Chit Chat Stocks - Anthropic's MASSIVE Funding Round + ARR Growth; Ferrari's Debacle; Salesforce Earnings Clean-Up $CRM

Episode Date: May 29, 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) Salesforce Earnings and Buyback Program (09:06) State of the Korean Markets (12:22) Verra Mobility's Earnings and Market Reaction (17:57) Discussion on DRAM ETF and Memory Stocks (26:56) Ferrari's First Electric Car Launch (37:02) Anthropic's Unprecedented Growth (42:53) Costco's Consistent Performance (46:48) Celsius and the Competitive Energy Drink Market (50:40) Mitek Systems and Autodesk Earnings (55:28) NBA Players Entering the Tech Space (01:00:55) OpenAI's Financial Challenges ***************************************************** 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.  ********************************************************************* Check out Value Spotlight: Stockwriteup.com  ********************************************************************* 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

For the past three years, IBKR individual clients averaged 24.3% annually, beating the S&P 500's 23.1%. Lower costs and 170-plus global markets matter. Interactive brokers, member SIPC, visit ibkr.com slash performance. Welcome to Chit Chat Stocks, the podcast that helps you find your next great investment. I am one of your hosts, Ryan Henderson, and I am joined today, as always, by the one and only brett schaefer this is our weekly investing power hour episode we do these live on thursdays at 5 p.m eastern time if you ever want to check them out live head on over to youtube look up chit chat stocks thursdays at 5 p.m we always take questions from the audience

here and uh it's it's a nice way to get like instant feedback on any of your questions but we've got plenty to discuss today we got salesforce earnings with a um i guess outrageous buyback program we've got a ferrari flop potentially we've got the latest fundraising round from anthropic and a whole bunch of other earnings as well as brett i've already took a sneak peek at some of your topics bubble watch plenty of them got some fun bubble watches this week yes welcome in everyone glad he could join us uh yeah a couple nba players i have a maybe a potentially fun game we could do with these Robin Hood AI accounts, but I'll let that as a tease for the rest of the episode. We're kind of in the lull of earnings season, but I think the first

thing, we're in the software part. The people that are a month off, they're a little twisted in the head. They like to have a weird fiscal year. It's fiscal year 2027 for Salesforce for some reason, but we're in 2026. Why don't we talk about this? Because that buyback figure, i think everyone was shocked at how aggressive that number was yeah let's i guess we can kick things off with salesforce the they reported earnings yesterday as of this recording and as far as headline numbers go they up they looked fine uh beat on earnings beat on revenue they raised revenue guidance for the full year but they lowered margin guidance so nothing really too crazy as far as this quarter's results go

the standout here was that and brett maybe you can share this chart they spent 27 billion dollars on share buybacks keep in mind this is a company that does i think six billion or so a quarter in free cash flow so and this is a massive jump like the previous four quarters were two billion two billion four billion four billion and then 27 billion dollars in buyback so they one second i'm bringing it up i was sharing the youtube live link in the sub stack chat one second for everyone they yeah they levered up to do this i believe they uh increased their debt load by 25 billion if i'm not mistaken it's a vote of confidence from management no doubt about that uh i think shares outstanding are down 10 percent about year over year this is

i think if you're salesforce and you're in the on the executive team there's probably a pretty big bifurcation between the narrative and what's actually happening i would be i would be truly truly shocked if they've had any customers of real size that have built the the solution from the ground up and it's one of those things where when you use it on a regular basis for example i use slack every day you realize all sort of the nitty-gritty and the challenges in building an optimal solution not just you know something that kind of works i don't think any business wants to go about using a whole bunch of homegrown software that kind of works i mean it's just no way to operate so yeah they talked a lot about agent force uh crossed a billion in arr on agent

force revenue is growing more than 10 a year is that the thing with the einstein logo yeah yeah they had matthew mcconaughey to share a video of the numbers of on the call no no no mark if you go to mark benioff's twitter he he said our q1 or maybe it's their fiscal year q3 i can't remember um we just released earnings here's a video from matthew mcconaughey telling you about all the progress we made and it just it's so i have an idea for ways to cut expenses let's start with this let's stop posting matthew mcconaughey earnings release videos because i promise investors don't care yeah you should have this loaded up it wasn't funny to play on the show next next time i want to i want to hear the actor talk about net revenue retention rate uh but okay

on a more serious note market gap now 150 billion ish they retired what 20 27 billion dollars last quarter that's i don't know 17 of shares outstanding something like that i mean i can pull up the calculator real quick and try to try to get an exact figure but either way it's a large number maybe it's 15 actually trying to do mental math here but yeah i mean look that's in that's insanely impressive they're not going to do it every quarter but the fact that they were able too yeah all right exactly 18 i still got it but the the it's even it's hard to even put into words like how aggressive this was i was i was truly shocked it's i think honestly maybe the craziest part about this they bought back 27 billion dollars worth of stock and the shares didn't go

up like i'm surprised that i was always overrated especially i'm sure the volumes i'm sure the volume's way higher but they may have done an accelerated i'm not sure sorry yeah i don't i don't remember seeing an announcement of any sort of like tender offer or anything like that like sometimes you'll see that where it's like a clear-cut you know offer of offer to buy shares at a certain price so if they were able to do this in the open market it's yeah that is pretty staggering the keep in mind they did have stock-based compensation this quarter maybe i'll pull up the actual exact numbers well i guess it doesn't offset it that much okay let's correct ourselves they had an accelerated share repurchase program executed by what's looked like all the big

banks so that's how they were able to get it out the door so quickly what exactly the downside of that is you have to do it at a higher price most likely okay so the banks find shareholder for you but you would think if they had to do it at a higher price it would have i guess impacted the stock but uh yeah 20 so it's the 27 billion dollars in buybacks and i know i saw a lot of people say well what about stock based compensation it's less than a billion in stock-based comp so this is a sizable any way you slice it this is a sizable buyback i think this has to be just a superb sign of confidence confidence if you're a shareholder in salesforce i would feel very content where you're at right now i think future returns or forward returns

look really good from here honestly yes look at the quick numbers for the listeners here pe20 This is GAAP, EV to EBITDA, 12, and the price to free cash flow officially under 10. That's not bad. We've talked about them before. They're growing revenue at a decent rate, but it's not as insane as it used to be historically. I mean, if you look at their 10-year average, it's 18.5% versus their 3-year average of only 8%. but if you get all right price to free cash flow of 10 pe of 20 you buy back a lot of stock and your revenue grows at eight percent a year you're going to do just fine yeah it's always honestly a

bit of a boring company to talk about because it's b2b customer relationship management software i mean they they sell more seats a little bit of more seats every year and they probably raise prices a little bit as well so you're gonna get i would think stable revenue growth and i'm i'm yet to see any real legitimate enterprises like publicly go out and say we're ditching salesforce we build a solution ourselves so um let's keep moving this one's going to be really quick really quick topic for you here brett okay state of the korean markets uh this isn't a full i'm not going to go through everything but you talked about the bonuses that some of the employees at samsung and sk hynix are set to receive this year the ishares msci south

korea etf is up 233 percent over the last 12 months can you uh was the what was the bonus figure again for the employees so i had gemini try to help me out with the math here because there are estimates, foreign currency translations, all of that across Samsung and SK Hynix, just those two companies, depending on how it all shakes out, the employees could get $45 billion cumulatively in bonuses this year. That would even make someone on Wall Street go away. That's quite a bit. And the overall incomes in the South Korean economy, again, this is according to Gemini.

as it says at the bottom it can make mistakes is about one trillion clean usd so that's a huge bond that's a huge bonus of four or five percent of the national income growth just from these bonuses associated with memory chips you can see why the stock market is going crazy and the south koreans love to trade is what we're picking up on can you guess what how much or what percentage of the iShares MSCI South Korea ETF is accounted for by just Samsung and SK Hynix? Well, you had this in the notes, so I purposely did not look it up.

What is it exactly? What of the MSCI South Korean ETF? Okay. Just the allocation. How much of the portfolio is? The weightings? 40? 55% of the ETF.

is just sk hynix and samsung it's like taiwan so yeah i mean people complain about concentration in the s&p 500 this is a whole another world this i mean i guess i know i know what your answer is probably going to be this what do you think could be second order effects here what what what could benefit from this and then also does this concern you at all that so much of potential wealth is tied to two companies that are famously cyclical uh this is the cyclicality of the south korean membership market is not a concern to me but it's anything that flows through to you to the south korean economy and retail spending which again we've said it you know company we like a lot it's been a dog it's in the south korean

index i would hope although they do tout themselves as a quote-unquote american business for trade relations it's coupon because there's going to be more retail spending and especially discretionary items maybe there's some restaurant plays in south korea i'm not exactly sure anything consumer spending related in the country is probably going to do well but if you're looking at a five-year time horizon, you have to be worried that there's a boom-bust cycle because it always happens in memory trips, and it might not happen this year,

it might not happen next year, it might happen in 2028, but eventually it's going to happen. Yeah. Let's keep moving here. What earnings did you look at this week? Sure, maybe we'll just go right in order here. Actually, there was a lot of people asking about this one.

Vera Mobility. This wasn't earnings, but it's kind of earnings. We haven't talked about their earnings yet. They released it a little farther back. The stock is down 70% this week, 80% year-to-date. Yeah, many people commented on it. I mean, we had some show comments. We had some people in the Substack chat, which I should mention,

every show, join the Substack, free Substack chat. We can talk about the episodes within there. They lost Avis Budget Group as a customer. They provided Avis with toll and traffic ticket management. Apparently, it was a high-margin business. It was around 10% of revenue or less, but still a high-margin business there. The fear is probably that they lose Hertz, too. Virbile, I don't know.

BarrowMobility is kind of a, well, as we called it, the toll road on a toll road. It's management systems and hardware and software associated with toll roads, with traffic cameras, and I guess they moved into some new stuff with parking tickets, public parking garages, things like that, as well as helping out these rental fleets with that same stuff. You know, managing tolls, automatic payments, making your life more efficient. They had been a durable-ish grower. They hadn't grown that much in recent quarters. It's not an explosive growth business by any means, but I wanted to take a look at the

valuation. Again, the market cap is now down to $630 million, but they have around $1 billion in net debt. So $1.6 billion enterprise value. They are now expecting with this contract ending, their adjusted EBITDA to be $380 million this year and free cash flow at $150 million, which puts them at four times EBITDA EBIT

and 10 times free cash flow. They're continuing to buy back stock, but they don't have unlimited capacity here given where the balance sheet is. They don't have too much cash on the balance sheet. And the rest of the business seems durable. I guess you'd expect them to keep their contracts with the governments i'm kind of wishy-washy on it i like it i don't love it after this huge

collapse uh what about you any interest here yeah there's essentially two two legitimate businesses uh under the vera mobility complex if you want to call it that i guess you could take parking solutions but it's very small the government solutions is creating physical toll uh and ticketing infrastructure for local governments so that to me seems really sticky i really like that business the commercial services is what we're alluding to here with the avis contract i don't know how much of revenue that contract accounts for but commercial services in general as a whole and that's i assume a lot more than just avis i assume there's a plenty of rental car companies in there accounts for less than half of overall revenue so government government

solutions still accounts for the the lion's share i really like the government solutions business it'll be a slow grower but at the right price it seems like it would generate consistent cash flow should be a consistent growth as well i assume there's some pricing power baked in there i would be this is already at the top of my watch list and when i looked up stocks down the most this week uh trying to find topics and fair mobility showed up down i think you said 70 this week that was quite a reaction yeah i felt like that was a bit i would have expected maybe at 30 which is still extreme but 70 i've rarely seen that i'm curious if it is just an outsized portion of earnings i mean i do think it's more profitable than the government solutions but

i can't if if we just eliminated the commercial solutions in general or commercial services would it fetch a price similar to what it has now well i'm not sure but i know that they didn't guide down on their adjusted ebitda that much this year so i don't i don't think it can't be the entirety of the profit pool. Uh, clearly it was high margin. People are concerned about that, but maybe this is when you plug your nose and dig deeper. But the one thing that doesn't get me super high conviction to like this is I don't think this is a high growth business. I don't think it's the best business. Um, yeah, you know, New York city, maybe it would be tough for them to rip and replace this but it's not unheard of um and you see this right now like all right

ava said we don't want you anymore yeah i see the numbers now actually commercial services is far more profitable and i bet that the government solution side and the tolling infrastructure that that stuff it's probably a lot more competitive than i think so i it might stay on the watch list for the time being because there's probably some learning i need to do before i feel comfortable owning shares on this one sure also that probably means avis is switching to someone else maybe or no one because this it was like an add-on service where you had you essentially any parking tickets or camera traffic or toll road stuff barrow mobility would manage that for Avis. And now Avis is, they can manage that themselves or force their customers

to do that. It's probably going to degrade the customer experience, but rental car companies, I don't think they're known for caring about the customer experience. It's all about customer service. Yeah, exactly. Exactly. All right. Listener question. Thoughts on the DRAM ETF. DRAM, do you call it, do people call it DRAM or is it DRAM? It's the Roundhill Memory ETF. It launched Thursday, April 2nd, so less than two months ago. It's already up to 125%. Roundhill, always good on that timing for launching thematic ETFs,

but I think the answer for both of us is a big no. We like talking about the memory stocks in South Korea, but we are ones that are kind of anti-chasing what is hot at the moment. You research your investments, you analyze markets, you manage risk, but did you research your broker? For the past three years, IBKR individual clients averaged an annual return of 24.3% compared to 23.1% on the S&P 500. IBKR's lower trading cost, competitive rates, efficient execution, and access to more than 170 global markets helped investors keep more of what they earn and put more capital to work. Over time, the broker you

choose matters interactive brokers member sipc if you care about performance find out why the best informed investors choose interactive brokers at ibkr.com slash performance yeah i i wasn't interested in uh memory chip stocks three years ago maybe i should have been i was kind of hard to foresee this coming i'm definitely not interested up probably a thousand percent for a lot of these companies so yeah don't say something like this it's so blatantly cyclical like i just i kind of wonder like what are investors thinking i i saw well you remember 2021 when they said that semiconductors weren't cyclical anymore that was more the core ones They're saying that now. They're saying the same thing. Permanent supply shortage.

I read one of the recent sell-side research pieces on, I think, Micron. And Micron is expected to have a massive jump in earnings, unsurprisingly. I think the projection, they were doing a billion dollars in earnings, I think in 2024, 2025. 2027, they're expected to do more than 100 billion. So it's been a huge inflection. And I can't remember the investment bank that said it, but they they they said we're valuing it at 15 times 2027 earnings. It's like you're you're giving a mid teens multiple on likely peak earnings. That's very aggressive. It feels like what would you give it for? I think for for sounds fine. yeah especially given how like we're talking about we're not talking current earnings we're talking about earnings 400 higher from here i would expect that to be the peak over the next 10 years potentially maybe not a guarantee potentially yeah i mean that's like just look at their history they are consistently cyclical and to people that are like well this the ai

tailwinds going to continue it very well could that but competition will increase as well but all of these all of these memory chip companies that are listed in this dram etf are probably going to increase capacity what happens when that capacity starts to match closer to supply i mean the earnings are going to get wiped out right at least to some degree that's what happens every time that's what happens every single time uh and and if the big three don't like i don't know if they keep restricting supply you'll get a crazy player like elon musk who will come in and do a similar tariff fab thing we have by the way this round tail strategy is such a like smart it's smart kind of a funny business like just come up with the funniest four-letter word

you can to match whatever the hot theme is and just put a bunch of companies in a bucket i mean it's smart is i don't think it's a good business model yeah i can't can't knock them but it's just it blows my mind that other etf providers aren't as like flexible or fast moving as as round hill so yeah they're good all right we have a i want to talk the ferrari uh reveal which i think will be a fun topic for us we have a comment here that i think encapsulates the thoughts on all the semiconductor stocks at the moment co-workers today asked if he should sell his s&p 500 index fund and buy sandisk he had his brokerage pulled up on his phone and ready to do it not a question but a sign of the times yeah i think that's the vibes we're getting here i'm feeling that as well

and it's pretty clear like the semiconductor etfs the memories this dram one i mean you can look at dram the round hill etf the ticker is dram when it launched it's pretty much gone up every single day this it feels so like 2021 feels like we're back not in a good way like in a different part of the market different different part of the market uh but definitely back yeah we have tyler here in the comments there's 19 companies now that are above a trillion dollar market cap i know that doesn't technically mean anything but that eight i think six seven years ago there was one uh it's 15 eli lily across that they probably deserve it more than a lot of them uh i i read it before in another episode but it's just the the mix of the global like greatest

market caps if you go on there's a nice website i like to use for quick reference companies marketcap.com it's very easy to check out there's a lot of semiconductor exposure nowadays and if you compare that versus what you could estimate their through cycle earnings over the next 10 years it's probably inflated um we have a comment here that says at least from my understanding it will take years before supply catches up based on ai needs yes it could take three years but then your profits go to zero and probably negative just look at micron's earnings earnings chart it's a sinusoid you don't want sinusoid do you want netflix well netflix a little bit messy but you want the microsoft so you want you want up and to the right yeah and i i read

uh asian century stocks had kind of a good write-up on this which is like China is going to increase production on some of these lower-end memory chip offerings. And he said, if anyone is good at increasing production, it's China, and doing so at a low cost. I've seen some comments here that hyperscalers won't use Chinese RAM. I think if you are that big of a cost difference,

they very well could. I mean, where do Apple's chips come from, for the most part? china right uh well hey taiwan i thought there was also i thought they had a big supplier in china as well uh you could be right but i mean tsmc is the core maybe not maybe memory is different who am i who am i thinking here i'll pull it up but i just think if there's low enough obviously you know maybe you're sacrificing some quality in terms of the chips but if you're that of a cost difference which from what i've heard the a lot of the growth for these memory chip companies has come from basically having to increase prices it could certainly be a headwind

oh i agree i think in general we can talk a lot of different variables again when there's a supply shortage it eventually leads to a glut happens almost 100% instances, instances. And I think it happens this time. It happens here. Is it 2027, 2028, 2029, 2030? I don't know. It could be a huge super cycle, but eventually it is. And that's just keeps me nervous from investing, especially when everyone's saying, come on, you have to pile into Micron. You can't miss this rally. And that's when things get dangerous okay well i mentioned before ferrari here stock we like to follow nice luxury player ryan take us through they launched their first electric car kind of a momentous

occasion in the company's storied history here yeah uh people have conflicting opinions on this i guess just real quick after a google search i is wrong they are not supplying their chips apple's not supplying their chips from china so uh just pretend i i didn't say that but ferrari yeah this week they launched their first fully electric car called the ferrari loose it will cost more than six hundred thousand dollars usd and it seems like so far most people hate it uh pretty much all the comments i've seen were pretty negative. They brought on Joni Ive from Apple to be the lead designer on this. And there's been a ton of backlash against it. I've actually seen a couple of pictures that from the top,

the Ferrari Luce kind of looks similar to an iPhone, which is a bit funny. But in an interview, there's kind of this interview that went viral with Ferrari's former chairman. His quote was, if i were to say what i really think i'd be doing ferrari a disservice we risk destroying a legend and i'm truly sorry about that i hope they at least remove the prancing horse from that car the uh he sounded like he reminded me of a football or whatever soccer in european coach complaining about the refs after a game you kind of have that italian accent he's just kind of moving his head shaking and he's going well if i said what i wanted to say i'd get fired yeah yeah they have a different way of words than uh than the americans uh well hey for any italian

listeners i looked this up because you know pronunciation not not the american strong suit you're using the spanish pronunciation it's luce what do you what do you think of that name that's how you say luce ferrari luce i mean i guess it sounds a little more luxurious a little better a little better yeah italy's transport minister even criticized it which i thought was weird at first he criticized the price of it which it's not a serious country ryan come on i mean this is football and ferrari that's what that's what this is what matters he simultaneously criticized how high priced it was and said this isn't the ferrari way basically it's like this is exactly the ferrari way this is what they do uh anyways i've seen a lot of different takes on it most of them

would were negative on i in looking at the car it does not look like a traditional ferrari i don't know if you can pull up a picture of brett or if it's even worth it people might have already seen it ferrari stock yeah just look it up you'll you'll find it it dropped more than eight percent initially on the news the the thing for me so the discourse online was a whole bunch of people that can't can't afford a ferrari saying this looks stupid and then which i'm not i'm one of those people then there was toby litke shopify founder i don't think he can afford one anymore he can afford one he said i don't know what everyone else is thinking i think this looks cool and then which here's the thing but i you might be trying to talk but it looks like you're on mute

i i was just saying we don't want nerds uh uh liking it that's all i'll say like someone like me you don't want them liking it no no and the other part is if uh some people were like this is the only thing that matters if the billionaires like it that's all that matters no part of the reason you drive one is so that is for the admiration of everyone else honestly like i would guess a lot of that that's probably the thrill that a lot of the customers get in buying a ferrari so you don't just want the wealthiest liking it you want everyone craving one or desiring one so i i think this was a flop my gut tells me they will probably end up walking this back yeah i don't think we need the 10 000 ferraris in the world to be electric to save the planet

like if that's their strategy here it's a very european mindset and one they have this automated um like simulated engine noise which is again part of the big ferrari thing that's i think very lame the color isn't red or yellow maybe maybe it can be different colors but i kind of think they should have a band in all colors except red or yellow and then what are these called neutrals or black white gray whatever you want on those black or white and if it looks like something coming out of china like like it's it's that if you told me this is from one of the chinese brands i would have been okay yeah it makes sense or a tesla okay yeah that makes sense you don't want ferraris to look like that at all it needs to be differentiated craftsmanship artisanship

however you want to describe it it looked like uh honda i remember people showing that the some of the new hondas that it looked like the and you're right i mean look for ferrari can't save the environment they literally don't have enough customers they they've got they sell like 7 000 no i think it's like 12 000 yeah cars a year okay tesla sells you know 1.5 million or whatever so it's not this isn't a mass market vehicle i don't see why people are i don't see why ferro did this to begin with yeah i agree i agree yeah and you know the bitter truth about electric vehicles is i think it takes like 12 years to offset the production cost emissions so by used but yeah like we have common here it says six hundred forty thousand dollar honda that goes

fast in a straight line electric ferrari is a dumb idea you want the aggressive styling you want the combustion engine you want no compromises people would love it yeah maybe i mean hybrid could be potentially where you go because you could still do that kind of racing thrill stuff that ferrari owners like let's bring it back to the stock though ryan the pe is down to 33 but for a luxury stock it's fairly cheap you want that durability uh where would you be interested in ferrari or are you out completely because of this uh management debacle i mean this this alone is not gonna people are still gonna seek out they still want ferraris the i was pretty concerned about ferrari i guess towards the end of last year when they i mean

deliveries had jumped like seven percent a year for like four years like there were only so many people that can buy these and then you if you are a ferrari shareholder you want the majority of revenue growth coming from pricing you don't want it coming from deliveries because it exclusivity is the selling point yeah i think you could argue a little bit in asia there's room for more of these sent not sent to maybe deca millionaires to afford one there's four billion people you could maybe you know it's half the world maybe if more of those people got rich you could double that production but you know over maybe a couple of decades i agree with you in in general though and that's what was happening right i think uh yeah mainland china and rest of

apac both had grown in terms of shipments and now shipments to mainland china are down call it 40 percent from 2023 peak it's yeah maybe there's like a slightly more room there but still I mean, the logic still applies. Like you don't want, you can't deliver these to everyone. This isn't the same thesis as a Tesla, for example. So maybe if there's just that many more billionaires in the world, but there's no way that maybe right now billionaires are growing at 7% a year, but I don't think that's sustainable. Well, in the AI future, there's, we're going to be a, it's going to be all abundant. What are the AI people say? Yeah, you're not going to have to work. No, I agree. I think I've said this before, PE of 20 to 25, I get interested.

It's that good of a brand. And even if current management is no good as that, what do the guys say? If I had what, uh, if I were to say what I really think I'd be doing Ferrari a disservice. Yeah. I think that's what a lot of people feel. And I have no connection to the company. but still it's that high quality high quality of an asset

if there's a further dip from here it's a nice set in for a good position. Tyler says maybe the Koreans will buy enough Ferraris to cause unit volumes to increase yeah that's what I'm telling Asia in general I mean South Korea is not that populous but

I was thinking more India and China those are very large markets you just need 10,000 new I don't know millionaires to afford vehicles a year did you see this news anthropic i believe today raised their series h round which is just insane that they're already onto a series h i think they were founded like three years ago 2021 i looked it up as a trivia for you after seeing this yeah this was your notes here were my news so it's uh kind of breaking news for for everyone on this

show. Yeah. So Anthropic raised $65 billion at a $965 billion valuation. That's about almost as much as what SpaceX is trying to raise with their IPO. They also announced that they crossed $47 billion in ARR earlier this month. So at the end of 2024, so start of 2025, they were at a billion dollars in arr so over the last year and a half they've gone from a billion in arr to 47 billion in arr that is unprecedented growth really i can't think of any business that's grown that quickly do you think this means they're going to delay the ipo the to the question yes i think definitely this gives them a pretty decent runway to maybe even get to cash flow positive with this money. We don't have their numbers, so I'm not exactly sure. It could be worse than I'm assuming.

They claimed they were profitable last month. Eh, adjusted numbers. I want to see gap figures. I want to see audited figures. These are scientists running these companies. Like, I'm reading the AI book that, uh, I don't even know who wrote it. It's about Demis Hassabis, but it trickles down to all these companies what's funny is that deep mind which google acquired pretty much has the coaching tree for the entire industry including elon musk like he obviously didn't start there but his ambitions are related to that let's let me give you an anecdote here that can maybe cool the flames down there was a rumor today i believe today or this week that there was a

consultant that leaked to the news that they had a client spending 500 million dollars on clod in one month do you want to guess what company this was sorry just you forgot a certain word in there accidentally accidentally accidentally yeah they must have not had a budget yeah no budget constraints yeah do you want to guess who this company was if you haven't um i haven't i saw the headline i didn't see who the company was let me guess okay and this is from uh account called singularity research so okay take take my the leak here with a grain of salt uh yeah this could be bs but i would guess meta amazon oh yeah yeah this i think it makes sense giving their spending habits so this is where i think it gets interesting on that arr figure the math here from

again the singularity research account makes sense they had a 500 million dollar increase in one month okay that's six billion in arr yeah of their 47 billion yeah true well okay and amazon owns anthropic they're spending the money and it's going to flow back to aws it's all the always sunny clip that's this entire cycle it goes in a circle goes in a circle do we have any real money no so was this accidental put it on that tinfoil hat ryan amazon pumping their books here the who's the biggest winner from this zoom probably they own maybe one percent of the business yeah this might be zoom honestly maybe not anymore

maybe the stock is i think it's gone up a bunch because of this stake was probably the cheapest way to play anthropic i i think there was a sell side report that came out that was like But Zoom at this point is an anthropic stake with a Microsoft Teams competitor, like a web meeting business that's very stable. Only at 20% year-to-date, Ryan. Sean Emery came on the show, pitched it. I think it's been a significant amount since then. Maybe there's still an opportunity if you believe in that anthropic plus Zoom durable cash flow thesis. But if they're not going to IPO, they can't monetize it.

I did. I tried to back into some assumptions here on what the state could be worth. Granted, they've been diluted down a ton, but on a $1 trillion valuation, in theory, if it goes public and stays above a trillion dollars until Zoom can sell, the stake's potentially worth more than $10 billion. And I think the market cap today is like now $25 billion or something like that. yeah it's not the entire business but it's nice that's nice as soon as business isn't that attractive to me there zoom's gap earnings are going to explode from the market here on this so is amazon's again it's just all circular we're marking up our gap net income we spent on um all this operating expenses on one side of the business maybe it was even at aws and then they come back and spend the money at aws our customer tell me this is not.com come on people need to get their head on a little bit straight here i get that these are revolutionary products but one 500 million dollars in one month yeah it's insane the did you see costco earnings today

pretty uneventful but uh i will say it is just staggering the comp sales growth is like it was seven percent comp sales excluding the gas and foreign exchange i think they've had my data only goes back to 2019 my quarterly data they've had positive comp sales i think above three percent for every single quarter since 2019 my guess is that probably extends to almost 2010 unless there is some blip in economic spending that i'm forgetting about so positive since 2010 every quarter uh let me try to do the best guesswork i can i know every single quarter since 2019 has been positive and at least the pandemic yeah annually it has been positive every year since 2012 so my assumption there is the quarters are flowing into that pretty

consistently this is probably the i see why this is the and it shouldn't be this because it trades at 50 times earnings or whatever maybe it's different now but the when people want a safe place to go with their money safe place to park their cash the durable business they turn to always seems to be Costco because it is staggeringly stable. The, uh, the stat that stood out to me, Brett, do you know how much the average Costco warehouse generates in operating profit each year? Operating profit? I know their quarterly was at 2.8 billion. So let's round that off to 12 and then divided by a thousand warehouses 100 100 million 100 million operating profit is that way off no you're almost there you you had it uh uh it's 10 yeah yeah okay okay

off by off by an order of magnitude i think it's 11 and a half to be exact like around 11 and a half billion in profit per warehouse i also shout out to fiscally i for the custom metrics here this is always fun to do can you guess how many card holders on average belong to each warehouse oh that is a great stat yeah really i think that's a great stat for the nerds dads would love this at a at a barbecue and at least nerdy um i have no clue to a hundred thousand am i way off there you're not way off okay there are 160 000 cardholders on average per warehouse that's good isn't that a good business great business you can kind of feel it when you go

on a costco but it does just sound like a staggering number oh yeah without a family i'm never setting foot in there but yeah when you have a family it's great anyway the uh yeah the quarter looked fine for costco i mean there's usually never any after hours moves with a company this consistent the uh a few of mine these were listener suggestions if uh you want a little earning celsius and we haven't talked about in a while that old flame yeah yeah they're in a 50 percent drawdown i guess the alani new acquisition is not going over well with wall street i looked over the numbers uh briefly don't act like this was some deep analysis but celsius brand revenue that Celsius, the core brand, they grew just 6% year over year last quarter. They had 55%

revenue growth internationally, but from a small base. So they're doing well, trying to expand around the world. Alani New Retail Sales, though, are growing 100% year over year. They have a little bit of a lower gross margin profile than Celsius for whatever reason. Maybe it's the ingredients. Maybe, I doubt it on that. Maybe it's the marketing spend. Wait, never mind. That would be below the gross margin. But either way, it's slightly lower margin. Their price-to-sales ratio now is under 3 for a sector where you have Monster Beverage

that has posted 30% operating margins historically, which, you know, if you're going to grow like this, that would be nice. However, right now, their EBIT to EBIT Celsius is, their EBIT to EBIT is 45 with their last 12-month operating margin or EBIT margin of just 8%. And maybe there's a nice thesis here if you think margins can expand back to 20%, but it's not as cheap as it looks. And the category is getting more and more competitive. Ryan, I'm not in a place that has Celsius, haven't been all year. Is it, what is your gut saying? Getting stronger, getting weaker, still stable? What are your thoughts?

my consumer gut feel is that this industry is just hyper competitive and has been since the rise of celsius has become way more competitive like the only place where i usually and even considering buying an energy drink is at the gym and it is just rows and rows of different brands owned by or usually some sort of influencer relationship some some fitness influencer relationship and everyone kind of seems to follow the the the drinks of the influencer they like almost it just feels different today than it did five years ago the the energy drink space and somehow monster has just avoided all of it maybe it's because they don't really i don't think monster really overlaps as much with the the fitness lifestyle influencers i think

monster and red bull are just above the fray it's kind of a pepsi coke they're the standard bears red bull is always going to be available at clubs and bars and other areas monster maybe a little bit different but it's just core it's always there celsius still this is all gut feel here and maybe there's market share data that i should be sharing but celsius feels a little more elevated in terms of brand stature whereas i would say alani new feels like it's becoming increasingly irrelevant every every time i go to the gym or every time they restock that uh 100% growth, Ryan. A lot of new.

That's what it's, yeah. 100% retail growth year over year. Unless I was reading it wrong. Yeah, retail sales. 100% year over year. They're gaining market share. But your gut says it's not going to continue. No, it just doesn't feel like it.

But, again, data should win over anecdotes and gut feel. sometimes though your gut could be telling you that the trend is topping yeah potentially i mean the benefit here is that celsius has the distribution advantage with pepsi uh i think they're attached now to the pepsi distribution network so being able to hop on those trucks stack a few more cases of alani news in in those routes that's that's going to be way more useful than the local fitness influencer brand that doesn't have that agreement in place. All right.

Matek Systems, Ryan, or Autodesk Earnings? What do you want to talk next? Is Matek Systems the photo check capture? That's right. Potential AI winner, wouldn't you say? No way. Maybe. I haven't heard about this business in a long time.

Yeah, so we wanted us to look at them. Their stock has been doing quite well. You can maybe look at that while I'm talking here, Ryan. They just reported earnings. Again, digital ID and fraud protection company. Listener wanted to talk about them. Quote, here's from their press release. The team's execution on our Unify and Grow ethos resulted in record revenue and profitability,

led by 18% year-over-year SaaS growth as customers route more transactions through Matek to counter AI-driven fraud. a potential ai winner if that type of stuff just keeps getting worse and worse um they are guiding for just under 200 million dollars in revenue this year market cap 750 million and the stock is at 17 times ebit uh it's good cash flowing business i'd say good conversion you know it's not it's asset light somewhat fairly valued probably here um stock is at 17 this year was below 10 in late 2025 so maybe there's a real opportunity there what are your thoughts ryan like it love it watch list want to look at it more or or hard pass for a business that provides uh well i think this is a declining part of the business but the check capture

i would have expected revenue to just decline for the last decade nice pivot then nice pivot revenue since 2007 from from 2007 to 2020 so before any of this these recent years revenue went from six million dollars to a hundred million i would have thought it was just a declining industry like i i'm pretty blown away by this revenue chart honestly yeah it's gonna double again it's become much more profitable as well it seems margins have kind of inflected here yeah i mean you what did you say the market cap was they got 27 million in operating income today 750 million dollar market cap um yeah it's not dirt cheap but at the end of last year maybe it was deemed an ai loser or something like that

because it looked very very cheap on a forward basis yeah let's talk autodesk numbers the oh I got to, let me pull these up. It's a company we both kind of have a love-hate relationship with. You're still an owner or did you get, you're done? I am still a shareholder. I think you'll be pleased by this. Coffee can portfolio. How did it react?

Wow, down 5% after hours. That could be really interesting because the numbers looked, I think, pretty darn good. One, billings up 18%, revenue up 18%. All their categories, geographies, across the board, growing, I think, above 15%, at least most of them. And gap operating margin of 28%. Free cash flow is nice. And their remaining performance obligations growing,

guiding for 28% operating margin for the full year. Yeah, pretty interesting, I'd say. If they can actually start getting gap operating margin better and then returning cash to shareholders through buybacks. I like it. They are buying back. I would like the CEO to be gone, but that's just me. Is it still Andrew Anagnost, or am I misremembering?

Yes, yes. A good product guy, but yeah. Might be time for a new face. Stock's basically been a stable coin for the last five years. The 28% operating margin is really encouraging. i mean the operating margin chart has it looks really solid the buyback i mean they are i'm looking at it now here cash flow 870 million or so in free cash flow this quarter they spent looks like almost three quarters of that on share buybacks

i this could honestly i haven't touched my autodesk position in four or five years this might finally be the chance to to actually add at a reasonable price yeah it could be nice yeah nothing nothing else to add all right before we get out of here i did tease the bubble watch um did you see the nba players maybe ex-nba players getting into tech and stock recommendations i saw one nba player second yeah tristan thompson has a robotics play cav's a legend i don't know if i trust him on robotics well yeah he also is famous for other reasons uh what if he was married to a kardashian was like a big maybe he's dating some this is something if we have women uh listening to the podcast which is the five

frankly doubtful uh they might be laughing that we don't know that but um okay well All I want to say is we have these NBA players talking up on stocks. I think I saw other industries, let's just say that, a family-friendly show talking about stock portfolios. There was a certain betting analyst that gets thrown in my face on Twitter all the time that says, pour your money into the S&P 500. I think Ryan knows what I'm talking about. Maybe, maybe not.

I don't even want to mention it on the show, but there's a lot of people outside the industry saying to get into the stocks and let me just frame it this way for people that's they always go well you think no one else can do this blah blah blah blah blah if there was a somehow bubble at basketball and I was telling Tristan Thompson and Kyle Kuzma

who I'm not like I'm not saying I'm maybe even a good high school player or college player but I kept trying to tell him hey this is how you play I have some good ideas for how you guys can win this week like you laugh yeah i'm looking at some of these uh some of these tweets here i mean some of them to be honest don't really make much sense but the here's one i'll i'll repeat it 10 gdp growth 10 unemployment i think we're going to have to

depend on most tech companies for ubi and eventually uhi more investment in tech for the government too how else do we take care of society honestly these are so confused i don't really understand i think it's i think it's a little ai help i'm assuming it's also just kind of hot takes from like magazines like the atlantic right i've heard these takes a hundred times yeah this is uh i don't know i feel like generally when you start having athletes get into finance is kind of a look i shouldn't if you're learning about finance or whatever and uh that's one thing but it's like i felt like this was happening a lot during crypto like the crypto boom felt like we were seeing a lot more athletes like tied to some of these well there might have

been payments yeah true can't imagine i think less paying kyle kuzma for a for a guy yeah yeah uh this belongs on bubble watch but honestly i don't know what to think about all right this is one i think is great because we could maybe even try out a little fun game for the show robin hood just announced new ai agents for stock trading and credit card spending uh quote once up and running the agent can scan for the best prices monitor availability and make purchases uh blah blah i don't care about the credit card um i care about the ai agent would you trust the ai agent of robin hood who is a stark competitor of our loved sponsor and my favorite brokerage in the world interactive brokers but i will say should i put in

a hundred dollars and see if it can it can beat our performance i think that'd be fun if you can set the parameters correctly to just say you know i'm just gonna say make me money by ibkr if it drops below a certain price or whatever i guess this takes out and it's somewhat convenient maybe but you can also do that with just like a non-expiring bid on on any trading platform so uh it doesn't i'm just gonna tell to make me a billion dollars i do think there is maybe some potential for things to go wrong here honestly uh i saw some pretty hilarious memes whereas con like fake conversations with uh dave ramsey about like so you told your age you gave all your money to your agent

and told it to buy stocks for you and now you lost all your money yes that's right dave and the incentive is for robin hood to make money by we have a comma here robin hood agent keep put keeps putting you in zero date options and they said also on buying robinhood but regardless of that they have incentives for their partners in their uh what are what are these the market makers the like the high frequency traders that they that pay them i think there's misaligned incentives there to get you trading more this is a more serious bubble watch topic open ai's operating margin let the listeners think about this one apparently reported an adjusted figure adjusted operating income margin of a negative 122 percent in the first quarter

if we're going to adjust just make it positive am i am i right yeah if you're going to adjust you might as well go crazy with it honestly there's no point in it's fake number just make it a little more fake yeah i mean there's no there's no stopping you there's no rules around it you can adjust it however you want honestly it could be this makes me feel like they have negative gross margins uh if your adjusted margins are this low i don't see how you could even have positive gross profits the anthropic is space extra good businesses i think the ai we work ai we work is not the worst name for open ai there has i i can't remember the last piece of good news i saw for open ai other than them completing their capital raise which

is questionable as to whether or not that's that's good news it's probably not for the investors yeah we'll see i can't even remember that was a couple months ago yes i believe amazon was quite the large participant in that if i'm not mistaken so amazon has been uh on the hot seat lately as far as capital allocation goes let me just say i am not 100 certain that that sourcing was correct but it is plausible that amazon is one of the only largest companies that could spend 500 million dollars on cloud tokens and either way like there's companies spending across the board and amazon yeah it's throwing money at anything ai at the moment before we leave you mentioned that space at last i think it was last week you mentioned that spacex

burned nine billion dollars i feel like burns kind of an aggressive term law had a free cash outflow of around nine billion dollars in the first quarter that is the second biggest free cash outflow for q1 in in all of global equities can you guess who number one is um intel oracle oracle oh yeah that's a good choice i think they had negative 11 billion in free cash flow in q1 that's another just the money's going in a circle yeah right they're related they're all related well i think that's it we had some listener questions from the sub stack chat uh i guess we can try to answer those within the chat this time but thank you everyone for tuning in ryan ryan anything else before we get out of here no no uh

oh oh i should mention if you've stuck this far around uh we are hiring at fiscal ai there's there's pretty much three open roles right now uh head of legal and two account executive roles so if you're interested, we want people that have an interest in investing along with other skill sets as well, obviously, for those specific roles. Feel free to check them out. Just look up Fiscal AI Careers. And if you mentioned that you listen to the Chit Chat Stocks podcast, I think that will be a bright spot on the application. Ryan's not the hiring department, but they do want people that like investing. Correct. That are knowledgeable. Okay. As a disclosure, we're not financial advisors. Anything we say on the show is not formal advice or recommendation. Ryan and I

are any podcast guests. May hold securities discussed in this podcast. May have held them in the past and may buy, sell, or hold them in the future. Thank you everyone for tuning in and we'll see you next time.