From My Desk

As Washington pursues a diplomatic exit from the five-month-old Iran war, Tehran is quietly preparing for a far larger, costlier fight. Today, our Middle East correspondents detail how Iran's hard-line leaders are rebuilding missile infrastructure and mobilizing forces to widen the conflict against the U.S. and its allies.

Beyond the war, the artificial-intelligence race has a $3 trillion blind spot. A Journal review of disclosures by nine major tech companies, including Google parent Alphabet and Amazon, found massive spending commitments for data-center leases and chips that aren't accounted for on their balance sheets.

Today's Headlines

Federal prosecutors and the SEC are investigating whether Los Angeles Dodgers owner Mark Walter or his companies committed fraud by concealing financial connections while borrowing billions of dollars from insurers he controls.

President Trump said he would "substantially reduce" joint military exercises with South Korea, touting his "very good relationship" with North Korea's Kim Jong Un.

Rural economic pain is testing the GOP's grip on Iowa, a Trump stronghold.

No other state has more Haitians with Temporary Protected Status than Florida. Now the Trump administration has revoked that status, triggering a labor crunch.

America's housing affordability crisis is leading more home buyers and flippers to give abandoned and dilapidated homes in Baltimore a fresh look.

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Live From The Markets

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Each quarter, big tech companies disclose their massive capital expenditures on AI infrastructure. But those figures don't come close to expressing the full extent of future spending to which Alphabet, Meta, Oracle and many others have committed.

Turning to the job market: There are hidden advantages to being a job hopper.

Read It Here First

Iran has a secret plan to escalate the war.

After Trump signed a memorandum of understanding with Iran in June, administration officials fanned out to build support for an agreement they hoped would reopen the Strait of Hormuz and start winding down the war. Iran's hard-line leaders came up with a different plan, according to Iranian and Arab officials. In their view, the pact was likely just an attempt by the U.S. and Israel to take pressure off the global economy and buy time for a bigger attack. Instead of putting faith in talks, they took the past two months to prepare for a bigger fight. Their goal is to inflict enough pain to ensure the kind of attacks Iran has endured aren't repeated, report Benoit Faucon and Summer Said.

Here's how Burger King revamped its Whopper and overtook Wendy's.

To overhaul its signature Whopper, Burger King added a more premium bun, new mayonnaise, a box to preserve freshness -- and a corporate chef who had already worked magic at chicken chain Popeyes. Overseen by Burger King's U.S. Head Chef Amy Alarcon, who developed the Popeyes chicken sandwich that became a viral sensation in 2019, the revamped Whopper is now helping propel a comeback for the chain, reports Heather Haddon. After struggling for years, Burger King is gaining momentum in a rocky patch for the fast-food industry, growing its restaurant sales and drawing diners at a swifter rate than both McDonald's and Wendy's.

See The Story

We created a flyover map of Manhattan's office-to-residential conversions.

A near-partial collapse last month at America's largest office-to-residential conversion project in Midtown Manhattan is bringing new scrutiny to this booming development strategy. Nineteen Manhattan office buildings have begun conversions so far this year, and another 17 are planned, according to Cushman & Wakefield. The stakes are high because cities throughout the U.S. are embracing conversions as a solution to two of their most vexing problems: a severe shortage of housing and a glut of office space left behind by the remote-work era. Take a tour of the projects transforming the skyline.

Happening Today

Earnings: Fabrinet, H World Group, XP

Number Of The Day

$12

That's what a pack of Ralph Lauren tennis socks costs -- a symbol of how American luxury brands are still growing and, in Ralph Lauren's case, outperforming European rivals like LVMH by offering entry points middle-class shoppers can afford, writes Carol Ryan.

And Finally. . .

Bank of America's CEO is playing a secret word game with Wall Street.

Wall Street analysts who cover Bank of America need a grasp of complex financial metrics, familiarity with regulatory ratios and, apparently, a high SAT vocabulary score. When the second-largest U.S. bank discloses its quarterly financial results, analysts have to decipher the lexicon of CEO Brian Moynihan, riddled with obscure, archaic words like "gainsay," "concomitant" and "fantods." It isn't happenstance: The 66-year-old is playing a game with analysts, according to people familiar with the matter, and only a small circle inside Bank of America is in on the joke.