The Canadian Investor - The Metaverse is Not a Science Project - Earnings Roundup

Episode Date: February 10, 2022

Partnering with the Quartr app in this release of the Canadian Investor Podcast, we cover the following earnings releases and news: Canada lost 200,000 jobs in January Peloton drawing interest from potential suitors as an acquisition Meta earnings Lightspeed commerce earnings Alphabet earnings Paypal earnings Amazon earnings Pinterest earnings Spotify earnings Brookfield Infrastructure Partners earnings Unity earnings   Tickers of stocks discussed: FB, PTON, LSPD.TO, GOOG, PYPL, AMZN, PINS, SPOT, BIPC.TO, U   https://thecanadianinvestorpodcast.com/ Canadian Investor Podcast Twitter: @cdn_investing Simon’s twitter: @Fiat_Iceberg Braden’s twitter: @BradoCapital Stratosphere 🚀 https://www.stratosphereinvesting.com/See omnystudio.com/listener for privacy information.

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I'm Brayden Dennis, as always, joined by Simon Belanger. Simon, I don't know how we don't go three hours recording on this episode. Earnings season is in full swing. Tons of reports we're going to go over today. How are you feeling, buddy? Feeling good. I'm not sure if I'm feeling good enough to do three hours. Let's try to keep it between one and two is probably a good target. Yeah, I know. It'll probably just be longer than normal. Hopefully not three. All right. So you have some job report here from Canada. Do you want to kick us off with that? Canada lost 200,000 jobs in January.

It was worse than expected and pushed the unemployment rate up half a percent to 6.5%. Most of the job loss were in the food service and hospitality industries. So that goes with no surprise, because obviously there was a lot of lockdown happening. Well, especially in Quebec and Ontario, they were very affected by these numbers. It'll be interesting to see if we see a sharp rebound like we did last year when there were lockdowns and then reopening. Now that Ontario and Quebec have announced an easing of restrictions, I think Ontario is a little bit in front of Quebec, but Quebec's a few weeks behind. So it'll be interesting to see what happens in terms of job numbers, February, March and April.

Yeah, I hope these jobs come back, man. It's time, man. I know Ontario and Quebec are still in these restrictions. Ontario does this like kind of multi-stage reopening plan. As a resident, I'm like, what about stage six, which is no restrictions? I'm still waiting. What is that number? What is that stage?

I don't see that stage on your guys' report. We saw Friday Peloton stock go up like 35% or something on the news that it might be bought. What's the story here? Yeah, Peloton is drawing interest from some big players. Apparently, the rumor is that Amazon, Nike, even Apple are interested. I think there's been other names too rumored that would be interested in buying Peloton. Like you said, on the news, the shares went way, way up after hours and they're up pretty big today as well because of

that speculation going on. To me, it'll be interesting because I think especially for the big tech companies, I'm not sure how regulators would see that because it's still kind of in that same space, right? So I think probably Nike's the one that probably would have a best shot of getting it approved. I don't know what you think about that. I mean, there's a couple of good suitors for it. I'll be shocked if this deal actually goes through with Amazon. I don't see that actually happening.

But hey, if they could throw that on on Prime, if Apple was to buy it, the whole meme of Peloton being a stationary bike with an iPad on it could actually be a real thing. And then we'd go full circle in the internet meme. So, that would be fantastic. Yeah. I mean, if you're a shareholder, definitely of Peloton, unless you got in really at the IPO, you're hurting quite a bit. So I hope for any Peloton shareholders that it probably goes through or, you know, long term, if they stay as a standalone company, they kind of bounce back. But there's especially since the last thing I'm going to mention, anything will be dependent a lot on these insiders, because I was reading an article saying that insiders own about 80% of the stock.

So I think, obviously, if they're not willing to go ahead with a takeover, it won't happen. Fair enough. All right, let's get right into earnings season. There's so many companies to report on. We have for this episode, once again, like we did last week, partnered with the app Quarter. That's Q-U-A-R-T-R, Quarter without the E. And it is an app you can download on your iOS or Android device. And you get earnings calls on your fingerprints. When I first learned about it before they started working with our podcast, I couldn't believe that this didn't exist before. It's so good. Spotify for earnings calls is just the best thing ever. So thanks to them, we're partnering with them on this. So let's get into the meta

results. The best part about Q4, Simone, is that we like to talk about full year results. Q4, Simone, is that we like to talk about full year results. We are long-term investors, quarter over quarter. It doesn't always mean as much as the street puts that on, like the emphasis the street puts it on. Full year, year over year results is really important because it's long-term investors. This is tracking long-term fundamental business results. And that's really important. So Facebook, aka Meta, did $117 billion in revenue, an increase of 37% year over year. And I'm going through all these numbers. Facebook stock dropped 25% on the results. So let's get to that in a second. But earnings per share was up 36%. Free cashflow was $38 billion, up 67%. Monthly active users were up to 2.91 billion people on Facebook or Instagram. I guess that

includes the WhatsApp and stuff like that. An increase of 4% year over year. Now, this is where things get interesting, is CapEx spend is up a lot. R&D expenses up 34% compared to last year, 25 billion in R&D expenses. Now, average revenue per user is what Facebook does so good. ARPU, this is the number they dominate all of their social media apps. They had an ARPU of almost $41, which was up 28% year over year. They're able to monetize their users so well. And the fact that they're still growing that ARPU number at 28% year over year, incredible. Now, as I just mentioned, the stock dropped off a cliff on these results. On the surface, you hear growth of 36% on owner-spread share, and you're like, that's pretty solid. They're going to be able to delete the share count now that the stock is down a lot too

and reward shareholders over the little while. But the problem is that investors are now at a crossroads. And I've been talking with my analyst team quite a bit over Slack over the last couple of days since the Facebook report came out and updating our report on Stratosphere for Facebook, which is you must believe in the hundreds of billions, that's not an exaggeration, the hundreds of billions of dollars Zuck is going to throw at the metaverse investments this decade. I just mentioned 25 billion in R&D and 19.24 billion in CapEx for the year. Now, you have to believe that they are going to be throwing more and more money at the metaverse.

You have to believe in it because Apple is eating their lunch with iOS updates, not allowing them to target ads well anymore. And TikTok is giving them lots of competition for attention. And Zuck has talked about this a lot on the call. So meta is feeling the need to own the next computing platform and own their own destiny. There's too much risk that Apple can control them in the future. So let's pull up a clip here from Mark Zuckerberg talking about the ads business and the effect that Apple has on it. So next up is ads.

And with Apple's iOS changes and new regulation in Europe, there's a clear trend where less data is available to deliver personalized ads. But people still want to see relevant ads and businesses still want to reach the right customers. So we're rebuilding a lot of our ads infrastructure so we can continue to grow and deliver high quality personalized ads. Later in the Q&A section on the call, which you can skip right to on the quarter app, by the way, that's one of the better features. They said it's a $10 billion hit, they estimate from the Apple changes. I think the stock deserves to be down quite a lot, to be honest. I think 25% is pretty extreme. And we're seeing lots of knee jerk, huge swings on earnings results. But hundreds of billions in market cap erased in one trading day is not normal. I'm curious to hear what you think. But investors are at a crossroads.

That's what I'll say. No, I mean, I think you put it well. I think what Facebook is realizing is their core offerings, I think they may have hit a bit of a plateau, right? We're still seeing growth, but not as quick as we saw in previous years. And Zuckerberg is not, he's not stupid. I mean, I don't like him, but he's a smart guy. And I'm pretty sure a few years ago, he knew that Apple could do changes like this and

it could affect them in a big way. Obviously, it didn't happen. I think it was early in 2021, right, that were implemented. And there was a big war between Zuckerberg and Tim Cook. And Zuckerberg saying it would hurt businesses and so on. And Tim Cook was saying, well, you know, I think people should choose whether their data is being tracked or not. And now we're seeing a lot of people weren't sure how much it would affect Facebook. And clearly, And now we're seeing a lot of people weren't sure how much it would affect Facebook. And clearly, it does affect them quite a bit.

And I think that's why Zuckerberg has been really pushing the metaverse because he probably thought this was a possibility. Not 100% sure, but he was preparing for it to potentially come to this. And that's why he's been pushing the metaverse to really conquer a new space. I think that's the easiest way to put it because you said it. I think their social media platforms, I mean, obviously they're used super widely. What, a third of the world population is using them? But at some point you run out of users to grow and you have to look somewhere else to grow. And I think that's what they're betting that the metaverse will be this next platform. Yeah. They want to own the hardware side, right? Because we've seen what happens when you own the hardware side. That's what Apple got, right? Tim Cook is like

Thanos right now. The Facebook results came out and Pinterest and Snapchat, all the ad-based social media platforms just went spiraling off a cliff on their share price. And so you can see just kind of the effect that Apple holds. And what I think is interesting is Mark is going out and saying, hey, look, hey, look, regulators, listen to our earnings call. I'm talking about competition all over the place. Look at TikTok, look at all these other apps. And I'm talking about antitrust with Apple. And he's smart, right? He knows that he has been in the crosshairs of regulators for how long now? He's been been public enemy number one from antitrust regulators. And now he's saying, hey, look, they're eating our lunch. We do have competition.

And two, Apple can bully us out of basically anything that they want to. So I think he's smart to call some of those things out, even though in the short term, maybe his stock price suffers in the short term. Yeah, no, exactly. Like I was going to mention that last part that you just said. I think it probably will show regulators how much power Apple can have with an app store, right? They really, if they can affect the company as powerful as Facebook, can you imagine how much it can affect companies that are not as powerful as Facebook? So it'll be interesting what side of regulators kind of look at it. Are they happy that it's preventing Facebook from using that data? Or are they kind of scared of the power that Apple

has with the iPhone and like the App Store, essentially? Yeah, it Yeah. I could talk about this all day. It's such a wildly complex problem that the regulators have and it's going to be more and more important, this whole like privacy thing. And you know what? I'm going to just leave it at Facebook investors are at a crossroads. So they got to figure out what they want to own for the next decade. And the metaverse has to be a part of the investment thesis at this point. As do-it-yourself investors, we want to keep our fees low. That's why Simone and I have been using Questrade as our online broker for so many years now. Questrade is Canada's number one rated online broker by MoneySense. And with them, you can buy all North American ETFs, not just a few

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And if you are an index investor and haven't checked out their listings, I highly recommend it. I bet you'll be as pleasantly surprised as I was that BMO, the Canadian bank, is delivering these amazing ETF products. Please check out the link in the description of today's episode for full disclaimers and more information. Now moving on to a Canadian company, one that I know a lot of our listeners own, Lightspeed. They released their Q3 2022.

Before I get started on the results, obviously there was some big news that Dax De Silva would be resigned as CEO, but would be becoming the executive chair of the board with JP Chauvet becoming the new CEO. Before I get started, let's listen to Dax just explaining the reasoning, a little bit of the reasoning behind it, and just introducing JP Chauvet as new CEO. With regards to changes in the executive leadership team, I will be assuming the newly created role of executive chair. I'm focusing my time setting strategic priorities for the company at the board level and will be directly responsible for all ESG and DEI initiatives.

JP Chauvet, my longtime colleague and friend, has been appointed CEO. JP joined Lightspeed in 2012 as its Chief Revenue Officer. He became a board member in 2016 and was promoted to the role of President in April of 2016. JP has driven the company's M&A strategy, was instrumental for our listings on both the Toronto and New York Stock exchanges, and led the launch of the highly successful Lightspeed Payments offering. His vision and focus on execution has helped Lightspeed transform from a regional PO provider to a global commerce platform integrating suppliers, merchants, and consumers. As Lightspeed continues to execute on its mission and recognize its full potential, I can think of no one more qualified than JP to lead the company. So what I found interesting is that DAX will now be focusing more on the strategic vision.

Maybe it's because he's realizing that execution might not be his forte, and he's really using JP Chauvet to do that part that it's not something that he's particularly good at. I'm not sure. Like, I'm just speculating here. I don't know the exact reason for the change. Obviously, I'm sure they had some shareholder pressure because of the big drop that we've seen with Lightspeed over the last, what, six months or so since that short report came out. But JB Chauvet did mention something very interesting, is that they are a software company first. He did mention that specifically on the call,

and they know that some of their competitors are essentially giving out software almost for free to get revenue from the payment transaction. And Lightspeed really has no intention of doing that as they really believe that their software is a key differentiator. Now, the total revenues were $152.7 million. That's an increase of 165% year over year. They achieved 74% in organic growth in software and transaction-based revenue. Subscription revenue of $68.6 million, that's an increase of 123% year-over-year. Transaction-based revenue of $75.8 million, an increase of 249% year-over-year. And their gross margins were 51.7%, which was down from 57.8% last year.

Now, the net loss was $65.5 million, an increase of 53% year-over-year. Lightspeed did complete the acquisition of Equid on October 1st, so it means that the Equid revenues were there for the full quarter. Equid provided $7.8 million of revenues, part of that total of $152.7 million for the quarter. And they are burning a decent amount of cash. So we can see that boat on the cash flow statement and on the balance sheet. So their cash was down 18% compared to last quarter on a sequential basis. This is something I definitely would keep an eye on because growth companies like Lightspeed that are not cash flow positive, you really want to make sure you keep an eye on because growth companies like Lightspeed that are

not cash flow positive, you really want to make sure you have an eye on that because if they don't reduce the cash burn, eventually they'll come at a crossroad. They'll need more money. So either you issue more shares or you issue debt or a combination of both. So for the nine months that ended on December 31st, 2021, they were free cash flow negative to the tune of $84.6 million. So that's the nine-month period. And that's an increase of 18% compared to last year for the same period. So they're burning more cash.

JP Chauvet did say that they want to focus. It's a big focus on the path to profitability. It is a priority, but he did not give concrete details on that. But he said that he would in future quarters. So that's something I would definitely look for if you're a shareholder or you're looking to start a position. Because at some point you want to see a company like this start being profitable. So for me, I mean, overall, I think it's a good quarter for Lightspeed. I don't think it was bad. Obviously, the stock has taken a big hit. They're still trading at seven to eight times

sales roughly for this year's sale. And they actually also updated their guidance for the fourth quarter. So now they're guiding between 540 and 544 million in revenue versus 520 to 535 for the full year. So they've updated their guidance for the fourth quarter, but this is the total numbers for the full year. So slightly better than they were previously saying. So it's, I don't know, it's a mixed bag, I would say, for Lightspeed. I think overall the numbers look pretty good.

I don't know if the change in leadership will have a positive effect or not, but I don't think it's anything to be too worried about. If you're a shareholder, for me, I have them on my radar. I definitely will give them at least a few more quarters to see where this is going. And I want to hear a concrete plan from JP Chauvet about the path to profitability. The path to profitability has become... Holy grail. It's an old adage in Silicon Valley at this point. I guess the question is, at what point does this company actually have operating leverage? That's the question that I have

had for quite a while. And the growth is exceptional. Like if you look at the top line, even if you back out the acquisition growth, you're looking at organic growth of very solid, like almost doubled year over year on just organic growth for a software company and point of sale company at seven to eight times sales. That is fantastic. Like super cheap. Like the value on, on light speed is, is wonderful right now. So if, if you are like a contrarian investor and going, this thing was goofy at 25 times sales, but super interesting at seven times sales. I back that. I completely understand it. It has flew up our stratosphere rankings, even though there's been so much negativity on the stock. It is an unsexy stock to own these days. Let's not kid ourselves. And that's why it could be interesting. The thing that I always caveat that with is you have to catch falling knives. If you want to own something, you have to recognize that unless you bottomed it, unless

you happen to bottom tick a stock, it will be worth less than when you purchased it at some point during your ownership of it. Unless you bottom tick every stock you buy when you're trying to buy it at a better price, then that's always going to be true. Just keep that in mind that momentum can be a hell of a drug, both in the upward and negative direction. There's been so much negative sentiment on the stock. I could think, I would assume over the last few months, Dax De Silva has gotten very little sleep. You know, like this guy's been pretty stressed and maybe that you got to think that has a big reason to why he's stepping down. The guy's probably like, dude, I am so financially set no matter what. I built this multi-billion dollar public company. And I still think he has a lot of drive, but

he must be pretty stressed out. There was the short report, his stock fell so much. It's been just so much negative sentiment all over the place so maybe it gets bought and your bold prediction from earlier maybe that pans out yeah who knows i think for me i always come back to the thing i've mentioned before when he had an interview and he said like they're looking to become a mega cap company and i always had the feeling i mean i Dax overall, the way he talks and so on, but I always had the feeling that he was like, maybe he had his mind focused a bit too far in the future. Like he was skipping a few steps, right? There's a lot for Lightspeed to do before they even get into the conversation of being a large cap company, right? So I think maybe with him just being focused on the strategic direction and JP Chauvin on the operation side, maybe that's a good thing for Lightspeed.

We'll see. For me, it's still on my radar. I definitely want to see a couple more quarters, especially on that path to profitability. That'll be big for me. Let's talk about Alphabet, Google's parent company, Alphabet. Oh boy, what a quarter. The market loved this one. Revenue for the full year, so for almost all of these today, I'm going to talk about full

year numbers. Revenue was $257 billion, a quarter of a trillion dollars in sales. Can you imagine? Can you imagine like the original founders? And they're just like, yeah, I mean, they long exited out of the company now, but like, yeah, our company should $257 billion in sales. This was an increase of 41% year over year. Earnings per share of over $100 at $112 per share. An increase of 91%. Now, I will comment on profitability here. EBIT margins have actually been quite compressed for Google. So I think that that's going to improve over time though.

Free cash flow was $18.5 billion for the quarter. My God. Cloud revenue was 5.5 billion, which was up 45% compared to the same quarter last year, which is wonderful to see. Almost 50% year over year growth on the cloud business. YouTube ad revenue was $8.6 billion. This is an increase of 25% compared to the same quarter last year. For context, that is more than Netflix is doing on a quarterly basis in revenue. I really don't have much else to say other than core Google search is probably the best business ever created. And I know I say that so much on the podcast.

I'm like, this is the best business ever. Like I say it all the time. I said about ASML the other day, but Google search is just like a consensus best business ever. And then it has all this extra optionality on top of it with Google and I'm sorry, Alphabet. YouTube is a beast. The cloud is growing very fast. I think that's going to hit operating leverage pretty soon. That's going to actually be profitable soon and meaningfully contribute to profits relatively soon. Margins are a little depressed right now. It hardly matters. That's how much money they're making. The business is incinerating cash in other bets and it hardly matters. They have been bad capital allocators. I'm serious. They have actually been bad capital

allocators. And the Google search and ads business is so good that it doesn't matter. And it sounds ridiculous to say, but it's the truth. Man, this is my second largest position. When the earnings came out, it popped pretty good. I was happy to own it. What's not to like about probably the best business ever? Yeah, I mean, they've been tighter on the expenses for other vet ever since Ruth Porat came in as a CFO. So I think that's a good thing. I mean, the only bear case you can really make for Alphabet is that pretty much all the revenue, not all, but I think it's what a 90% tile is tied to ad, right?

So I think that's the only bear case. Can they get disrupted? I mean, I guess they can, but it'll be extremely difficult. I don't see, you know, them being disrupted anytime soon. They did mention too, I don't know if you heard that, but that YouTube revenue was affected a little bit by the Apple privacy on the iPhone, just like meta was effective. So that's something also to keep an eye on. But I guess because they do own Google search, right? I mean, they control the data there. So it's less likely for them to happen. But that's probably the only bear case is that 90% of their revenue is solely ad based. Yeah, it's like both the bull and bear case, I guess, depends on how you want to frame

it. Now they do pay Apple a considerable amount of money every year to make Google the default search engine on iPhone. And you could flag that as a risk for sure. I mean, think like the volume of search on mobile devices is higher than desktop. So you have to consider that as a fairly big risk. We consider it a fairly big risk. The question is, is Tim Cook Thanos going to go Thanos on everyone? That's the question. This guy has way too much power. Not much more for me to add other than excellent growth. 41% year over year for a company doing over $200 billion in revenue. It's like, what the hell? How is that even possible? Yeah. Now, moving on to another full year result, PayPal. It was a mixed bag quarter and year for PayPal.

So I'll go over the good, the bad, and I guess the ugly a little bit and explain why the stock dropped as much at 30% last week. Let's start with what was good. They achieved annual total payment volume of $1.25 trillion, which was the highest ever for PayPal and the first time they achieved over $1.25 trillion, which was the highest ever for PayPal and the first time they achieved over $1 trillion. They had a record 5.3 billion transactions in Q4 alone that was up 21%. They had 49 million net new active accounts to finish the year with 426 million active accounts, including 34 million merchants. And that's really important to take

into context because PayPal here is really a two-sided network effect because you need to have merchants, a lot of them accepting PayPal and obviously a lot of users. So it's very important to keep track of those numbers here. They added 122 million net new active accounts in the past two years, which is insane, but also shows that they probably had a lot of pull forward growth due to the pandemic. Their transaction per net account grew to 45, which was 112% year over year. Free cash flow grew 8.9% to 5.43 billion. Venmo had a quarter billion dollars in revenue for the fourth quarter alone. That was up 80% year over year. Keep in mind, when PayPal bought Venmo, it was not monetized at all.

So they're just starting to monetize Venmo here. And I don't know if people remember, but last year we did mention in our news, one of our news podcasts, that there was actually an agreement for Venmo to become available on Amazon later this year. So that'll be definitely a big tailwind for PayPal. Now let's look at what was not so good about the year.

And there were a few things. So the eBay transition was an issue, but it won't be for much longer. So it's been known for a while that eBay is transitioning away from PayPal. And before I elaborate a bit more on that, let's listen to Dan Shulman, the CEO of PayPal, talk about the impact that eBay had on the top line. With all that said, 2021 was also a difficult year. It was a particularly hard year to forecast. eBay's migration to manage payments happened faster than we anticipated. Overall, eBay put $1.4 billion of pressure on our top line, reducing our revenue growth by 700 basis points. So $1.4 billion impact on the top line for the year is not nothing, but it's also not something like half of their revenue. So you have to keep that in mind. But keep in mind that eBay volume was less than 3% for the fourth quarter versus 6% last year for the same quarter. So some of the other reasons that Dan Schulman mentioned on the call that were slower than expected for the fourth quarter, slower growth than expected. Supply chain issues that impacted some of their merchants.

Inflation pressures impacted some of the spending for their consumers. New COVID-19 variants impacted booking of travel and events booking, which is no surprise. Slower consumer spending during the holiday quarter versus industry expectation. And that is true. We did in the news item a few weeks ago that the December spending was actually flat year over year for the holidays and reduced spending due to the elimination of stimulus checks. You add that to the base effects versus last year and the tremendous growth that they have, it puts things a bit more into context. Despite that, PayPal grew their market share and met their revenue guidance for the quarter.

The guidance is really where I think the 25% drop came from on the day the earnings came out, especially the eBay part. First, eBay will put $600 million pressure on the top line in 2022, with $400 million of it coming in Q1 and the rest in Q2. Dan Schulman actually mentioned during the call that he's looking forward to the back half of 2022 so he won't have to talk about like comparing for ebay numbers anymore and saying like you know paypal is just so excited for this breakup like if you're the ceo of paypal how many times have you had to talk about ebay when it's just like give it up you know no i know and i mean i feel

for him because like throughout the call he's just like, oh, our revenue growth was this if we exclude the eBay portion and all that. So I do get that it's starting to weigh quite a bit on him. And the other reason that I think the market reacted pretty negatively on the stock is they now expect 15 to 20 million net new accounts in 2022. For context, they were saying that they were looking to reach 750 million accounts in the midterm. And now they're changing that. I mentioned earlier, their current account total was 426 million. So you have 15, 20 million to that. So you don't be around like 450 million

at the end of 2022, if they reach their guidance, what they're saying is they're essentially shifting from a strategy based on user growth to a strategy based on consumer engagement. What they're seeing is that the more consumers are engaged with their app, which they call a super app now, and I would not disagree with that, they spend and use the various products and services that they offer more. So they really are focusing on that. But I think the market was taken aback for both the eBay impact and this new change in direction from PayPal. they still had some pretty good guidance. So they want to enter 2023. So they think in 2022, they'll have over 20% in revenue growth. But they did mention there's a lot of unpredictable factors with the macro environment, which they cannot control. And I totally agree with that. So my final take here is, I mean, I added shares when it dropped.

here is, I mean, I added shares when it dropped. So I think, you know, it's something that I will keep an eye on. It's not kind of set it and forget it. I will definitely make sure that I listen to every earnings call next year and that really the new vision that they have is starting to show some positive sign of coming to fruition. This is the perfect explanation of the stock market if you're new. PayPal stock went up 250% from the bottom of March 2020 until the summer July of 2021, this past summer. It fell 60% since then and trades at the same price it did of like May 1st, 2020 in the spring of 2020. Since then, how much has total payment volume gone up? It's gone from what, like a couple hundred million to 1.25 trillion. They've added tons of, yeah, a couple of numbers and the business has become extremely profitable. They've gained tons of active users.

Venmo has grown their R and D efforts in the super app has increased. And so these are the facts, right? Now their stock did get, I thought it was pretty stretched this past summer. I was talking to my analysts. I was like, PayPal could be a trillion dollar company one day, but it seems a little stretch here. And it turns out it was like, but like, how am I supposed to really time that? But I had a hunch that it was a little stretch, but now you're going back to lapping the May of 2020 price and the business has gotten significantly better. This is your opportunity, right? This is your opportunity. And this is not

just like for PayPal. I mean, PayPal has struggles ahead of it, just like every other company does and difficult comps and how are they going to really gain monthly active users? These are the kinds of questions that are out there and exist, but this is what happens in the stock market. If you own individual securities, this is what happens. You focus on the business fundamentals like Simon did here in his little rundown And you get somewhere closer to the truth. But in that window of stock performance, the market is crazy inefficient. And that's just the reality that you got to be ready to feel with your wallet. Yeah. Yeah. And I mean, look, we saw the difference between the market's reaction between PayPal, Facebook, and say, Google, right? Google was up 10%.

Facebook and PayPal got completely slaughtered. The reason is that Google is firing on all cylinders, just beating expectations. Obviously, the market was impressed. It beat even the market's expectation. Whereas PayPal and Facebook, they're facing some headwinds at least in the short term and really the question for both businesses is if you're interested in them is this a short-term thing or is this going to persist longer term and if you think it's going to be just short-term and it won't persist long-term then you probably should very seriously consider starting a position if you have them on your radar. That's right. I think that there are so many good companies with a lot of negative sentiment right now. That is your opportunity. But the opportunities fade fast, man. They fade fast. They're there and then they're gone. There's no comment on PayPal,

by the way. Of course, nothing in this podcast is financial advice. Do your own research. But my gut feeling is there's some really good ideas out there right now. As do-it-yourself investors, we want to keep our fees low. That's why Simone and I have been using Questrade as our online broker for so many years now. Questrade is Canada's number one rated online broker by MoneySense. And with them, you can buy all North American ETFs, not just a few select ones, all commission free so that you can choose the ETFs that you want. And they charge no annual RRSP or TFSA account fees. They have an award-winning customer service team

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Please check out the link in the description of today's episode for full disclaimers and more information. Let's talk about Amazon, something that I've been thinking has been a fantastic idea recently. Haven't I been saying that? I've been saying that on this podcast. I said that I think, well, I also said on my bold predictions that it was going to be the best performing megatech. Now, the reason for that is because the stock has had negative sentiment.

And now it's like, oh, wait, they're still really good. So let's reward the stock. Now, net sales were $470 billion for the year. That's not bad. An increase of 22% year over year. AWS, it's the story here, man. AWS and third-party sellers and ads, this is the story people care about. Revenues of $62.2 billion, an increase of 37%. This now has a $71 billion run rate. Now they had a 40% growth on AWS compared to last Q4. That 40% growth rate is actually accelerating and is hard to believe. What an incredible business they have spun up. We were just talking about Google. We talked about Microsoft last week. Who would have predicted the three major cloud players would be built on these already gigantic businesses? And who thought in 2022 that they would be the major storylines every earnings season? Maybe not for Google, but for Azure and for AWS. And of course, Google Cloud is also one of the major storylines. But who could have ever modeled that? And that's why

it's really important to be able to pay attention to the facts and change your mind when presented with new facts. I think that that's my little recommendation. Now, they now operate 600 million square feet. This is something we graph on the Stratosphere Report for Amazon. And it's something that not a lot of people look at because deep buried in their 10K. It's on like page like 168. Like you're not going to find it on any press release. But 600 million square feet of space that they operate is a number that I actually, Simon, cannot comprehend. I can't either. I know it's huge.

Yeah, like how do you actually conceptualize that? You'd have to compare it to a piece of like land, like a country or something like that. Yeah. Yeah, yeah. I was explaining on Twitter. Oh, that would blow up on twitter well okay what i'll do is i'll i'll take a google like zoom in on satellite view of 600 million square feet and put it like against a comparable country you're welcome

yeah yeah thanks for that for when that goes viral check will be in the mail for you simon i was explaining speaking of twitter at br Bredo Capital, duh, follow me, duh, how their footprint has gone from 30 million square feet in 2010 to 600 million, just a little over 600 million at the end of 2021, now that we have their fourth quarter. I used to work at a manufacturing plant during one of my engineering internships back in the day at good old Magna Automotive. This manufacturing plant employed about 2,000 people. It was around 750,000 square feet, this facility, which is huge, by the way. This is one of their biggest facilities in Ontario, which is about like one third of their

manufacturing footprint. It took a while for me to walk from one end to the other side. This is 800 times that. So between AWS, third-party sellers and the ads business, all growing like mad. The fact is, AWS is maintaining a 40% growth rate just like over many years now. And so that's astonishing. And who could have predicted that out into the 2020s? Everyone would have underestimated it. And I probably think that we'll continue to underestimate it. I'm surprised you didn't mention that they're increasing the prime membership in the US from $119 to $139 per year. I wish you did my notes for me today because we've been talking about pricing power and how they're due for a hike. Exactly. A sizable hike

came, right? Yeah, but not for Canada. It's funny. Every time there's a hike, it's always in the US and Canada spared. But I feel like that won't last for very long. I would be surprised if they don't increase it. Real smart enough. Yeah, Canada in the next couple of years, but still a decent increase, right? Like 20, about 15, 20%. I think it's going to be like 180 bucks US if you pay monthly now. Yeah, I think you're right. I think I saw it. It goes from 1299 to 1499 on the monthly basis and then 119 to 139 on a full year basis yeah wow that's wild yeah that's a decent increase but i mean i don't think they'll lose that many people remember the stats i gave for costco and even amazon when

we did the pricing power episode and i think, when they get used to this service, even, you know, if we get back to normal and the pandemic is more of an endemic and the restrictions are all behind us. I mean, I still think a bunch of things, people will still want to have the convenience of it. You know, there's. Oh yeah, no, definitely. Yeah. Especially if like, dude, dude i tell you you give me

that lord of the rings series in september i'll be i'll be on prime baby i'm thinking about certain items but uh yeah the lord of the rings is good too they got something for everyone and my inner nerd is ready now moving on to another tech company now that we're i guess pretty much done the the big tech part of our portion actually before we move on remember when we were saying like big tech was firing on all cylinders just a few weeks ago and now it's uh it's a bit of a mixed bag huh well okay let's look at it microsoft crushed it google crushed it apple Google crushed it. Apple did well. It's just Facebook. I guess it is just Facebook. It's literally just Facebook. Amazon did well.

I guess PayPal's like somewhat big tech. Maybe not. Yeah, but they're not like the Fang. They're not like the Fang. That's right. Okay. Yeah. Maybe I exaggerated a bit there.

Well, if you do Fang, Netflix had a bit of a rocky quarter, but it's funny because they sold off like crazy. And then three days later, they recovered all their losses so true yeah that's how the market is a bipolar thing it swings like crazy these days and they're focused on the business fundamentals and netflix is a perfect example yeah and just you know i hope you like roller coaster rides because that's what the market has been recently. Just don't jump off a roller coaster and you never get hurt. That's it. Now, moving on to Pinterest. They had their full year results.

I had a few people tweet at me asking my opinion on them. They know I own them. It's not been a great investment since I started the position. I think I'm down like 40, 45%. But I mean, I'm starting to see signs of my investment thesis may be playing out slowly for Pinterest. But there's also some flags. So first of all, revenue increased 52% to 2.58 billion for the year. For the quarter, revenues increased 20% year over year. The US accounted for just over 2 billion of the revenues of 41%.. accounted for just over $2 billion of the revenues, up 41%. International accounted

for $562 million of revenues, up 110%. Net income was $316 million versus a loss of $128 million last year. Monthly active users were down 6% to $431 million. So this is where it gets a little tricky for Pinterest. It was down 12% on a US basis and down 4% internationally. And the reason why the US hurts here is because the ARPU, so the average revenue per user, was 2,198 for US,

up 43% year over year, and international was $1.59, which was up 80%. So you can see that the US is what, about like 15 times higher than international in ARPU. So that's definitely, I mean, it's good that the ARPU has been, they've been monetizing their user much more. And I think that was one of my, it was one of my investment thesis for Pinterest. The issue with them is the monthly active user. You don't want to see that going down. Obviously, you know, they'll never get to a Facebook level. I don't think that would be reasonable for Pinterest, but you want that to at least stabilize and hopefully increase a little bit.

If it can stabilize and even increase a little bit, then you really see their power to being able to monetize it. That will have an even larger impact. So that said, they were saying on the call that the US MEUs were impacted by easing of overall restrictions in the US versus the previous year, but also a change in Google's search algorithm. They said they were impacted by that. They're still studying that change to better understand the impacts.

It was also impacted by competing services, but they are investing more in shorter videos to mitigate that. They are seeing some early positive signs. Another good thing was that their gross margins were actually up to 79% from 73% last year. One thing that was very impressive was their free cash flow. They had $743 million in free cash flow versus $12 million last year. So that's a 60x increase. So that's pretty amazing to see. The guidance was lukewarm, I would say. It was okay.

A lot of unknown. So they expect that the pandemic unwind impact should ease this year. So essentially that hopefully, you know, the numbers of users that they've seen kind of go off the platform in terms of monthly active user will slow down because now a lot of things are reopened specifically in the US, of course. But competition plus the algorithm from Google could be a persistent headwind. So they expect Q1 revenue to grow in the high teens year over year. They also expect expenses to grow quite a bit, 10% year over year for the quarter. expenses to grow quite a bit, 10% year over year for the quarter. But for the full year, they think expenses will be around 40% higher as they invest in the business in some new content,

for example, in the short video forms that they're talking about to try and mitigate the impact of competitors. So I think it's still, I mean, it's dropped a lot in the past few months, Pinterest. So it's definitely come down in price. Like I said, I'm down about like 40, 45% on my investment. Yeah, it's not, it's not been great, although it's not. F in the chat for Simon. Oh, it's all good. I'm sorry to hear that. No, I mean, you make, you know, you, when you invest, you make bets. They might not always pan out. Of course, it's been about six months, so not even. So it's still very short term. I'll look to see what Q1 looks like.

I don't think I'll add to my position just yet. But if Q1 is sowing some good signs, especially from the unknowns that they were talking about, I might think of adding a little bit to that position. Definitely one thing I'll want to see is stabilization in those MAUs. Now, I'm curious because I would never own a stock this early in its maturation with declining MAUs, personally. I think that's extremely risky. Now, your investment thesis was an ARPU increase, which we're seeing. So part of your thesis is playing out.

So kudos to you. If Q1 or like, you know, year over year, say we lap this and we go 2022 full year results and full year, we see MAUs down another 5%, 10%. At what point, we don't talk a lot about selling stocks on this podcast because we buy good companies, hold them for a really long time, and don't really, like, we sell positions, but not that often. If MAUs are down 5% to 10%, again, what do you do? Just out of curiosity.

I think I would probably sell for the full year. I would give it the full year still, just because there's a lot of factors now in play. Well, especially the pandemic, right? They've been saying the pandemic played a big part, boosting their monthly active user, but then the opposite effect when things started reopening. So what I want to see really is stabilization, especially in the US. The US is the one I want to see stabilize. If I can see in the low, at worst down 1% to 2% at worst, or flat or up, that's what I want to see. Anything worse than that after all of 2022. Yeah, 2022. I'm still getting used to the years.

After all of 2022, if it's like 5% or worse for sure, I'm selling that. That would be a big red flag because last year I think they get a flyer. But now it's time for them to show that they can at least keep those MAUs flat, but possibly increase them. And especially in the US because there's such a big discrepancy on the ARPU US versus internationally. Yeah, I think that's a good call because we love to hold great businesses. But one, if we were wrong, or two, the story's changing. We're not married to them.

So I think that that's a good call. The ARPU up a lot is the main investment thesis because it's been so under-monetized. The thing with Pinterest, right, is like there might've been, there's obviously this like insurge of people who started using it over the last maybe two years. But we got to remember,

the platform is not for everyone. It's a crafty, artsy, their target market is not everyone. It's a select number of people. And it's a big, it's a huge TAM, but it's not Instagram. It's not everyone's going to have a Pinterest. And so I think you're right to call out like it can stabilize they ramp up that arpu for the people who love pinterest because there's people who love pinterest not everyone's going to be on pinterest it could play out really well yeah it was definitely a contrarian play right when i started a position so obviously you know if they were growing users five ten percent and growing and

it would have been over a hundred dollars a share probably like i'm just speculating but it would have kept going there and uh probably kept those high valuations but i'm still betting i use the platform mostly for cooking so that's what i use it for i also used it for my wedding to get some suit ideas with the bow tie and stuff so i've used it a little bit but i know it's predominantly women that will use the platform yeah their stats are probably like i'm just making this up but i'm gonna assume like over three quarters women are on are their active users yeah i don't know them by heart but it's predominantly women but uh anyways that's kind of the way I see it right now. I do have my eye on them. Like I said,

I'm not going to give them unlimited runway to run. They have to prove it to me this year. It's on a leash. I love it. Okay, cool. I'm just curious just for me. And I think it's useful for the listeners to hear us talk through that because it's important. Let's talk about Spotify, ticker SPOT. You might be listening on Spotify. They actually called out that they're the number one most used platform for podcasts. And there's all kinds of controversy, which I'm going to get to in a second. But let's talk about the business results. of controversy, which I'm going to get to in a second, but let's talk about the business results. Full year revenue was 9.6 billion euros. This is a Swedish company. An increase of 23% year over year. Monthly active users was 406 million people using the platform on a monthly basis, which grew 18%. It's kind of in line with this high teens, low 20% year over year

growth and 7% compared to last quarter, not like year over year, but to last quarter. Q4 premium users. So people who aren't subscribed and pay monthly are 180 million. Ad supporter users was 236 million. So that's the kind of the breakout there. users was 236 million. So that's the kind of the breakout there. Now, Daniel Ek, the CEO, who is awesome, by the way, I know there's been so much controversy on this business lately that everyone's heard about it. You know, I've had Neil Young remove his music. He said, if Joe Rogan's on the platform, I'm not on the platform. Now, everyone has their own opinion on this. So I'm not going to go there Now, everyone has their own opinion on this. I'm not going to go there. Everyone has already set up what their opinions are. Nothing I say

is going to matter. What I will say is, although there's a ton of negative press on Spotify, Daniel Ek is a stand-up, wonderful human. That's what I'll say. The CEO, the founder of Spotify, Daniel Ek, listen to him talk. He's gone on multiple podcasts, by the way. Listen to him talk. You can search up in Spotify or whatever, whatever. He is brilliant, absolutely brilliant, and a standup guy. He's doing his best to navigate this very tricky situation. I just wanted to caveat that because I respect him so, so much. All right, Spotify. So let's get to Dan X statement here. I thought that this clip was interesting. And again, you can go find these clips on the quarter app. Go ahead, download. It's free. You don't even have to make an account to start listening

to these, which I like right away. It's no friction. Give me some conference calls. Let's go. Where I try to focus my time. We're building a category-defining company, and this takes patience. And some may still describe us as the leading music subscription service. And while this surely reflects where we've been, it doesn't encompass all the advancement we've been making in audio.

And further, I don't think it properly captures all the future initiatives that we're working on either. It is as Jim Barksdale described, it's constantly about bundling and unbundling on the internet. He then went on to talk about their opportunity in the creator economy, and the big creator economy ahead that many of these huge global business to consumer apps and software are speaking about because they realize that it's a huge market. He said something that I thought was interesting, which is, we are building a category-defining company, and this takes patience. building a category defining company. And this takes patience. And it's true, right? Like the opportunity in audio is much bigger than just what it exists in today. And I truly believe in that. I really do believe in that. So it's more the same from Spotify. The stock dropped a lot

when they relatively had inline user growth. However, all the stocks that are getting punished right now on earning season are all about guidance. And they've talked about, you know, how do we keep growing at this rate? You know, we had this pulled forward pandemic. How do we keep growing at this rate? And the reality is, is that there's going to be somewhere in between. These companies aren't going to grow 50% year over year forever, right? And so this stock, given its gross margin expansion, is very interesting to me. Gross margins are the knock on the business. And the gross margin expansion over the last five to eight quarters is wildly impressive. It's gone from low 20s to high 30s in gross margin. And that's why it becomes interesting and the unit economics of

this business and the operating leverage kick in. And I think it's an interesting opportunity long term. Yeah. Yeah. Spotify is definitely interesting to say the least right now, especially with all the controversy surrounding, like you said, Joe Rogan and the Joe Rogan experience. Yeah. And I mean, they paid a lot to to have exclusivity with $100 million. Man, you know how long it was spread over? Oh, I forget. I was trying to find it as you were talking.

Yeah, I couldn't find the duration. Yeah, the duration because 100 million. I mean, it's fine. But if it's over 50 years, it's not that much per year you know i think it's four years that's what i just found here okay yeah 100 million for four dude 25 million dollars a year yeah that's like a all-star yeah hey spotify we'll take a million a year each yeah at spotify uh no i digress it's definitely interesting just to see what will happen for me i don't own it but i kind of rely on you to kind of know what's going on with spotify and the unit economics i find always interesting because it's different from from netflix too right

so it's just yeah it is it's an interesting comparison because they're in similar spaces, but they have different business models. The business models are actually very different given Netflix has all the upfront cost for creating the content. And then Spotify doesn't have any of that, but they pay out per stream, right? And it's kind of like YouTube where the creators on YouTube make all the content. So there's no CapEx requirement for the content creation on YouTube, but they pay it out. 55% of the ad revenue goes out to the creators. So they are much different. And the streaming and royalty business interaction with Spotify is wildly confusing.

Sometimes I have to go on Stratosphere and reread our report so I can like re-understand how all the dynamics work. It's not that straightforward, to be honest with you. Yeah. Now moving on to earnings that are not tech related. So Brookfield Infrastructure Partners, they had their earnings, was a very, very good year for Brookfield. Revenues were up 30% to $11.5 billion. I'll be talking a lot about FFO, so funds from operations.

Main thing to understand here is that it is essentially net income, but excludes the impact of some non-cash items like depreciation and amortization. For a full breakdown of how they define FFO, you can view their statements. It'll be in the footnotes. Now, FFO was $3.64 per unit. That's an increase of 16% year over year. I did a little graphic per segment they added, but I added the increase year over year. So utilities increased 6.98% year over year in terms of FFO. Transportation increased 18.81%. Midstream increased 70.24%. And I'll touch on that a little more. And data increased 21.43%. So those of you didn't know, they do own some data reads so that's why there's a data section here for one of their segment there's also the corporate segment but that one

essentially just loses money because it's all their expenses there's not really any revenues tied to that BIP also closed its acquisition of interpipeline on October 28 2021 so that would be a part of that increase year over year is definitely tied to that acquisition. They also increased their quarterly dividend by 6% to 54 cents per share effective next dividend payment, which will be on March 34th, 2022. The date of record is February 28, 2022. So if you want that dividend payment, you have to make sure you own the share by february 28 just make sure that you buy it i think usually it's like three business days three four business days in advance just for you to actually show as a shareholder it was just

another year of vip doing brookfield things they increased their dividend, like I mentioned, and they usually do in the 5% to 9% range. So they're right in there at 6%. They acquired a business that has historically produced very good cash flows in inter-pipeline. And the market was clearly down on pipeline stock. So whether you like pipeline stocks or not, that's besides the point here. Clearly, for me, I tend to not really own businesses that are in that space, but Brookfield has more than that. But it just shows that they look for value and they saw value in midstream and pipeline. So pipelines and midstream, it means the same thing. And that's where they actually decided to make an investment. So I can see that being a very good investment for them in the long term in terms of producing cash flows. They're both BIP and BEP are two of my largest holdings.

People know this on the podcast. And I know BEP has been down quite a bit, but BIP has been doing much better. And for both of them, I have some drips on. So dividend reinvestment plans. So every time I receive a dividend payment, I buy a couple more shares. So I'm just a happy shareholder and just been compounding for me for several years now. Why own super contrarian names in my own personal portfolio when I can just let Bruce Flatt do it for me. That's my investment thesis for Brookfield. I'm just going to write that and then stick to it. It's infrastructure, right? It's global infrastructure

and they're really good value investors. And hard real assets is a good place to be a value investor as well. I just want to add that in as well, because you can find great deals. And they are really good at it. So let them keep doing it. That's it for me. Yeah, I think they aim for, if I remember correct, I'm just going based on memory here, but I think they aim for about 10% to 15% total returns per year, right? I think that's a number that comes to mind. So basically, total returns per year, right? I think that's a number that comes to mind. So basically what it means is you won't see the stock double in a year. You won't see that. I mean, maybe a bit with BP with the whole renewable thing last year, I think it went up pretty high. And the shareholders have been paying for that lately.

Well, but the point of owning these businesses is really for the long term. 10% to 15% may not look like it's amazing when you see some of the returns that tech stock can provide sometimes. But when you compound that over 10, 15 years, you're getting some pretty sweet returns. If you can beat that 10% historical S&P return, you become hyper wealthy if you have enough time.

And that's like, don't let me tell you, punch it into a calculator. Don't let me tell you, experience it for yourself. I mean, if they could get a total return, I'll put my whole portfolio in. Of course, there's risk to every total return that they're aiming for. So there's no guarantee they get that. But if they do that, I'll put my whole portfolio in it. It already is like 10% of my portfolio. So that's bam, to be clear, the mothership. All right, last on the slate. We've done it, Simone. I just want to mention, before I was talking about Spotify's gross margins, I said they went from high 20s to high 30s. That is incorrect. I just want to

clarify it is high teens to high 20s in gross margin expansion. So it went from about 16% to 28% in the last couple of years. So still telling the same story, but I want to, before someone calls me out on Twitter, I just want to clarify my data here. All right, Unity, ticker U, the gaming engine, the gaming engine that pretty much lives in a duopoly with Unreal Engine, which is owned by Epic Games, which is owned by Tencent. Well, 50% of it's owned by Tencent. So the revenue top line was 1.1 billion, which is an increase of 44% year over year. They keep getting that over 40% year over year growth on the top line. You love to see it. Dollar-based net expansion rate was 140%. Again, they keep sustaining that

beautiful 140%, meaning the current customer base net of churn is spending more and more over a year. And there's no better metric to track this than calling out the customers paying over $100,000 every single year on their platform on the trailing 12 months, which increased 33%. So now they have over a thousand people or a thousand people, a thousand enterprises paying over a hundredK year over year on the platform. So a couple of things are happening. They're gaining new customer wins, and the current customers keep spending more and more on the platform, demonstrated by that 140% dollar-based net expansion rate. Now, I have said repeatedly that for a company trading at the price to sales multiples that it has historically traded at,

since it's been a publicly traded company, usually sits in with companies doubling their top line like every year for multiple years. If you're warranting that crazy nosebleed face ripping price to sales number. You're looking at other companies doubling their revenue year over year. And then unity here, you have like 40% typically is what they post every year. So that's a lot lower. However, the difference is, is unity. And I've been saying this repeatedly is I believe that they have a huge long runway and can sustain that for a lot longer than the other companies trading at those crazy prices. Now, this is not me saying it's a cheap stock. It's not a cheap stock. And that's why it was getting wrecked, but it

bounced up 20% on the news that they just posted on these financial results. So it's a fantastic company. The gaming engine is going to be more and more important as we all know. So I am a happy shareholder. It's a small position, but I'm a happy shareholder right now. Yeah, it's your play on the metaverse. Yeah. Well, I guess it is, isn't it? I mean, the gaming engine, dude. Yeah. I mean, to me it would be. It's sweet. Yeah.

The tech is sweet. Like I played around with it at my last job really quickly. And the stuff that you can do with the gaming engine outside of the core offering of gaming is what really gets me excited. offering of gaming is what really gets me excited. It's potential and optionality in other industries, in media and film and entertainment, in modeling 3D digital worlds for like industrial applications. This is happening. It's really happening. And that's where they're gaining a lot of excess growth as well yeah no not much to add there again that's when i mostly rely on you but uh looks like uh some pretty good numbers still pretty high valuation but i guess we'll have to see will unity or pinterest pan out that's

yeah let's do unity versus pinterest Two very different stories. All right, let's do it. Today's February 7th. Unity versus Lightspeed. Probably that would make a bit more sense. Yeah. Okay. All right. They're both, well, yeah.

Thanks so much for listening, guys, and coming along with us for maybe the longest, I don't even know how long it's been. Maybe the longest recording we've ever done because there's so much to talk about on earnings season. And every time we keep doing more and more notes, as I told you guys earlier, we had to do a new Google Doc for this show because we broke the old one. There was just too many graphs and too much writing that you literally could not open the Google Doc anymore because putting in the research and putting in the time for you guys. You should complain to Google, man. Yeah, dude. Get your cloud figured out. It's growing 45% year over year. Can't you put some excess bandwidth on the Google Doc? Come on. I'm paying $5 a month for G Suite. It's the least they could do. Thanks so much for listening, guys. Really appreciate it. This podcast is growing really fast and it is literally because you guys share it. And so,

if you guys can keep sharing it, give it a rating, give it a five stars. Dude, did you know we have over 700 five-star ratings on Spotify? And they just released that. Yeah, I think they we last time I checked, we had 500. But hey, it's growing very quickly. And we definitely appreciate it. We also try to engage as much as we can with you guys. I know we'll, we'll try to respond on Twitter. And of course, if you have questions, you can go to our, our website canadianinvestorpodcast.com. Just type it. You can send us an email and we will get back to you. We're a few weeks behind on the emails, but we do appreciate all the emails that we get. The email is getting hard to keep up with, but I promise you we'll get to you. Yeah, we get to all of them. It's just, again, I think we've mentioned it before. We just do this

part-time. If you catch us at the right time, though, sometimes I respond immediately, like within, like kind of like embarrassingly fast. Like I'll be on my phone and open it and I'll respond like, they're like, do you just respond to emails all day? But no, that's not the case. 5.0 stars on Spotify, 735 ratings, Simon. Thank you, everyone. We appreciate it.

That's pretty good. Thanks so much for listening. As always, you can go to stratosphereinvesting.com and check out the software company. You can find 10-year financial statements. No more of that 30-year financial statements crap. We don't want that anymore. Take care, guys.

Really appreciate it. Bye-bye. The Canadian Investor Podcast should not be taken as investment or financial advice. Brayden and Simone may own securities or assets mentioned on this podcast. Always make sure to do your own research and due diligence before making investment or financial decisions.