Meta’s AI Promise, Microsoft’s Disappointing Beat & Why Google Should Spin Youtube
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Some tag presents the ins and out of caring for your home out uncertainty, self debt, stressing about not knowing where .

to start in, plans and .

guides that make IT easy to get home projects done out word art, sorry, with laugh lovers in knowing what to do, when to do IT and who to hire, start Carrying fewer home. We confidence down the the tack today.

Everybody make a pino here this week on to touch more. We are honor to have the second gentleman dug in hf on the show. We chat about his historic partnership with vice president kala herri and how he talks to men about what's at stake in this election.

Plus we look into why so many W. B. A coaches have been fired this off season.

And we've got another installment of R. A. Megan, or are you so food edition, check out the latest episode of a touch more. Where will you get your podcast and on youtube?

How is amErica a lot of fea certain products that are harmful and banned in other countries, like don't tell care about us. This we got explained to me. We unwrapped some fda policy and a little halloween Candy and search for some simple answers.

This is where things get a little bit complicated. And I just I feel among blog coming for me for even saying that because it's not complicated story. New episodes every wednesday, ying follow wherever you get your podcasts.

Today's number, twenty to billion dollars that much, russia has find google for blocking its news channels on youtube, the sexual predator or racist and a russian spy walk and do a bar. Ed, the bar tender says, what can I get to president trump?

But a little election humor going have election will count some boats. James got one hundred. D, L.

M. That is that guy. I'd like him. Do you like him? Do like to carvel.

I think I prefer you. You're a impression event. I think that sort of .

my highlight so for appreciate that I must be bonuses and someone's someone's kissing someone's as help pluck up you little a little podcasts o 和 speach。 Today, we're discussed earnings from google, microsoft and meta, but first hear with the news is property analyst at elson edit is a good word. How are you?

I'm doing very well. Um I didn't know twenty sicilian was a number, but I looked into IT. It's twenty trillion times a trillion, times a billion and the global GDP is one hundred trillion. So actually put that into perspective, just shows you the russians have that had crew on straight.

I'll say about that. That's actually what I produce. Clare requested as a bonus for managing Young, irresponsible broadcasters.

We can't quite get there. This is a profitable business. But now I had never heard the term of salian either.

Where are you at your in new york? I'm in new york. As always.

We past halloween and I need more banter. Pretend i'm interested in your life. What do you do IT for a thanksgiving? No, I haven't made .

thanks giving I I london. It's kind of weird to celebrate thanksgiving in london.

It's not really .

yeah they don't have thanksgiving. We left them exactly .

what do you thanksgiving? A and I back to london yesterday. Two weeks. I had to new york for speaking gig and to lost cables for bahaa summer.

Or i'm speaking and talking about vertical farming and doing much from chocolate at night and listening to some DJ who is specially is hot. And then I got a vagus or got L A. For another ridership because I don't know if you heard them working on original script to dramatic netflix.

So what do you do in the right test room? Do you kind of like sort of shout over them, but sort of things are doing wrong?

Or how does that work? Now it's the guy, the show runner and the lead writer will say what he thinks got. And i'll say, no, they would never say that even though i'm not listening. I just I pretend that what they're saying is unrealistic.

So i'm kind of on the right track.

I'm supposed to the person that puts you in the room that makes IT feel authentic. And i'm super sely the person that understands these people, which is which is kind of comical, but it's fun. That sounds very fun.

You don't actually have to do the right and you just kind of like opine on what's happening.

That sounds you know me, I don't like to actually work. There's no where work involved in this whole property enterprise for the for the property. It's actually a lot of fun. I get to envision scenes and i'm working with this really talented guide, scope burns and media rez and this super talented people. So so far so far when honeyman parable say sounds .

like the best job .

I I F that I D stopped the line.

get to the news. Well, before we get started with just a quick reminder, subscribe to profit markets on its dedicated feed proof che markets wherever you get your podcast hit, follow and tune in to our interview with Anthony scaroons I on thursday that in dv will only be available on the dedicated feed. And now let's stop with a week the review of market vitals.

S, S, B, five hundred declined, the dollar fell, bitcoin rose, and the yield on ten treasuries increased. Shifts in in the airlines. U.

S, G, D P grew two point eight percent in the third quarter. That was slightly slow than the previous quarter and just below expectations. Whoever economists were largely encouraged by the growth driven by consumer spending on goods.

Reit turned to profit for the first time ever, with revenue reaching almost three hundred fifty million dollars in the third course, so that's up sixty eight percent from a year earlier. The company also reached nearly one hundred million daily users, and those strong earnings sent shares up more than forty percent. Shares and drug maker eli lilly fell more than six percent after its third caution.

Profit and revenue missed analyst expectations. The company also reported disappointing the sales of its weight loss and diabetes drugs. And finally, elon musk, artificial intelligence starts up X, A, I is in talks for a funding round that would value the company at forty billion dollars, nearly doubled evaluation from its previous round. Your thoughts, starting with this national economic data, GDP growth in america, two point eight percent in q three.

A G D P number doesn't mean a lot unless IT has a benchmark. So just a benchmark there. A japan's annual GDP growth was up point three percent. So we're growing nine times faster than japan. France at one point, one percent in canada at one point three.

Mean, this is just the economy here is just really striking to listen to this kind of person on the street interviews about how people feel about the economy is so there is kind of a vibe session as kind of scaling called that. Or people, again, have this habit of crediting their character in their grip for the racist and blaming everyone else, or blaming the government for whatever Price hikes there are. But our growth is impressive, and two point eight percent may not similar. But what that means is about every twenty five or twenty seven years, the size of the american economy would double.

In addition, we have this new inflation data that just came out. It's down to two point one percent. In other words, inflation has officially been dealt wired.

Meanwhile, you look at other develop nations that has struggled with not only higher inflation than we had but also longer inflation. So it's sort of makes the case or not sort of IT does make the case for carmilla haris. A few believe that coma haris is just a continuation of the current administration.

And if you care about the economy, and this is a big reason to vote for carmona Harris. But if you've made this point before, he should be making a way stronger argument about how she's sort of the economy vote. If you care about the economy, you should be voting for cma.

Harris IT hasn't really resonated. But for those of us, they care about statistics, they care about data, what the data is actually telling us. And when you look at the U.

S. Compared to other nations that has struggled with problems way worse than hours, you know the answer is, is pretty close, statistically speaking. Common house should be also.

I so badly want to be had to comes through like eleven days for the heroes campaign.

I thought people saying you should be.

by the way, I just think you should have in a back pocket every time someone starts complaining about the economy, the economy saying, OK, sean handy, there's one hundred ninety seven nations here, an intelligent guy, what economic globally is stronger than us right now? What name IT? Instead, they they always go to this democratic self hate of, I know things are tough out there and when we have worked to go IT should be bitch we are on fucking fire, get your head out your ass anyways.

Okay, read IT. Why don't I listen? My own advice, I bought some stock here, but not enough.

I believe the stock is now about triple where IT Prices in its I P. O. About two months ago. Can I ask how much you bought? You can ask.

May you answer? I think I bought about .

three million dollars with the stock, but I pared some of IT, so I don't know nearly as much as I hope, but i've done very well. But IT pops so big the first day, I trimmed some of my holdings, and I just didn't listen myself. I knew this thing.

I still think he has more room to run anyway. Its revenue of sixty eight percent year on year daily users is up forty seven percent. They're going global. They're being really smart. They're translated their post the A, I and a french, spanish, portuguese, german and its international daily of unique visitors increased forty four percent.

which was huge. And it's just such a simple innovation. It's such a great use case for A I just simply translating uh the the language of your content.

But it's so, so effective IT essentially just ten x is your total addressing market. Not is what we are doing. At least we are trying to do IT. We're using A I to translate .

this podcast into spanish and portuguese at the moment would do.

But I think this is something that everyone in content should be looking at. How can we figure out away to just overnight, flip a switch and make this all available to the eight billion people across the entire globe? It's just a really quick and nice way to just skyrocket your total addressable markets.

So that would be the first thing that I would I would commend read IT on the second key driver of their growth actually was not intentional, but it's very interesting. And that is google recently changed the way IT ranks search results. So they made this update called the hidden gems update.

And what they've done with the algorithm is they are now referencing what they call authentic content, which is the content that is generated by users, content you find on forms and on chat rooms. And so as a result, you will find that redit is showing up more and more when you search things on google. It's also appearing higher in your rankings.

And here's a great start read. IT is now the sixth most google word in the us. So it's is great combination of you know this intentional play with A I, but also the market dynamics are shifting two red, its benefit and it's just it's just translated to this explosion in the business and in the stock. So incredible quarter for redit.

But when you are talking about flipping a switch and accessing a global market using A I ah and again, the a Operative term nervous, flip the switch and go global, you sound like me and are our hands last week where at that point a the person who runs the company, Cathy, doing a bitch, you translate the should into farcical and trying to find the equivalent of zip crude and iran to advertise. And it's not quite flipping a switch is what the push back. I ga.

it's flipping a million switches.

Yeah, it's in someone actually has to build the switch and manage IT while I I just you know the pot as to say let the switch and let's go global.

This is strategy Operations yeah .

this is a difference between being front front house and backhouse, right? So exactly. I interviewed the CEO at the annual advertiser event, and they have big, they have big advertisers in the room.

I saw the C. M. Of mars. I have the biggest media agencies there. IT feels to me a little bit like, can I don't know, matter pentre or snap in the early days? One of the reasons i'm going to kiss the asked to see o that he seems like a nice man is I bet my prediction is you're going an amazing party. I can the next one or two years, they're going to say we need to be in of stroking the hair of people who we are putting out a business and uh, get bring them to some great party and get do a lipa or or bad bunny or somebody anyway, we're going we're going to the red of beach party. That's what I take away from all of this.

I can't wait, waiting for my invite. Let's move on to eli lilly. As many of all this is probably no eli lily cells that bound and major, which are these G L P one drugs. They are the alternatives to oceanic and rogov e, and it's not selling as much as people had thought, or at least that wall street had thought.

And the obvious question is, of course, why what is going wrong now is interesting as that the ceos answered to that question was that there isn't a problem with demand, but there is a problem with supply. So supposedly, the suppliers of the inventory for these drugs, those supplies cut down on their stock and IT affected eli liz ability to get the drugs out. But as a bulk kley analyst pointed out, if that's true, that could only have accounted for around twenty percent of that drop off in revenue.

In other words, there must be something else a foot here. Something else is going wrong in the eli lily G L. P.

One drug story. And IT can't just be this sort of chokehold on on inventory. And certainly, wall street doesn't believe that story either. So I I have a few thoughts of my owners to what might be going on, but I will throw back to you, what do you think could be the problem at eli lily, that the city did a bad job of explaining or at least won't tell us.

I wonder if we keep hearing about all these compounded jaime producers being able to sell. And if you go off market, but there's a bit of a glitch and matrix or a looper where if a product is sold out, you can build almost like a generic version of IT, the cost much less I gotten, think that, that's denting demand a little bit.

And I would think that in only that, you have a lot of these kind of upstart to sort of scrappy, maybe don't take a institutional approach for a great marketers and understand new medium. So I wonder if it's some of the new guys. So these compounded geoeye producers maybe slow their growth. What are your thoughts?

I was thinking that too. And if you look at hms, which we have discuss before they have been getting into the gp one game, yes, the compounded version that revenue increased fifty two percent north quarter, and a large part of that was their weight loss drug business. And there are several other companies that are offering these compound alternatives.

It's sort of becoming a growing space. And I think IT is possible that this do apply that we've seen on semi blue tie that has been owned by another nordic k and by eli lily IT could be a little more fragile than we think. The other thing I think is worth mentioning, which about team members, just a lung pointed out, and it's a simple but important point, is when you think of glp ones, maja zap bound, do not come to mind the two names that come to mind oroetes c and we gov.

And so I could be just a simple brand recognition problem that these products just aren't present in the public discourse enough. If you've been watching the world series recently, you will likely have seen this would go vy ad over and over this new ugo vy jingle that is probably stuck in a lot of people's heads right now. So I think the other explanation here could be a very simple issue, is just a marketing problem under brand awareness problem. We know what's that bound of majora is because we study this stuff for a living. But for the average american, you just think olympic and will go you and you probably don't even know what G, L, P, one is either.

It's interesting. I I agree with you. I usually don't like the idea. Typically, when I walk into a brand and they say they want to show me a brand campaign and are going to spend money on advertising, I usually say, well, if you're spending a lot of money advertising, usually you have somebody who wants to hang out with really cool, interesting people, which add agency people are or you're out of ideas because the companies of the best products don't need a lot of brand marketing.

In this case, I think an awareness campaign exactly around you set around that bound a major awesome. Maia is awesome if I came back. And in my next life is an M M, A fighter.

I want to be called mojo. I think that's a bad as name. It's a really cool name on jo do anyway but I agree with you.

I think they need fire up the od budgets yeah IT .

gets some awareness. There's so much money on the line here. Um also suppose if there's a lack of scarce, I um that finally there's enough production here to meet demand. I wonder what's gonna en that when to reach us into the markets that should be in. I'm just such a huge fan of this technology speaking, which should bring this back to me and i'm doing this N A D treatment.

If you heard of this only from you .

mentioning IT last week ad.

that's i'm fine.

I leave no dillion dollar bonus for you.

I'll make my way.

Just Clair is getting a dsl lion dollars anyways. This C I D stuff is really, really powerful. But I wonder if he has a similar compound, this G L P.

One, because I have noticed i'm losing my taste for the sauce and I don't. I'm gna fit right in a baha about last year. They take drugs, but they don't drink.

I would that going back ili ipod doesn't all over the place. This fuck and native is supposed to get me focus. Maybe IT doesn't working.

I think this is probably a buying opportunity. I think anyone in this market with two great brands or one great brand, man joo and zap bound, that's a terrible. Your bound for zp is zp bound. That sounds awful. That's like some rock climate started, you know, some bad ropes company or something I think other than the CEO making lame excuses and say this one buy the debt.

Our final headline is X A I, uh, which elon, this is elon's A I company, which he is supposedly trying to raise around at a forty billion dollar valuation. This is a reminder of what this company is. So people may remember the promise of this company was to create a competent to ChatGPT that was, quote, more truth seeking.

So for a while, d ilan was calling that kind of jokingly truth GPT. Um he saw how successful ChatGPT had become and he wanted to make a competitor that was also less woke pretty much so xi did build that product. And the product is called rock.

Many people may have heard of IT, and it's available to all paid users of the x platform, formally known as twitter. I've used IT. It's fine. There was a period where I try to be anti woke and funny and IT felt like IT a not very funny guy who's trying to just cracked jokes at every second.

That wasn't a great product, the tony hdge Cliff of elms.

it's exactly right and they fall flat. So i'll get your reactions to X A I in this funding round. There are a few more details we can go into, but what do you have thought on this round?

So I think this is my next opportunity to turn three billion dollars into ten my senses. This is now a distant forth or fifth in the LLM market. And he did some slide a hand, trying to give tiki right to the data, I think, of twitter, and spent out X, A I.

And he got a disproportion amount of the firm. I would have gone abiit crazy if I was a shareholder in twitter. But ill, greg right now is a distant fourth, fifty or six, trying to trade at the same valuation as anthropic.

And that's the analogue here. I would imagine an anthropic has dramatically more traffic revenues, Better technology. It's sara and what they keep leaking as a genson hawk did say that it's easily the fastest supercomputer on the planet. X A I has built its own data center. But i'm i'm not sure if that ends up being much very competitive with I think .

that's an important point. Is that a competitive advantage? When I look at X A I, it's like there are three main differences that make IT different from other A I companies.

The first is that elon musk is leading. So that's a big deal. IT means you can raise a bunch of money.

Uh, the second is, as you said, they're building their own data centres and that's what sets them apart from open a eye. Open a eye does not own any data centres. Instead, they essentially rent their compute from microsoft, and that's why they have that partnership. And then the third big difference is that xi is building its own frontier models, and that's where it's similar to OpenAI, but not similar to a company like complexity, which is building models on top of the models that are built by other companies like OpenAI. So in other words, that sort of strategic differentiation is that they want to own everything that they create. They want to be a truly independent eye company, which is a little rare these days because it's developed in to this massive supply chain where you have the chip manufacturers selling to the data centers and the data set is selling the computer to the model makers, and the model makers selling their models to the apt makers is a big supply chain. And X, A, I has decided we're just going to own all of IT ourselves.

I just don't know if X, I, I is going to have the capital. They're starting from less than zero versus everybody else, and they want to raise at the same valuation as the number two with the number three player and thropp. S, so I have a bias because i'm not a final musk. E, but on just a stray evaluation standpoint, this feels me like a bad deal.

Yeah, I mean, that sounds like the elon musk premium, but it's why why he still deserves a premium like this to me is beyond me the fact that he destroyed eighty percent of the market value of twitter that was his lost venture in its its crazy as local.

He's gone moon gentle on us.

We'll write back after the break with a look at big tech ones after enjoying the show so far. Be sure to give property markets a follow wherever you get your pot ghosts.

Candidate trump, as you've likely heard, Jimmy, the overton window up a few inches at a rally in medicine square garden on sunday with racist, sexist VGA wasn't even a particularly good joke and its seta commentary from speakers. But did you hear the really weird part, the speaker of the house, mike Johnson, part a nice looking guy.

just a little beautiful face with a glasses.

Get a little glass. Yeah, that was also weird. But that's not actually what i'm talking about. Just a little later, try turn to speaker Johnson and he said this.

we can take the senate pretty easily. And I think with our little secret, we're going to do really well with the house rate. Our little secret is having a big impact. And I have a secret. I'll tell you what IT is when the races is over.

That comment is making people nervous because trump does have a plan for if he loses this election. A reporter did some digging into IT. We're going to talk to him today, explained little secrets every weekday, wherever and whenever you get your podcasts.

We're back with property markets most of the magnificent seven reported earnings last week, bringing A I demand on spending into sharp focus. Google, microsoft, boat reported cloud revenue growth above thirty percent of beating expectations. But while google stock rose, microsoft fell as the company advised its overall revenue growth would slow in the current quarter.

Meanwhile, meta stock also fell after the company missed expectations on user growth and warned that its A I expenditure would continue to increase in twenty twenty five. So I think let's just start here. A lot of tech earnings telling slightly different stories that just start with what wall street thought about these earning.

So for google, all street was very happy. Revenue grew fifteen percent, cloud revenue, sky rocket said, and the stock rose four percent. I think the main story with google is there was nothing that you could really fault the company for in that earnings report.

Everything was going well. Microsoft and meta. On the other hand, wall street was not so happy with. And it's a very similar story that we've seen before in tech, which is the top and bottom lines were very strong.

They beat expectations at both companies, but there was just one tiny little temple on the earnings report for both of them. And for microsoft, IT was that their guidance was a little bit soft, not as strong as ball street wanted. And for matter, the user growth was slightly weaker than expected, three point to nine billion active users verses three point three one billion expected, I should remind us daily active users.

So it's still pretty incredible. As a result, microdot stock fell four percent and meta stock fell three percent. So I think the summary with these earnings here is that is very strong overall, but again, incredibly high expectations for these companies. That just start with your headline reactions to the tech earnings that have coming in this week.

What you said was really prevent an encyclical a few months ago, and that is the expectations are now that you're going to blow away expectations. So matter actually, the revenue, earnings Beata expectations increasing one hundred and thirty five percent, respectively, but investors were disappointed by weak than expected daily academic growth.

And also, I think they think that freak everybody out as when ZARA burg wasn't threatened to spend tens of billions dollars, the mixed ality had sets, he was promising and he did IT and he and he kept spending well beyond any evidence that this was working. And when socket wick says, no, we're going. We're going in on A I and get ready, folks sold on your heads.

A kinds spooked, I think as investors is a little bit just because, uh, you know, relative to the earnings in the revenue beat, the revenue earnings were were amazing here. And I at the same time, let's go to the other end of the spectrum, everyone sort of waiting and anticipating snap to start a death rather. And even though they their sales jumped fifteen percent, not as much as the other guys, they you know their was up ten percent because the expectation people are sort of when people list to a medical, they're waiting to see just how fuck and amazing IT is when people listening a snap burnings called, they're kind of a little nervous like exist.

The quarter that snap announces the meta is just putting the matter business and the expectations here have gotten so crazy. And I know i'm jumping around a lot, but let's talk a little bit about microsoft. They also beat revenue earning expectations.

The stock was off four percent and after hours trading on weaker guidance, good CEO sandbag guidance. They you always want, in my opinion, under promise and over deliver. And when you start getting gas spread or you're worried about losing your job, you start over promising and under delivering.

The total revenue increase at this at sixteen percent of a huge number. That means that they have they found another eight or ten billion dollars per court or in comment revenue. And also the revenue mix is getting more solid because they are cloud offering asure revenues up thirty three percent. And that is a business with incredible margins and tall points of growth came from A I services. So in some, this was just I just, this was just striking. And the only thing that, the only wrinkle here, the thing I would offer that I noticed when we were talking about this a lot, is that if I were to ask you what is what comes to mind when I think of when I ask you what who is the leader in, uh, the streaming market who comes to mind?

Well, you know you know my real answer. But I think the average person would say, netflix.

that's right. And yeah but IT IT isn't right. It's youtube. And youtube is combined ad and subscription revenue over the past four quarters, this the past fifty billion dollars. So net lix is that thirty seven billion over the same period over the last four quarter. So so youtube is a bigger streaming network, bigger.

And be curious what the growth rate is there and not sure they break IT out, but if you applied the same multiple to youtube, you'd have a half a trillion dollar market cap company. And I wonder if there's opportunity for alphabet to cut a deal, the D O, G, among other things, in their remedy trials. They look, what if we spend youtube, but across all of these folks, you know whether was read IT, which looks like it's becoming a truly big tech company, a meta, all of them snapped showing that we're still here, snaps like, hey, don't forget us.

We're still here. We're still growing. We're still doing really well. And the other guys, the big guy, the alphabets, the matters of the world are just, you know, still on fire.

Yeah, a lot, a lot. That will start with youtube. I just want to to reemphasize that number.

You said fifty billion dollars in revenue in the past four quarters compared to netflix at thirty seven billion with the same multiple. Youtube would be a half a trillion dollar company in market cap. It'll probably be higher given the margins and you given the growth rate.

But if they were broken up into its own company, which you have just suggested. So want to point out that would be one of the top twenty most valuable companies in the world. IT would be more valuable than oracle.

IT would be more valuable than moster CD. IT would be more valuable than Johnson Johnson. And yes, of course, I would be more valuable the netflix. So I I mean, we've discussed why we believe youtube was basically the most underwater asset in the market right now. I think this should really drive at home for people is something that people don't seem to talk about that much.

And I think, to your point, it's a little bit of the kingdoms MMA attacks that sort of gets lost in the noise because of all of the other things that google is doing. But this is just a dragon or in the entertainment space. I am just fascinated by this business of youtube, and they continue to crush IT.

One of the other things you pointed out there is the idea that matter, they spent, they spent really big on the matter of us, and I freak everyone out. And now they are spending really big on A I. And so the numbers are matter is raising its capex forecasts for four to between thirty eight and forty billion dollars, and that is slightly freaking the market out.

They don't love how much that expense line is going to grow. Having said that though, all the other tech companies are doing IT. So over a google, their carpets rose sixty two percent from a year ago to thirteen billion dollars.

Microsoft is doing IT too. Microsoft cotex doubled from last year to twenty billion dollars. And this is just for the quarter.

The ultimate business strategy has become capital as a weapon, mark rober goes. We have access to cheap cap also. I'm gonna spend you I mean, there's kind of three for no one can no one can keep up with these guys except each other. The biggest companies in the world that aren't big tech can make these types of investments any longer. They're spending more money on know on G, P, U, an x on on spent on oil exploration at the peak.

I mean, so just some days are here. Microsoft, meta, alphabet will spend more than one hundred and fifty billion dollars on capex in twenty and twenty four. And more importantly, microsoft matter, alphabet and amazon account for roughly forty percent of invidious sales.

So what we're seeing here is a dynamic where, you know in video is pretty much propping up the stock market. We all kind of identity that an nvidia's entire top line is being propped up by the capex spend of microsoft matter, alphabet and the amazon. So in a way, that capex number is the most important number in the in the entire global stock market right now.

We should all care a lot about how much they're spending. But as you mentioned, the the competitive aspects to this, the idea that they are all ramping up spending, I wonder to what extent this is becoming a little bit of a big dick contest. Well, if you if you're mox OK bag and you're seeing you know you're seeing under patri invest billions and billions into the space and you've decided to getting the space too.

I wanted to what extent they're gonna start out beating each other, not because IT necessarily makes sense for the business because they don't want to be caught out and they don't want to look to the world like the loser or like the coward who wasn't down to double down on A I and you know, maybe i'm not giving them enough credit, but I could certainly see if I were in their position how I could get caught in that dynamic. Google doing IT, microsoft doing IT. So we Better do IT too well.

I think correctly, in high insight, IT looks like the stimulus plan during covet that the fed and the White house overdid IT. They spent more money than was needed. And Janet elen, when faced with that question that did you overdo IT SHE said we decided he said, ah we probably did.

But at the time the analysis was its much risky to undergo IT and overdo IT and I think that's how these guys are approaching A I and that is if they overdo IT, they spend too much. That's not the same risk is being the company one of the big tech companies had all of the assets, all of the I P, all the customer face, but got vested and saw their stock lag. Everyone else is because they underinvestment in what appears to be the most seminal technology trend last twenty years.

So I gotten imagine that, okay, we need ten billion the range of requisite capex to mere plants. The summer between twenty and thirty billion. You got a thing to see, you says with a stock at an all time high with access to cheap capital, i'm not going to be the CEO that missed on A I you say twenty to thirty billion, here's thirty two .

will be right back. And if you're enjoying the show so far, kid, follow and leave us a review on property markets.

We're back with property markets. So metta's revenue jumped nineteen percent to forty point six billion dollars. It's that's its record revenue struggling number. You mentioned earlier about revenue mix.

You know the point that microsoft is on a really good job of diversifying its revenue, which makes IT that revenue a little bit more stable. They're able to weather a storm. It's a great it's a great reason to diverse fire revenue.

So one point out, there's one sort about matter. Ninety six percent of their revenue still comes from advertising, so they're not in a very strong position from a longevity perspective, but it's sort of highlights. Just want to juggle this advertising businesses.

The fact that this company is one of the top term most valuable communities in the world, and it's all just from all of that advertising. You talked about how we've been getting into A I, which has been massively increasing their ability to accumulate users and also monitise these users. I'm just amazed that meta is worth this much and making this much money, and it's still just a pure play add business. I just thought that was quite fascinating.

I mean, these companies combine probably have ad driven revenue growth of summer between, I don't know, twenty and forty billion dollars in criminal outgrowth. And I had dinner the other a week ago with this iconic broadcast anker. And this is someone who likely, I don't know what this person makes, but I imagine it's tens of millions of dollars, household name outstanding of what they do. You have to tell us now, I can, I can, in a sense, because we're good, good friends, and I don't like to prostitute my relationships.

I am imagining its underside, Cooper.

and just let you not go on. What I will say is I wasn't a understood oops, I A second friend. I A second friend now on the media go .

system anyways 哦 toka .

colson got OK me and toki yeah we faced each other and we were screaming out um the ghost of rick antm I know I got that name um that's an image。 That's an image anyways uh and he said that every contract renew al is coming up across the biggest nakuru biggest stars in broadcast television. The conversations are going something like this.

As you know, it's a stress ecosystem. We know you are making ten million year and now we're going to pay three and a half. And it's directly correlated to these earnings because the economy is growing three percent a year and all of these companies are going eighteen percent.

Ad spending is not a 8 percent。 This has become a bit of a zero some game. And that is say at spending is up because it's a strong economy, say, okay, fine, it's up five percent at spending is in up fifteen.

So that incremental ten percent is coming from somewhere else. And I can tell you what is coming from. It's coming from generally speaking and supported media that isn't one of these guys.

And so we're as if you hosted yeah the ultimate morning show program, right? And you were they were just printing money they could pay, hold you seven or ten million year and not like, how do we love you but revenges are down thirty percent. Profits are down sixty percent.

We're going to pay a timman is like, fuck that. I'll just go drink White wine all day. You know, IT also, just more generally speaking, I have spoken to two individuals. You know, like I I like to think i'm trying to be good about my word on coaching. Young man, i've heard i've had two men reach out to me and asked to speak to me.

And they both men, men who are my age, who are both very successful in the media market and they've either quit or been laid off and they have no idea what to do right now because the the motion picture and television market in los Angeles and generally speaking, the media market is really strained if you're not working for one of a handful of companies are that are just killing IT and IT IT strikes me that these folks haven't connected the dots. There is real pain on the other side of these revenue numbers. And that is that is a terrible time to be A C, B, S.

Or n mtv. Does anyone remember what mtv is? A newby newspaper revenue of eighty percent in the last thirty years. Billboard drive time. If IT wasn't for the election, local new stations would be just gone.

Yeah, that's a great point. And you think about the other beneficiaries of that revenue growth, where is that advertising going? Is going to the people who are creating content on instagram and on tiktok and on youtube, those of the beneficiary that granted, they're not getting multimillion dollar contracts, but the reason you're seeing those millions getting shaved off of the Anderson Coopers of the world is because, Frankly, it's going to the Scott gallons of the world and people a lot less famous than you people who are creating content on instagram, who are making videos, who are commentating on things in the news.

There are thousands, probably millions of these people out there who are making a living and who are making real money by creating on the digital platforms. And when I just can't wp, my head around is how those people continue to not be taken seriously by the main street media. It's been oma sight. Mainstream media just set of covers their eyes and pretends like they're still in their hay day. Well, what's happening as we're seeing the social media companies having this this explosion and growth and meanwhile, legacy media is completely drain up well.

really. So election night and i'm bragging right now, but I was I was asked to appear on a variety of cable networkers, right? They want to bring in. They go for twelve hour state y've a lot of time to fill. So like, oh, bringing the guy and Young man just tell not to tell dig jokes, right?

So almost every network called and said, you want to come on an election night and the one I chose, i'm going on amazon with brian Williams and that's kind of telling, right? IT used to be egon sana fox or cbs or abc because those are the hypertension. Now I now i'm going the new guy.

And today on pivot, we interviewed mark Brandon, who I just think is so talented and sobering as I was listening to market. I thought she's going to get hired by youtube or amazon and she's going to be positioned with the right technology in the right format in one of these mediums. And she's going to drive so much more economic value for the parent company and herself. And even our little podcast, we just started posting our videos on youtube. We're now making forty or fifty thousand dollars amount the incremental ads from youtube just by putting our stuff on youtube.

not to mention all the stuff on that happening on instagram, where you'll post an instagram real and it'll go viral and then you'll get speaking engagement requests. I mean, the fly wheel is up run in social media.

One of the things i've learned over the last ten years, we're in an attention based economy, full stop. If you can command attention, you can get revenue. Oh, wise.

The person running the firm should be let go. And what you want to find is companies where the there's a delta between the two. So newspapers used to get thirty percent of the advertising and they were getting ten percent of the attention.

You knew they were in trouble. And the web was getting thirty percent of time and had eight percent advertising. You knew those two we're going to chew up right now.

The greatest delta in terms of attention to revenues is podcasting. Total consumption is about fifteen or twenty percent and revenge are solid and growing, but they're nowhere near the attention. And in addition, I think if you collapse that with the following, and that is there are very few ways, are increasingly fewer ways for an advertiser to reach you.

You're a great White right now for advertisers. And that is the age of twenty six. X, your, your, what I would effectually refer to as stupid.

And that is you in your mating year. So you'll spend one hundred and fifty box on that stupid crew net shirt you're wearing. You'll join SOHO house. You'll spend seven dollars .

on coffee house .

would never have. No, I much more down to earth. I'm much more to, by the way, that I tried about the global express. I flew back here from miami.

Anyway, the i'm not nearly as superficial as you IT anyways, but advertisers love Young people because they're stupid and they're they're made years. So they will spend a tony money on high margin products trying to attract a mate. They are the ultimate target.

And the problems M S N B C average viewer is aged seventy, empty v is like fifty two or fifty four and you or and your cohorts is listening to podcast. So we not only have growth and attention, but you have growth, uh, in attention across the group that is increasingly difficult for advertisers to reach. So I I think you're going to see I in one of my predictions of doing predictions.

I think the podcast revenue is going to grow faster then every digital platforms revenues, maybe with the exception of tiktok who rely, claim the numbers are lower. But I think you're going to see next year revenues, ad revenues growth twenty five percent plus and twenty twenty five is going to be there. A podcast busted open by this this election or candidate interviews, attention and advertisers are figuring out the media landscape is dramatically shifting under our fate.

Let's take look at the week at we'll see the fed interest rate decision for november will also see earnings from polenta, nova artist, B M B and paramount. I doubt we will care about any of that because we'll have bigger fish to fry tomorrow. Scott, your predictions .

will like to see election, and i'm predicting that vice present Harris is going to win the election. The gambling markets say that it's two to one in favor of trump. You correctly pointed out that, that might be skilled because of these markets over index Young man, who are much more by towards trump.

A lot of people think these markets are being manipulated to send the signal of confidence around the trump campaign. Also want to recognize, I have huge confirmation by here. I'm very emotionally caught.

Openness I could not get over. I was happy to get back to london. I don't know if you've noticed IT and maybe don't notice IT when you're in boiling water, but I cannot get over how tense things are.

I wonder and again, confirmation by here that people are just fucking exhausted and think, how can I take some of this temperature down and distinct the policies distinct of where the, you know, perfect is not on the many here there. I think a lot of people going to, you know, I just rather not go back to that shit. yeah.

So anyway, my prediction, simply put, is that it's not only going to be. Uh hair sone, but I think I think it's going to be a decisive when and all of the odds and all of the data say that, that's unlikely. But anyways, in some i'm predicting that in january of twenty, twenty five were going inaugurate vice president Harris.

People forget how much is sucked, not from a policy perspective, from just a day to day discourse perspective. Having that guy lasted over the news, people freaking out about him, twenty four, seven. Every single conversation is about politics and about how the us.

Is in decline. And whether or not you believe any of that is true, are you really down for that to just dominate your life all day, every day for the next four years? That to me is just that what's the big nightmare of of the trump of the trump presidency is how I just, we could never escape in. We had four, nine years of some kind of borrowing politics, and I really hope that we can have four more of them.

My favorite thing about senator bennet, he, I did a fundraiser at my place for him, and he said, they said, what would you be like as president? Someone ask me like, i'm going to be the president you never hear about and I thought she's, this crime would not be refreshing.

I absolutely loved that.

He said, I want to, I want to be the president you don't think about, i'm going to do the job. I'm not to send, send everything. I'm not as charismatic as some of these other people.

I'm just gonna the guy that gets the job done anyway. I hope that the guy that gets the job done is a SHE. And I I really hope that when I move back to the us, IT feels less tense, less sanctions ious, that we keep this economy going.

That Young man recognize that their Operating system should be won a protection, and that I I genuinely do believe that women are under threat here and that men don't recognize how much this could affect us. So i'm hoping i'm hoping and trusting that some of these things enter people's brains as they enter the voting booth. And and i'd also just like to highlight, I acknowledged that a lot of people don't come to this podcast politics.

I endorsed haris, my newsletter numbers in a mouse. We have the greatest number of unsubscribed we've ever received. And as i've said before, there's no point in having economic security and people who love you on conditional, if you can speak your mind. And also told the people who unsubscribed I just wanted tell you a full refund, just come in your way. March is out.

the service said was produced by car Miller and engineer by Benjamin Spencer or says, produce results and vice mister varia is our research ad jasa as our research society. Opers is our technical director and Katherine dolan is our executive producer. Thank you for listening. Profit markets from the vox media podcasting tworog join us on thursday for our unpack on the election with Anthony scar mochi only on the profit markets feed.