Chit Chat Stocks - Anthropic's Crazy Revenue Growth; Berkshire (And Others) Insider Buying; A New Fast Growing Small Cap Stock; Wix's Aggressive Moves

Episode Date: March 6, 2026

The Investing Power Hour is live-streamed every Thursday on the Chit Chat Stocks Podcast YouTube channel at 5:00 PM EST. This week we discussed: (00:00) Introduction (01:17) Anthropic's Revenue Surge (07:13) Insider Buying (13:18) Berkshire Hathaway's Stock (23:05) Real Brokerage Earnings Review (30:15) Small Cap of the Week (39:58) Wix's Financial Engineering and Growth (44:57) The Future of E-commerce Stocks (51:52) Michael Burry and Adobe (57:00) Appreciating Capital Losses ***************************************************** Subscribe to Emerging Moats Research: emergingmoats.com  ********************************************************************* Chit Chat Stocks is presented by Interactive Brokers. Get professional pricing, global access, and premier technology with the best brokerage for investors today:  https://www.interactivebrokers.com/  Interactive Brokers is a member of SIPC.  ********************************************************************* Fiscal.ai is building the future of financial data. With custom charts, AI-generated research reports, and endless analytical tools, you can get up to speed on any stock around the globe. All for a reasonable price.  Use our LINK and get 15% off any premium plan: ⁠https://fiscal.ai/chitchat  ********************************************************************* Disclosure: Chit Chat Stocks hosts and guests are not financial advisors, and nothing they say on this show is formal advice or a recommendation. Learn more about your ad choices. Visit megaphone.fm/adchoices

This episode is presented by Interactive Brokers. Will the U.S. Consumer Confidence Index be above 101 in March 2026? Turn your view into a trade with IBKR Forecast Trader and earn a dollar per contract if you're right at ibkr.com slash forecast. Last trading day is March 22nd. More on this later in the episode. Welcome to Chit Chat Stocks, the podcast that helps you discover your next great investment. I'm one of your hosts, Ryan Henderson, and I am joined as always by the and only Brett Schaefer. This week, we've got our 201st Investing Power Hour. We do these live every Thursday at 5 p.m. Eastern time on YouTube. So if you ever want to ask any questions, head on over to YouTube, look up Chit Chat Stocks, and you can ask us live. You can also ask us in our

Substack chat throughout the week, whatever you want to do. But on these shows, we talk all things financial markets, news, anything relevant, earnings from the week. We'll have our bubble talk or a bubble watch. We have our small cap of the week. People have asked me to bring that back. We've got a good company or an exciting company, I should say, for this week. We also have Wix earnings and some drama around a buyback potentially, as well as some significant insider buying, which I'll get into in a bit. But Brett, where do we want to kick things off? why don't we talk about anthropics revenue ryan i did you see this chart well when you put it in our show notes yes yeah well you didn't see it before that it was quite

astounding and uh i mean you can read up the numbers here i'm putting up the the thumbnail on youtube but they are adding i mean they 10x the revenue to 10 billion over 10 billion dollars and ARR, and they're at the same pace now. Yeah, I'm pulling it up for anyone watching. This is outrageous. I don't know if I've ever seen a company grow this fast. I mean, that eclipses OpenAI, right? Not sure.

But did you also see that OpenAI got its funding? It's going to last for another... Well, we'll see how long this funding lasts, but I think they got their $100 billion. It's been reported for a long time. They finally got it together. Anthropic got its together. And I guess that means the music is still playing.

The funding can go. We can keep investing. And I think that will fully bridge the gap to the IPOs, not just for those two, but as well as SpaceX, as they are a little bit different, obviously, not full, you know, just an AI lab. but I think that will bridge the gap for these massive IVOs that are supposed to be coming later

this year the show goes on Brett the show goes on I mean Ryan you're I should mention your AC is a little loud I know this is a live show I don't know if it's possible to turn that off I can maybe go into a topic

first while you do that or once we get a break but I'm hearing that on my end but what were you about to say i mean these businesses are astounding and i'll i'll see if i can uh fix the audio in a bit the i don't know if i've ever seen a business go from what looks like uh am i reading this right basically three billion dollars to 19 billion over a year in revenue pretty much pretty much and the i think what's most impressive is given the momentum

they've been seeing to start 2026, Anthropic specifically, gaining market share on OpenAI in both consumer and enterprise, is they went from what? Let's get the exact dates. They were at $14 billion. Let's just do end of 2025.

$10 billion end of 2025. As of March 2026, their revenue grew ARR, which, you know, we'll see if that recurs in succeeding years, because a lot of the, you know, it's a lot of experimental revenue

for a lot of these companies at the moment. But their pace of revenue, their ARR is at $19 billion in two months. So pretty much doubled in two months. And if this keeps up, I mean, they could be one of the biggest businesses in the world by the end of this year. And I want to know when the growth

is finally going to stop because it seems like Anthropic, while not necessarily the tortoise in the race, open AI was definitely the hare. And when you see Anthropic come back here and take, I don't think they have the majority market share now, but their revenue growth has just been so impressive. I want to see what the income statement looks like once we hit the S1, because as I've said before, if you opened a Chipotle and you sold dollar and you sold burritos for one dollar you'd get a lot of demand so yeah they have impressive technology but are

they you know what what are the unit economics looking like today and i know they can spin things on what the economics look like but let's see the full numbers first yeah the only thing i caution here is that these businesses are not intended a vc-backed business that is growing at the rate they have the venture capital firms typically encourage them to spend as much as they can because they're generating good returns on their investment so i wouldn't i would be shocked if they dropped an s1 and you saw like 50 operating margins well they're not gonna have that but maybe let's look at what the gross margins are true yeah i am curious a business that's very compute intensive what how much that really hurts them on the revenue side

i i know it feels like every enterprise is using claude maybe i'm overstating that but i would be curious around some stats on like what percentage of fortune 500 businesses have and you know claude seats yeah yeah definitely i mean it's gotta be a lot given that revenue but i thought that was a fun way to kick me i was absolutely astounded to see that revenue and the fact is they just started generating revenue like three years ago something like that i just recently started using like ai agent for sheets like or excel i use google sheets these things are i mean they're helpful yeah they're definitely helpful oh yeah 100 100 all right what else do we want to talk about this week.

We have some earnings from companies we follow, Wix, Real Brokerage, Nelnet, three that I follow closely. We have questions around Coupang, MercadoLibre,

I see Limited, the Amazon clones. We have questions on from the Substack chat, geopolitical risks, thoughts on Burry buying Adobe, NewBank, software stocks bottoming.

I don't want to jinx it, but maybe it has. Anything interest you, Ryan, as the second topic here? Let's do insider buying because there was a series of, I think it's like the window is open basically for them to buy. I think, I'm not sure what the windows are, but you know, there's certain timing where they can't be purchasing shares in the open market. But there were some notable insider buys this week that are probably worth calling out. So I'm going to rip through some of these. Stop me if you want, Brett.

But let's see which of these is Signal and which of these is just Noise. So Anthony Noto, SoFi CEO, bought $1 million worth of SoFi shares. Noise. Noise, okay. Jared Isaacman. Yeah, I mean, it's not. Some of these maybe I should have gone back and got more context around, like, what's their transaction history prior? Because sometimes it feels like, oh, it's only $1 million. But if they've made recurring purchases over the years in small gulps, that's maybe more signal than noise. the second one here jared isaacman founder and former ceo of shift 4 he's the director of nasa

now so i don't think he's allowed to be the ceo of shift 4 anymore uh he bought 14 million dollars worth of shift 4 stock not a small amount i don't think uh i don't know shares of absolutely puked too yeah i'm not sure why i don't follow them closely enough but people say it's cheap could be interesting could be a good signal here's an interesting one marcelo melamud i might be saying that wrong the chief accounting officer for mercado libre bought a hundred thousand dollars worth of stock now i kind of don't know what to think here because $100,000 is like whatever. Obviously, this isn't, it's not massive size relative to MercadoLibre's market cap.

But the chief accounting officer is encouraging. It's an encouraging role as opposed to, you know, maybe a CTO, someone product related. And also, you know, it could be a larger percentage of their wealth, you know, compared to like a CEO, for example. Any thoughts on that one? Yeah. MercadoLibre looks interesting here. I know. It's like any stocks I'm interested in, when I see an insider buy, I'm like, yeah, they got the right idea. I think insider buying is interesting because it can be

somewhat of a single depending on the situation. For example, you're about to say the Greg Abel one here. It's not really too meaningful. The Isaacman one, I think, can be meaningful. But if you look at someone like Jeff Green that came out today at the Trade Desk, founder and CEO who bought a hundred million dollars. That is a signal, but if you look at the business and you're like, oh, well, I think the business is structurally challenged, but the insiders are buying shares. Like that doesn't mean you should necessarily buy if the thesis on the business has totally changed. yeah let me let me rip through a few more of these and then we can talk

more at length about insider buying in general you mentioned it greg abel the now current berkshire i believe his title ceo but uh he bought 14.8 million dollars worth of stock he said he would do this he said basically i'm pretty sure like all of his cash pay he said he would just buy berkshire stock in the open market with uh yes so not a whole lot to see there other than phenomenal alignment i guess but i will say berkshire is getting kind of interesting like how so the i remember someone breaking down the valuation in terms of uh cash on the balance sheet equity investment uh mark to market if you strip those out you're buying the operating businesses i i remember i can't remember exactly what he said but a pretty attractive earnings

multiple on those operating businesses the stock is down what is it 10 maybe maybe i'm overstating it here uh but i remember seeing basically stripping out cash and equity investments you've got a decent operating earnings multiple here and i do think all these predictions about distributing the cash in some way or another i think it's going to come to fruition i could see a world where they just dividend it out or at least a good chunk of it which would be i think nice for shareholders well they started repurchasing stock again so maybe that's the way they're going to do it who knows though the and they're going to pile up even more cash on the balance sheet every year unless there's some insurance anomaly that happens every every once

in a while i just have no interest in berkshire it's been boring for a long time it's so if you want to go to the meeting you got to buy a ticket you got to buy a share yeah i don't know if you actually have to now only you have like three guest passes i think per person if you remember this that's right yeah yeah all right well maybe we can talk Berkshire potentially another time at the meeting yeah it's

just the other buying back so maybe they think it's cheap but it sure it's gonna do fine from here is it gonna be a miracle results no right that's just not how it's built no and I should say if

if there were if markets hadn't puked or when i say markets were almost at all-time highs if my portfolio hadn't puked over the last month or so i'd probably be more encouraged to deploy some into berkshire but if if it is cheap it seems to be coinciding with a lot of other stocks that i also think are cheap at the same time so yeah it's a little mature to be it's hard to get that excited about honestly i know yeah like if there if there's much better options on your watch list in your portfolio yeah for example nelnet smaller berkshire growing quicker longer longer opportunity to grow i do not understand why you would buy a berkshire over over over that yeah yeah that's fair uh okay last three here james shelton uh director of duolingo bought

500 000 worth of stock now this one was kind of interesting kkr both co-ceos honestly i didn't know they had co-ceos uh bought about 4.4 million dollars worth of stock same time and a director mary dylan who i recognize the name i can't remember why uh she bought two million dollars worth of stock my opinion is when you have to sync when you have to sync it up and have both co-ceos buy at the same time a it feels a little like planned like okay we're gonna show here's a show of strength that both our ceos are buying and they're buying the exact same amount and also like you couldn't i don't know you couldn't go out and do it on your own you had to do the same amount it just feels all a little more signal than noise but side note kkr and a lot of these

private equity businesses in general or big asset managers are in major drawdowns kkr is down 43 percent there's a lot of people that say the private credit blow could happen i have no idea if the blow up or if there's terrible loans or what have you within these markets is going to happen or if it happens, how severe it will be. But it's just not something I want to play in where, you know, there's a chance a lot of these companies, a lot of these funds just do extremely poorly. What is the juice worth the squeeze? I'm not sure.

Okay. Last one here. You already mentioned it. uh jeff grain the trade desk ceo bought 148 million dollars worth of shares which is significant it's significant for him it's significant for the company so just to double check prices here uh the trade desk had a market cap prior to this of i think just over 10 billion dollars yeah just over 10 billion dollars so basically took out bought one percent of the company in one go of it on the one hand i think this is quite a sign of confidence but on the flip side i there's a part of me that thinks sometimes founders and ceos are almost too close to the business to maybe recognize if there is something

structurally wrong obviously they have more information than we do but like if they are getting disrupted it's sometimes hard as a founder of the business to admit it will the u.s consumer confidence index be above 101 in march 2026 at ibk or forecast trader the yes recently priced at 40% and the no at 58%. But markets move fast. Forecast contracts let you turn your views into trades on future events like the economy, climate change, and politics with simply yes or no prediction style contracts. Explore trending data and spot the trends. And if you get your prediction right, you earn $1 per contract at settlement. Plus, you'll earn 3.14% APY on your investment with an interest-like incentive coupon. And you'll get USD $3 for

signing up which you can use for any purpose or to start trading forecast contracts are not suitable for all investors go to ibkr.com forecast and turn your views into ibkr forecast trader contracts today last trading day for this contract is march 22nd sure i mean you've never met an executive team that's not bullish on their own company if they weren't why would they be out the company as it's an extreme rarity with trade desk specifically yeah i think they're structurally challenged in the ad market i think it's a very tough space to play and i think amazon's taking a lot of share from them sure does jeff green have skin in the game but i honestly think skin in the game is overrated i think someone on a mission is much more important for example

interactive brokers i mean petrify petrify is getting older but the team that's there is still on the mission that he started. Airbnb, on a mission. Adyen, on a mission. Riccardo Lepre, on a mission. I could go down and down remotely, even though Oppenheimer's stepping back, on a mission.

It doesn't matter exactly what they own of the company, but they're in it. That's a cringy term, but they want to win. You didn't want to say, in it to win it? Yeah, I did not want to say that. That's what popped into my mind. But I think listeners understand. It doesn't matter that they're buying the dip with you.

Clearly, they're bullish. They're running the company. They would have to be optimistic. You're never going to find an optimistic CEO running a company. But it's much more important, in my view, if someone's focused on, like, oh, we're going to win this market and do well by shareholders. You can just see that.

For example, it wouldn't matter to me How much of IBK are Petter Fee owned? It's 10, 20, 50%. I think it's even higher than 50%, honestly. But it's his rhetoric, his actions, the culture he set up. That's much more important to me. Costco, another example. That's how the culture gets spread from the founder

down to the new executives that join the company. How much insider buying are they doing? I don't know, but I trust that business much more than i hope the trade does yeah it's been yeah it's a premium valuation it has been for a long time what are your thoughts on that idea yeah i agree although i'm not averse to the founder that is motivated by money if if they are in it for the long run if you get a set like if they know that the long run motivation by money is their shares being worth more that sure and sometimes it's kind of hard to draw the line between like like everyone every founder is like

a mission-led founder or they at least advertise themselves as that but there really are and you can really see it with companies that drive down price like customer price it's rare that you'd never do that if you weren't focused on the long run uh especially if you're already gaining market share so marketplaces are kind of a good example where it's sort of easy to do that i mean you saw that with bezos like wanted to drive selection and price more selection faster faster shipping times lower price that i mean that was that to me was sort of a mission-led founder costco is probably another good example of that but i think it's always hard it's hard to tell like everyone says they're a mission-led founder how do you know in whether it's true or not uh actions execution

at the end of the day are they good is the business high quality and i think what's more important for me because when insider buys it's not increasing intrinsic value at all what's more important to me is if when you're thinking about catching a falling knife and the stock might go down 30 percent more from there is the company lining up the buyback that is a much bigger signal for me a hundred percent and actually it's funny how much people champion insider buys when you should be championing buybacks because like you said it doesn't improve the intrinsic value and if anything it's you could make the case like mark leonard that you're actually uh taking advantage of misinformed shareholders like

mark leonard has famously said like we're not going to buy back stock because we're well in this case i'm going against my example but basically we're not going to just be driven by the price of our stock we don't really care yeah i just disagree he's an extremely smart man i just disagree with him people need to take accountability for their own lives i don't really understand that philosophy whatsoever there is a part of me that when someone makes an insider buy it feels like they're more focused on their own portfolio and own own personal wealth than purely driving long-term shareholder value obviously it's their own money versus the company's excess capital but i would when someone

says put your money where your mouth is i'd rather them do that through a buyback than a personal financial decision right because i can help my stake or whoever's stake all right what of the earnings do you want to talk about? The real brokerage? Many people are asking about the real brokerage. A company I own, Ryan, I do not believe owns it, but it's one that I did a still free research report. I believe it's going to be on Emerging Moats, the website. If you want to read that, we also did a podcast on them. It is a cloud-based brokerage for the residential real estate market. They are gaining a lot of share. They're trying to convince agents to go over to their platform. They just reported this week, revenue was up 44%. Gross profit was up 30%

year over year. Now, gross profit is growing slower than revenue because more agents are hitting the revenue ceiling on the revenue share part. So once they hit that ceiling of how much they need to give back to the real brokerage every year, then they're going to earn more revenue for the real brokerage, but they're not going to give much at all, except for like payment processing fees. I think they're changing that model slightly for their power users because they don't want to just say, hey, look, you hit $12,000, $15,000 in commissions to us. Well, then after that, it's just all free. I think that they would understand that. But if we go back to the earnings, they had a slight net loss on a gap basis, but a lot of free cash flow because they

do share-based revenue sharing. People understand that with their agent partners. Think about them as contractors for them. These are real estate agents or real estate agent teams that are using the real brokerages technology. And then at the same time, they are buying back stock to offset the SBC. I think that is consistently return cash to shareholders through buybacks, especially if they're using stock to incentivize these agents. It's not the end of the world. I would just not just be consistent with it, which I think they are. There's been slow progress on their new initiatives, expanding into things like mortgaging, like the loan officers, essentially title insurance and the real wallet. Real wallet seems to be doing all right,

but they're still investing behind them. It's pretty early and they're still optimistic on getting more and more agents to try this. When I look at them, they keep adding more agents. They toss up press releases all the time about new agent teams joining their platform. And as long as they can keep growing sales, gross profit, I guess, too, and agents and then show decent unit economics. I really see nothing to dislike on the quarter. And the question remains,

is this a catalyst stock for when the housing market, if the housing market, finally unlocks in the United States? Do you remember in 2022 when the deals, ah, 2023, the housing market will unlock? Date the rate.

Date the rate. Marry the home. Date the rate. It's 2026 and mortgage rates are not back to three percent yeah date the rate marry the home honestly it's a good sales slogan remind me a bit of how the real brokerage model works so these agents are basically independent businesses or contractors and they use real brokerages like platform brokerage cloud cloud brokerage yeah so same does a coldwell

Banker, Windermere, Remax, I think. Some of the larger ones out there, 21st Century. The Compass is another cloud-based brokerage that is acquiring a lot of these companies, which is throwing a curveball into the industry. But I think the real brokerage will do fine despite that. Those are traditional ones where it's a similar model where you do revenue sharing with the brokerage that processes the transaction, similar to a stock broker, how that would be. But with the real brokerage, it's all cloud-based. They are a white label solution for these real estate teams they do all a lot of the back-end work for them they want to increase the back-end work they do over time including helping with my financing working capital uh you know title insurance stuff

like that they just want to make the home buying process extremely easy and they're convincing people to join them because they seem to have a better technology solution you don't want to get that you know i go into more depth in the research report but the coldwell bankers of the world will give a good picture like, oh, you need to join us. We're a name brand. But you have the overhead costs similar to a legacy bank versus an online only solution. You have them tied to this brand where you can't make your own brand in real estate with yourself or your team. You have to be under Coldwell Banker or Windermere, what have you. And you almost get stuck to them. And then real brokerage gives better revenue share because they have much lower overhead costs. And they've been

Congressing and marketing and revenue sharing at the start. But if they can land these customers, which are the agents, get them to be successful with them and lower churn, which they are lowering churn, I think they can be successful over time. Yeah, I could see how that would work. And I could see agents being attracted to this model. i don't really understand the appeal of hey we're cold well banker we're a brand name we're a household name no buyers buyers like it sellers like it trusted i don't get that you're buying you're younger not buying i mean i'm in i know i'm in that process now and it's like i'm kind of like i feel like a lot of the discovery process now for home buying is done from the buyer like

maybe i'm wrong maybe i'm not thinking about it correctly but i think a lot of people do zillow surfing and they just find whatever agent is the one they know or even i don't think that's 100 i understand i understand what you're getting at and i think that's happening over time but there's still this you know there's still two trillion dollars of deposits at bank of america earning nothing there's friction out there and people have existing relationships if you bought sold a home with a specific person before, friends, family. You understand that. But the most important thing is convincing an existing agent who is paying more to Coldwell Banker that's maybe successful, been around for five or 10 years, and the real brokerage sends him an

email, cold outreach, and says, hey, look, tell us what you're giving to the Coldwell Banker, and we'll tell you what you can do on your own. Okay. When I sell my business, I want the best tax and investment advice. I want to help my kids, and I want to give back to the community. Ooh, then it's the vacation of a lifetime. I wonder if my head of office has a forever setting. An IG Private Wealth Advisor creates the clarity you need with plans that harmonize your business, your family, and your dreams. Get financial advice that puts you at the center. Find your advisor at IGPrivateWealth.com. coffee routine with the coffee plus range infused with functional benefits choose the coffee you

love with added b vitamins like coffee plus b12 to help support immune function and coffee plus b6 to keep your day moving or go with the flow and choose ginseng delight our new double espresso with ginseng extract whatever lies ahead don't change your morning let your morning change you Discover Coffee Plus on Nespresso.com. Charge your own brand. People know the stereotype of the real estate agent. They want to be almost that very salesy, you know, like almost an influencer, right? That's part of the ideal.

And you don't want to be cold to a banker. You want to own your own brand. It's the white label here. And I think that's why they're gaining market share and will continue. Even though there's direct competition, they just seem to be the one that's executing the quickest. Full disclosure, I do own shares. very small position but it's one where i think high risk high upside all right should we talk wicks earnings or we do want to do small cap of the week let's i'll take a break and you can do

small cap of the week and then we'll talk wicks earnings which maybe as a teaser uh a lot of good i mean the stock's doing great but some very they never make it easy on trusting them uh which we'll get into but let's talk your small cap of the week there was some recommendations in the sub stack chat we'll get to those in future weeks we have 52 in a year so don't worry about that genius sports i don't think i've ever heard of this company ryan so take the listeners through it yeah so genius sports is basically a data provider for the sports industry so think s&p capital iq for sports or honestly even it's probably even a little closer to like a fiscal ai for for sports it's there's actually some very similar dynamics here all right listeners drink

ryan mentioned fiscal ai if you have a beverage in hand uh now that was the time the uh so basically in terms of how they aggregate the data and okay having now having been a part of a data business for a while there's basically a few things that i think you have to figure out is a how do they get the data b is that sustainable and differentiated like do other people have the same data kind of thing and then who are they selling it to so in the case of aggregation they are they basically have a bunch of cameras throughout stadiums uh as well as some like algorithms that they've developed for like tracking player movement they also have manual statisticians that they send to record data to a bunch of games and then they have integrations with those gps tracking tools that

are usually worn by players i think a lot of people see them if they watch soccer they the soccer players have these kind of like bib looking things that there are there are other sports that have these right i know you only watch soccer but the other sports the other sports have them as Well, like the helmets, you know, there's a lot of that in American football as well. Is that where they track it in the NFL is the helmet? Oh, that's a good question. I think they have a lot of data points. Ever seen those ads powered by AWS, trillions of data points, every ad brick.

I think it's something along those lines. I'm sure genius is in that as well. So basically they get exclusive licenses, not technically exclusive, but sort of exclusive licenses from the leagues to be the data collectors uh and so a couple big leagues that they have licenses with are the nfl uh the english premier league for soccer or football however you want to say it depending on where you are in the world and the ncaa and so and i'll talk about those deals in a second but then once they collect that data i assume it's done through some sort of data feed, they, customers buy that data stream from them. The customers include sports books are big

ones. So DraftKings, that kind of thing, media businesses as well. So ESPN, CBS, those kinds of companies. And then even the sports leagues themselves actually will buy the data from the data collectors. So this has been a pretty lucrative place to be, especially with the growth of sports betting revenue for them has gone it's basically increased at a 35 percent annual rate since 2020 so over the last five years really strong growth and one of the biggest risks that people talk about is whether or not the leagues will renew those exclusive rights for data collection or even when those renewals do come up how much more expensive are they because It's kind of a bidding war typically for, I think the big data collectors are Genius

and Sport Radar, I think is what it's called, or Sports Radar. And you'll submit a formal bid. You'll talk about why you deserve it, what you're willing to pay, that kind of thing. The NFL really drives a lot of volume for them. And you can actually see this in some of the quarterly numbers. There's some seasonality there. In the case of the NFL specifically, Genius issued them shares in the form of warrants as a part of their bid which i think was probably worthwhile in terms of how much uh they've

benefited from it on a revenue side and it probably gives some good alignment there and it's less likely i mean now now the nfl has a financial incentive in genius sports so i think when that renewal comes up which i think is in 2030 they i imagine are more likely to stick with their data collector or even accept a lower bid from them because they've got that financial incentive. As for the valuation, market cap of $1.5 billion, $250 million or so in net cash. So $1.2, $1.25 billion enterprise value. They've earned $670 million roughly in revenue over the last 12 months. And then they saw a big jump in one-time equity awards this year. A lot of that was some of these warrants uh i think warrant conversions from uh the nfl but also there was

apparently executive equity awards as well they said one time i kind of shrugged my shoulders at that i didn't this is my small cap of the week so i didn't dig deep enough into that but i'm i makes your eye your eyes squint whenever you're oh it's one time equity awards okay Yeah. The free cash flow is legit. Well, aside from the stock-based compensation, but nevertheless, they are generating cash every year. $65 million in free cash flow, $136 million in adjusted EBITDA. Take that with a grain of salt. So it's about 18 times your cash flow, nine times adjusted EBITDA. i'm pretty interested honestly in this business i the i need to get a better sense of where margins are going but directionally i think this data is going to be more and more in demand over time and they're going to keep improving the data that they can offer to sports books and and media companies and i would think the nfl's pretty incentivized to renew with genius so

I don't know I'm interested any thoughts it's interesting for sure reminds me of one of the acquisitions that gambling.com group acquired it's one of their fastest growing businesses well I'd like to know how they relate maybe genius sports sells to them

it's definitely something that I'm very interested in seems like similar to electronic arts sorry I got something in my eye I'm watching similar to electronic arts with Madden when you locked in that contract you're going to be the one that does it and no one's going to want to go to someone else because why are they going to offer a much better product as long as you're not like totally botching the situation one thing i was

looking at while you were talking on fiscal ai that's a good time to mention as usual we're getting past that uh holiday season and this is when people are looking to maybe purchase things new software new software programs to help their investing and personal finances and that would be I would recommend Fiscal AI, Ryan's employer, our longtime partner. If you use our link, you get 15% off any paid plan, and you have all these KPIs that I was looking at while Ryan was talking. But the one that stood out to me that I want to look at is gross margin. It's only 23%. I want to know why that is, whether that can expand a lot at a greater scale, or if it's going to be something where you look at this revenue multiple, and I'm seeing about just under one, just under two times revenue. Well, at first I was like, oh, wow, that could be extremely cheap, especially because the stock is totally puked in the last, just start 2026. And, well, if it's at 1.8 times sales, but gross margins are quite low, maybe it's not as cheap as we think. That's something I would also want to investigate. Yeah, that's a good point around gross margins.

I hadn't looked at it. My assumption is that they're paying a lot of money to the leagues and that's baked into their cost of sales. It's also, I mean, it's heavily, I'm looking at the segment split right now. Common size this real quick. 70% of their revenue comes from sports betting. So I think you have to have some view probably on what you think the sports betting market's going to look like over the next five years because that's probably going to drive the bulk of their growth my suspicion is that it's going to be much larger and i would bet that like the uh poly markets calci's of the world anyone that's like a betting market on sports is probably needs this data as well so whether it's directly sports betting or circumventing it and still

sports betting uh i think you're going to need this data more and more yeah it's interesting i mean that growth is undeniable and again use our link fiscal.ai slash chit chat link is in the show notes get 15 off any paid plan all right ryan the main event the stock that's up 30 percent in the last two days. This has some interesting financial engineering and some wild announcements that I'm still digesting. It's Wix Earnings. They posted ARR growth, annual recurring revenue of 14%, pretty solid. Their base 44 acquisition is already at $100 million in ARR from a standing start when they acquired them less than 12 months ago. So growing very, very quickly. Now it's not, there's no Anthropic, but they're using Anthropic and OpenAI and stuff like that. Well, actually

wix itself is as a partnership with open ai base 44 more application based has a partnership with anthropic so basically base 44 is you can build applications without coding uh mobile applications stuff like that and it's catching on like wildfire they have 100 million dollars in arr uh it seems like they've had a strong launch of wix harmony which is wix's brand vibe coded like new age you know, for anyone that says Wix is an AI loser, I would like to refer them that in 2016, they launched basically vibe coding websites. So they've been in this for 10 years now, but this is the revamped version powered by modern tools. And they said that it's been a strong start to that, but we'll see. Obviously, what's most interesting is the financial engineering

they're trying to do with this cheaper share price. They said, you know, they authorized a $2 billion share repurchase plan. They haven't been able to start that because of the blackout period. But they basically said now they're planning to repurchase all of that this year if they can, which is insane

versus their market cap of like, after the jump, $5 billion. Which goes half the market cap. However, there's also a little bit of a catch. As always with them, seem a bit, I don't know, a little bit immoral to outside shareholders, small-time shareholders like myself. I don't think that's unfair to say.

Yeah, you get a little concerned about that type of stuff. They sold $250 million in stock at a discount to outside fund, durable capital partners, these friends, I'm not sure. And they also gave them warrants. It feels to me like Insider is getting a better deal. and they don't need the funds. So you could have said, hey, Durable, if you want a larger investment in our company,

just buy it on the open market. Maybe they would argue that if Durable wanted to invest more on the open market, that would crowd out the buyback. Sure, but the argument, it seems a little flimsy to me. Any of the arguments I've heard, that it's fine. It's definitely a yellow flag for me. But if I look at the net buyback, it's still going to be quite large. And they are doing a tender offer to all shareholders, which is essentially they have this range.

I think it's $84 to $92 a share. An existing shareholder can go to them and say, I want to sell to you at whatever price. They're going to figure out the exact price and they're going to do a mass buyback depending on the band there. So we'll see what happens. But all in all, I mean, it's coming. That's just durable revenue growth trades at sub 10x free cash flow. And they're maybe going to take up half of their stock, half of their shares outstanding. i was like it's frustrating because honestly wix has a management team that

rubs me the wrong way like this durable capital partners private placement thing feels wrong like on the one hand and i people are maybe the wix proponent or the management team would say you know we want the cash we want you know shareholders that we know are going to stick around where they do have a one-year lockup it's fine sure but if you are sitting there with a whole bunch of cash on your balance sheet and claiming we're gonna buy back two billion dollars in stock do you really need the cash no that doesn't want to give durable capital partners a stake in the business yeah that's dumb i'm serious like oh sorry they must be friends yeah it is it's not a giant it's like

a five percent discount so it was at the end of the world no but like philosophically it feels a bit yucky we have um i would be curious what kind of relationship they have or avishai abraham he has with them with them yeah that's that's exactly right all right we have andrew marshall in the chat from mindset capital mindset reminds a capital one of those been on the show before capital mindset great youtube channel and invest me okay when i sell my business i want the best tax and investment advice. I want to help my kids and I want to give back to the community. Ooh, then it's the vacation of a lifetime. I wonder if my head of office has a forever setting. An IG Private Wealth Advisor creates the clarity you need with plans that

harmonize your business, your family, and your dreams. Get financial advice that puts you at Find your advisor at IGPrivateWealth.com. Morning change you. Discover Coffee Plus on Nespresso.com. Communities such as ourselves, he said, if you want the Wix theme without the uneasy feeling, GoDaddy is also doing a massive buyback and a similar play. We are long GoDaddy.

It could be another small cap of the week to look at. I haven't looked at GoDaddy in a long time. I mean, I looked at them three or four years ago. If it's similar, I mean, if it's sub-10x free cash flow and they're buying back a boatload of stock, that's quite interesting because, again, is ai going to disrupt companies like verisign and godaddy i'm not sure and we have another comment here that says i hate the sketchiness probably regarding wix but i do love the

willingness to actually start buying back shares like crazy that's exactly where i sit i go there's a lot to like here but why do you have to make me feel uneasy as someone who's potentially going to be a shareholder for you over a 10-year period you have to yeah i think with wix you have to separate your emotions from this investment you can make money because of the buyback but date it don't marry it just to steal the uh the opposite yeah it's a philosophy there let me share a chart the shout out to fiscal ai here and get your thoughts segments kpis total number of premiums oh yeah yeah yeah i've seen this been floating around it's not a giant concern they have purposefully gone and kind of shedded explain what then for

the listeners explain yeah for people that are listening can't see the chart basically premium subscriptions ever since 2012 have grown consistently there were 470 000 subscriptions uh in 2012 2023 they got to 6.3 million then over the last two years they've now seen two consecutive years of declines in premium subscriptions yeah it's something that again in a vacuum you go oh well you want more subscribers but i i think as a kpi they're not they don't care about anymore because they one they said they're they've shed um what was it shed just like bad customers, customers that weren't that profitable,

customers that didn't give them much revenue. And what makes me believe them is if you look at their quarterly cohorts, they have a very nice chart that they give on every quarterly earnings presentation, something like that. You can find it on their website of how their revenue is progressing.

And they're getting back, you know, COVID, they had a little bump because they had some very nice cohorts in 2020, 2021. but their cohorts from a revenue perspective are getting back to that level and are making progress and the trajectory looks quite nice.

If you just let, for example, let's say you have a really small website, you're paying not much money. Wix maybe historically could go, oh, if you're about to leave, why don't we give you a really big discount to stay because our unit of anonymity is so strong. They decided not to do that.

They're targeting partner revenue. I mean, we saw that with Wix when we had our own website for the investment fund. They would do the same thing. It's part of their marketing plan. They're targeting more, again, small business customers, the partners revenue, which is essentially design teams that use Wix's tools.

And now they're going more into adding on these vibe coding stuff for both applications through Base44 and website development with Wix Harmony, which they said that will get fully deployed across all the Wix product portfolio in due course. You know, they have a partnership now with OpenAI, so you can start vibe coding your Wix website through ChatGPT, which I think is very, very smart because if you go to ChatGPT or Gemini,

I actually tested this when I wrote my research report on Wix and I said, hey, I'm looking to build a website. I'm a restaurant in this area. I need menu and whatever, some different connections. Like, hey, I want to have my menu online. I want to connect to the delivery platforms. I want stuff, you know, some basics. and Wix populated as number one for a small business.

They also said, you know, you might want to have some different point-of-sale solutions if you're more complicated, but that, you know, was nice. And then the fact that you have this partnership with ChatGPT, where if you go on ChatGPT and say, yeah, I want to build a website, they're going to say Wix is your first option. That's quite nice, and you can start it directly from ChatGPT. I mean, there's a billion users now. I think that's quite nice.

Let's see. we have a question what is vibe coding that's it's no coding coding um it's essentially using llm prompts or using your chat gpt your claude your gemini to build applications without actually coding in the terminal and i don't know i don't know if that question was in jest or not because it's become sort of like a meme uh yeah yeah exactly but i think i think Look, I can't forget if I gave this stat out last week, but only 0.3% of the global population pays for an AI premium subscription. So the amount of people that are vibe coding things and know what it is, I think is a little lower than we think. Yeah, I think the Twitter echo chamber might make it feel like the whole world is following it.

I mean, you work for a vibe coding company, right? Almost. Somewhat. Somewhat. Adjacent. Adjacent. vibe coding but yeah the it i think wix is in uh i think wix is in a good spot i and maybe it's just the volatility of the stock my only gripe is that it feels like management just kind of

cares too much about the stock price like yeah they got a lot of owner they got a lot of employees that have huge ownership stakes here and if if you go god i think our stock's just so much more valuable. You're in almost a five-year drawdown from $300 to below $100. At some point, I would go, let's just lever up. We know what our AR looks like, our free cash flow looks like from our core business. Let's just lever up and start buying back this thing. Everyone's going to be a little more happy. I think you very diplomatically described their stock-based compensation policies. They have a lot of employees that are tied to the business. and yeah they might have underwater they could have underwater options who knows

um it's interesting it's one where i believe i don't know pounding the table never i guess works usually stuff that i have high conviction in is actually the stuff that performs worse for me but i'll say i think we just got thrown out with the bath water with the software drawdown people are like why does wix need to exist and they've been investing in this direction the vibe coding direction for a decade. So they've been fully prepared for this. And I think given the fact that there's more apps being built, there's more websites being built, you've seen there's third party data around that. Well, they're the leader in the space. They've been investing in AI vibe coding websites for a decade. And there's more websites now being built. There's better tools

for them to utilize. Isn't this incredibly bullish for them? I don't know. You tell me. Yeah, I think they're in a good spot. Let's take some of these listener questions here because we've got a few to potentially get through. First one, thoughts on Michael Burry buying Adobe. Brett, any strong takes here? Did he buy Adobe? Because in the Substack chat, it said question mark.

He's been tweeting about it. We're going to decide this throughout the year, but I might be on team cancel at the Burry subscription because hand-run change, thumbs down for the renewal process, Ryan, because he tweeted that they should acquire MidJourney and any other tool like that. I was just thinking, are you serious? For what?

They're going to get them for $3 billion? It's just a huge waste of capital. Yeah. So, okay. Michael Burry is not going to care because I don't think he listens to this podcast. He's got a lot more money than us. I want ARR.

He is very bright, but I think he gets in his own way a lot. And you are right. I think the sub stack has been a little underwhelming. I was hoping we could have a we can have like a spectrum, you know, like the the fear and greed analytics. Are we canceling by December 2026 or are we keeping, you know, you can turn things around. But right now we have two votes for cancel. Individual stock analysis. I love I love what he does.

but a lot of them have just been like market overvaluation think pieces or very granular things about companies accounting that might not matter that much the i don't know how people found out that he bought adobe i don't know if he he said that or something but i don't think it was a part of his 13f and he didn't publish it in the sub stack unless i'm mistaken unless there something in the chat but i don't understand why they would buy mid journey i've used mid journey it's a helpful tool but adobe's has integrations with all the text image and text video uh generation models so i think being the agnostic player makes the most sense actually so you don't have to like you can kind of meet the customer where they are in terms of what tools they use

Like if a customer really loves NanoBanana or whatever, I can't say that company without laughing a little bit, that product, I should say, or whatever the image or video generation model is, like let them use it, let it be a part of their Adobe workflow, let them iterate and edit that file on Adobe right there in the ecosystem. That makes more sense to me than them paying up for mid-journey. Figma and Canva are much more important. Yeah. and stuff like that uh i mean what what do i think of burry buying adobe it it doesn't mean much to me honestly he's still a shareholder ryan you're still a shareholder he's come back a little bit has this leads to another question has the stock has the software we're totally jinxing it but have software stocks bought i kind of hope not because i didn't really

buy as much as i was hoping to uh i was hoping to kind of sit at those multiples for a while you want three months of three months of you know getting your paychecks put that money in the account yeah yeah yeah yeah i want my cost basis to come down on some of these and and other businesses too i mean uh at the end i don't know if they've traded back up with the software companies but i mean they're back closer to 900 now so it's gone down a little bit which is nice i'd like to buy more shares in a lot of these businesses so i kind of hope it has not bottomed might be greedy thinking on my part but it's possible it really is possible and i think you're right like it has to climb the wall of worry because there's not going to

be a single quarter that it's like well that's it ai didn't take over like these software stocks are fine like there's going to be something to point out with every company for you know the foreseeable future where ai could be disruptive i feel like it's almost like amazon back in the day when they would announce a new target uh well that's pun intended uh a new you know area they were getting into and then the entire sector would sell off they acquire whole foods every grocers sells off their they're trying to get into amazon fresh you know sprouts farmers market there's a whole bear case for three months three years on that and you got to climb the wall worry but eventually that Amazon shine of,

oh, we're entering this market, everything sells off 20%, it stops because a company can be good at some things, but they're not going to be, even Anthropic, that's the fastest growing company in history, is not going to be good at everything. I doubt they're going to have the,

like, you just have a culture of, you know, what you're good at. Yeah. As far as the executive team, like that, it feels similar where Anthropic announces something, we're getting the financial analyst and people are like,

oh, I just vibe-coded a Bloomberg competitor, you know? We'll see. Yeah. It was like when Claude had the, like, we're launching Claude for Excel, and Microsoft sold off a little bit. It's like, this is helping Excel. Like, more people will build on Excel.

Yeah, it's true. It's true. Anyway, we don't have to do the full software, software-mageddon discussion all over again. It would be funny, it would be funny if Jack Dorsey firing half of his staff for AI was marked at the bottom. Hey, you know, I saw some tweets. These could be people just trying to get attention.

There's a lot of stuff on Twitter that I know is fake, and then I worry about what stuff I don't know is fake these days. It's not as much fun to spend time on there anymore. But there's something that said basically they were big head from Silicon Valley, and they're like, I got acquired by Block, and I basically just chilled. on the roof in san francisco for three years like they didn't do much it was so i was reading some of jack dorsey's replies and like yes he's right it was someone was like you just overhired he's like yeah you're right we had to deal with the integration of an acquisition at the time and

it's like we had to you you over you paid 42 billion dollars for after pay and talked about synergies what do you mean you were shocked by the integration costs also when the integration costs you know it's tough but integration and mergers usually mean layoffs and that's how it goes it's unfortunate that's how it goes because you have two you have duplicated tests all right other questions before we get out of here people said which one do you like best three e-commerce stocks amazon clones that are in drawdowns coupon mercato libre or c limited ryan rank them right now gun to your head coupon number one mercato libre number two c limited number three i like mercado mercado libre is probably close uh to coupon there potentially but i just knew

no coupon a little better and i think they're also in more of a uh sort of temporary blip given some of the data correction stuff so gross profit multiple is much lower too yeah yeah i see a world in which this generates pretty good return over the next over the short term as well as the long term. I'm putting C-Limited 3 as well. I'm going to do the exact same order out of both Mercado Libre and Coupang here, but C-Limited, I just don't understand it as well.

It's a region of the world I have less confidence in in understanding the dynamics. Do I understand South Korea fully? No, but I think it's a little easier to grasp than the craziness of 10 different countries in Southeast Asia. And the same with Latin America.

I think I understand that much, much more. Yeah. All right. Any of these other ones you want to talk about? Thoughts on new holdings? Did you see that they got Inter-Miami as a sponsor, which as a Brazil-Argentina rivalry, that's quite the treasonous ask, wouldn't you say? my the biggest competitor mercado the national champion of brazil new new bank national champion of argentina mercado libre two competitors direct competitors now and brazil gets the new bank it's the hero of argentina i yeah that is interesting i didn't really think about it that way the there is obviously a lot of like inner miami the soccer team has kind of become synonymous with argentina now because not only messy but they've bought a lot of argentine players

so it could be smart double play new bank enters argentina and the united states yeah the other part is there's just a lot of latin americans in miami so yeah uh whether it's mexicans argentines brazilians colombians i'm sure new bank operates i believe in colombia as well right that's the three countries yep brazil colombia mexico but they haven't entered argentina marcado pago's kind of got that on lock all right any other let's do bubble bubble watch this is something you probably saw ryan uh have you thought of our good friend from um what's the podcast the all-in podcast chamath i did see this yeah so someone said and they may have been joking but some said there's a big twitter response how about all

the scams through your specs you never came clean about it millions of customers lost money chamath replies bs some other guy named the dude from whatever that movie is uh not bs i invested in all of them. Your pitches were compelling and I lost tons. You made tons. Why? And then Chamath says, and I'm thinking this could be another meme that we could use throughout the years, Ryan. Then you generated capital losses. Did you use those yet? Have you thanked Chamath, Ryan, for generating capital losses for you? This is what I tell my friends who invested alongside me in Portillo's. Stock's down 50%. What happened? Use the tax write-off. You're welcome. yeah look at that tax okay honestly i'm a little disappointed that we're talking about this because

i'm i am convinced there's no one better on the internet at rage bait than chamath he knows that's a dumb thing to say but he knows it'll get engagement the only thing is disengagement in in this case it surely is not helping him in any future endeavor yeah let's see has the All In podcast produced an episode in a long time I think they haven't I'm checking on this after a certain

now they started doing them again never mind there was a certain list there was a certain person on a certain list we're not ready to get into it I was curious if they started it we'll leave it there but

I agree with you Chamath uh unfortunately yes i fall for the bait because it is hilarious yeah i mean he's got charisma have you generate it's kind of like uh suzeo or 2020 legend peru sexina do you like accounting or do you like making money yeah uh i think we'll leave it there yes this was a bad look for chamath but an attention getter nonetheless i think that's going to do it thank you everyone for tuning in thank you for all the questions in the chat uh we want to remind listeners that brett and i are not financial advisors anything we say or discuss here on chitchat stocks is not formal advice

or a recommendation thank you again to everyone for listening and we will see you all next time audio ads that connect display ads that stand out run them together on spotify and unlock incremental reach for your campaign