Motley Fool Money - Tesla’s Robotaxi Non-Event & GPT-6 Is Here!

Episode Date: September 4, 2026

Tesla held a robotaxi event this week but didn’t invite media or investors. Even Elon Musk sat the event out. What does that say about the future of autonomous vehicles? Plus, we discuss GPT-6, Adobe’s new CEO, and the health of consumer spending. Travis Hoium, Lou Whiteman, and Jon Quast discuss: - Tesla’s “Event” - GPT-6 - Adobe’s New CEO - 10-Year Predictions - Retail’s Health - Radar Stocks Companies discussed: Reddit (RDDT), CECO (CECO), Tesla (TSLA), Alphabet (GOOG), NVIDIA (NVDA), Apple (AAPL), Shopify (SHOP), Walmart (WMT), Amazon (AMZN), Meta Platforms (META), Adobe (ADBE), Dick’s Sporting Goods (DKS), On Holding (ONON), Lululemon (LULU). Host: Travis Hoium Guests: Lou Whiteman, Jon Quast Engineer: Dan Boyd Disclosure: Advertisements are sponsored content and provided for informational purposes only. The Motley Fool and its affiliates (collectively, “TMF”) do not endorse, recommend, or verify the accuracy or completeness of the statements made within advertisements. TMF is not involved in the offer, sale, or solicitation of any securities advertised herein and makes no representations regarding the suitability, or risks associated with any investment opportunity presented. Investors should conduct their own due diligence and consult with legal, tax, and financial advisors before making any investment decisions. TMF assumes no responsibility for any losses or damages arising from this advertisement. We’re committed to transparency: All personal opinions in advertisements from Fools are their own. The product advertised in this episode was loaned to TMF and was returned after a test period or the product advertised in this episode was purchased by TMF. Advertiser has paid for the sponsorship of this episode. Learn more about your ad choices. Visit ⁠megaphone.fm/adchoices Learn more about your ad choices. Visit megaphone.fm/adchoices

Tesla had an event last night and we were not invited. Molly Fool, Hidden Gems, Investing starts now. Welcome to Molly Fool, Hidden Jems, Investing. I'm Travis Holium, joined today by Lou Whiteman and John Quast. And guys, we previewed on the Wednesday show, Tesla's event that they had last night about the robot taxi. There's a lot of hype around this. Lou, not only were we not invited. I don't think anybody was invited.

No live stream, no nothing. Yeah, I'm confused here. Okay, because I get, I don't want to slam a company for doing a publicity event. Publicity events are very, very important. But if you want to do a publicity event, you should try to get publicity. You should do a live stream. You should just like, they hyped this for weeks. There was contests of like if you take a ride in Austin, you can get to go.

And then night of the event, Elon Musk didn't even show up. Not only didn't he show up. He barely had the energy to live tweet it. He did like one retweet or so. I, why bother? I just, I don't understand. They basically announced that we are actually doing what we announced last year and it will start rolling up.

You know the whole, this could have been an email thing. This could have been a press release, guys. John, is there a more bullish way to look at this? Well, I think that we're talking out of both sides of our mouth here saying there was hype for weeks and then yet it wasn't hyped on the time of the event. I mean, I think that they were playing this a way that they wanted to play it. Is it even fair to call it a launch? It really isn't. It's a slow rollout is what it is. And so I actually think it makes more sense to not overly hype this because we are not going out across the country in all cities with a fleet of hundreds

of vehicles. If you do hype it too much, then you set the expectations too high. and then there's disappointment by comparison. Isn't that what Elon's been doing for a decade or more, though? I mean, this is the original Robotaxi. Yeah, the original Robotaxy event was in 2024. That was two years ago. They started talking about the Robotaxi, I believe, in 2018 or 2019. Not in its current form, but the idea of the Robotaxie and having this fleet, we're almost a decade after that.

And other companies have much, much bigger fleets. It's just, we are at this point, and the reason that I wanted to bring this up on the show is we are at the point where autonomous vehicles are real. And Tesla was supposed to have this huge first mover advantage. They were supposed to have a huge cost advantage. And once you have both of those things and you have this network effect, now no one can catch up. And it seems like they've kind of fumbled that. So, John, are we at the point where they really got to put up? or, you know, Waymo is out there scaling their vehicles

and they're cutting their costs dramatically. I think the hardware, the rumors were the hardware costs for autonomous vehicles, so basically on top of the vehicle itself, went from about $150,000 down to about $20,000. This is the way hardware works. It gets less expensive over time. So, yes, they have more sensors. But if the cost differential is very small and coming down,

it seems like that advantage the Tesla should have is sort of evaporating in front of our eyes. Yeah, I mean, this is why we all drive Nissan Leafs right now, right? I mean, because Tesla pumpled its first mover advantage, right? I mean, Nissan Leaf came out before Model S, and you could say that it had the first mover advantage, but Tesla is the one that won out in the end. Listen, call it what you will,

but Tesla understands one thing very well. It understands the psychology of the consumer, not necessarily that the best product wins or the first product wins. The most anticipated, the one with the best vibe is the one that wins a lot of times. It reminds me a little bit of the old I'm a Mac, I'm a PC commercials, right? What was that actually telling us about the specifications of an Apple MacBook or a Microsoft PC? Really nothing, but one was perceived as a little bit cooler.

And I do think that there are people who win the Cybercab is available a lot more. I think there's going to be a lot of people lining up for cyber cab because that is the one that they want to ride in over a Waymo. It's why my nine-year-old counts cyber trucks on the road, and I've never told them anything about cyber truck. We still haven't really explained what the purpose was last night, though. I mean, look, we knew all this before. And, yeah, I mean, congratulations. Didn't even get your CEO to show up. This would be like Apple announcing a new phone and then saying,

The phone's going to be launched in three days. The phone's going to be launched in two days. The phone's going to be launched in one day. We're going to do a big, big event for the phone launch. And then just not talking about it right there. You're right, so there was the Apple versus PC commercial. Apple took the time to spend money to actually get that commercial out in front of people. My just kind of confusion here is that they had this event, but then they kind of hit it,

which as an investor, I don't know if I should read anything into that or not. They, it's funny, the biggest Tesla advocates coming out of us for like, I don't know why they did this last night. We didn't learn anything. Stock is down 6% on it. It's just very, I don't know, it could turn out being a great product if they get there. And Travis, to your point, I think the bigger fear is, is that, and maybe this is what they're acknowledging, I don't think events work anymore. Events were really cool when nobody had cars on the road. and they were just giving you cad-cam images of how cool this was going to be.

Right now, I can go out my door and see this in practice. And so for someone to do a PowerPoint presentation about how cool their service is going to be, that might work for kids, but that's not going to work for investors. You actually have to get, when you have, what was way about, four thousand something, I was just out, past three or four of them on the road. I think what's going to impress investors now is, John's right, when that day comes, if they're out there in force with fleets in the thousands all over the U.S.,

they might have the better, cooler product, and might win. But until then, I don't think that these events serve a purpose. I think they're just reminding us the fact that they are behind. Well, John, let's go to the business model, too, because Tesla is still a $1.2 trillion company. It's part of the Meg 7. There's a reason that we're talking about this company specifically. And if you look at what the story was for Tesla five years ago,

I mean, I remember listening to those conference calls and Elon Musk and team, that entire team where it's basically laughing at the entire industry going, you guys are all going to be licensing FSD in the future. You just don't realize it yet. And here we are in 2026. Not only is no one licensing FSD, doesn't seem like anyone is interested in licensing FSD, and everyone else is launching vehicles that are at the very least level two autonomy, where you have this driver assist system, a little bit like FSD is today,

or going all the way to level four, and even level three, which is what companies like Mercedes have. I think BMW is launching some of those features. These features are really starting to roll out in consumer vehicles on top of the Zooks of the world, the Waymo's of the world, Maine Mobility is another one that's around. So it just seems like the thesis of five years ago is just not playing out the way that you would think it is still a cool vehicle. My kids also count cyber trucks.

But that doesn't mean that they've sold a lot of them. I think that mine share is important when it comes to long-term market share. But to your point, Travis, I heard someone say recently for every mile of road there's two mile a ditch. And so I do want to stay out of the ditch on both sides. The ditch on one side is to say that Tesla is the clear market winner, and there's something you can do about it. And to your point, that's kind of how the executives were talking about it five years ago. The other side of the ditch that I want to stay out of here is that Tesla is irrelevant because Waymo is ahead. I think it's incredibly relevant.

Maybe it doesn't license its full self-driving software to the other car companies. Maybe they do build out there. And in fact, I think that's even more likely that each of these companies is going to have its own driver data. that it can build its own models off of. I think that that's perfectly reasonable. But there will come a time when things are solved on the regulatory front, and we can actually sell to everyone everywhere. And that is really the big difference when you talk about an iPhone event, right?

What were the restrictions on selling an iPhone? None. You could sell to anybody anywhere. Right now, you can't sell a self-driving taxi to anybody anywhere. There are rules. when those regulatory hurdles are cleared, that is when I think that this becomes a lot more meaningful who is taking share.

Maybe that would be a good time for an event. There you go. Well, a lot to talk about with Tesla, but I think this is one of the more exciting spaces because we are seeing more of these autonomous vehicles all over the place. And it is going to be a huge market. It's just a question of how are investors

going to be able to make money on it. When we come back, we're going to talk about the launch of G.T. 6. Sorry, it's GPT6. GTA's still not up. Yeah, not GTA. More on that in a moment. You're listening to Motley Fool, Hidden Gems, Investing. New from Nespresso. Blend wellness into your coffee routine with a 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. Double espresso with ginseng extract. Whatever lies ahead, don't change your morning. Let your morning change you. Discover Coffee Plus on espresso.com. Welcome back to Motley Fool and Jim's investing. John, we did get, we're not getting GTA 6 quite yet. I am excited to talk about that in a couple of months.

But GPT6, or at least the first version of that, is now starting to roll out, at least to some enterprise customers that was announced yesterday from OpenAI. interesting from the release. And here's the quote that I took from it. It can take care of tedious tasks like filling out online forms, updating customer records in a CRM and organizing your calendar, end quote. John, we were promised AGI and we get a bot that can fill out forms for us.

It's definitely going to be more powerful than that. But is there really a there there for investors? Well, I think it's hilarious. the whole artificial general intelligence conversation, the AGI. This is, of course, different from just regular AI. AGI is basically AI is smarter than humans in all domains and can connect domains together, really kind of think like people, but better. Open AI President Greg Brockman is saying,

welcome to the AGI era and saying this could be AGI. And Sam Altwin saying, maybe someday we're going to look back at this and realize this was the moment. Listen, I'm sorry, if it's AGI, we're going to know it when we see it. And to me, that's a tell that this ain't it. To me, it's a tell they still want to do an IPO, but maybe I'm too cynical there. That's probably true. This does seem like one of those, it does seem to be back and forth between all these different companies. And we can bring Google and Gemini into this as well. They keep pushing forward with their flash models. That's what I use a lot, because it's just very, very quick and, you know, it doesn't cost me anything.

It's included in whatever Google things I'm paying for. But it seems like the push for all of these companies, and even with this one, is on that enterprise side. And that seems to be really telling that that's where the money is for these companies. And also, I have to wonder, as all of these companies try to IPO, how much money is there for them to grab if they're all going after that same enterprise customer, the same coding applications. It just seems like there's a bunch of money

chasing one pot at the end of the rainbow. That's exactly. It's interesting that you say that, Travis, because actually this GPT6 isn't great at coding compared to other AI models that are out there. In fact, if I recall, it barely better than GPT5. So it's not really excelling in the coding aspect.

It's excelling in some other areas. But to your point, if you're going after Enterprise, that seems like something that Maybe you wanted a step improvement in. We're an investing show. I'm not going to pretend to understand. And you don't want me judging which of these models is best and which one is bleeding edge and which one can be your imaginary friend.

But, Travis, to your point, we do need to see revenue here. And I don't think I'm kind of numb from every six months. Another one of these companies say, ours is the best thing in the world and nobody can stop it. And we're visionaries and gurus or, whatever. What I know is, is that increasingly the enterprises are finding ways to not use the frontier models, these bleeding edge models, to generate the productivity they want. Travis, just like what you're saying. The flash models work good enough. I am going to go out on a limb and say that

for all of the attention that these new model releases get, they, for the businesses, don't really matter. I think that as these things get better, as they get maybe closer to imaginary friend status, there's going to be even less need to pay up for the most amazing thing because all of those trailing models are going to continue to get better as well. I think that both things could be true. GPT6 could be the most amazing thing out there, but yet not a reason for an enterprise that is already set up and clawed to shift. Lesser model at cheaper prices, kind of the meta model, feels like a better model right now

than Bleeding Edge is a premium in terms of generating revenue. And that could be a real problem for some of these companies that are kind of focused on the bleeding edge. A couple of data points on that, Duolingo, at least for a while a year or two ago, was the biggest user of tokens from Open AI. They talked on the most recent call about how, you know what,

we are now using high-end models for certain things, but most of our work is being done with much less expensive models, open source or open weight models, we're really optimizing that cost. So that's not going to those front-year models. The other one is Uber. Uber is one of the companies that say, hey, we blew through our budget early in the year.

But now they've said, hey, we're actually doing more with AI, but we're spending the same amount. So I think this is going to be something we're going to have to really keep an eye on is second half of the year into 2027. How does the spend for those enterprises go? Because it seems like it went astronomically higher

in early part of 2026, may not be on the same trend over the next 18 months. All right, Lou, I quickly want to touch on the change with at Adobe. This is something that we've been looking for over the past couple of months. But Adobe is one of those stocks that's been beaten up. I think it kind of falls into that value territory for a lot of investors. So really intriguing, but they did announce a new CEO, stayed in-house. What do we need to know?

So the market doesn't like this, apparently, down 7% today after the news, but all software stocks are down today. So I don't know how much to read into that. Yeah, the stock's been on a slide. It is up 35% since July 1st, but it's been cut in half over the last five years. So kind of pick your timestamp. This to me, okay, full disclosure, I bought into this at it near its lows on the kind of, I thought the AI is going to eat its lunch was overstated.

So I am all for it going up from here and not down. The CEO transition looks routine. And I think it's good that there is like just the question. has been answered. Someone who has been on the job 20 years decided to retire. I think that's fine. Timing isn't great, but I don't think there's controversy here. CEO looks kind of new person kind of looks like a caretaker, but I think the business works. For me, I'm looking at business trading 11 times expected earnings before the fall today and asking, is AI going to eat its lunch? Maybe over time. But I don't think people like Dan Boy behind the glass and all the people

who use Adobe products professionally are in any hurry to say, oh, let's just code something up and do it again. So I think there's more stickiness here than we think. It's not a while higher. I'm glad it's now in the rear view mirror. And I am hopeful that just quarter to quarter we can see the sky isn't falling. And if so, did I mention 11 times expected earnings? Yeah. John, I do think that valuation story is really important. But also, the question for Adobe is more about what does their business model look like in the future? And if you go back 15 years, that was really what the innovation of the, you know, the outgoing CEO was, hey, we got to go from selling a box in Best Buy to this subscription as a service model that really turned around the company. Is a caretaker CEO the right choice in that environment where disruption could be on the horizon?

We'll see when Adobe reports earnings next week, but I'm suspicious that it's the wrong move. The guy that they passed over is David Wadwani. He is the guy who is in charge of Photoshop, Premier Acrobat Firefly, basically the things that generate most of Adobe's revenue. And I think what the market is reacting to today is he's actually unexpectedly leaving the company saying that this is a time for a fresh start, new opportunity, and he said this is a rare moment when technology, changes, not just what we build, but how companies are built. To me, it sounds like there is

somebody running out to vibe code up a competitive product. And I do, I do have suspicions that Wadwani is headed for an AI company to better compete with Adobe after being passed over. Definitely one of the most fascinating companies to watch because when these AI products came out, it was those images that were really captivating that caught a lot of people's attention. But like Lou said, a lot of the people that use Adobe's products are not going anywhere. So interesting place for Adobe to be in. When we come back, we're going to look in our 10-year crystal ball. You're listening to Motley Fool Hidden Gems Investing.

Welcome back to Motley Fool Hidden Gems Investing. In this segment, we like to have a little bit of fun. And I wanted to look in our crystal ball. We've talked about a couple of big things that are happening in artificial intelligence, in autonomous vehicles. So I want some 10-year predictions from Lou and John. And we can kind of go through how we're thinking about these things when we're looking for investment opportunities because this is the kind of time horizon that we like to

look at as foolish investors. So, Lou, which company is going to have the most autonomous miles driven per year, 10 years from now, 2036, Tesla, Waymo, or you can take the field, but you have to pick someone else if you're going to take the field. All right. So I'm going to push back on something John said earlier, right? He was saying that he thinks that it's going, like, individual automakers are all going to have their own technology. I think that the long history, whether it's technology or parts in the automotive industry is that just, you know, normalize, commoditize, and move on. So that would be like the modular business model, for example, the level one solutions today. Most of those come from mobile eye. Something like that.

Yeah. I mean, look, and I know this isn't the same as wiper blades, but I think there's just a long history of commoditization, innovation turning into commoditization in this business. And I am not going to assume otherwise. I didn't know I had to pick someone in the field. So I was going to say the field for that way, but I don't think it's going to be Tesla. I think I would take Waymo over Tesla here. I think I'll take the field. If you make me say GM, I'll cringe, but just because they're bigger and I think they'll stay bigger. But yes, something like whether it's MobileI or Nvidia or someone, I think that this is going to just be like, right now everybody buys their turbochargers from the same place.

basically, you know, one company. I think that 10 years from now, we're going to have a similar situation with the technology inside the cars too. Yeah, so the idea here is that instead of each individual automaker developing autonomous driving technology, you have one company, develop it

and then sell it to everyone else. That's the modular business model. A couple of names there would be AV. Ride, We Ride. One of those is owned by Nebius, and one of them is publicly traded. I always get the mixed up, but there's like pony AI.

There's a dozen or more companies that kind of fall in that category. John, what do you think is going to be happening with autonomous vehicles 10 years from now? Assuming no regulatory burdens or barriers, I would say Tesla. And I think that everyone listening is going to be like, this guy just loves Tesla. Okay, I don't own Tesla stock. I don't plan to buy any right now. But I do see the case here that they're going to have the most autonomous miles because they're the ones that can scale manufacturing to the cyber cab faster than competitors in my view. I would say that 10 years hence, if there is regulatory greenlight, then they're the ones that are able to get it out there.

Plus, they have the resources to potentially subsidize those vehicles, whereas maybe competitors don't. We see that right now with AI companies, right? You're not paying the token costs, the true token costs. AI companies are subsidizing those to a degree to get you to adopt. I can see the same thing happening with Tesla, and I would see the incentive to do so. Can I break in, like just another, I'm honestly curious what you guys think, like a related question. Those miles, do we think that the cybercabs or the, you know, the autonomous vehicles are going to drive the most miles? Or do we think it's going to be individually on vehicles in 10 years?

So just to that point, they basically had an inquiry yesterday. I think a form that you could fill out saying, hey, I would like to be a fleet owner of cyber. Or something like that. In 10 years, do you think most people don't have a car in the garage? I'll say no on that in 10 years. That's why I'm curious. Yeah, I mean, I don't want to give up my manual transmission, so I'm definitely going to keep the car in the garage.

But it's a great question, Lou, it's a great framing. I don't know what the majority of people are going to feel about that. Yeah, I don't either. I mean, maybe eventually, but 10 years seems really, really short for me to, like, think of the world changing that dramatically. We'll see. here would be my prediction is I think so we have you know me my wife and three kids and a dog there's it's probably unlikely that we give up all vehicles but I would love to live in a world where

we have one large vehicle a large SUV or a van whatever it is for driving the family around and then that's it and if I need to get somewhere or if my kids need to get somewhere there's an autonomous vehicle that can just pick us up you know within a minute or two I that might mean that people still have vehicles in their garages, but there's fewer of them. So we'll see. It'll be interesting to see how this plays out. And there's a lot of bets to be made,

whether you're looking at Tesla or a lot of other opportunities in the industry. Okay. Who is going to be building the best AI model? And I'm talking about the frontier side of things. Is that going to be Google, Anthropic, Open AI, meta, or the field? Again, I'd like you to take somebody, but I don't necessarily know who would be that player.

And Invidia, maybe, something like that in the field. But the idea here would be not everyone is going to be on that bleeding edge 10 years from now. Companies are going to eventually capitulate and kind of tap out. Lou, who do you have winning this race? I have no clue, but I'm going to take you through my logic here and explain why I come to where I do. I don't think most of the revenue is coming from the bleeding edge. as I said before. So that makes me think that the best AI model, I don't know who's going to be around to fund it if that's what you're focused on. I think the AI model providers in the future

are going to be the Googles and the metas and the ones that have other businesses to support it. I don't think both Anthropic and Open AI are around as independent companies in 10 years, maybe one of them, and it's hard to say. Do you think they go public in the next year or so? And then they eventually get bought out either under distress or for some other reason? Or strategically, yeah. I just don't think that there is going to be enough revenue for the bleeding edge models for this to work as a standalone business. So I'm guessing the dominant AI vendors are going to be, if not the established companies we know now, but other companies is part of a more diversified business model instead of just a standalone science lab.

Travis, I'm going to answer this. It's going to sound like a cop out. It is not intended to be. But who's building the best AI model 10 years from now? Irrelevant. Because honestly, I mean, as soon as you build the best AI model, someone's coming along beside you with something just as good for these companies that are focused on this, really your lead. Well, that's where we are today.

But you've got to think that in the future, like none of these companies are making a profit on building that leading edge model. so eventually some of them are going to tap out. But who's going to be left, like trying to push that bleeding out? Sure. I mean, yeah, I would say that, you know, Alphabet is definitely still in the mix. I would be not surprised if meta was still in the mix, right? But which one of those two, if it's a two-horse race, I mean, how much of a lead is either of them going to have? Not for very long, I would say.

Now, that's it. I do want to circle back to something that I didn't mention here with the update of OpenAI is GPT6. There is something interesting about this new model. So you've heard about Deepseek and how it was able to basically make allegedly, reportedly like this incredible model on only a fraction of the compute power. What it allegedly did was distill from the frontier models to create what it had. And basically, it's not training.

It's just looking at the reasoning that the AI is going through and then taking that and putting it into its own. Apparently with GPT6, what I'm seeing is that the chain of thought is not as easy to follow. So it may not be easy to distill that for these cheap models that are coming in and trying to take the share. So that is something interesting to watch. It'll probably be somebody building the best AIOP model who also is investing in the best compute. That would be a logic for some of these current leaders to widen that lead by making it more difficult to distill. things like that.

Okay, how are we shopping in the future? And the reason that I wanted to bring this up is, I spent a lot of time thinking about, where's Shopify going from here? Where's Walmart going? Amazon, you know, Open AIs building these products. Some of the things that came out yesterday with the GPT6 launch was just talking to the AI

and going, make a reservation for me, buy this product for me. I'm not ready to do that yet. But, John, when you look out, 10 years, how are we shopping in the future? Is it similar to today? So we have Walmart, Target, those companies still doing fine. Is it an incremental change from today? So Amazon is doing fine. Or is it, we are using AI, maybe Open AI is a winner. Shopify, I think would be a winner in that world. How do you think about the future of shopping? You know, that example from the launch video for

open AI just shows me like how different those people live compared to most people, right? I mean, to need a reservation for dinner. I mean, it's just not something that hardly ever comes up in my life. But, you know, agentic commerce definitely is the future. I think that if you look at these Walmarts, these Amazon's, Shopify even, you know, kind of like the website is not anything of a competitive distinctive anymore. All retail companies need a website. I think that all retail companies are going to integrate with agentic commerce systems.

So then it becomes the other side of that. Your payment, your financial technology companies, the ones who are sending the agents to your platform. I think those are the ones to watch. Honestly, I would say that Coinbase is a dark horse here, the way that it is investing in agentic commerce. That's a really interesting one to watch. It's just funny.

And again, not to sidetrack, but the whole make a reservation for you, the computer will do that. I just looked it up. Apple has been promising that. since June of 2012 was the first time they did a demo on that, which again, yeah. So great. Wow, innovation. It's great. We're a decade into this innovation. How's shopping going to work? I am going, so I will say, and maybe I'm just being an old and maybe I'll change your time.

But the idea of a bot helping me with search is very, very intriguing. The idea of a bot making the purchase and things just showing up and I get to find out what it got is dystopian to me. And that is the difference. So my guess is, is that all of these demos, just like the Apple demo back in 2012, spoiler alert guys, the demos always overstated. It's going to be some, 10 years from now, it's going to be some version of today with different tech tools to guide us versus, I mean, look, the idea, if you would have told me 20 years ago that I could get on a computer and seamlessly search through thousands of products instead of having to just go see what they have at the local target,

that would sound like innovation to me, but it's still all the same players plus a few more. I'm guessing it's going to look the same thing. I think Shopify will have a huge part. I think Walmart will. I think Amazon will. Open AI of the ones you said, I mean, maybe, but it's just a different version of the same. It's not going to be as dramatically different as the futurists and the demos might say. I think what you're hearing here from a theme from a lot of these things with artificial intelligence is it's looking a lot more like a

sustaining innovation than a disruptive innovation, which tells you that a lot of the existing players are going to be the winners in the future. So, well, I do think to just kind of as a closing point, I think as investors, this can be useful to go back and see what, I mean, I don't mean to dunk on Apple here. Apple has done amazing things, but to go back a decade, look at what was promised and look at how it turned out in reality and then try to use that filter on what's being promised today. And so you don't get kind of too ahead of yourself as an investor. I think that there's logic there. When we come back, we're going to get to the stock center radar.

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Advertisements are sponsored content and provided for informational purposes only to see our full advertising disclosure, please check out our show notes. Before we get to Stock Center radar, I did want to touch on some of the retail news that came out. John Lulu Lemon reported earnings yesterday. Not good. Sales were down, same store sales were down 5%. The stock is down almost 20% in trading today. What did you see there?

And is there a theme that we can see across retail and sporting goods right now? Well, Lulu Lemon has a Lulu Lemon problem, plain and simple. and the numbers back that up. So according to the Census Bureau, clothing sales in 2026 are up nearly 6% compared to 2025. That's actually a pretty big number. Now, you look at Dick's sporting goods. It has a foot locker problem, not anything else.

And again, the data backs us up. Sporting goods sales in the U.S. up 10% so far this year compared to last year. The consumer is spending. And this isn't a case of consumers trading down. from brand names to off brands necessarily. You look at American Eagle, starting the year off with 10% growth, Abercrombie's riding a 15 consecutive quarter streak of growth.

You look at something like Yeti, and I know this is way out of this range here, but Yeti is expecting 7 to 8% growth this year. And that is definitely a high end of its market. So it's definitely a Lulu Lemon problem. I think that if you look, it's struggling in the Americas, not the rest of the world. So to me, that says,

I have a brand that's recognizable enough to go global, but competition's coming in on my home turf and stealing share. Spot on. I mean, I think I'm not going to say that the consumer is healthy. I think there's better ways to look at the data on that, but there's a real danger in finding patterns in individual retailers. As John said, there's others. Lulu has a real Lulu lemon problem. There's a common theme here with Lulu and on and some of these. Hot retail is dangerous. Hot retail is hot until it isn't. And you have to really call that right. You can make a lot more money on the trendy email, I'm sorry, trendy retail while it's going up. It is a better investment than slow and steady. But when the air comes out of that balloon, it's really hard to refill it. So is this something

where the way to play it as investors is just to stay away, Lou? Or is there an opportunity here to buy some of these more value stocks because, you know, if consumers are spending, some of these companies are still growing, not every company is dropping, you know, 5% or losing customers the way that Nike is. Expectations matter. I mean, I don't think Lulu is going away. It's trading it almost, it's down almost single digits to earnings. It might be a T.J. Max from here.

I don't think someone should buy in saying it's going to go back to where it was, but that doesn't mean it can't be a winning investment. My answer is to stay away, though, because retail fashion trends are really hard to get right. I will say if you were looking for a chance with on holdings, this is still a really good gross stock, but the valuation is now down 70%. So if you were waiting for the air to come out of the balloon a little bit, I mean, this is a good business, still growing nicely, and now it's finally trading at a price that makes sense for a shoe stock. I also got to take a look at Yeti. So thanks for bringing that one up. All right, let's get to the stocks on our radar and bring in Dan Boyd for his thoughts behind the glass.

John, you're up first. What do you got? Okay, I got Reddit, and this ticker symbol, RDDT. Listen, I'm not a huge fan of the social platform, but I do like the business. So this is a platform where people go and they share information. They start little communities. For two years now, it's maintained a growth rate over 60%. A couple of things are happening.

There's more users and monetization is going up. So advertisers getting increasingly used to the platform. It's Reddit Max product is automating ads. And this is causing, actually, this product grew over 150% recently. So that's a big deal. higher revenue leading to higher profits, operating cash flow more than doubling. And so the net margin here at 30%, that's really good.

No debt, great cash position, buying back shares, and now trades for only 20 times forward earnings. This is starting to look attractive here. Dan, are you a Reddit user? No, I am not. And it's just ads, right? This is the money that Reddit makes? Well, they make money from like Google paying them

to get their data into artificial talk So if you do a Google search and you see those AI overviews, a lot of those are coming from Reddit. Yeah. Okay. Yeah. No, I don't care about this company one day. John's starting out behind the eight ball. Lou, what do you got for us this week?

And I'm still trying to lose. But I'm channeling old economy run here, Dan. So hopefully that works. Dan, I'm looking at Seco Environmental CECO is the ticker. What do they do? They provide air quality, wastewater management, energy transition, all sorts of products to large corporate customers. These are big things. Think air scrubbers for power plants.

Also, the kind of to make the, when we're making EV batteries, all of the toxic wastewater and things like that, kind of making sure it doesn't get into the environment. Stocks up 50% over the last year, Dan. I think there's still room to run. We know there's growing demand for power and energy thanks to data centers. I mentioned the battery production, semiconductor manufacturing. They're involved in a lot of red-hot markets. It's not a value stock.

They trade it almost 30 times earning. but they have a $1.8 billion backlog, a clear path to $3 billion in annual orders compared to $2 billion now. And we're getting towards 20% EBIT of margins manufacturing at scale. I think this is a winner from here. Dan, I didn't have air scrubbers on my bingo card for the show today. But what do you think? I feel like the regulatory environment is probably not great for this company at the moment, but that sort of thing tends to be cyclical.

I also like that this is a 60-year-old company who's been listed for 40 years, Travis. All right. So make it official. What's going on your watch list? Oh, we're not going Reddit. Let's go Seiko. All right. Congratulations to Lou for Lou Whiteman, John Quast, and Dan Boyd behind the glass.

I'm Travis Hoym. Thanks for listening. We'll see you here tomorrow.