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Initial Public Offerings Exhibit Varied Performance Amid Increased Market Activity

IPO Market Navigates Selective Investor Enthusiasm with Mixed Debuts U.S. initial public offerings (IPOs) presented a diverse landscape this week, with seven new listings and two special purpose acquisition companies (SPACs) entering the market. While some companies, notably in the space technology and healthcare AI sectors, achieved significant gains, others faced substantial declines, reflecting a highly selective investor environment. The overall activity suggests a renewed, albeit cautious, appetite for growth-oriented companies in public markets. Key Debuts and Sector Performance The week was marked by several high-profile debuts across various sectors. Firefly Aerospace (FLY), a space technology company specializing in launch and lunar logistics, completed an upsized IPO, raising $868 million by pricing 19.3 million shares at $45 each. This debut valued the company at a post-IPO market capitalization of $6.3 billion. Following its listing on the Nasdaq Global Market on August 7, 2025, Firefly Aerospace's stock finished its first week up 11%. The company’s strategic focus on the underserved mid-lift market with its Alpha rocket and Blue Ghost lunar lander, alongside a $1.1 billion contract backlog including a $177 million NASA deal, fueled investor optimism. Despite reporting a net loss of $60.1 million in Q1 2025 and a widening net loss of $63.8 million in Q2 2025 on revenues of $15.5 million, its Q2 gross margin expanded to 25.7% due to higher-value contracts. In the healthcare sector, Heartflow (HTFL), a developer of AI-powered coronary imaging tools, also saw a robust debut. The company raised $316.7 million through an upsized offering, selling 16.67 million shares at $19 each. Heartflow's shares surged 51% in their first week, lifting its market value to approximately $2.3 billion after its initial trading day on Nasdaq. The company’s Heartflow One platform, which uses AI to create personalized 3D heart models, has been validated by over 600 peer-reviewed publications and is recommended in major clinical guidelines. Heartflow reported Q1 2025 revenue of $37.2 million, a 39% year-over-year increase, though its net loss grew to $32.3 million. Conversely, WhiteFiber (WYFI), an AI infrastructure provider utilizing NVIDIA GPUs, faced a challenging debut. After raising $159.4 million in an upsized IPO by selling 9.375 million shares at $17.00 each, the company’s stock ended its first week down 10%. WhiteFiber, a spin-off from Bit Digital Inc., initially achieved a market capitalization of $619 million. While the company demonstrated strong Q1 2025 financials with revenues of $16.8 million (up 105% YoY) and a net income of $1.4 million, and strong profitability metrics such as EBITDA margins of 34.14% and gross margins exceeding 60%, its valuation ratios, including a price-to-sales (P/S) ratio of 9.9x, significantly surpassed the US IT sector average. CTW Cayman (CTW), a Japan-based HTML5 browser gaming company, experienced the most significant setback among the week's IPOs. The company completed a downsized IPO, raising $12 million by offering 2.4 million Class A ordinary shares at $5.00 each, resulting in a post-offering market capitalization of $240 million. CTW Cayman's shares declined 46% in their first week of trading. Despite reporting $68.4 million in revenue for FY'24 (up 8.7% YoY) and a net income of $6.0 million, investor concerns likely centered on the niche nature of browser gaming in Western markets and the challenges of HTML5 monetization outside Japan. Analysis of Market Reaction The divergent performances underscore a market with renewed risk appetite but heightened scrutiny. The strong debuts of Firefly Aerospace and Heartflow reflect investor confidence in innovative technologies with substantial contract backlogs or proven clinical validation. Firefly’s success, despite its current unprofitability, highlights the market