The Logic

Canada’s Big Six banks beat third-quarter earnings expectations, driven by strong capital markets activity and solid growth in their businesses outside the country. The results landed just days after Canada walked away from trade negotiations with the U.S., putting the spotlight on the lenders’ exposure to tariff uncertainty and how much risk they see ahead. Tariff stance: Bank CEOs struck a measured tone on the escalation of the Canada-U.S. trade war.

TORONTO — Xanadu is opening a new factory to make the hardware for its quantum computers, with $195 million in new funding from the federal government. The firm plans to overhaul part of a former Campbell Soup plant in Toronto to manufacture the photonic components for its system. It’s part of Xanadu’s plan to refine and mass-produce quantum computers to combine into a US$1-billion new data centre in the city by 2029.

OTTAWA — Canada’s new retaliatory tariffs will affect nearly 14 per cent of the value of U.S. imports to Manitoba, according to data analysis by The Logic, which is the highest share of any province and a sign the next step of the trade war will be felt unevenly across the country.

The Toronto-based critical mineral recycling company will use the equity funding round to build its South Carolina campus starting in the fourth quarter. T. Rowe Price led the round, with California electronics recycler ERI participating. (The Logic) Talking point: The company, which recovers rare earth metals from electric motors in cars, wind turbines and MRI machines to reuse in new technologies, said it aims to bolster U.S. rare earth production with its recycling operations.

The economy grew at an annualized rate of 3.3 per cent in the second quarter after six months of stagnation, driven by a jump in exports, household spending, and business investment, Statistics Canada reported. (The Logic) Talking point: Revised data also shows the economy did not slip into a technical recession in the first quarter of the year, as Statistics Canada previously thought, but grew 0.3 per cent.

Ottawa named the first 64 scholars who will relocate to Canada as part of the Eddie Goldenberg Research Chairs of Canada program. Of the recruits, 48 are from U.S. institutions, including Harvard and MIT. The other researchers are coming from 12 countries including Germany, China, the U.K. and Japan. (The Logic, Bloomberg) Talking point: The program will ultimately support up to 100 researchers with $1 billion over 12 years.

Iren, an Australian AI compute provider, said in a release it will use the money to expand its Mackenzie data-centre campus in B.C. Pacific Investment Management also backed the deal, which covers about 90 per cent of the funding it needs to build out the infrastructure at the site. (The Logic) Talking point: Blue Owl’s data-centre financing has helped the firm recover after it became the face of private credit instability earlier this year.

U.S. producers supply 25 per cent of manufactured materials used in domestic construction, prompting the Canadian Construction Association (CCA) to warn that new counter-tariffs could further raise costs and disrupt supply chains for job sites across the country. (The Logic) Talking point: That share of U.S. imports is as high as 40 per cent when it comes to engineering construction, such as communications infrastructure or oil and gas, based on 2024 data.

TORONTO — The Creative Destruction Lab (CDL) is using a decade and a half of data to understand what makes science-based startups succeed and fail. The Canadian non-profit is making the information, drawn from its network of accelerators, available to researchers around the world to study how founders, financing, mentorship and other factors impact firms’ prospects.

“AI-enabled cyberattacks will become far more widespread and sophisticated,” the 116 signatories warned in an open letter. They called for firms and infrastructure operators to spend more on security and share information on and patches to vulnerabilities, and for governments to share intelligence and co-ordinate responses to incidents.