectual property from “copycats”.

He declined to say whether the Microsoft agreement would be profitable for Helion but said the generator designed for the IT giant, which it is building in Washington state, would be a “sub-scale commercial unit”, meaning it would be less efficient than the larger systems the company hopes to deploy later.

Helion has also signed an agreement to develop a 500-megawatt power plant with steelmaker Nucor for 2030.

Axios reported last month that OpenAI was also in talks to buy electricity from the fusion venture.

One fusion investor said the continued intensity of competition across the sector suggested that Helion had not established itself as a clear winner. If the company were truly that far ahead of rivals, the investor said, “honestly, [fusion] conferences are not necessary”.

US-based Commonwealth Fusion Systems, the best-funded fusion company with about $3bn raised, plans to build its first commercial plant in the US in the early 2030s, with Google signed up as an offtake customer. According to the Fusion Industry Association, 89 per cent of private fusion companies believe the technology will be supplying power to the grid by the 2030s.

Helion argues that one source of its confidence lies in its design. Unlike most power plants, it does not plan to rely on turbines to convert heat into electricity.

Instead, the company aims to generate electricity directly from changes in the magnetic field as the plasma expands, inducing a current in surrounding coils — a more energy-efficient process. One fusion investor who spoke to the FT described the approach as the “holy grail” of fusion.

In theory, that could allow Helion to produce commercially useful electricity with a smaller net energy gain than rivals. Helion is testing a pre-commercial machine intended to “demonstrate electricity from fusion”, although Jain declined to say whether the company was close to an energy break-even point.