Heading Into March
Block's AI shakeup. The Iran situation. Here's how I'm positioned into March...
Marlin Capital Readers,
The major market indices have now been stuck in a range for 5 months. February did nothing to change that.
The S&P 500 finished -1.4% in February. The Nasdaq fell -1%.
But the real damage was underneath the surface. Software got crushed, falling -8.9% on the month. The Global AI Technology ETF (AIQ) dropped -4.5%. Many individual names got hit even harder. MSFT -7%. PLTR -7%. APLD -22%. IREN -23%. GRAL -40%. EOSE -60%.
It was a very difficult month. And heading into March, it’s not getting any easier.
The AI Labor Market Shakeup
Block (XYZ) announced last week that it is laying off roughly 40% of its workforce. Over 4,000 employees gone. According to Goldman Sachs, the job cuts were concentrated in engineering roles, not sales or compliance.
In other words, Block is replacing engineers with its own internal AI platform. The stock initially popped +24% on the news.
Read that again. A major US tech company just announced it is cutting 40% of its employees, and the market rewarded it with one of the biggest single day rallies in the stock’s history.
CEO Jack Dorsey was explicit about the reason, citing AI. In his letter to shareholders, Dorsey wrote, “A significantly smaller team, using the tools we’re building, can do more and do it better.” He went further, predicting that “within the next year, I believe the majority of companies will reach the same conclusion and make similar structural changes.”
But here is what really matters. Block’s (very) positive stock reaction sends a very clear message to every other CEO in America. If you are struggling, cut your workforce significantly, attribute it to AI, and your stock will rally big. That is a powerful incentive. Whether or not this triggers a broader wave of AI-driven layoffs across corporate America is something I will be watching very closely the rest of 2026.
With all of this uncertainty, my strategy has never been more important. Over the past 5+ weeks, I have exited 23 different names and closed out an entire portfolio.
What I am left with are leaders only. And they are still leading.
Here is how I am positioned heading into March. 👇
2026 Portfolio
GLW (from $88.79)
GLW is our top unrealized performer YTD and a clear market leader in the Optical Connectivity theme. As I covered in “Leaders Shine Bright”, the optical segment is growing rapidly driven by the 800G/1.6T upgrade cycle.
VIAV (from $18.08)
VIAV is one of the most overlooked names in the optical group, and that has provided a tremendous opportunity. VIAV’s +116% EPS beat and +440 bps of margin expansion tell you everything you need to know about the pricing power of AI network testing right now.
These are 2 of my 18 current holdings.
The full portfolio breakdown, my Active Trading Portfolio, my thoughts on the Iran situation heading into Monday, and my full watchlist are all included below for paid subscribers.👇