AI transcript
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– Today’s number, $8 million.
So that’s how much a 30 second ad spot
on the Super Bowl costs this year,
an all time record.
Ed, nothing says American exceptionalism,
like four hours of beer,
boner pill ads, and men giving each other CTE
for our entertainment.
It’s essentially Rome, but instead of Lyons,
we have Taylor Swift, Ed.
We have Taylor Swift.
(upbeat music)
(singing in foreign language)
– Welcome to Prop G Markets.
That was sort of a thoughtful Super Bowl themed intro.
Banter, Super Bowl, do you care?
– No, I don’t care at all, actually.
And this is the first year I’ve decided
I’m just not watching.
I feel like I’m always watching
because I feel like I have to,
but I’ve just decided, you know what?
I’m not interested in the NFL,
I’m not gonna watch this year.
Are you watching?
I don’t even know who’s in the,
Claire, do you know who’s in the Super Bowl?
By the way, Claire, I have a,
oh my God, I just realized you’re in my house, Claire.
I literally thought she has the same climbing wall I have.
– Yeah, this is your house.
– Claire, how are you?
– I’m really good, it’s good to see you.
– Welcome, welcome, don’t touch anything.
– Thanks so much for having me.
– Anyways.
– Yeah, you have a climbing wall in your house.
– You’re in the kids’ room.
I do have a climbing wall, and my kids have climbed,
my kids climbed for a good 30 minutes,
and now it’s just a decorative piece.
(laughing)
Cost me about 40 zip recruiter ads.
– By the way, I think it’s Chiefs and Eagles.
– That’s right, Chiefs and Eagles.
– Chiefs and Eagles.
– I thought you used to be a big NFL fan, Scott, no?
– I’ve never actually been a sports fan until my kids.
I decided to give up golf and watching all sports
and poured into fitness,
in trying to spend more time with clients,
such that we could develop a father-son
parasocial relationship,
and they’d pay me millions of dollars to consult,
and then I could at some point buy one quart of a golf stream.
– You know what I’m doing tonight?
I think I’m gonna do ketamine tonight.
– Really?
– I went out with some friends last night,
and they were having such a good time,
and I’m like, “What are you drinking?”
They’re like, “Oh no, we don’t drink raw ketamine.”
I’m like, “Really?”
And I’m having trouble, Ed.
I’m having trouble disassociating.
I think we’re in the middle of a second insurrection,
and no one’s talking about it,
and it’s freaked me out and got me really upset.
So I think I need to disassociate,
and I’m hearing good things about ketamine.
Do your friends do ketamine, Ed?
– Yeah, good amount of my friends do ketamine.
I can’t tell if you’re serious,
so you know it’s illegal to just do it.
– There’s a few things I do that are illegal,
and I continue to engage in them, Ed.
– Okay, just making sure you’re clear.
I know you did it the legal way.
– Hot’s legal now, so yeah, edibles are legal,
so that’s not a problem.
– Right, yeah, exactly.
– Actually, I don’t do that much that’s illegal.
– And the way people do it is they snort it.
You’re really gonna go up and–
– Oh, really?
I was hoping to stick something up with my hand.
I was hoping to find an attractive one
with some gloves handy.
(laughing)
I have to pay for that, I have to pay.
Now, now cough, Nurse Ratchet, anyways.
– Well, I’m excited to see you in a couple of hours.
I’m gonna come over and hang out at your house.
– Oh, that’s right, I have a team meeting,
you’re all presenting your business plan.
– You excited to see me?
(crickets chirping)
– Get to the headlines, Ed.
– Let’s start with our weekly review of market vitals.
(upbeat music)
(upbeat music)
The S&P 500 inched up throughout the week.
The dollar declined, Bitcoin was volatile,
and the yield on tenure treasuries dropped.
Shifting to the headlines.
Disney earnings beat expectations
on the top and bottom lines.
However, Disney Plus lost 700,000 subscribers
with another modest drop expected in the current quarter.
The stock fell 4% following that earnings report.
Novo Nordisk saw strong fourth quarter demand
for its weight loss drugs with Wigowi sales
more than doubling, and Osempic sales
rising 12% year over year.
Profits also exceeded analyst expectations
up 29% from a year earlier.
The stock rose on that news.
And finally, Uber’s fourth quarter revenue
beat expectations, rising 20% year over year.
However, operating income was lower than expected,
and the company issued weak booking guidance
for the current quarter, and Uber’s stock fell 7%.
Scott, your reactions,
starting with Disney’s earnings a beat,
but the stock did fall.
– It’s clear who the number one is in streaming,
but they’re all fighting to be number two.
They’re like, okay, the number two will survive,
and it’s not entirely clear who’s number two.
And the race for number two is between, in my opinion,
the artisanal sort of HBO that’s created
an incredible culture that produces kind of the water cooler
zeitgeist moment of content.
And then Disney, which has just such singular
clear positioning around family,
and then bundling Hulu and ESPN.
I think it’s ESPN plus.
It’s a pretty good offering.
Now, they were able to raise prices of 4%,
which isn’t a huge price increase,
but it is a price increase.
And basically they lost 700,000,
but they would argue that’s flat.
That does kind of communicate
that they have some pricing power.
I would argue that’s a good thing.
Netflix’s churn is 2% while Disney’s is five.
That may not sound like a lot, but it’s huge.
It means that every three years,
Disney has to reinvent their entire customer base
that Netflix does not.
In addition, you have this incredible transfer
or means of production.
What do I mean?
What Japan did Detroit, Netflix is doing to Hollywood.
And that is Netflix announced that the majority
of their content, more than 50% of their $15 to $18 billion
investment on content is being spent and/or,
if you will, produced overseas.
They’re not doing that because they like Spanish people
or they want more multiculturalism in their content.
They’re doing it because they figured out
they can get a gaffer, a writer, an actor,
a producer, sound engineer, studio construction folks
for 40 to 60% of the cost of what it is in the US.
Whereas Disney, the percentage of content spend overseas
is 4%.
But what Netflix has said is that if I have every week,
not a 10, but I have just a shit ton of sevens and eights,
people don’t cancel.
– Yeah, I think these earnings, I mean,
Wall Street did not react well to these earnings.
And I think rightly so because I think this was just
unimpressive on so many levels.
I mean, Disney plus subscribers declining,
not by much, it was around 1%, but still a decline.
And Disney plus’ response or Disney’s response was,
well, we rose prices, so this is expected.
And by the way, that’s kind of what you said too,
but you look at Netflix,
Netflix also raised prices last year
and they still added 19 million subscribers.
So I don’t fully buy the, we’re raising prices
and therefore subscriptions are gonna fall off.
We’ve seen it with Spotify too, Spotify raised prices
and their subscriptions are still continuing to climb.
You also mentioned the churn rates.
I just see this as such a big issue in all of streaming
that it makes me believe that streaming
is in a lot of ways uninvestable over the long term.
Apple TV’s churn rate is 8%.
Peacock’s churn rate is 9%.
Disney’s churn rate is on the low end,
but still it’s really high, it’s 5%.
So if you just wanna stay flat in any given quarter,
you basically have to grow your subscribers
by 5% every single quarter, which is just insane.
I mean, I just don’t see
how that is a sustainable business model.
And then the second thing that makes me concerned
about Disney was their box office results,
which were exceptional,
but it was all because of this one movie, Moana 2.
And that was kind of what saved these earnings.
Without that movie, this earnings report
would have been pretty terrible,
which again begs this question,
like how sustainable is this business?
Where you’re basically riding on your growth vehicle,
which is Disney Plus, is pretty stagnant.
And then you’re also relying on these sequels
every single year.
I mean Moana 2, Inside Out 2, Deadpool and Wolverine.
At what point are people just gonna get bored
of these sequels?
Like who’s gonna watch Moana 3 and Moana 4 and Moana 5?
Like how much longer can this go on for?
– You do start to see fatigue.
I would even argue like Deadpool and Wolverine,
I love both those actors.
I think they’re fantastic.
And I’m like, I’m not sure I’m gonna see the next one.
I’m like, okay, I think I’m sort of done with those franchise.
Anyways, what’s really interesting here though
is that the parks did well.
And that is, and if you think about it,
AI can’t replace the parks,
or at least I don’t think it can.
There’s still something especially wonderful
or especially horrible if you’re the parent
about Walt Disney World, right?
That still is a, that isn’t a norm.
Netflix is gonna have a tough time
into Universal’s credit.
They spent the money and the decades
to build those franchise businesses.
But Adams are, this is your notion
that Adams are more important than bits.
But the Disney business right now,
the strongest part of the business as far as I can tell,
is the parks, the cruises and the resorts.
Because it’s hard for Netflix to spin up a cruise ship
business, these things take a long time
and they’re good at the in-person stuff.
– Absolutely, but if you wanna keep that business going,
you’ve gotta also be creating original
and persuasive and compelling intellectual property,
which they’re not doing.
No one’s gonna ride the Moana three ride.
– Yeah, but they can license content, they can.
I mean, I don’t, was Harry,
I mean, for example, Harry Potter, Lego.
I don’t, I think Lego licensed its IP
to someone who knows how to run those parks.
I don’t know if it’s a division of Lego,
maybe it is Legoland.
By the way, you’ll see when you have sons.
Legoland, in my opinion, is the least awful
of all of them.
– Legoland’s amazing, that was my favorite growing up.
– Oh really?
Oh yeah, that’s right, I forgot how young you are.
But I used to, I took my sons to the Lego hotel
and it was pretty cool.
– It’s epic.
– I love the image of Little Ed at Legoland.
Right, building scary, like you’re like,
I can build something bigger than that.
Anyways.
– By the way, just before we move on here,
when is your Netflix show coming out?
– Oh, not for a while.
– If you had to guess.
– I would guess fall of 26.
Yeah, it’s gonna take a while.
– We need to get you on camera here.
Is that part of the plan?
I hope so.
– No, I am, you will see soon.
I do have a cameo in what is the hottest show on HBO
in several seasons.
I do have a voice cameo.
So I’m excited about that.
We’ll have a party, you’ll all come over,
we’ll all celebrate and we’ll watch it together.
None of that is true.
(laughing)
None of that is true.
But it’s a nice thought, isn’t it?
If I was kind of a more loving and engaged boss,
get out of my climbing room, Claire.
Don’t touch anything.
Anyway, sorry, go ahead.
– Let’s talk about Novo Nordisk.
This was pretty important earnings report for this company
’cause they simply put have not had a good year.
The stock’s down 30% in the past 12 months.
They tried making this new GLP-1,
this drug called Kagrosema and the trials failed.
They’ve been outclassed by Eli Lilly
who have been sharing from their studies
that their drugs are just more effective.
So Novo Nordisk is not in a great place.
They needed a really strong showing,
not from the insulin business or the glucagon business
or any of their other medicines,
but from the GLP-1 business
because that, as we know, is the only thing
Wall Street cares about with this company.
And rightly so, that’s where all the growth is coming from.
The results were pretty good.
Wagovi sales more than doubled.
If you look at that in combination with OZMPIC,
the obesity drug business is up more than 50%.
So the GLP-1 business is doing quite well.
I think the question here is a larger question,
which is, will this whole GLP-1 thing live up
to the hype that we had about 16 months ago?
And that’s sort of up for debate.
I mean, I’ve seen market size predictions saying
this is a $100 billion market.
Some say it’s a $500 billion market.
No one really knows.
So I kind of look at this company,
I look at these earnings
and I don’t really have an answer.
The only thing I can conclude with Nova Nordisk
is, you know, wait and see.
– I would argue that the space is just getting started.
The GLP-1 drugs, the category, everything I’ve read,
I just think this technology is incredible.
The next sort of question though
is how many competitors are in the space?
And also asked about the motor and who we had on last week,
made an interesting point
and that is for him, Nova Nordisk,
history was they kind of slipped and fell on Bogovino’s Epic.
– Let’s face it, they got valuable
because they were in the right.
They got lucky.
I mean, it’s not like amazing R&D
where they said we’re gonna come up with a weight loss drug.
The diabetes drug happened to have a side benefit.
And I think that until they come up with another product
that is a market changer, blockbuster drug,
I think the hypothesis has to be
that they got lucky with these two drugs
and they’re going to go back
to being a sleepy Danish diabetes drug company.
– I mean, that has showed an ability
to create another or acquire another product
in Instagram, right?
Google launched YouTube, you know, these companies,
Microsoft has an incredible cloud bed.
These companies have shown an ability
to innovate more than, you know, repeatedly.
And his view was Nova Nordisk
hasn’t really demonstrated that.
– To his point, the only company
that actually innovated this drug
that didn’t stumble its way into it was Eli Lilly,
who created their own versions.
Of course, after Nova Nordisk
figured this whole thing out accidentally.
So I think if you’re thinking about, okay,
how do I get exposure to GLP-1s?
Yes, Nova Nordisk is the market leader.
It has the greatest market share in the US and in the world.
But I think in terms of culture and innovation,
all that stuff that Aswa talks about,
I do think Eli Lilly is probably a better bet
from that perspective.
Let’s move on to Uber.
Uber reported earnings revenue grew 20%.
They had this kind of soft guidance,
$42 billion in gross bookings
expected in the course coming up.
And the stock did not react very well.
I thought the most interesting part with these earnings
was that Uber is officially launching a wait list
for its Waymo partnership.
So this is gonna happen in Austin first
and later in Atlanta.
Uber and Waymo are teaming up
and self-driving taxis are coming in 2025.
And I think the most important thing here is
the autonomous taxi fleet.
It’s not coming from Tesla.
It’s coming from Uber.
And I think that’s notable
because it just highlights this market bias
that we keep on seeing towards Tesla
where Tesla will go out and talk very vaguely
about full self-driving and autonomous taxis
and the stock rips.
Meanwhile, Uber does it and the stock declines.
People just don’t take it seriously for some reason.
And I can’t really wrap my head around it.
I mean, some people say,
you know, Waymo’s are more expensive to build,
they’re more expensive to operate,
which is probably a fair point.
But I think the larger point still stands,
Waymo is the only one that has figured it out.
And now they’re going to market
with the biggest ride sharing company in the world, Uber.
Meanwhile, Tesla has shipped nothing.
So I think this is a pretty big deal.
I think full scale commercialization
is still a long way away.
But to me, this signals Uber’s actually kind of
leading the pack in autonomous.
And I get the sense it’s probably very undervalued
at this point.
– Waymo’s been here for a while.
And the notion that we’re all waiting for Tesla autonomous,
I took a Waymo taxi six months ago in LA.
By the way, extraordinary, my first ride in this thing.
And we get to this intersection
where there’s been an accident.
I’m like, oh, great.
I’m going to be the first like autonomous guy taken out.
I’m like, this is so fitting for what I do.
PropG takes his first autonomous Uber
and gets, you know, T-boned by a bus.
Because the fucking Waymo couldn’t process a billion points.
There’s a cop with cones waving with illuminated batons
saying, okay, you need to go around the crash car
into the wrong side of the road
and to get around this accident.
And I thought, there’s no way
this thing’s going to be able to process this.
And it was very hesitant.
It drove like what I would imagine
a scared 16 year old girl would approach the situation.
That sexist.
– Or a boy or a scared 16 year old boy.
– No, my boys decided you can make,
you can make a left on a red light if you just stop first.
That’s what he’s decided.
It’s like, wait, you just need to stop.
And then you can go, no, no, no, no, anyway.
So this thing went out very hesitant and it figured it out.
So the notion that we’re waiting, it’s just so ridiculous.
Tesla, in my view, has already lost.
Waymo’s doing a great job.
Uber has massive, I mean, the number of Teslas is dwarfed.
By the number of Uber rides out there every day.
And you gotta give, I think Dara Kastur Shahi
has done a fantastic job because in their DNA,
if you think about a lot of the companies
that have outperformed the market,
they’re asset-like, right?
They don’t have big catbacks.
Airbnb, Uber said, no, we don’t wanna be
in the business of owning real estate.
We don’t wanna be in the business of owning cars.
We’re gonna leverage other people’s catbacks investment.
So Dara said, rather than go into AI
and announce big partnerships
and that we’re putting 10 billion into AI and autonomous,
he just said, no, I’ll draft off of other people’s catbacks,
in this case, Google and Waymo,
which has spent kind of 15 years and tens of billions
of dollars and I’ll give them, I’ll co-brand,
I’ll have an offering.
This is kind of how you do it.
– And by the way, Uber had their own autonomous vehicle unit
which they scrapped in favor of this.
And I think the market said,
oh, they don’t know what they’re doing.
Actually, it’s a small move for exactly the reason you said.
No one’s complaining that Apple didn’t go deep
into AI spending.
They said, okay, similar to how Uber evaluated autonomous
and said, there are other people spending more money
than we need to, we’d be playing catch up.
Why don’t we just become a remora fish
off of that giant spending?
And despite the deep seek meltdown,
Apple has not registered a loss in their stock
because they never decided to get into this arms race.
So I really, I’m shocked.
I think Uber arguably,
I don’t wanna say it’s been the biggest turnaround,
but I think that you needed someone sort of crazy
in a reverent and provocative and build fast
and break things in Travis Kalanick.
I don’t think he gets enough credit
for what he envisioned and what he built.
I think it’s extraordinary.
But Dara came in and has just made a series of very,
what I’d call smart, thoughtful moves.
Oh, it’s about to sneeze.
Sorry, that’s my pre-ketamine face.
By the way, if you run into me tonight and I like me,
it means I’ve tried the ketamine.
I’m excited.
I’m gonna truck you down.
I’m gonna make sure I see Scott on ketamine.
Instead of my screensaver,
I have a picture of Preep Barara in his phone number
because he’s my one call if I get into trouble.
So I used to be my boys on my screensaver.
Now it’s gonna be Preep
’cause if I get really fucked up, I’m calling him.
He just seems like very responsible
and he can get me out of any bad situation.
– We’ll be right back after the break
for a look at Spotify’s earnings.
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(upbeat music)
We’re back with ProfG Markets.
Spotify posted its first full year of profitability ever
with gross profits rising 40% year over year.
The streaming platform also added a fourth quarter record
of 35 million monthly active users.
That’s a 5% increase from the previous quarter.
Spotify Wrapped was one of the top drivers
of user engagement, fueling double digit growth,
shares surged 13% after that earnings report.
I’m just gonna point out,
I made one prediction on our 2025 predictions episode.
And that was that Spotify would be the media platform
of the year in addition to YouTube,
which I’m also really bullish on.
But I am just consistently impressed
with this company, the innovation,
their integration of video,
the integration of comments and polls,
their transition to profitability now.
I think if there’s one platform
that can rival YouTube in this new digital age,
I think it’s Spotify.
And we’re starting to see it in the numbers here.
Scott, your reactions to Spotify’s earnings.
– I love Spotify.
I think I picked it as one of my stock picks five years ago.
I went flat for three years, so I got it wrong.
But there are very few companies
that are able to take an entire medium
and distill it down to an app, a searchable app.
I can find anything on Spotify.
And people say, well,
Apple and Amazon have done the same thing,
but to your point, they’ve really innovated.
The rap thing, I thought,
I’m not entirely sure how you connect rap to more revenues.
I thought it was cool.
And I like Spotify saying, by the way,
you listened to Tom Petty and some DJs and that’s about it.
But how does that, I’m curious.
I don’t understand the mechanics
of how that translates to more revenue.
Tell me young person, what is happening on Spotify?
– Well, they didn’t connect it to revenues,
but they connected it to user engagement,
which that’s what it’s all about.
It just creates heat and excitement.
And I think possibly, I mean, full disclosure,
I don’t use Spotify because I’ve always used Apple Music
and I’ve never wanted to go through the cumbersome process
of transporting everything over.
But when Spotify rap came out,
it was the first time I was like,
maybe I should switch because this just sounds fun
to have this little presentation about me
and all of my music habits.
So I think that would be the answer.
– Let me just give you a little insight
into the role that streaming music plays in mating.
If you’re ever at home with your girlfriend
and you’re thinking, I don’t want to have kids
and I don’t want to have sex.
– I know it’s coming, I know it’s wrong.
– Just play ad supported Pandora.
– Nothing says do not mate with me.
This is, you are taking the evolutionary pull down
a couple notches if you have sex with someone
who has ad supported Pandora.
I play, I love, I still have ad supported streaming radio
and I think it’s hilarious.
I play it and I’m like, oh my God,
the commercials are so bad, listen to this commercial.
Anyways, but back to, I’m shocked.
I thought you would have had Spotify.
I absolutely love Spotify.
And also they have the best party.
Just so you know, they have the best party at Cannad.
– Oh really?
– I’ll take you, you can be my date.
– I would love that invite.
Well, let’s just go over some of the numbers here
because I think they’re pretty incredible.
So Spotify’s monthly active users hit 675 million,
beat estimates by 10 million,
which means that one in 12 people on earth is on Spotify.
Premium subscribers grew 11% year over year.
That was despite the price hikes,
average revenue per user up 5%.
First profitable year in the company’s history,
which I think is a very big deal
and stock is now at an all-time high, $620 per share.
We should probably think about
what could go wrong for Spotify.
I think one potential issue is this growing public resentment
towards Spotify and specifically towards Spotify
and how they pay their artists.
So a lot of people say that Spotify squeezes their artists.
They don’t pay them enough.
They reward the top 1% and the other 99% get screwed.
And that’s timely because Chapel Roan,
who just won the best new artist award at the Grammys,
she actually called this out.
She didn’t call out Spotify specifically,
but she called out the whole music industry
of which of course Spotify plays a huge role.
So let’s just listen to what she said.
– I told myself, if I ever won a Grammy
and I got to stand up here
in front of the most powerful people in music,
I would demand that labels and the industry
profiting millions of dollars off of artists
would offer a livable wage in healthcare,
especially to developing artists.
(crowd cheering)
– Well, isn’t that fucking precious?
(laughing)
Well, here, if you, you know,
and if you get in front of a group of kids
in high school, tell them not to be music artists
because it’s a shitty industry with too many people
fighting over too few revenues
and a series of platforms that are developed in a monopoly.
So okay, the notion that’s great virtue signaling,
you know, good for you and it’s gonna,
it’s not gonna mean dick.
It’s not, these guys are doing their job.
If you wanted, all right, are you sincere?
Pull your shit off of Spotify.
Are you really sincere about helping an event
and call your friends, you know,
do you hang out with Beyonce, do you know Taylor Swift
and pull your shit off of Spotify?
Because as long as you have oligopolies,
they’re gonna extract more and more
and they find that the best way to get retention
is to just consistently recommend Taylor Swift
over and over.
And the notion that she’s gonna bully the record labels
Spotify is now worth more than all the record labels.
So if she really wanted to have an impact,
let me do some virtue signaling.
When Spotify decided to not fact check Joe Rogan
who would have one legitimate doctor on one day
and then an illegitimate doctor the next day
and create all sorts of vaccine hesitancy
and false equivalences,
I called them and said, we’re pulling Prove G off of Spotify.
I pulled my shit down and it cost us
somewhere between a quarter of a half a million.
So yeah, put your money where your fucking mouth is,
pull off of Spotify.
But there’s notion that you’re gonna shame people
in the audience to paying artists
who aren’t making them any money, more money.
Yeah, good luck with that, have at it.
– No, I completely agree with you.
And I think this just, it reminds me
of all the dynamics that we’ve seen in Hollywood.
And the reality is altists have been getting screwed
since the dawn of time.
And historically it’s been the record labels
that have screwed their artists.
And I think back to the 1950s,
this is probably the most famous examples
where you had all of these incredible black musicians
who are suddenly dominating the charts
and then none of them got rich
because they signed these shitty deals
that ultimately rewarded the owners of the record labels.
So this dynamic of artists getting screwed to an extent
is nothing new, but I don’t think,
I mean, a lot of people are blaming Spotify for this
saying that they just don’t pay them enough
and blaming the business model.
I really don’t think you can blame Spotify for this
because all you have to do is look at the financials.
You have to remember,
this is Spotify’s first ever year of profitability.
So for the 16 years before this, Spotify was losing money.
They were losing money to pay employees
and to pay for technology.
And yeah, to pay their artists.
And so I’m not trying to like make a sob story for Spotify,
but I think all I would say is this is a business
and the business has to make money.
And this year was the first time they ever did that.
The other side to this, you know,
one other way that they could have paid their artists more
or they could pay their artists more
would be to massively raise prices for the consumer.
But actually they haven’t done that.
And in the past 16 years,
the price has gone from 9.99 to 11.99.
So actually on an inflation adjusted basis,
Spotify actually got cheaper.
And then you compare that to things like Netflix.
Netflix has more than doubled its prices
in that same amount of time.
So, you know, I’m sure someone’s being greedy here.
I’m sure, you know, for the record label
has screwed some artists here or there.
But the fact that Spotify is getting wrapped into this
like as the big bad company
that’s just sort of ruining the music industry,
I just don’t think that is true.
And I think ultimately what this is
is that as you say, being a struggling artist
is a bad business.
It just doesn’t really work.
And in almost all industries,
it only starts to make you real money when you hit the 1%.
And finally, Chapel Roan has done that.
And I don’t think she’s gonna be giving her money away
to the other 99%.
I think she’s gonna be, you know,
claiming her check from whichever record label
she’s signed to.
So, I have a very boomery outlook on this.
Sounds like you do too.
And it sounds like we’re just in fervent agreement.
– We need a different term than boomery.
Look, the digitization of markets
results in a consolidation and a winner take most environment.
You digitize retail, you end up with one company
with 50% of all your commerce.
You digitize connections and socialization online.
You end up with one company meta that owns two thirds
of all social interactions online.
You digitize information.
One company ends up with 93% share of search.
You digitize mating and online dating.
And 80 to 90% of all swipe rights happens amongst
the 10% of most attractive males, right?
Men are less choosy, women are more choosy.
They all want the same guy.
And the same thing’s happening on these channels.
When you digitize a platform,
the Taylor Swift gets more listen,
more listen time than all of classical music now.
Taylor Swift is bigger than classical music or jazz,
the entire genre.
And it’s because the algorithms, they consolidate
and they say, okay, when everyone has access to everything,
the very best, and Taylor Swift is the very best,
according to hopped up 14 year olds on sugar,
they consolidate the market.
Now, I don’t know if there’s anything you can do.
The only things you can really do about this
on a systemic level is to make sure you have
a really robust FDC and DOJ
that makes sure there’s a lot of competition
such that you transfer money back from the monopolies
to the artists, to the means of production,
to the labor force.
The other thing you can do
is have minimum wage of 25 bucks an hour,
such that if these people have side hustles,
they’re at least making a good living.
But let me just, let me just clue young people in.
The world does not owe you your passion.
And you don’t have the right, the birthright to make music.
You have the birthright, in my opinion,
to make, to have healthcare.
I mean, let’s start there, healthcare, universal childcare.
You don’t have a birthright to be an independent music
producer or independent musician and make money.
These are, the vanity industries
will always have an overinvestment in human capital
and they’ll be a small number
and increasingly, unfortunately, a small number of people.
What I think you have to do is say, okay,
if you’re the backup drummer on a Kellogg’s ad,
they have to pay you at least 25 bucks an hour.
Anyways, I think this is a social issue
and we need to break up monopolies,
of which I’m not sure you could say Spotify’s a monopoly.
Everything’s going hunger games.
The winners leave it a remarkable life
and everyone else dies a slow death.
And if you want to change that,
you have to make systemic change
at education levels, antitrust levels,
but believing that somehow shaming the record labels
or Spotify and to paying people.
You know why they pay these people nothing?
Because they can.
And they’ll keep making music.
And by the way, the only way it gets better
is if it becomes such a shitty business
that just people don’t go into music
and over time they have to pay them more.
– Right?
– Anyway, I think the market,
I don’t want to say the market’s doing its job here,
but the solutions are societal.
They come out at DC.
They don’t come out of like virtue signaling
at the Grammys.
– We’ll be right back with a look at Google’s earnings.
If you’re enjoying the show so far,
hit follow and leave us a review on Prof.G Markets.
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Google’s fourth quarter earnings largely disappointed.
Revenue grew 12%, which was the slowest pace since 2023.
Growth in the cloud division
also slowed from the previous quarter.
Still, CEO Sunder Pichai highlighted
the company’s accelerated investments in AI data centers
with plans to increase capital expenditures
to $75 billion this year.
That’s up from $52.5 billion last year.
The stock fell 7% following that earnings report.
Just wanna quickly touch on why the stock fell so much.
By the way, that was Google’s fifth worst trading day
in 10 years.
It erased $200 billion in value.
So you would think based on that
that Google had a dreadful quarter.
Actually, on the whole, it was fine-ish.
Revenue up 12%, roughly in line with expectations.
Net income up 28%, it beat expectations.
The problem, as we keep on seeing with big tech,
was this one number, which was the cloud revenue,
or you might call it the AI revenue.
And that was $12 billion up 30%,
but most importantly, lower than what Wall Street predicted.
And I think in 2025, if you are a big tech company
and you’re not smashing expectations in AI specifically,
your stock is immediately gonna drop.
It’s just a non-starter.
This is, by the way, exactly what happened
to Microsoft the week before.
They had decent earnings, AI revenue missed,
$200 billion in market cap erased overnight.
Let’s get your reactions to Google’s earnings, I guess,
particularly this obsession with the cloud revenue
and missing on those estimates.
– Yeah, look, it’s impossible to ever count them out.
They have five separate businesses
that do more than $30 billion in annual.
This is a really robust business,
meaning that while they’re kind of core business of search,
they have five companies that could be
$100 billion plus market cap companies.
They’re very diversified,
and they coordinate, cooperate with each other,
which is probably not a good thing.
But between Google Search, the DisplayOut Network,
YouTube, and subscriptions,
that’s YouTube Premium, Google Play, and then cloud.
They just have some amazing businesses.
The analysts here made the analogy.
It’s like having the revenue power of five Starbucks
or five visas.
The thing that I think was the scariest thing in here
was one, analysts pointed to the fact that
their cloud business was not growing as fast,
which they saw as an indicator
they haven’t figured out a way to monetize AI
from the company that had most of the IP around AI.
I think the scarier number here
is that for the first time, their market share,
the scariest number for Google shareholders,
I should say, or for Alphabet shareholders,
is that for the first time, their market share of search
dropped below 90%.
And so what I’m hearing from some young people
is they have totally abandoned Google Search
and are now just using AI, that they just get more.
And I’ve found myself getting impatient with Google Search
and just going to chat to BTR Anthropic
and typing in a question.
And I find it just, it doesn’t give me 500 links
to make me sort through them.
It just says, it tries to give me,
it tries to answer the question, right?
Because with Google right now, it’s a query,
but it’s also an invitation to throw a bunch of shit at me
that’s not accurate that you think you can further monetize
and take me to another place.
Whereas chat GPT, although it hallucinates
and as does Anthropic,
it attempts to actually answer the question in one shot.
And so you could see the stock,
if Google Search share drops below 85%
in the next 12 months,
I think you get the stock really get hammered
because what that means is that their ultimate toll booth,
it’s losing its power.
And at the same time,
they announced an increase in CapEx from 58 billion to 75,
which the market didn’t like.
But I still think this stock and this company
have so many amazing, at the same time YouTube is growing.
We’ve said this before that Netflix isn’t a premier streamer.
It really is YouTube if you’re talking about video.
But I think fears around AI,
they haven’t figured out an AI strategy to monetize
and to search dipping below 90%,
I think analysts are gonna keep watching
what’s happening to a search share
because I could see an environment
where if there’s enough applications
and these AI guys continue to raise this kind of capital,
I think you could see in a year,
their search volume go from 90 to 70%.
– I think I disagree on these points.
And I think the market share,
the search market share is an important point
that has to be tracked and we’ll see what happens.
But I can just say from my experience,
I do use chat GPT,
but I would say it’s 95% Google and 5% chat GPT
and maybe 1% other tools.
So search is still an incredibly valuable product to me.
And I think it’s still an incredibly valuable product
to many others.
And I think that’s why you’re seeing their search revenue
is continuing to grow quite steadily
on the cloud revenue point.
I think it’s important to note,
the reason Google missed on cloud this quarter
was not because there wasn’t enough demand,
it was because they couldn’t keep up with supply.
They literally don’t have enough compute,
which you might say, okay, well, that’s another problem.
But then you realize,
well, actually they’re about to invest $75 billion
into data centers this year,
which solves exactly that problem.
So, you know, I see the stock dipping
because everyone’s getting all wigged out
about this cloud revenue thing.
But to me, I see it as kind of a good problem.
There’s too much demand
and now they’re investing in meeting that demand.
So I see this, I think they’re being over-punished
for those cloud numbers.
I also think they’re being over-punished for deep seek,
which we can get into.
But, you know, 25 times earnings,
lowest P multiple in all of tech.
Meanwhile, you’ve got Apple at 37 with what?
2% revenue growth.
You got Google over here growing at 12, 13, 14%.
I think that it’s perhaps being over-punished here.
– I like your take better than mine.
I would draw the comment.
I think your take is better than mine.
The thing you said there that stick out was 25.
Cheapest company in tech,
the diversification of the revenue streams.
I like how you couch it against valuation
and that it’s arguably the cheapest of the big tech players.
And the reason I love Alphabet is because, you know,
it’s impossible not to find a business
that’s not, you know, only meeting expectations
when you have five different businesses.
But the reality is they have five different businesses.
They’re hugely diversified.
And their ability to coordinate and cooperate
and share data to the users
and the advertisers detriment is extraordinary there.
They’re kind of the only other company
that can gather this much, who grew up this much data
and then use it to increase prices
or rents on people is meta.
And these guys have it.
They also have the second largest operating system
or actually the largest operating system,
but the second most profitable in mobile with Android.
So you just, this is one of those stocks, I think,
especially at this price, you just own it.
You know, you just–
– You better own it. – You just own it.
– By the way, just on YouTube,
10 and a half billion dollars in ad revenue, up 14%.
It is still the fastest growing unit
in the Google ad business.
It’s still bigger than Netflix.
And I pointed out it’s the most popular
TV streaming platform in the US.
It is now also the most popular podcasting platform too.
More popular than Spotify,
twice as popular as Apple podcasts.
So this thing is just growing so rapidly
and it’s already a behemoth.
It’s already way bigger than Netflix.
I’m so, I mean, we’ve been bullish on YouTube for a while.
I just, I remain extremely bullish on YouTube.
– YouTube is now the largest podcast distribution platform.
The more people are listening to podcasts now
in terms of listenership on YouTube,
then they are on Apple or Spotify.
– Yeah, and then just one final point here,
we should touch on is this CAPEX.
I think there were a lot of questions following deep seek
as to whether big tech would be pulling back
from all of this AI CAPEX spending.
The answer we’ve gotten from this round of earnings
is a resounding no.
It’s kind of crazy.
You’ve got Google spending $75 billion,
way up from last year.
You got Meta spending $65 billion,
Microsoft $85 billion, Amazon more than $90 billion.
This is more than $300 billion in CAPEX,
all coming down the pipeline for 2025.
It’s all going to go to AI,
which presumably means it’s all going to go
to Nvidia pretty much.
So I’m just looking at what’s happened with deep seek here.
I’m struck by the extent to which deep seek
did not affect the AI CAPEX story,
at least in this round of earnings.
Maybe that’s going to change next quarter
and they’re going to switch things up.
But so far at least the plan
is basically completely unchanged.
Let’s take a look at the week ahead.
We’ll see the consumer and producer price indices
for January.
We’ll also see earnings from McDonald’s, Shopify, Reddit,
and Airbnb.
Scott, do you have any predictions?
You’re a big shareholder in two of those companies.
– Yeah, they’re both going good, especially Reddit.
Jesus.
God, why didn’t I buy more?
That was so obvious.
– Come on, you did well.
– You have been out well.
Dude, I’m glass half empty.
Haven’t you figured that out?
Anyway, so my prediction is the following
and I didn’t have one, but you inspired one.
I think Joe Rogan is about to be displaced.
I think that the new number one podcasters
will either be Mel Robbins ’cause she’s so talented
at like connecting emotion with psychology.
I think she’s outstanding.
But my outside shot here is I think that the new Joe Rogan
is Steve Bartlett, diary of a CEO.
And it’s for the reason you stated.
And that is the first thing I did literally
when I landed in London, a friend of mine said,
“There’s this Brazilian party at Five Hurtford.”
And I went and it was like an amazing party
with hot people everywhere.
And I’m like, “I love London.”
It’s been downhill since then.
And then the next day, the first thing I did,
this is all true is I went on this podcast
of this young handsome guy who was supposed to be,
he was like the number 10 podcaster in the UK.
But I thought, “Oh, I wanna get to know people in the UK.”
And it was Diary of a CEO.
And I think I’ve been on his show four times now.
And the thing that just blew me away,
and this is two and a half years ago,
was he had probably six people in the room
and five of them were focused on camera work.
He had lighting, obviously amazing sound,
but swivel cameras and cameras on sleds,
getting different shots.
And he forces everyone to come into the studio
as does Rich Roll actually.
And the result is just these podcasts
that are just kind of visually arresting
and do really well.
And he also was testing, A/B testing like crazy buttons.
And I don’t know if you’ve seen his promos, but–
– They’re incredible.
– He’ll do something where I’ll say,
the secret to happiness is,
and then I’ll like goon, cut away and say,
tune in now, he just spends a ton of time
optimizing for YouTube before it was cool.
And the result is he’s now the number one podcaster
in Europe and I think he’s number nine in America.
I think he’s gonna be number one
because he understands the medium of YouTube.
He’s weaponizing and leveraging
what is now the biggest distribution platform
in podcasting, that’s YouTube.
So my prediction is the new Joe Rogan
or the person who’s gonna displace Joe Rogan
as the biggest podcaster in the world
is Steven Bartlett from Diary of CEO.
– But you’re missing someone.
– Ed Elson?
– Two of us, we’re investing in video.
We don’t have swivel cameras yet, but we’re working on it.
– Yeah, I think–
– We can– – I don’t wanna be that big.
I wanna have enough money just to have a second jet
in unlimited supply academy,
but I don’t see us as the number one podcast.
I think that, I think we wanna be,
well, we could be number one in business.
We’re talking about, by the way in a meeting today folks,
we’re talking about Ed going daily.
We’re talking about doing a daily property markets
to talk about the markets ’cause the news keeps coming.
But I think we could be number one in business.
We’re in the top 10 in business
and occasionally we’d pop into the top five,
but that guy, David Ramsey,
who keeps selling expensive mutual funds
and saying that you can pick a mutual fund.
– We could beat the Ramsey network, surely.
– Yeah.
– We gotta do that.
– I love shitposting our competition.
That’s so classy, isn’t it?
It’s so big of me.
But anyways, let’s go back to my prediction
where I can actually lift up young people.
Diary of a CEO, Steven Bartlett, he’s the new Joe Rogan.
– This episode was produced by Claire Miller
and engineered by Benjamin Spencer.
Our associate producer is Alison Weiss.
Mia Silverio is our research lead.
Isabella Kinsel is our research associate.
Drew Burris is our technical director.
And Catherine Dillon is our executive producer.
Thank you for listening to Prof.G Markets
from the Vox Media Podcast Network.
Join us on Thursday for our conversation with Alice Hahn
only on Prof.G Markets.
♪ Lifetimes ♪
♪ You help me ♪
♪ In kind reunion ♪
♪ As the world turns ♪
♪ And the dark lights ♪
♪ In love ♪
(gentle music)
– The key to good leadership is to motivate people
and give them a vested interest in the success
of the company I’m announcing today
that we’re doing really well.
And if the company and individuals such as yourself
continue to perform like this,
because I want to create motivation
that there’s a really good chance
if you guys continue to show the same type of talent
and commitment that I’ll be able to get a second plane.
(laughing)
That’s…
But I want you guys to just–
– I always know what it’s come to.
– I don’t want to promise anything.
– I don’t want to promise anything.
– It’s like sullen.
You start looking down at the floor and I just know it’s coming.
– It’s not sullen, it’s my age.
You’re getting a map.
If you continue to perform like this,
daddy might be able to get a Gulf Stream.
I want to motivate you.
I want to keep you in the game.
Super exciting.
I promise to send you photos.
– Okay.
– Seriously, Ed, something to look forward to.
(laughing)
Now get out there, little soldier.
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at netsuite.com/vox, netsuite.com/vox.
– Today’s number, $8 million.
So that’s how much a 30 second ad spot
on the Super Bowl costs this year,
an all time record.
Ed, nothing says American exceptionalism,
like four hours of beer,
boner pill ads, and men giving each other CTE
for our entertainment.
It’s essentially Rome, but instead of Lyons,
we have Taylor Swift, Ed.
We have Taylor Swift.
(upbeat music)
(singing in foreign language)
– Welcome to Prop G Markets.
That was sort of a thoughtful Super Bowl themed intro.
Banter, Super Bowl, do you care?
– No, I don’t care at all, actually.
And this is the first year I’ve decided
I’m just not watching.
I feel like I’m always watching
because I feel like I have to,
but I’ve just decided, you know what?
I’m not interested in the NFL,
I’m not gonna watch this year.
Are you watching?
I don’t even know who’s in the,
Claire, do you know who’s in the Super Bowl?
By the way, Claire, I have a,
oh my God, I just realized you’re in my house, Claire.
I literally thought she has the same climbing wall I have.
– Yeah, this is your house.
– Claire, how are you?
– I’m really good, it’s good to see you.
– Welcome, welcome, don’t touch anything.
– Thanks so much for having me.
– Anyways.
– Yeah, you have a climbing wall in your house.
– You’re in the kids’ room.
I do have a climbing wall, and my kids have climbed,
my kids climbed for a good 30 minutes,
and now it’s just a decorative piece.
(laughing)
Cost me about 40 zip recruiter ads.
– By the way, I think it’s Chiefs and Eagles.
– That’s right, Chiefs and Eagles.
– Chiefs and Eagles.
– I thought you used to be a big NFL fan, Scott, no?
– I’ve never actually been a sports fan until my kids.
I decided to give up golf and watching all sports
and poured into fitness,
in trying to spend more time with clients,
such that we could develop a father-son
parasocial relationship,
and they’d pay me millions of dollars to consult,
and then I could at some point buy one quart of a golf stream.
– You know what I’m doing tonight?
I think I’m gonna do ketamine tonight.
– Really?
– I went out with some friends last night,
and they were having such a good time,
and I’m like, “What are you drinking?”
They’re like, “Oh no, we don’t drink raw ketamine.”
I’m like, “Really?”
And I’m having trouble, Ed.
I’m having trouble disassociating.
I think we’re in the middle of a second insurrection,
and no one’s talking about it,
and it’s freaked me out and got me really upset.
So I think I need to disassociate,
and I’m hearing good things about ketamine.
Do your friends do ketamine, Ed?
– Yeah, good amount of my friends do ketamine.
I can’t tell if you’re serious,
so you know it’s illegal to just do it.
– There’s a few things I do that are illegal,
and I continue to engage in them, Ed.
– Okay, just making sure you’re clear.
I know you did it the legal way.
– Hot’s legal now, so yeah, edibles are legal,
so that’s not a problem.
– Right, yeah, exactly.
– Actually, I don’t do that much that’s illegal.
– And the way people do it is they snort it.
You’re really gonna go up and–
– Oh, really?
I was hoping to stick something up with my hand.
I was hoping to find an attractive one
with some gloves handy.
(laughing)
I have to pay for that, I have to pay.
Now, now cough, Nurse Ratchet, anyways.
– Well, I’m excited to see you in a couple of hours.
I’m gonna come over and hang out at your house.
– Oh, that’s right, I have a team meeting,
you’re all presenting your business plan.
– You excited to see me?
(crickets chirping)
– Get to the headlines, Ed.
– Let’s start with our weekly review of market vitals.
(upbeat music)
(upbeat music)
The S&P 500 inched up throughout the week.
The dollar declined, Bitcoin was volatile,
and the yield on tenure treasuries dropped.
Shifting to the headlines.
Disney earnings beat expectations
on the top and bottom lines.
However, Disney Plus lost 700,000 subscribers
with another modest drop expected in the current quarter.
The stock fell 4% following that earnings report.
Novo Nordisk saw strong fourth quarter demand
for its weight loss drugs with Wigowi sales
more than doubling, and Osempic sales
rising 12% year over year.
Profits also exceeded analyst expectations
up 29% from a year earlier.
The stock rose on that news.
And finally, Uber’s fourth quarter revenue
beat expectations, rising 20% year over year.
However, operating income was lower than expected,
and the company issued weak booking guidance
for the current quarter, and Uber’s stock fell 7%.
Scott, your reactions,
starting with Disney’s earnings a beat,
but the stock did fall.
– It’s clear who the number one is in streaming,
but they’re all fighting to be number two.
They’re like, okay, the number two will survive,
and it’s not entirely clear who’s number two.
And the race for number two is between, in my opinion,
the artisanal sort of HBO that’s created
an incredible culture that produces kind of the water cooler
zeitgeist moment of content.
And then Disney, which has just such singular
clear positioning around family,
and then bundling Hulu and ESPN.
I think it’s ESPN plus.
It’s a pretty good offering.
Now, they were able to raise prices of 4%,
which isn’t a huge price increase,
but it is a price increase.
And basically they lost 700,000,
but they would argue that’s flat.
That does kind of communicate
that they have some pricing power.
I would argue that’s a good thing.
Netflix’s churn is 2% while Disney’s is five.
That may not sound like a lot, but it’s huge.
It means that every three years,
Disney has to reinvent their entire customer base
that Netflix does not.
In addition, you have this incredible transfer
or means of production.
What do I mean?
What Japan did Detroit, Netflix is doing to Hollywood.
And that is Netflix announced that the majority
of their content, more than 50% of their $15 to $18 billion
investment on content is being spent and/or,
if you will, produced overseas.
They’re not doing that because they like Spanish people
or they want more multiculturalism in their content.
They’re doing it because they figured out
they can get a gaffer, a writer, an actor,
a producer, sound engineer, studio construction folks
for 40 to 60% of the cost of what it is in the US.
Whereas Disney, the percentage of content spend overseas
is 4%.
But what Netflix has said is that if I have every week,
not a 10, but I have just a shit ton of sevens and eights,
people don’t cancel.
– Yeah, I think these earnings, I mean,
Wall Street did not react well to these earnings.
And I think rightly so because I think this was just
unimpressive on so many levels.
I mean, Disney plus subscribers declining,
not by much, it was around 1%, but still a decline.
And Disney plus’ response or Disney’s response was,
well, we rose prices, so this is expected.
And by the way, that’s kind of what you said too,
but you look at Netflix,
Netflix also raised prices last year
and they still added 19 million subscribers.
So I don’t fully buy the, we’re raising prices
and therefore subscriptions are gonna fall off.
We’ve seen it with Spotify too, Spotify raised prices
and their subscriptions are still continuing to climb.
You also mentioned the churn rates.
I just see this as such a big issue in all of streaming
that it makes me believe that streaming
is in a lot of ways uninvestable over the long term.
Apple TV’s churn rate is 8%.
Peacock’s churn rate is 9%.
Disney’s churn rate is on the low end,
but still it’s really high, it’s 5%.
So if you just wanna stay flat in any given quarter,
you basically have to grow your subscribers
by 5% every single quarter, which is just insane.
I mean, I just don’t see
how that is a sustainable business model.
And then the second thing that makes me concerned
about Disney was their box office results,
which were exceptional,
but it was all because of this one movie, Moana 2.
And that was kind of what saved these earnings.
Without that movie, this earnings report
would have been pretty terrible,
which again begs this question,
like how sustainable is this business?
Where you’re basically riding on your growth vehicle,
which is Disney Plus, is pretty stagnant.
And then you’re also relying on these sequels
every single year.
I mean Moana 2, Inside Out 2, Deadpool and Wolverine.
At what point are people just gonna get bored
of these sequels?
Like who’s gonna watch Moana 3 and Moana 4 and Moana 5?
Like how much longer can this go on for?
– You do start to see fatigue.
I would even argue like Deadpool and Wolverine,
I love both those actors.
I think they’re fantastic.
And I’m like, I’m not sure I’m gonna see the next one.
I’m like, okay, I think I’m sort of done with those franchise.
Anyways, what’s really interesting here though
is that the parks did well.
And that is, and if you think about it,
AI can’t replace the parks,
or at least I don’t think it can.
There’s still something especially wonderful
or especially horrible if you’re the parent
about Walt Disney World, right?
That still is a, that isn’t a norm.
Netflix is gonna have a tough time
into Universal’s credit.
They spent the money and the decades
to build those franchise businesses.
But Adams are, this is your notion
that Adams are more important than bits.
But the Disney business right now,
the strongest part of the business as far as I can tell,
is the parks, the cruises and the resorts.
Because it’s hard for Netflix to spin up a cruise ship
business, these things take a long time
and they’re good at the in-person stuff.
– Absolutely, but if you wanna keep that business going,
you’ve gotta also be creating original
and persuasive and compelling intellectual property,
which they’re not doing.
No one’s gonna ride the Moana three ride.
– Yeah, but they can license content, they can.
I mean, I don’t, was Harry,
I mean, for example, Harry Potter, Lego.
I don’t, I think Lego licensed its IP
to someone who knows how to run those parks.
I don’t know if it’s a division of Lego,
maybe it is Legoland.
By the way, you’ll see when you have sons.
Legoland, in my opinion, is the least awful
of all of them.
– Legoland’s amazing, that was my favorite growing up.
– Oh really?
Oh yeah, that’s right, I forgot how young you are.
But I used to, I took my sons to the Lego hotel
and it was pretty cool.
– It’s epic.
– I love the image of Little Ed at Legoland.
Right, building scary, like you’re like,
I can build something bigger than that.
Anyways.
– By the way, just before we move on here,
when is your Netflix show coming out?
– Oh, not for a while.
– If you had to guess.
– I would guess fall of 26.
Yeah, it’s gonna take a while.
– We need to get you on camera here.
Is that part of the plan?
I hope so.
– No, I am, you will see soon.
I do have a cameo in what is the hottest show on HBO
in several seasons.
I do have a voice cameo.
So I’m excited about that.
We’ll have a party, you’ll all come over,
we’ll all celebrate and we’ll watch it together.
None of that is true.
(laughing)
None of that is true.
But it’s a nice thought, isn’t it?
If I was kind of a more loving and engaged boss,
get out of my climbing room, Claire.
Don’t touch anything.
Anyway, sorry, go ahead.
– Let’s talk about Novo Nordisk.
This was pretty important earnings report for this company
’cause they simply put have not had a good year.
The stock’s down 30% in the past 12 months.
They tried making this new GLP-1,
this drug called Kagrosema and the trials failed.
They’ve been outclassed by Eli Lilly
who have been sharing from their studies
that their drugs are just more effective.
So Novo Nordisk is not in a great place.
They needed a really strong showing,
not from the insulin business or the glucagon business
or any of their other medicines,
but from the GLP-1 business
because that, as we know, is the only thing
Wall Street cares about with this company.
And rightly so, that’s where all the growth is coming from.
The results were pretty good.
Wagovi sales more than doubled.
If you look at that in combination with OZMPIC,
the obesity drug business is up more than 50%.
So the GLP-1 business is doing quite well.
I think the question here is a larger question,
which is, will this whole GLP-1 thing live up
to the hype that we had about 16 months ago?
And that’s sort of up for debate.
I mean, I’ve seen market size predictions saying
this is a $100 billion market.
Some say it’s a $500 billion market.
No one really knows.
So I kind of look at this company,
I look at these earnings
and I don’t really have an answer.
The only thing I can conclude with Nova Nordisk
is, you know, wait and see.
– I would argue that the space is just getting started.
The GLP-1 drugs, the category, everything I’ve read,
I just think this technology is incredible.
The next sort of question though
is how many competitors are in the space?
And also asked about the motor and who we had on last week,
made an interesting point
and that is for him, Nova Nordisk,
history was they kind of slipped and fell on Bogovino’s Epic.
– Let’s face it, they got valuable
because they were in the right.
They got lucky.
I mean, it’s not like amazing R&D
where they said we’re gonna come up with a weight loss drug.
The diabetes drug happened to have a side benefit.
And I think that until they come up with another product
that is a market changer, blockbuster drug,
I think the hypothesis has to be
that they got lucky with these two drugs
and they’re going to go back
to being a sleepy Danish diabetes drug company.
– I mean, that has showed an ability
to create another or acquire another product
in Instagram, right?
Google launched YouTube, you know, these companies,
Microsoft has an incredible cloud bed.
These companies have shown an ability
to innovate more than, you know, repeatedly.
And his view was Nova Nordisk
hasn’t really demonstrated that.
– To his point, the only company
that actually innovated this drug
that didn’t stumble its way into it was Eli Lilly,
who created their own versions.
Of course, after Nova Nordisk
figured this whole thing out accidentally.
So I think if you’re thinking about, okay,
how do I get exposure to GLP-1s?
Yes, Nova Nordisk is the market leader.
It has the greatest market share in the US and in the world.
But I think in terms of culture and innovation,
all that stuff that Aswa talks about,
I do think Eli Lilly is probably a better bet
from that perspective.
Let’s move on to Uber.
Uber reported earnings revenue grew 20%.
They had this kind of soft guidance,
$42 billion in gross bookings
expected in the course coming up.
And the stock did not react very well.
I thought the most interesting part with these earnings
was that Uber is officially launching a wait list
for its Waymo partnership.
So this is gonna happen in Austin first
and later in Atlanta.
Uber and Waymo are teaming up
and self-driving taxis are coming in 2025.
And I think the most important thing here is
the autonomous taxi fleet.
It’s not coming from Tesla.
It’s coming from Uber.
And I think that’s notable
because it just highlights this market bias
that we keep on seeing towards Tesla
where Tesla will go out and talk very vaguely
about full self-driving and autonomous taxis
and the stock rips.
Meanwhile, Uber does it and the stock declines.
People just don’t take it seriously for some reason.
And I can’t really wrap my head around it.
I mean, some people say,
you know, Waymo’s are more expensive to build,
they’re more expensive to operate,
which is probably a fair point.
But I think the larger point still stands,
Waymo is the only one that has figured it out.
And now they’re going to market
with the biggest ride sharing company in the world, Uber.
Meanwhile, Tesla has shipped nothing.
So I think this is a pretty big deal.
I think full scale commercialization
is still a long way away.
But to me, this signals Uber’s actually kind of
leading the pack in autonomous.
And I get the sense it’s probably very undervalued
at this point.
– Waymo’s been here for a while.
And the notion that we’re all waiting for Tesla autonomous,
I took a Waymo taxi six months ago in LA.
By the way, extraordinary, my first ride in this thing.
And we get to this intersection
where there’s been an accident.
I’m like, oh, great.
I’m going to be the first like autonomous guy taken out.
I’m like, this is so fitting for what I do.
PropG takes his first autonomous Uber
and gets, you know, T-boned by a bus.
Because the fucking Waymo couldn’t process a billion points.
There’s a cop with cones waving with illuminated batons
saying, okay, you need to go around the crash car
into the wrong side of the road
and to get around this accident.
And I thought, there’s no way
this thing’s going to be able to process this.
And it was very hesitant.
It drove like what I would imagine
a scared 16 year old girl would approach the situation.
That sexist.
– Or a boy or a scared 16 year old boy.
– No, my boys decided you can make,
you can make a left on a red light if you just stop first.
That’s what he’s decided.
It’s like, wait, you just need to stop.
And then you can go, no, no, no, no, anyway.
So this thing went out very hesitant and it figured it out.
So the notion that we’re waiting, it’s just so ridiculous.
Tesla, in my view, has already lost.
Waymo’s doing a great job.
Uber has massive, I mean, the number of Teslas is dwarfed.
By the number of Uber rides out there every day.
And you gotta give, I think Dara Kastur Shahi
has done a fantastic job because in their DNA,
if you think about a lot of the companies
that have outperformed the market,
they’re asset-like, right?
They don’t have big catbacks.
Airbnb, Uber said, no, we don’t wanna be
in the business of owning real estate.
We don’t wanna be in the business of owning cars.
We’re gonna leverage other people’s catbacks investment.
So Dara said, rather than go into AI
and announce big partnerships
and that we’re putting 10 billion into AI and autonomous,
he just said, no, I’ll draft off of other people’s catbacks,
in this case, Google and Waymo,
which has spent kind of 15 years and tens of billions
of dollars and I’ll give them, I’ll co-brand,
I’ll have an offering.
This is kind of how you do it.
– And by the way, Uber had their own autonomous vehicle unit
which they scrapped in favor of this.
And I think the market said,
oh, they don’t know what they’re doing.
Actually, it’s a small move for exactly the reason you said.
No one’s complaining that Apple didn’t go deep
into AI spending.
They said, okay, similar to how Uber evaluated autonomous
and said, there are other people spending more money
than we need to, we’d be playing catch up.
Why don’t we just become a remora fish
off of that giant spending?
And despite the deep seek meltdown,
Apple has not registered a loss in their stock
because they never decided to get into this arms race.
So I really, I’m shocked.
I think Uber arguably,
I don’t wanna say it’s been the biggest turnaround,
but I think that you needed someone sort of crazy
in a reverent and provocative and build fast
and break things in Travis Kalanick.
I don’t think he gets enough credit
for what he envisioned and what he built.
I think it’s extraordinary.
But Dara came in and has just made a series of very,
what I’d call smart, thoughtful moves.
Oh, it’s about to sneeze.
Sorry, that’s my pre-ketamine face.
By the way, if you run into me tonight and I like me,
it means I’ve tried the ketamine.
I’m excited.
I’m gonna truck you down.
I’m gonna make sure I see Scott on ketamine.
Instead of my screensaver,
I have a picture of Preep Barara in his phone number
because he’s my one call if I get into trouble.
So I used to be my boys on my screensaver.
Now it’s gonna be Preep
’cause if I get really fucked up, I’m calling him.
He just seems like very responsible
and he can get me out of any bad situation.
– We’ll be right back after the break
for a look at Spotify’s earnings.
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(upbeat music)
We’re back with ProfG Markets.
Spotify posted its first full year of profitability ever
with gross profits rising 40% year over year.
The streaming platform also added a fourth quarter record
of 35 million monthly active users.
That’s a 5% increase from the previous quarter.
Spotify Wrapped was one of the top drivers
of user engagement, fueling double digit growth,
shares surged 13% after that earnings report.
I’m just gonna point out,
I made one prediction on our 2025 predictions episode.
And that was that Spotify would be the media platform
of the year in addition to YouTube,
which I’m also really bullish on.
But I am just consistently impressed
with this company, the innovation,
their integration of video,
the integration of comments and polls,
their transition to profitability now.
I think if there’s one platform
that can rival YouTube in this new digital age,
I think it’s Spotify.
And we’re starting to see it in the numbers here.
Scott, your reactions to Spotify’s earnings.
– I love Spotify.
I think I picked it as one of my stock picks five years ago.
I went flat for three years, so I got it wrong.
But there are very few companies
that are able to take an entire medium
and distill it down to an app, a searchable app.
I can find anything on Spotify.
And people say, well,
Apple and Amazon have done the same thing,
but to your point, they’ve really innovated.
The rap thing, I thought,
I’m not entirely sure how you connect rap to more revenues.
I thought it was cool.
And I like Spotify saying, by the way,
you listened to Tom Petty and some DJs and that’s about it.
But how does that, I’m curious.
I don’t understand the mechanics
of how that translates to more revenue.
Tell me young person, what is happening on Spotify?
– Well, they didn’t connect it to revenues,
but they connected it to user engagement,
which that’s what it’s all about.
It just creates heat and excitement.
And I think possibly, I mean, full disclosure,
I don’t use Spotify because I’ve always used Apple Music
and I’ve never wanted to go through the cumbersome process
of transporting everything over.
But when Spotify rap came out,
it was the first time I was like,
maybe I should switch because this just sounds fun
to have this little presentation about me
and all of my music habits.
So I think that would be the answer.
– Let me just give you a little insight
into the role that streaming music plays in mating.
If you’re ever at home with your girlfriend
and you’re thinking, I don’t want to have kids
and I don’t want to have sex.
– I know it’s coming, I know it’s wrong.
– Just play ad supported Pandora.
– Nothing says do not mate with me.
This is, you are taking the evolutionary pull down
a couple notches if you have sex with someone
who has ad supported Pandora.
I play, I love, I still have ad supported streaming radio
and I think it’s hilarious.
I play it and I’m like, oh my God,
the commercials are so bad, listen to this commercial.
Anyways, but back to, I’m shocked.
I thought you would have had Spotify.
I absolutely love Spotify.
And also they have the best party.
Just so you know, they have the best party at Cannad.
– Oh really?
– I’ll take you, you can be my date.
– I would love that invite.
Well, let’s just go over some of the numbers here
because I think they’re pretty incredible.
So Spotify’s monthly active users hit 675 million,
beat estimates by 10 million,
which means that one in 12 people on earth is on Spotify.
Premium subscribers grew 11% year over year.
That was despite the price hikes,
average revenue per user up 5%.
First profitable year in the company’s history,
which I think is a very big deal
and stock is now at an all-time high, $620 per share.
We should probably think about
what could go wrong for Spotify.
I think one potential issue is this growing public resentment
towards Spotify and specifically towards Spotify
and how they pay their artists.
So a lot of people say that Spotify squeezes their artists.
They don’t pay them enough.
They reward the top 1% and the other 99% get screwed.
And that’s timely because Chapel Roan,
who just won the best new artist award at the Grammys,
she actually called this out.
She didn’t call out Spotify specifically,
but she called out the whole music industry
of which of course Spotify plays a huge role.
So let’s just listen to what she said.
– I told myself, if I ever won a Grammy
and I got to stand up here
in front of the most powerful people in music,
I would demand that labels and the industry
profiting millions of dollars off of artists
would offer a livable wage in healthcare,
especially to developing artists.
(crowd cheering)
– Well, isn’t that fucking precious?
(laughing)
Well, here, if you, you know,
and if you get in front of a group of kids
in high school, tell them not to be music artists
because it’s a shitty industry with too many people
fighting over too few revenues
and a series of platforms that are developed in a monopoly.
So okay, the notion that’s great virtue signaling,
you know, good for you and it’s gonna,
it’s not gonna mean dick.
It’s not, these guys are doing their job.
If you wanted, all right, are you sincere?
Pull your shit off of Spotify.
Are you really sincere about helping an event
and call your friends, you know,
do you hang out with Beyonce, do you know Taylor Swift
and pull your shit off of Spotify?
Because as long as you have oligopolies,
they’re gonna extract more and more
and they find that the best way to get retention
is to just consistently recommend Taylor Swift
over and over.
And the notion that she’s gonna bully the record labels
Spotify is now worth more than all the record labels.
So if she really wanted to have an impact,
let me do some virtue signaling.
When Spotify decided to not fact check Joe Rogan
who would have one legitimate doctor on one day
and then an illegitimate doctor the next day
and create all sorts of vaccine hesitancy
and false equivalences,
I called them and said, we’re pulling Prove G off of Spotify.
I pulled my shit down and it cost us
somewhere between a quarter of a half a million.
So yeah, put your money where your fucking mouth is,
pull off of Spotify.
But there’s notion that you’re gonna shame people
in the audience to paying artists
who aren’t making them any money, more money.
Yeah, good luck with that, have at it.
– No, I completely agree with you.
And I think this just, it reminds me
of all the dynamics that we’ve seen in Hollywood.
And the reality is altists have been getting screwed
since the dawn of time.
And historically it’s been the record labels
that have screwed their artists.
And I think back to the 1950s,
this is probably the most famous examples
where you had all of these incredible black musicians
who are suddenly dominating the charts
and then none of them got rich
because they signed these shitty deals
that ultimately rewarded the owners of the record labels.
So this dynamic of artists getting screwed to an extent
is nothing new, but I don’t think,
I mean, a lot of people are blaming Spotify for this
saying that they just don’t pay them enough
and blaming the business model.
I really don’t think you can blame Spotify for this
because all you have to do is look at the financials.
You have to remember,
this is Spotify’s first ever year of profitability.
So for the 16 years before this, Spotify was losing money.
They were losing money to pay employees
and to pay for technology.
And yeah, to pay their artists.
And so I’m not trying to like make a sob story for Spotify,
but I think all I would say is this is a business
and the business has to make money.
And this year was the first time they ever did that.
The other side to this, you know,
one other way that they could have paid their artists more
or they could pay their artists more
would be to massively raise prices for the consumer.
But actually they haven’t done that.
And in the past 16 years,
the price has gone from 9.99 to 11.99.
So actually on an inflation adjusted basis,
Spotify actually got cheaper.
And then you compare that to things like Netflix.
Netflix has more than doubled its prices
in that same amount of time.
So, you know, I’m sure someone’s being greedy here.
I’m sure, you know, for the record label
has screwed some artists here or there.
But the fact that Spotify is getting wrapped into this
like as the big bad company
that’s just sort of ruining the music industry,
I just don’t think that is true.
And I think ultimately what this is
is that as you say, being a struggling artist
is a bad business.
It just doesn’t really work.
And in almost all industries,
it only starts to make you real money when you hit the 1%.
And finally, Chapel Roan has done that.
And I don’t think she’s gonna be giving her money away
to the other 99%.
I think she’s gonna be, you know,
claiming her check from whichever record label
she’s signed to.
So, I have a very boomery outlook on this.
Sounds like you do too.
And it sounds like we’re just in fervent agreement.
– We need a different term than boomery.
Look, the digitization of markets
results in a consolidation and a winner take most environment.
You digitize retail, you end up with one company
with 50% of all your commerce.
You digitize connections and socialization online.
You end up with one company meta that owns two thirds
of all social interactions online.
You digitize information.
One company ends up with 93% share of search.
You digitize mating and online dating.
And 80 to 90% of all swipe rights happens amongst
the 10% of most attractive males, right?
Men are less choosy, women are more choosy.
They all want the same guy.
And the same thing’s happening on these channels.
When you digitize a platform,
the Taylor Swift gets more listen,
more listen time than all of classical music now.
Taylor Swift is bigger than classical music or jazz,
the entire genre.
And it’s because the algorithms, they consolidate
and they say, okay, when everyone has access to everything,
the very best, and Taylor Swift is the very best,
according to hopped up 14 year olds on sugar,
they consolidate the market.
Now, I don’t know if there’s anything you can do.
The only things you can really do about this
on a systemic level is to make sure you have
a really robust FDC and DOJ
that makes sure there’s a lot of competition
such that you transfer money back from the monopolies
to the artists, to the means of production,
to the labor force.
The other thing you can do
is have minimum wage of 25 bucks an hour,
such that if these people have side hustles,
they’re at least making a good living.
But let me just, let me just clue young people in.
The world does not owe you your passion.
And you don’t have the right, the birthright to make music.
You have the birthright, in my opinion,
to make, to have healthcare.
I mean, let’s start there, healthcare, universal childcare.
You don’t have a birthright to be an independent music
producer or independent musician and make money.
These are, the vanity industries
will always have an overinvestment in human capital
and they’ll be a small number
and increasingly, unfortunately, a small number of people.
What I think you have to do is say, okay,
if you’re the backup drummer on a Kellogg’s ad,
they have to pay you at least 25 bucks an hour.
Anyways, I think this is a social issue
and we need to break up monopolies,
of which I’m not sure you could say Spotify’s a monopoly.
Everything’s going hunger games.
The winners leave it a remarkable life
and everyone else dies a slow death.
And if you want to change that,
you have to make systemic change
at education levels, antitrust levels,
but believing that somehow shaming the record labels
or Spotify and to paying people.
You know why they pay these people nothing?
Because they can.
And they’ll keep making music.
And by the way, the only way it gets better
is if it becomes such a shitty business
that just people don’t go into music
and over time they have to pay them more.
– Right?
– Anyway, I think the market,
I don’t want to say the market’s doing its job here,
but the solutions are societal.
They come out at DC.
They don’t come out of like virtue signaling
at the Grammys.
– We’ll be right back with a look at Google’s earnings.
If you’re enjoying the show so far,
hit follow and leave us a review on Prof.G Markets.
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Google’s fourth quarter earnings largely disappointed.
Revenue grew 12%, which was the slowest pace since 2023.
Growth in the cloud division
also slowed from the previous quarter.
Still, CEO Sunder Pichai highlighted
the company’s accelerated investments in AI data centers
with plans to increase capital expenditures
to $75 billion this year.
That’s up from $52.5 billion last year.
The stock fell 7% following that earnings report.
Just wanna quickly touch on why the stock fell so much.
By the way, that was Google’s fifth worst trading day
in 10 years.
It erased $200 billion in value.
So you would think based on that
that Google had a dreadful quarter.
Actually, on the whole, it was fine-ish.
Revenue up 12%, roughly in line with expectations.
Net income up 28%, it beat expectations.
The problem, as we keep on seeing with big tech,
was this one number, which was the cloud revenue,
or you might call it the AI revenue.
And that was $12 billion up 30%,
but most importantly, lower than what Wall Street predicted.
And I think in 2025, if you are a big tech company
and you’re not smashing expectations in AI specifically,
your stock is immediately gonna drop.
It’s just a non-starter.
This is, by the way, exactly what happened
to Microsoft the week before.
They had decent earnings, AI revenue missed,
$200 billion in market cap erased overnight.
Let’s get your reactions to Google’s earnings, I guess,
particularly this obsession with the cloud revenue
and missing on those estimates.
– Yeah, look, it’s impossible to ever count them out.
They have five separate businesses
that do more than $30 billion in annual.
This is a really robust business,
meaning that while they’re kind of core business of search,
they have five companies that could be
$100 billion plus market cap companies.
They’re very diversified,
and they coordinate, cooperate with each other,
which is probably not a good thing.
But between Google Search, the DisplayOut Network,
YouTube, and subscriptions,
that’s YouTube Premium, Google Play, and then cloud.
They just have some amazing businesses.
The analysts here made the analogy.
It’s like having the revenue power of five Starbucks
or five visas.
The thing that I think was the scariest thing in here
was one, analysts pointed to the fact that
their cloud business was not growing as fast,
which they saw as an indicator
they haven’t figured out a way to monetize AI
from the company that had most of the IP around AI.
I think the scarier number here
is that for the first time, their market share,
the scariest number for Google shareholders,
I should say, or for Alphabet shareholders,
is that for the first time, their market share of search
dropped below 90%.
And so what I’m hearing from some young people
is they have totally abandoned Google Search
and are now just using AI, that they just get more.
And I’ve found myself getting impatient with Google Search
and just going to chat to BTR Anthropic
and typing in a question.
And I find it just, it doesn’t give me 500 links
to make me sort through them.
It just says, it tries to give me,
it tries to answer the question, right?
Because with Google right now, it’s a query,
but it’s also an invitation to throw a bunch of shit at me
that’s not accurate that you think you can further monetize
and take me to another place.
Whereas chat GPT, although it hallucinates
and as does Anthropic,
it attempts to actually answer the question in one shot.
And so you could see the stock,
if Google Search share drops below 85%
in the next 12 months,
I think you get the stock really get hammered
because what that means is that their ultimate toll booth,
it’s losing its power.
And at the same time,
they announced an increase in CapEx from 58 billion to 75,
which the market didn’t like.
But I still think this stock and this company
have so many amazing, at the same time YouTube is growing.
We’ve said this before that Netflix isn’t a premier streamer.
It really is YouTube if you’re talking about video.
But I think fears around AI,
they haven’t figured out an AI strategy to monetize
and to search dipping below 90%,
I think analysts are gonna keep watching
what’s happening to a search share
because I could see an environment
where if there’s enough applications
and these AI guys continue to raise this kind of capital,
I think you could see in a year,
their search volume go from 90 to 70%.
– I think I disagree on these points.
And I think the market share,
the search market share is an important point
that has to be tracked and we’ll see what happens.
But I can just say from my experience,
I do use chat GPT,
but I would say it’s 95% Google and 5% chat GPT
and maybe 1% other tools.
So search is still an incredibly valuable product to me.
And I think it’s still an incredibly valuable product
to many others.
And I think that’s why you’re seeing their search revenue
is continuing to grow quite steadily
on the cloud revenue point.
I think it’s important to note,
the reason Google missed on cloud this quarter
was not because there wasn’t enough demand,
it was because they couldn’t keep up with supply.
They literally don’t have enough compute,
which you might say, okay, well, that’s another problem.
But then you realize,
well, actually they’re about to invest $75 billion
into data centers this year,
which solves exactly that problem.
So, you know, I see the stock dipping
because everyone’s getting all wigged out
about this cloud revenue thing.
But to me, I see it as kind of a good problem.
There’s too much demand
and now they’re investing in meeting that demand.
So I see this, I think they’re being over-punished
for those cloud numbers.
I also think they’re being over-punished for deep seek,
which we can get into.
But, you know, 25 times earnings,
lowest P multiple in all of tech.
Meanwhile, you’ve got Apple at 37 with what?
2% revenue growth.
You got Google over here growing at 12, 13, 14%.
I think that it’s perhaps being over-punished here.
– I like your take better than mine.
I would draw the comment.
I think your take is better than mine.
The thing you said there that stick out was 25.
Cheapest company in tech,
the diversification of the revenue streams.
I like how you couch it against valuation
and that it’s arguably the cheapest of the big tech players.
And the reason I love Alphabet is because, you know,
it’s impossible not to find a business
that’s not, you know, only meeting expectations
when you have five different businesses.
But the reality is they have five different businesses.
They’re hugely diversified.
And their ability to coordinate and cooperate
and share data to the users
and the advertisers detriment is extraordinary there.
They’re kind of the only other company
that can gather this much, who grew up this much data
and then use it to increase prices
or rents on people is meta.
And these guys have it.
They also have the second largest operating system
or actually the largest operating system,
but the second most profitable in mobile with Android.
So you just, this is one of those stocks, I think,
especially at this price, you just own it.
You know, you just–
– You better own it. – You just own it.
– By the way, just on YouTube,
10 and a half billion dollars in ad revenue, up 14%.
It is still the fastest growing unit
in the Google ad business.
It’s still bigger than Netflix.
And I pointed out it’s the most popular
TV streaming platform in the US.
It is now also the most popular podcasting platform too.
More popular than Spotify,
twice as popular as Apple podcasts.
So this thing is just growing so rapidly
and it’s already a behemoth.
It’s already way bigger than Netflix.
I’m so, I mean, we’ve been bullish on YouTube for a while.
I just, I remain extremely bullish on YouTube.
– YouTube is now the largest podcast distribution platform.
The more people are listening to podcasts now
in terms of listenership on YouTube,
then they are on Apple or Spotify.
– Yeah, and then just one final point here,
we should touch on is this CAPEX.
I think there were a lot of questions following deep seek
as to whether big tech would be pulling back
from all of this AI CAPEX spending.
The answer we’ve gotten from this round of earnings
is a resounding no.
It’s kind of crazy.
You’ve got Google spending $75 billion,
way up from last year.
You got Meta spending $65 billion,
Microsoft $85 billion, Amazon more than $90 billion.
This is more than $300 billion in CAPEX,
all coming down the pipeline for 2025.
It’s all going to go to AI,
which presumably means it’s all going to go
to Nvidia pretty much.
So I’m just looking at what’s happened with deep seek here.
I’m struck by the extent to which deep seek
did not affect the AI CAPEX story,
at least in this round of earnings.
Maybe that’s going to change next quarter
and they’re going to switch things up.
But so far at least the plan
is basically completely unchanged.
Let’s take a look at the week ahead.
We’ll see the consumer and producer price indices
for January.
We’ll also see earnings from McDonald’s, Shopify, Reddit,
and Airbnb.
Scott, do you have any predictions?
You’re a big shareholder in two of those companies.
– Yeah, they’re both going good, especially Reddit.
Jesus.
God, why didn’t I buy more?
That was so obvious.
– Come on, you did well.
– You have been out well.
Dude, I’m glass half empty.
Haven’t you figured that out?
Anyway, so my prediction is the following
and I didn’t have one, but you inspired one.
I think Joe Rogan is about to be displaced.
I think that the new number one podcasters
will either be Mel Robbins ’cause she’s so talented
at like connecting emotion with psychology.
I think she’s outstanding.
But my outside shot here is I think that the new Joe Rogan
is Steve Bartlett, diary of a CEO.
And it’s for the reason you stated.
And that is the first thing I did literally
when I landed in London, a friend of mine said,
“There’s this Brazilian party at Five Hurtford.”
And I went and it was like an amazing party
with hot people everywhere.
And I’m like, “I love London.”
It’s been downhill since then.
And then the next day, the first thing I did,
this is all true is I went on this podcast
of this young handsome guy who was supposed to be,
he was like the number 10 podcaster in the UK.
But I thought, “Oh, I wanna get to know people in the UK.”
And it was Diary of a CEO.
And I think I’ve been on his show four times now.
And the thing that just blew me away,
and this is two and a half years ago,
was he had probably six people in the room
and five of them were focused on camera work.
He had lighting, obviously amazing sound,
but swivel cameras and cameras on sleds,
getting different shots.
And he forces everyone to come into the studio
as does Rich Roll actually.
And the result is just these podcasts
that are just kind of visually arresting
and do really well.
And he also was testing, A/B testing like crazy buttons.
And I don’t know if you’ve seen his promos, but–
– They’re incredible.
– He’ll do something where I’ll say,
the secret to happiness is,
and then I’ll like goon, cut away and say,
tune in now, he just spends a ton of time
optimizing for YouTube before it was cool.
And the result is he’s now the number one podcaster
in Europe and I think he’s number nine in America.
I think he’s gonna be number one
because he understands the medium of YouTube.
He’s weaponizing and leveraging
what is now the biggest distribution platform
in podcasting, that’s YouTube.
So my prediction is the new Joe Rogan
or the person who’s gonna displace Joe Rogan
as the biggest podcaster in the world
is Steven Bartlett from Diary of CEO.
– But you’re missing someone.
– Ed Elson?
– Two of us, we’re investing in video.
We don’t have swivel cameras yet, but we’re working on it.
– Yeah, I think–
– We can– – I don’t wanna be that big.
I wanna have enough money just to have a second jet
in unlimited supply academy,
but I don’t see us as the number one podcast.
I think that, I think we wanna be,
well, we could be number one in business.
We’re talking about, by the way in a meeting today folks,
we’re talking about Ed going daily.
We’re talking about doing a daily property markets
to talk about the markets ’cause the news keeps coming.
But I think we could be number one in business.
We’re in the top 10 in business
and occasionally we’d pop into the top five,
but that guy, David Ramsey,
who keeps selling expensive mutual funds
and saying that you can pick a mutual fund.
– We could beat the Ramsey network, surely.
– Yeah.
– We gotta do that.
– I love shitposting our competition.
That’s so classy, isn’t it?
It’s so big of me.
But anyways, let’s go back to my prediction
where I can actually lift up young people.
Diary of a CEO, Steven Bartlett, he’s the new Joe Rogan.
– This episode was produced by Claire Miller
and engineered by Benjamin Spencer.
Our associate producer is Alison Weiss.
Mia Silverio is our research lead.
Isabella Kinsel is our research associate.
Drew Burris is our technical director.
And Catherine Dillon is our executive producer.
Thank you for listening to Prof.G Markets
from the Vox Media Podcast Network.
Join us on Thursday for our conversation with Alice Hahn
only on Prof.G Markets.
♪ Lifetimes ♪
♪ You help me ♪
♪ In kind reunion ♪
♪ As the world turns ♪
♪ And the dark lights ♪
♪ In love ♪
(gentle music)
– The key to good leadership is to motivate people
and give them a vested interest in the success
of the company I’m announcing today
that we’re doing really well.
And if the company and individuals such as yourself
continue to perform like this,
because I want to create motivation
that there’s a really good chance
if you guys continue to show the same type of talent
and commitment that I’ll be able to get a second plane.
(laughing)
That’s…
But I want you guys to just–
– I always know what it’s come to.
– I don’t want to promise anything.
– I don’t want to promise anything.
– It’s like sullen.
You start looking down at the floor and I just know it’s coming.
– It’s not sullen, it’s my age.
You’re getting a map.
If you continue to perform like this,
daddy might be able to get a Gulf Stream.
I want to motivate you.
I want to keep you in the game.
Super exciting.
I promise to send you photos.
– Okay.
– Seriously, Ed, something to look forward to.
(laughing)
Now get out there, little soldier.
Follow Prof G Markets:
Scott and Ed open the show by discussing Disney, Novo Nordisk and Uber’s earnings. Then they break down Spotify’s results and discuss Chappell Roan’s Grammy speech criticizing the music industry. Scott outlines how she could drive real impact in the industry, while Ed explains why he doesn’t think Spotify is to blame for the struggle of artists. Finally, they unpack Google’s earnings, with Scott highlighting the biggest red flag for shareholders and Ed explaining why he remains bullish on the company.
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