The Prof G Pod with Scott Galloway - Prof G Markets: Productive Congress, Social Media Earnings, Crypto Floor, and Cloud

Episode Date: August 1, 2022

This week on Prof G Markets, Scott discusses the market implications of a surprisingly productive week in Congress, parses the deeper meaning of social media’s mixed earnings season (hint: it’s TikTok), and ponders whether we’ve hit bottom in certain volatile equity sectors. Plus a deep dive on the most potent value creation engine of the era: cloud. Productive Congress https://www.cnbc.com/2022/07/28/china-competitiveness-and-chip-bill-passes-house-goes-to-biden.html https://www.bloomberg.com/news/articles/2022-07-27/what-s-in-the-manchin-schumer-tax-climate-and-energy-agreement?utm_source=google&utm_medium=bd&cmpId=google Social Media Earnings https://www.reuters.com/technology/google-parent-alphabet-posts-higher-quarterly-revenue-2022-07-26/ Crypto Floor? https://www.bloomberg.com/news/articles/2022-07-30/crypto-wallet-maker-ledger-seeks-new-funding-at-higher-valuation#xj4y7vzkg Cloud https://www.pcmag.com/how-to/what-is-cloud-computing Learn more about your ad choices. Visit podcastchoices.com/adchoices

Join Capital Group CEO Mike Gitlin on the Capital Ideas Podcast. In unscripted conversations with investment professionals, you'll hear real stories about successes and lessons learned, informed by decades of experience. It's your look inside one of the world's most experienced active investment managers. Invest 30 minutes in an episode today. Subscribe wherever you get your podcasts. Published by Capital Client Group, Inc. Support for PropG comes from NerdWallet.

Starting your credit card search with NerdWallet? Smart. Using their tools to finally find the card that works for you? Even smarter. You can filter for the features you care about. Access the latest deals and add your top cards to a comparison table to make smarter decisions. And it's all powered by the Nerd's expert reviews of over 400 credit cards. Head over to nerdwallet.com forward slash learn more to find smarter credit

cards, savings accounts, mortgage rates, and more. NerdWallet, finance smarter. NerdWallet Compare Incorporated. NMLS 1617539. This week's number, 17%. Chipotle's Q2 revenues increase year on year was 17%. Driven not by volume, but by price increases. Although I think I took volume up 3% just individually. People make fun of my cargo pants until they want a Phillips screwdriver or a pulled pork burrito bowl. Then the dog's cargo pants come in handy. Chipotle is inflation-proof. Why? Because it's an essential, bitches. Welcome to Prop G Markets.

Today, after a quick look at the headlines, we'll be discussing our take on Q2 earnings, what the numbers in streaming and crypto might be telling us, and we'll take a deep dive into the cloud business. Caroline, what's in the news? Another young person rolling through Prop G Media. Caroline, give us the insight from the Gen Z millennial entitled work from home generation. I am, in fact, the last millennial, 1996. Okay. So the headline news is the Fed raised interest rates and it's the second month in a row that it has increased rates by three quarters of a percentage point. As we know, this is an attempt to rein in inflation. We also got the official

word that the economy did in fact contract in Q2. GDP fell at an annual rate of 0.9%. That's the second quarter in a row that the economy shrank, which is a common indicator of a recession. Jerome Powell does not believe that the U.S. is in a recession. Here's a clip of what he said during the press conference last week. I do not think the U.S. is currently in a recession. And the reason is there are just too many areas of the economy that are performing, you know, too well. And of course, I would point to the labor market. Scott, any takeaways?

Technically, the definition of a recession is two consecutive quarters of GDP contractions. Most economists say that we are technically in a recession. The thing that makes me believe we might not go into a full-fledged recession, and this is anecdotal evidence, I am just blown away. My kids are staying with me right now in New York City. The terrible thing about that is I have to do things with them, Caroline. Just by the way, never have kids. Just don't have kids. Anyways, everything I do with them. There was a line. There's a line around the block to get in the Museum of Ice Cream, the Nike, Adidas stores, lines, on running lines, Stussy. It's amazing. If you walk around a city right now, and I think that's true of almost any city, it's just very hard to imagine we're going into a recession. Unemployment is at a 50

or low at 3.6%. There are supposedly three job openings for every one person looking for a job. And wage growth was up 5.2% in the second quarter. Now, keep in mind, and this is why we hate inflation, when inflation clocks in at 8.1% and wage growth goes up 5.2%, that roughly means that your life's getting 3% worse because you're not making as much money as shit is costing. This will go down as one of the great unknowns at this point, and that is, are we going into a real full-blown recession or not? Because there's a ton of indicators in each direction. This is definitely going to be a random walk here. We'll definitely be keeping tabs on this. Let's move on. Russia cut its natural gas supply to 20% capacity in Europe, and that's on top of surging demand for energy due to recent heat waves.

This has driven natural gas prices in Europe to five times what they were this time last year. Obviously, a lot of this flows from Europe's response to Putin's invasion of Ukraine. Do you think Europe will hold the line on sanctions and support Ukraine? Or are these energy prices going to be too much to handle? Well, first off, the EU deserves a lot of applause, commendation, praise, because for the first time, Europe is a union. This invasion of Ukraine, and I think this was a huge miscalculation on Putin's part, has unified Europe. Now, unfortunately, it's hitting them the hardest because they've developed a crack-like addiction and interdependence on Russian energy. Historically, about half of EU imported gas is from Russia,

or I think it's about 40%. If Germany has to totally wean itself off of Russian energy, you're talking about a guaranteed recession there. Europe's already fragile. June inflation was 9.6% year over year. The Kremlin said they're trying their best, which is total bullshit. They will leverage their position. Russia's core competence, as it always has been, is the willingness of the populace to endure suffering. And Putin knows this. We thought for sure that their integration economically into Europe would make them less bellicose. And we were wrong. And who it's hurting the most is Europe and specifically Germany. But again, let me finish where we started. Europe has shown that they are a unified continent. There is a European Union.

Well, heading over to where it's not so unified, the U.S., the Biden administration has seen some big wins over the past week. Two major pieces of legislation look like they're going to pass before Congress goes on vacation in August. We mentioned one of them on the show last week, the $280 billion Chips in Science Act of 2022. The other big bill focuses on climate change. It's a $360 billion climate and tax package that's expected to raise hundreds of billions of dollars in tax revenue to help fight climate change and reduce the deficit. What's your take when Congress passes these big multi-billion dollar bills? Will these spur economic growth or will we just see more cronyism? I love this bill and climate change is important. This elimination of inversions should create

about $300 billion in additional revenue that we can apply towards the deficit or towards the cost of these climate change initiatives. Supposedly, the bail is going to cut greenhouse gas emissions by 40% and get to below 2005 levels. I still think one of the misconceptions in our society is that two kids in a dorm in MIT are going to come up with some new technology that we can all buy the stock and get rich and solve climate change. No, we have made trillions of dollars pulling shit and liquid out of the earth and 90% of the buildings and things that have been constructed around you or the things delivered to you are a function of fossil fuels. Nothing has been the gift that keeps on giving economically as fossil fuels. And what do you know, when you have that sword

of economic prosperity, you're going to have externalities. And we are seeing the mother of all externalities based on a century of prosperity from fossil fuels in the form of climate change. I think this is great legislation. There's always cronyism. There's always shit put in there that you'd rather not see in there. But the key to governance is compromise. And I think this is great. I'm very excited about this. All right, that's a wrap on headlines. Let's bust into it.

Earnings season is well underway, and I'd like to get your thoughts on a few Q2 results. Companies that we've been keeping tabs on, including Snap, Twitter, Meta, and Google, have all reported, and the results go from pretty terrible to, well, okay. So let's take a look. Alphabet's second quarter profits were $16 billion, down from $18.5 billion last year. The core Google search business remains strong, but YouTube revenue is up just 5%, which is below analysts' expectations of 7% growth.

Over at Twitter, advertising revenue increased just 2% year over year below analysts' expectations, even though its monthly active users increased 17%. Meta posted its third consecutive quarter of declining profits. And finally, Snap, which seems to be the platform that can't catch a break, even though their revenue increased 13% year over year, it still managed to lose more than $400 million. The meta one, what really stood out or what was the kind of the seminal moment in this earnings season was that meta for the first time in its history made less money in this quarter than it did in the same quarter last year. We've never seen that.

And it remarks sort of a mature company and arguably a company in decline. Now, if you're the CEO of a company and you have a business that's maturing and you recognize that it's maturing, the right strategy is you take the profits from that mature business and you start plowing them into another business that will become your growth engine. Essentially, every company does this or every smart company does this. Amazon and Google and Microsoft, I would argue that their massive investments in their cloud offering has created an entirely new business line that is driving growth. Google is still losing a lot of money on their cloud efforts, but Amazon has a growth engine that is wildly profitable and Microsoft is huge in the cloud too. Now, what does Meta do? Okay, Facebook and maybe even Instagram are beginning to mature. We need a new growth engine. I know.

Let's go into the Metaverse. Clonk, thud, faceplant. This shit is not working. It's just not working. And we're seeing that they no longer have that growth engine. And at the exact wrong time, it looks as if we're having a bit of an advertising recession. Specifically, the earnings and revenues for all these ad-dependent digital marketers is either kind of anemic or down. Google still grew, but Snap literally shit the bed. Snap's

stock is down 80% year to date. Meta's 53%, Google 22%, Twitter down 8% versus the S&P down at 16%. And Twitter is really an anomaly here because of you know who. But if you look at Twitter's numbers, they grew their user base by 16%. But their revenues were down 1%, meaning their ARPU has taken it on the chin. What is ARPU? Average revenue per user. So in sum, they're not able to monetize their traffic and their users to the same extent they were this quarter last year. Is this a general advertising slowdown or are there other factors at play? What is really going on here? Every digital marketer from Meta to Snap to Twitter and even Google is having earnings calls that are meh to, oh my God, that's awful. Why? Why? Because what Netflix

did to Hollywood and what Amazon did to retail, TikTok is doing to digital marketers in the United States. That is the thing sucking the oxygen out of the air here. Everyone talks about a recession, but I think the thing that is really hurting this entire sector right now is TikTok. So is this a forward-looking indicator of a recession when advertising goes down? Maybe. Advertising is easier to cut than employee costs or projects or infrastructure expenditures. However, I would be interested in knowing if you included TikTok's revenue increases if we're really in an advertising recession. So speaking of TikTok, it's projected to do $12 billion this year. That's three times, 200% increase in 2021 revenue.

So these guys are flat or up 16%. TikTok up 200%. So that's $8 billion. It's got to come out of the ecosystem because advertisers aren't spending more. They're just taking money out of Snap, Pinterest, Twitter, and Meta. What's behind those revenues? Usage. Generally speaking, attention translates to

monetization over the medium and long term. Snap users spend about six hours a month on the visual platform. Instagram, eight hours. Facebook, 16 hours. Now get this, get this, TikTok, Caroline, 29 hours. That's just freaking insane. We have a billion people spending on average 29 hours. That's 29 billion. Take a 40-hour work week. I'm trying to do this in my head. What is that? 700 million years, person years of work? I mean, being spent on TikTok. This thing is staggering. And we're seeing the entire digital marketing ecosystem melt under the sun of TikTok. All right, let's move on to some volatile markets, streaming and crypto. Netflix, as we know, has been hit pretty hard this year.

Between January and June, the stock fell more than 70 percent. But its shares actually started to gain momentum after the company released better than expected earnings in July. Disney shares also started to pick back up again. The stock hit a low of $92 a share a couple of weeks ago, but has since climbed to over $100 per share. Even crypto, which we've been pretty critical of, is finally starting to see some positive news after several months of declining prices. Bitcoin and Ethereum have both rallied. Scott, I'm curious if you think it's possible that these volatile markets have hit the floor.

The honest answer is I don't know, although it does feel as if a floor has been set on Bitcoin. Also, Netflix, I think a decent argument was that it was oversold. It's still the original gangster and still by a decent margin, the biggest streaming network. I think they have about 230 million consumers. I think they have tremendous margin power. I know I'd spend a lot more for Netflix and I think just cleaning up the password sharing by some estimates, half the people that use Netflix aren't paying for it, but I think they're going to start tightening that up. The ad supported product from Netflix, I think it's a bad idea. I think core to the Netflix brand is uninterrupted storytelling. Having said that, what I have everyone is trying to launch subscription-based services.

And the amount of money, the amount of capital, both financial and creative capital that's gone into streaming has been unprecedented. So what happens in any market when it becomes overinvested? The returns go down. So when you have $220 billion globally and $140 billion domestically being spent on original content for subscription streaming services, what you have is a suppression in returns. And we've seen that. See above, Netflix down 72%. Are any of these streamers worth investing in? The streamers, I would argue, have probably been oversold. Disney's way down. Netflix is way down. Netflix, for the first time, is a potential acquisition target for a Amazon or a Microsoft or maybe an Apple. That would raise a lot of antitrust concerns. But again, it's not whether it's a

great company. It's not its growth. Well, actually, it is whether it's a great company and its growth, but this is all set against valuation. And if you like Netflix six months ago, well, guess what? It's on sale for 70% off. So I haven't looked at the numbers, but I think Disney especially feels like a good value right now. And if you look at Warner Brothers Discovery, it's been hammered pretty hard. And again, they have just unparalleled assets. HBO, the Warner Brothers franchise, even Discovery, you could argue, I mean, Shark Week, Shark Week, that's got, even Discovery, you could argue. Shark Week. Shark Week. That's got to be worth a couple billion dollars. To see little seals basking on the beach and little do they know what waits for them out in the dark, murky waters of death.

By the way, I'm such a badass. They named it Week After Me. Dog Week. Dog Week. On Monday, erectile dysfunction. On Tuesday, ed edibles on Wednesday, anger and depression. Okay, Caroline. Anyways, what's next? I'm lost. Where am I? Given how bullish you are on the podcast space, especially seeing how you host quite a number of shows, are there any investment opportunities in the audio space that you're seeing? To resist is futile.

We're everywhere. We're like AOL when they started sticking those goddamn discs in its cereal boxes. Anyways, first off, I think podcasting is about to go from 1.4 billion to 4 billion in the next three years. So it's growing really fast. Podcasting is the mother of all kind of winner take all. And that is the top 200 podcasts probably account for 98% of revenue, and there's 2 million, meaning you have to be in the top, not 0.1%, you have to be in the top 0.01%. The majority of podcasts are passion projects, delusional that they're ever going to make any money. So your question, how do you make money? The only place I can really figure is a direct play is probably Spotify, who's gotten much bigger in podcasts. They do a really good job distributing

podcasts. It's a very sortable platform. When we left Spotify, we overnight lost about 12% of our downloads, which really hurt. So I'd say Spotify, the company we work for or distribute through Vox is a private company, so you don't get to invest there. So there really aren't a lot of ways to play podcasts. Let's talk about crypto. Has a floor been set? I don't know, but it definitely feels like one has been set in Bitcoin. I think it hit $18,000. It's up substantially since then. ETH has really ripped up off 80% since it's low. You're going to start seeing people talking about percentage up from its lows versus percentage down from its 52-week high. There is an optimistic sign

here. Personally, the only investment I have in crypto is with a cold storage hardware wallet called Ledger. On Monday, Ledger released 10,000 MarketPass NFTs that will grant priority access to their new marketplace platform. And what happened? All 10,000 were sold out within 24 hours on OpenSea, generating $4.2 million in sales. This was the greatest volume of any NFT collection. So what does this say to me? That for all the criticism and all the rhetoric about NFTs were a scam and going to zero, that's clearly not true. There's still clearly a lot of interest. I'm a big fan of NFTs. Why? I believe that signaling is increasingly moving online. How do you signal online?

With a drunk ape or a Chanel logo or my kids buy skins on Fortnite. There's an entire generation of people that are comfortable with spending money on digital goods. So NFTs, the rumors of their death have been greatly exaggerated. Do you think you're ever going to invest in a cryptocurrency? I'm a no-coiner. NFTs, the rumors of their death have been greatly exaggerated. Do you think you're ever going to invest in a cryptocurrency? I'm a no-coiner. I love fundamentals. With tokens, there's no underlying cash flows. There's no rights to the intellectual property or assets of a company.

So I have a difficult time valuing these things other than looking at their trading history. Oh, Bitcoin hit $68,000. Now it's at $20,000. I do think Bitcoin has utility as a store of value, but I just never have the confidence to buy something without having some sort of valuation benchmark or fundamentals that I can construct and say, okay, relative to its peer group, based on its growth, its margins, its cash flows, I think it's expensive, inexpensive, fairly priced. None of that is here. So I just don't have the competence to invest in these things.

Yeah, I wish I had that same intel because I've lost pretty much everything I've invested in crypto. Thanks for that, Scott. We'll be right back after this break with more of the latest markets news. The Capital Ideas Podcast now features a series hosted by Capital Group CEO, Mike Gitlin. Through the words and experiences of investment professionals, you'll discover what differentiates their investment approach, what learnings have shifted their career trajectories, and how do they find their next great idea? Invest 30 minutes in an episode today. Subscribe wherever you get your podcasts. Published by Capital Client Group, Inc. Support for this show comes from Constant Contact. You know what's not easy? Marketing. And when

you're starting your small business, while you're so focused on the day-to-day, the personnel, and the finances, marketing is the last thing on your mind. But if customers don't know about you, the rest of it doesn't really matter. Luckily, there's Constant Contact. Constant Contact's award-winning marketing platform can help your businesses stand out, stay top of mind, and see big results. Sell more, raise more, and build more genuine relationships with your audience through a suite of digital marketing tools made to fast-track your growth. With Constant Contact, you can get email marketing that helps you create and send the perfect email to every customer, and create, promote, and manage your events with ease,

all in one place. Get all the automation, integration, and reporting tools that get your marketing running seamlessly, all backed by Constant Contact's expert live customer support. Ready, set, grow. Go to ConstantContact.ca and start your free trial today. Go to ConstantContact.ca and start your free trial today. Go to ConstantContact.ca for your free trial. ConstantContact.ca Welcome back to Prof G Markets. Amazon, Microsoft, and Google all announced earnings this week, and every announcement included a comment about their cloud business units. Amazon and Microsoft are now generating $100 billion annually.

At Google, cloud revenue is poised to surpass revenue from YouTube. All three are growing at 30% or more per year. So we wanted to know what exactly is the cloud business? Why is it growing so fast? And why are these three very different companies so dominant in this space? That's the subject of this week's Deep Dive with our editor in chief, Jason Stavers. For a good definition of cloud computing, let's start with how Amazon itself describes the business. Cloud computing is the on-demand delivery of IT resources via the internet with pay-as-you-go pricing. Instead of buying, owning, and maintaining physical data centers and servers,

you can access technology services such as computing power, storage, and databases on an as-needed basis from a cloud provider like Amazon Web Services. That's the basic idea. Instead of owning and operating your own data center, you let the cloud company do it for you. But there's something critical in that description I want to highlight. Cloud computing is not renting computers or even space in someone

else's data center. It's renting technology services. The customer simply says, I need to store some data. I need to run some analyses. It's up to the cloud provider to provision sufficient space and computing power to deliver that service. And since customer needs vary day by day, even minute by minute, the cloud provider can efficiently deploy its hardware to whichever customer needs it at that moment. And not just its hardware. There are a number of economies of scale because the cloud provider can invest in security, in redundancy, and other common needs across its entire customer base. So cloud services are an obvious fit for corporate computing needs like inventory management or HR. But cloud computing is now also being used for all kinds of computing tasks.

For example, NASA uses Amazon's cloud to store and analyze the data that it gets from its Perseverance Mars mission. And cloud computing powers a lot of the consumer services we are familiar with. Spotify uses Google's cloud services to host and distribute its audio streams. Fortnite runs on Amazon's cloud. And LinkedIn, not surprisingly, runs on Microsoft's.

Is it mainly economies of scale that give cloud computing the edge over owning your own computer infrastructure? That has historically been true, and a big part of the reason that cloud became so popular. It's an easier, more efficient way to obtain computing services. But there are also two underlying shifts in the technology ecosystem that are fast making cloud the only option for the majority of computing applications. Behind the scenes of modern computing is a huge array of tools that we don't see, but are essential to the services we use. So for example, a service like Twitter uses literally dozens of different software packages and systems for storing tweets, creating the timeline, serving ads, storing user data. And

increasingly, the developers of those products are designing them to be cloud native. So if you want to use the latest analytical algorithms, the latest security services, and other cutting-edge tech, you have to be in the cloud. The other thing that's happening is that more and more software is being delivered not as a software package at all, but through a model called software as a service, which means the software runs in the cloud and users access it either through a web browser or through a simple app. So Gmail and Google Docs are really good examples of this model, but so is Slack and Zoom and all of our social media products. Dozens of companies are using the flexibility of the cloud to sell their software, not as a packaged piece of software that you buy and put on your own computers, but simply as a service you access through your browser. So some of the largest players in this space, like Facebook and Salesforce, they still run

their own data centers. Facebook has huge data centers, so does Salesforce. But new entrants increasingly don't bother to do that. They don't need the capital investment. They just rely on own data centers. Facebook has huge data centers, so does Salesforce. But new entrants increasingly don't bother to do that. They don't need the capital investment. They just rely on the big three cloud providers. And even the big giants, including Facebook and Salesforce, are starting to shift more of their own computing needs over to third-party cloud providers. It looks like Amazon, Microsoft, and Google dominate this business. How have they taken such a large share? In the US and Europe, they are nearly the only players in the market.

In Asia, especially in China, Alibaba and Huawei have significant share, but otherwise it's the big three. And the short answer to how they've done that is money. It takes billions of dollars to build and maintain these huge data centers, and there just aren't that many companies with the capital to do it. Amazon and Google have the additional advantage of being in data-intensive businesses already. Both of their cloud businesses are built on the back of

internal capabilities that they've turned around and sold to customers. There are some pretty significant differences between the three, however. Amazon was the first to make a serious move into this space, and from the beginning, its service has been geared towards technically inclined buyers, Silicon Valley startups and other tech companies with deep internal engineering capabilities. And also Amazon has continued to invest in their business.

They've actually gone so far as to develop their own custom chips that run its data center servers. Microsoft has come along and established itself in a strong second place to Amazon, but it's built its business differently. It's focused on corporate America, where it already has deep relationships,

and it's made sure that its services are easier to use and that they integrate easily with Windows and Microsoft's other software packages. So both Amazon and Microsoft, their cloud businesses are highly profitable. Google is the odd one out here. It has the smallest cloud business of the three at only $6 billion in revenue for the most recent quarter, and it loses several billion dollars a year. Now, Google claims that these losses are simply the result of investing in a growing business. And internally, it's told its teams that it expects Google Cloud to be

profitable by the end of the year. But the truth is that while Google pioneered a lot of the advanced technology that's used to run these massive data centers, it has failed to convert that leadership into a cloud service that has the same general purpose capabilities as its two competitors. And so it's been forced to compete on price. Its largest customers are companies that are biased towards lower margin data storage. So its largest customers are Apple, TikTok, and Spotify, which all store hundreds of petabytes of data on Google services, but don't use it for a lot of the same compute applications that Microsoft and Amazon customers do. Scott, you've been saying for a while that Amazon's cloud business could become the most valuable company in the world.

What do you think the future holds for these cloud companies? Well, simply put, the future is bright. And AWS, I believe, will be the most valuable company in the world when it's spun as an independent company or that the FTC demands that it be spun. So there's a lot of growth here.

Cloud has been growing at 35% per year and is projected to continue growing at 20% to 30%. Also, as you can imagine, the margins are great. COVID was real wind in their sails, whether it was watching Netflix or work from home. All of these things require additional cloud computing. So when you think about it, the operating system for all computing is the cloud. There's also additional growth sectors within the cloud. In addition, in our economy, our creativity around applications for data, our consumption of data have always outpaced the supply. This was the gangster move. I would argue Microsoft and Amazon,

absolutely. And probably over time, Google made the right call by reinvesting cash flows from their maturing businesses into the cloud. And this business is big enough to support the growth that these companies and their stock prices demand. If you think about the three businesses these big tech companies need to go into because they're so huge, it's one, automobile, big business, used to be low margin. Now it's a big business. It's higher margin, mostly because of Tesla. Two, healthcare, $4 trillion business. We're going to see Amazon go into that. We're already seeing them go into that. And then finally, cloud, an enormous business, and all three are already in that. What is the big thud here? What is probably the biggest strategic misstep of the last five years? Was Meta deciding that the new growth engine would be the Metaverse? No, it's not.

Doesn't matter what the name of your company is. This is not working. All right. Let's take a look at the week ahead. From a macroeconomic perspective, it's all about the labor market this week. New job and job quits on Tuesday, jobless claims on Thursday, and labor force participation on Friday. Earnings season continues, and we'll hear from Activision, Starbucks, PayPal, Airbnb, Toyota, Moderna, and CVS. Scott, any predictions for the week? My prediction is we're going to continue to see earnings beats. So about 20% of the S&P has reported earnings so far this quarter, and on average, about two-thirds of them have beat

earnings. I think recession fears appear to be so far a bit overblown. I think we're also going to see increased activity over the next several months in the online health market. With the acquisition of One Medical, Amazon is not just attacking, but breaching. I think essentially this is the starting gun that's just been fired, Amazon's acquisition of One Health. That's it for Prop G Markets. We're all meeting as a team tonight. I think it's important that you articulate a mission. Our mission is to help young people be more economically and emotionally viable. It's important in a capitalist society to be economically viable such that you can focus on the things that matter, and that is deep and

meaningful relationships. We hope you are achieving that. I am off to Zero Bond where I will drink Makers and Ginger and celebrate that I've been able to aggregate a bunch of young people that are more talented than me and wallow in my douchiness

with other douches at a members club in Soho. Yay for the dog! We'll see you next week. at work? The answer to that question is probably more complicated than you want it to be. The average US company deploys more than 100 apps, and ideas about the work we do can be radically changed by the tools we use to do it. So what is enterprise software anyway? What is productivity software? How will AI affect both? And how are these tools changing the way we use our computers

to make stuff, communicate, and plan for the future? In this three-part special series, Decoder is surveying the IT landscape presented by AWS. Check it out wherever you get your podcasts. Hey, it's Scott Galloway, and on our podcast, Pivot, we are bringing you a special series about the basics of artificial intelligence. We're answering all your questions. What should you use it for? What tools are right for you? And what privacy issues should you ultimately watch out for? And to help us out, we are joined by Kylie Robison, the senior AI reporter for The Verge, to give you a primer on how to integrate AI into your life. So tune into AI Basics, How and When to Use AI, a special series from Pivot sponsored by AWS, wherever you get your podcasts.