Instant Reaction: Alphabet, Microsoft Beat Estimates

Bloomberg Audio Studios, podcasts, radio news. 0:00:07.680 --> 0:00:11.520 Chairs of Alphabet just soaring in the after hours right now, 0:00:11.560 --> 0:00:15.880 Carol Hire after the company reported earnings up as we speak, 0:00:16.320 --> 0:00:20.079 another thirteen point six percent in the after hours right now. 0:00:20.239 --> 0:00:23.920 This after declaring a dividend, boosting a buyback, authorizing repurchase 0:00:23.960 --> 0:00:26.400 of up to an additional seventy billion dollars and shares. 0:00:26.680 --> 0:00:30.840 First quarter ad revenue coming out above expectations first quarter, 0:00:31.080 --> 0:00:33.760 also declared it cash dividend of twenty cents per share. 0:00:33.800 --> 0:00:35.600 All right, so let's get to it. James chalk Mak 0:00:35.720 --> 0:00:38.960 so much to talk about. He's partnering technology analyst at 0:00:39.000 --> 0:00:42.160 Clockwise Capital. He joins us from Miami. First of all, 0:00:42.200 --> 0:00:45.880 Alphabet feels like I can't find anything wrong here. Walk 0:00:45.960 --> 0:00:48.040 us through. Is this just kind of firing and all 0:00:48.400 --> 0:00:50.239 cylinders and if you will, and then just throwing on 0:00:50.280 --> 0:00:53.199 a dividend and then throwing on an additional buyback. 0:00:54.880 --> 0:00:58.160 Yeah, First, thanks for having me. You know, for Alphabet, 0:00:58.320 --> 0:01:01.040 this was a tough one. You know, we had the 0:01:01.080 --> 0:01:04.560 meta earnings last night, you know, uncertainty as it relates 0:01:04.600 --> 0:01:07.160 to the sustainability of the top line growth metrics, and 0:01:07.240 --> 0:01:12.240 obviously Alphabet via Google had, you know, uncertainties around their 0:01:12.280 --> 0:01:14.440 search business, and at the same time you had this 0:01:14.480 --> 0:01:16.360 growth and capex spend. You know, is that going to 0:01:16.400 --> 0:01:19.039 translate over? So you know, we were kind of debating 0:01:19.040 --> 0:01:22.840 what to do and going into the quarter. We actually 0:01:22.959 --> 0:01:28.000 rotated a portion of our Microsoft position to triple up 0:01:28.040 --> 0:01:31.200 our Alphabet position. But thankfully that worked out. But I 0:01:31.280 --> 0:01:34.320 tried to see you for Google. Yah, well yeah they're 0:01:34.319 --> 0:01:36.080 both out, so yeah, I mean it worked out. 0:01:36.520 --> 0:01:38.080 So why did you do it? What was it that 0:01:38.120 --> 0:01:41.640 you saw, James in the in the Alphabet story that 0:01:41.680 --> 0:01:42.840 you said you wanted to do that. 0:01:44.600 --> 0:01:47.160 Well, the main thing was the relative valuations. I mean, 0:01:47.560 --> 0:01:52.360 the expectations for Microsoft were exceedingly hot and the expectations 0:01:52.400 --> 0:01:56.480 for Alphabet were exceedingly low. And you look at one 0:01:56.520 --> 0:01:58.360 t trading at twenty two times earnings and the other 0:01:58.400 --> 0:02:00.960 ones at thirty five times earnings, So you know what 0:02:01.080 --> 0:02:03.120 kind of the risk reward is. And especially we had 0:02:03.120 --> 0:02:06.560 some sense of how things might trade if they came 0:02:06.600 --> 0:02:11.000 in on a bear because kind of narrative given how 0:02:11.080 --> 0:02:14.480 Meta traded. So it really just boils down to that. 0:02:14.840 --> 0:02:17.880 But the fact that Microsoft was able to exceed those 0:02:18.000 --> 0:02:21.640 nose bleed expectations in the testament to the trends and 0:02:21.680 --> 0:02:24.600 the force of trends that we're seeing in the in 0:02:24.639 --> 0:02:27.799 the shift of the cloud and AAI. More broadly, Hey, 0:02:27.800 --> 0:02:28.240 I just want. 0:02:28.160 --> 0:02:30.920 To get your thoughts on Snap, because the company you've 0:02:30.919 --> 0:02:31.959 been covering for years. 0:02:32.120 --> 0:02:34.880 I would love to ask about that there through. 0:02:34.680 --> 0:02:37.079 The good and the bad well. And the reason I'm 0:02:37.080 --> 0:02:40.160 asking is because shares are up, wow, surging as we 0:02:40.240 --> 0:02:44.560 speak by more than twenty percent, twenty five percent at 0:02:44.960 --> 0:02:48.520 this point. This is after the company reported. 0:02:48.240 --> 0:02:50.320 They are down thirty here today they are. 0:02:50.440 --> 0:02:54.600 That's important context, Chris. The company is seeing second quarter 0:02:54.680 --> 0:02:57.120 revenue from one point two to three billion to one 0:02:57.120 --> 0:02:59.480 point twenty six billion versus estimates of one point two 0:02:59.520 --> 0:03:02.000 one billion dollars. As Carol mentioned, it's been a brutal 0:03:02.080 --> 0:03:04.120 year so far for Snap. How are you reading into 0:03:04.160 --> 0:03:06.200 these results? And do you still you don't own Snap anymore? 0:03:06.200 --> 0:03:07.560 Do you? 0:03:07.639 --> 0:03:11.720 No? No? Not for a long time. You know with Snap, 0:03:12.160 --> 0:03:14.160 you know, they were supposed to be the camera company 0:03:14.240 --> 0:03:20.480 and transformed into you know, it's exactly what they were initially, 0:03:20.520 --> 0:03:23.840 you know, just messaging in some content initiatives. But at 0:03:23.840 --> 0:03:25.639 the end of the day, you know, I think it's 0:03:25.680 --> 0:03:28.680 really really hard for these niche platforms to scale in 0:03:28.760 --> 0:03:32.239 the manner in which is necessary to provide differentiation to 0:03:32.720 --> 0:03:36.880 advertisers and the return objectives and return enhancements on the 0:03:36.960 --> 0:03:40.280 on that ad spend. So I think that the disparity 0:03:40.760 --> 0:03:44.839 between these niche platforms like a Snap versus the likes 0:03:44.840 --> 0:03:47.680 of Alphabet and Meta will only increase from here. The 0:03:47.760 --> 0:03:50.800 caveat being that you have companies like Pinterest, which we 0:03:51.000 --> 0:03:54.240 used to own but sold, you know, just given the 0:03:54.280 --> 0:03:57.040 fact that they hit our target. You know, I have 0:03:57.320 --> 0:04:00.760 more opportunities because of the engagement that they've bring that 0:04:00.880 --> 0:04:03.760 is likely to grow over time versus you know, stick 0:04:03.800 --> 0:04:08.200 to more static rates, which is from the likes of Snap. 0:04:08.240 --> 0:04:10.120 All right, we've got to go back to Google. Forgive 0:04:10.120 --> 0:04:12.200 me Alphabet. I keep calling it Google, but I mean 0:04:12.200 --> 0:04:15.320 your first alphabet. I know, I know, up twelve and 0:04:15.360 --> 0:04:17.840 a half percent here, folks, in the aftermarket, this stock 0:04:17.920 --> 0:04:20.479 heading into it had about a twelve percent gain on 0:04:20.600 --> 0:04:23.200 the year here in twenty twenty four. The stock was 0:04:23.279 --> 0:04:27.040 up almost sixty percent last year. But you know, when 0:04:27.360 --> 0:04:31.200 when you look at Alphabet James, and you look at 0:04:31.200 --> 0:04:34.520 its business lines and its roles and it's play, whether 0:04:34.560 --> 0:04:37.279 it's AI, whether it's still advertising in a big way. 0:04:37.720 --> 0:04:39.680 You know, our own man Deep Singh saying, you know, 0:04:39.720 --> 0:04:44.240 this company is all about engagement. That's kind of so valuable, 0:04:44.640 --> 0:04:46.960 and that's going to be valuable certainly in terms of 0:04:47.040 --> 0:04:50.520 machine learning and jen Ai. This is really important stuff. 0:04:50.920 --> 0:04:53.960 I mean, how do you think about you know, Alphabet 0:04:54.160 --> 0:04:57.320 in kind of its future growth trajectory and kind of 0:04:57.320 --> 0:04:59.040 where it goes from here. I mean, these are this 0:04:59.120 --> 0:05:01.960 is a pretty impressive report, but it's also right appeasing 0:05:02.000 --> 0:05:04.600 investors of saying we're going to throw some cash back to. 0:05:04.560 --> 0:05:10.000 You absolutely, I mean any anything with respect to returning 0:05:10.040 --> 0:05:13.719 capital to shareholders or you know, getting religion on the 0:05:13.720 --> 0:05:16.839 cost side of their business and utilizing their cash flow 0:05:17.200 --> 0:05:21.719 for more constructive purposes rather than throwing it into black holes, 0:05:21.760 --> 0:05:23.840 which is the way that they have been operating for 0:05:24.279 --> 0:05:26.680 as long as I can remember that being said. I 0:05:26.680 --> 0:05:29.359 think that the future for Alphabet and Google, you know, 0:05:29.560 --> 0:05:32.880 is still remains a question mark. We don't know, and 0:05:32.960 --> 0:05:36.159 I don't think anyone can definitively say what that search 0:05:36.240 --> 0:05:39.440 environment experience is going to look like in the future. 0:05:39.560 --> 0:05:41.599 You know, when if you look out five years down 0:05:41.600 --> 0:05:43.680 the road. Now. The good news is all of this 0:05:43.720 --> 0:05:46.240 stuff seems to be like coming at you fast right 0:05:46.320 --> 0:05:49.760 all the AI. It's over the Since January of twenty 0:05:49.760 --> 0:05:53.039 twenty three, it's been coming hard and fast. But the 0:05:53.080 --> 0:05:55.880 good news is on the on the behavioral aspect and 0:05:55.960 --> 0:06:00.560 the consumer experience. You know, things have changed which GPT 0:06:00.680 --> 0:06:03.680 and whatnot, but things aren't changing that fast overnight, which 0:06:03.720 --> 0:06:07.960 affords Alphabet time to really figure things out, whether it's 0:06:07.960 --> 0:06:11.560 cannibalistic to their existing search business or not. You know, 0:06:11.760 --> 0:06:14.280 I think we have time. So I think extrapolating too 0:06:14.360 --> 0:06:18.560 much too soon is a risk, you know, so as 0:06:18.560 --> 0:06:21.120 long as they can they have the time, they might 0:06:21.200 --> 0:06:23.400 figure it out. They may not, but they might. But 0:06:23.480 --> 0:06:26.040 I look into twenty twenty four and twenty twenty five, 0:06:26.360 --> 0:06:26.800 that's it. 0:06:27.000 --> 0:06:32.000 Could Critics argue about Alphabet that declaring a dividend and 0:06:32.000 --> 0:06:35.719 boosting a share buyback potentially isn't the best use of 0:06:35.760 --> 0:06:39.840 money right now. Perhaps they should be investing more in AI. 0:06:40.000 --> 0:06:43.320 Perhaps they should be investing more and making sure this 0:06:43.400 --> 0:06:44.880 search product is bulletproof. 0:06:47.360 --> 0:06:50.080 Yeah. I mean they're throwing off tremendous amounts of cash 0:06:50.360 --> 0:06:53.839 as it is, and they're investing a lot, and and 0:06:53.920 --> 0:06:57.560 you look at the margin disparity versus a meta you know, 0:06:57.640 --> 0:07:03.040 they have a lot of cushion there, so and they're investing, 0:07:03.680 --> 0:07:07.600 you know, strongly as well. So I don't think it's 0:07:07.680 --> 0:07:14.080 utually exclusive. So long as the ball continues to move forward, 0:07:14.400 --> 0:07:15.840 which is what we need to see, and we'll see 0:07:15.880 --> 0:07:18.000 what the color commentary is on the call, I think 0:07:18.040 --> 0:07:20.000 it'll be okay. I think the longer term is one 0:07:20.000 --> 0:07:23.000 of the questions linger shorter term, it'll be fine, all right. 0:07:23.000 --> 0:07:25.280 So let's go to Microsoft, because it's also the other 0:07:25.320 --> 0:07:27.680 big one that are one of the big ones. After 0:07:27.680 --> 0:07:30.160 the close, it's up about five percent here in the 0:07:30.200 --> 0:07:34.640 aftermarket this one. Sales and profit beat expectations on robust 0:07:34.680 --> 0:07:36.960 AI demand. That's the headline on our story. So quarterly 0:07:36.960 --> 0:07:39.480 sales and profit climbing more than projected, lifted by corporate 0:07:39.520 --> 0:07:44.880 demand for Microsoft's cloud and AI offerings. Revenue, as we said, 0:07:45.000 --> 0:07:48.280 up seventeen percent in the third quarter, sixty one point 0:07:48.360 --> 0:07:51.520 nine billion profit two ninety four a share. Analyst on 0:07:51.560 --> 0:07:55.280 average estimated per share earnings of two point eight three 0:07:55.680 --> 0:07:57.880 two dollars and eighty three cents. Excuse me, on sales 0:07:57.920 --> 0:08:01.720 of sixty point nine billion, So again outperformance here, and 0:08:01.760 --> 0:08:05.760 we know that such an Adella has been really infusing 0:08:05.840 --> 0:08:10.360 all of Microsoft's entire product line with AI technology thanks 0:08:10.360 --> 0:08:14.080 to its partner open Ai. So thoughts on Microsoft, what 0:08:14.120 --> 0:08:16.120 we got here in the quarter, what it tells you 0:08:16.560 --> 0:08:18.840 about their business today and going forward. 0:08:20.480 --> 0:08:23.200 Yeah, what's most amazing to me is the fact that 0:08:23.280 --> 0:08:27.200 they're able to maintain the growth rates no matter how 0:08:27.280 --> 0:08:31.640 big their revenue base gets, and the fact that they're 0:08:31.680 --> 0:08:34.320 able to deliver the numbers that you just cited and 0:08:34.440 --> 0:08:37.880 do so in an efficient way where earnings are continuing 0:08:37.920 --> 0:08:40.360 to grow at the same rate, so it's not a 0:08:41.360 --> 0:08:46.760 there's no contra indicators on and you know, sales versus spending. 0:08:48.080 --> 0:08:51.319 So I think that to me, the sustainability is the 0:08:52.040 --> 0:08:57.719 biggest and most impressive component of their operations, and most importantly, 0:08:57.800 --> 0:09:00.360 you know, broadly, I think you can extrapolate that the 0:09:00.360 --> 0:09:05.280 themes on the data center spend and the semiconductors like 0:09:05.280 --> 0:09:08.000 the NVIDIAs of the world, and the direction of corporate 0:09:08.120 --> 0:09:13.640 enterprise and their appetite for shifting from analog to digital 0:09:14.080 --> 0:09:16.720 is as strong as ever. So I think it's a 0:09:16.880 --> 0:09:19.200 very very good omen for a lot of these companies 0:09:20.160 --> 0:09:22.400 and being at the center of it. Because you can 0:09:22.400 --> 0:09:25.280 make an analogy that you want in the first inning, 0:09:25.440 --> 0:09:28.400 third inning, or whatever. But I think the main thing 0:09:29.080 --> 0:09:32.319 is that the world is going to I think Sam 0:09:32.360 --> 0:09:38.000 Altman has this quote that he said, the technological changes 0:09:38.040 --> 0:09:43.719 that we've seen over the last five hundred years, No, 0:09:44.040 --> 0:09:46.960 the changes over the next fifty years will be greater 0:09:47.080 --> 0:09:50.880 than the technological changes over the next last five hundred, right, 0:09:51.000 --> 0:09:53.880 you know. So that's the pace of change that we're 0:09:53.880 --> 0:09:55.800 talking and a lot of that's going to come in 0:09:55.840 --> 0:09:58.560 the first decade, and these companies are all at the 0:09:58.600 --> 0:09:59.600 epicenter of it. 0:09:59.720 --> 0:10:03.720 Just what and point out Azure Microsoft's cloud computing unit 0:10:04.440 --> 0:10:06.520 revenue gaining thirty one percent in the quarter, above an 0:10:06.520 --> 0:10:09.040 average prediction of twenty nine percent, so picking up slightly 0:10:09.080 --> 0:10:11.240 from the thirty percent growth in the previous period. So 0:10:11.480 --> 0:10:13.360 you know that's a trend line if you're following it, right, 0:10:13.440 --> 0:10:14.160 you want to see I. 0:10:14.160 --> 0:10:15.720 Mean, there's a chance we see both of the depending 0:10:15.760 --> 0:10:17.800 on what happens. There's a chance we see both Alphabet 0:10:17.800 --> 0:10:21.079 and Microsoft hit new records tomorrow in today's trade, depending 0:10:21.160 --> 0:10:24.280 on what happens. Okay, I want to talk James just 0:10:24.320 --> 0:10:27.640 a little bit about Microsoft's legacy here and the way 0:10:27.679 --> 0:10:31.840 that it's been able to shift and embrace AI. Where's 0:10:31.880 --> 0:10:35.880 the most important part of looking at Microsoft's growth moving forward. 0:10:35.960 --> 0:10:38.560 I mean, I know, we obviously know Azure is incredibly important, 0:10:38.559 --> 0:10:41.200 but the company has made a huge, huge bet on 0:10:41.320 --> 0:10:44.040 AI with open Ai. Where do you start to see 0:10:44.600 --> 0:10:49.880 that investment and its relationship with open Ai manifest in earnings. 0:10:51.600 --> 0:10:53.960 I think it's going to be, you know, exactly, you'll 0:10:53.960 --> 0:10:56.199 see it in the Azure business, but more broadly in 0:10:56.240 --> 0:10:59.680 the intelligent cloud segment. I mean, it just continued to 0:10:59.679 --> 0:11:02.480 trans on that front, but it's not just that segment. 0:11:02.480 --> 0:11:04.800 It's going to have It's going to feed into other 0:11:04.840 --> 0:11:08.119 parts of their business too, you know, on the subscription 0:11:08.280 --> 0:11:14.080 side of their software services and potentially even gaming, and 0:11:15.720 --> 0:11:18.240 you know, so there's there's a lot of levers I 0:11:18.240 --> 0:11:21.000 think that will be pulled from that relationship. And as 0:11:21.040 --> 0:11:23.600 the world and the corporate enterprise continues to move in 0:11:23.640 --> 0:11:25.600 that direction, more data is going to feed into it, 0:11:25.600 --> 0:11:29.600 which is going to fuel even more efficiency with respect 0:11:29.640 --> 0:11:33.200 to the capabilities that they do. And you know, Copilot, 0:11:33.280 --> 0:11:36.440 you know, for instance, is just on the I don't 0:11:36.440 --> 0:11:38.560 want to use saying first end of that day, day 0:11:38.600 --> 0:11:41.960 two of its potential. So and there's a lot of 0:11:41.960 --> 0:11:44.920 money to be paid there that you'll see that. I 0:11:44.920 --> 0:11:48.240 don't think it is being appreciated at all, virtually at all. 0:11:48.320 --> 0:11:50.880 Right now, these are all different companies, but they're all 0:11:50.920 --> 0:11:54.160 working on AI, and to a certain extent, they're competing 0:11:54.160 --> 0:11:57.240 with each other when it comes to that technology. No question, uh. 0:11:57.520 --> 0:12:00.000 Given what we're seeing from shareholders in reaction to micros 0:12:00.080 --> 0:12:02.840 oft in alphabet today, and given what we saw today 0:12:02.960 --> 0:12:07.079 in the session from reaction from investors to meta platforms 0:12:07.120 --> 0:12:10.600 sending shares for their worst ten months, what did the 0:12:10.600 --> 0:12:13.400 two companies that reported today get right? Or maybe a 0:12:13.400 --> 0:12:16.160 better way to ask is what did meta platforms get wrong? 0:12:19.520 --> 0:12:22.600 What did meta platforms get wrong? I think what they 0:12:22.720 --> 0:12:28.720 got wrong was largely related to the management of the expectations. 0:12:28.960 --> 0:12:33.959 You know, there was no indication around the pace of 0:12:34.400 --> 0:12:38.120 investment that's necessary to sustain the kind of growth. I mean, 0:12:38.320 --> 0:12:41.320 they talk very qualitatively. 0:12:40.480 --> 0:12:43.280 About this is a big opportunity ahead, you know, all 0:12:43.320 --> 0:12:47.880 the metaverse and YadA YadA, But you know, there was 0:12:47.920 --> 0:12:52.520 no pushback whatsoever on the questions and commentary with respect 0:12:52.559 --> 0:12:56.480 to you know, how we should expect the pace of 0:12:56.559 --> 0:13:01.240 investment to ramp to justify and capitalize on the trend 0:13:01.360 --> 0:13:02.679 that Zuckerberg talks about. 0:13:02.720 --> 0:13:06.280 So I think it was more of an expectation versus 0:13:06.480 --> 0:13:10.040 reality in mismatch that probably could have been better managed. 0:13:10.160 --> 0:13:13.360 All right, let's just remind everybody the bigger earnings after 0:13:13.400 --> 0:13:16.199 the close and those that have really outperformed here in 0:13:16.280 --> 0:13:20.480 showing some studying moves to the upside, Microsoft among them. 0:13:20.640 --> 0:13:24.320 That stock, as we mentioned, it is moving up just 0:13:24.480 --> 0:13:28.560 about four point four percent here in the aftermarket, and 0:13:28.559 --> 0:13:32.760 the company coming out sales and profit beating expectations, lifted 0:13:32.760 --> 0:13:35.760 by corporate demand for the software maker's cloud and AI offerings. 0:13:35.800 --> 0:13:39.319 We talked about Azure gaining revenue alone gaining thirty one 0:13:39.320 --> 0:13:43.080 percent in the quarter that was above analyst expectations. Revenue 0:13:43.080 --> 0:13:47.360 in the third quarter overall up seventeen percent to sixty 0:13:47.440 --> 0:13:50.160 one point nine billion dollars. Profit was two dollars ninety 0:13:50.160 --> 0:13:53.880 four cents a share. Analysts on average estimated per share 0:13:53.920 --> 0:13:56.080 earnings of two to eighty three, so below what they 0:13:56.120 --> 0:13:59.520 actually came in with, and the estimate for sales was 0:13:59.520 --> 0:14:02.200 sixty point so again really hitting out of the park 0:14:02.200 --> 0:14:05.000 when it comes to those estimates, and that is certainly 0:14:05.280 --> 0:14:07.400 one reason why you're seeing the stock or a big 0:14:07.440 --> 0:14:10.840 reason why you're seeing the stocks up. The stock of Microsoft, 0:14:10.880 --> 0:14:12.280 I should say up at the aftermarket. 0:14:12.400 --> 0:14:14.360 Okay, let's worth let's repeat a little bit of what 0:14:14.400 --> 0:14:17.640 we saw from Alphabet the company's first quarter Google AD 0:14:17.679 --> 0:14:19.960 revenue coming in at sixty one point six six billion 0:14:20.040 --> 0:14:22.360 versus estimates of sixty point one eight billion, in the 0:14:22.400 --> 0:14:25.440 company author authorizing a repurchase of up to an additional 0:14:25.520 --> 0:14:28.960 seventy billion dollars worth of shares, also declaring a dividend, 0:14:29.040 --> 0:14:31.240 a cash dividend of twenty cents per share. First quarter 0:14:31.320 --> 0:14:36.440 revenue excluding traffic acquisition costs sixty seven point five to 0:14:36.520 --> 0:14:39.320 nine billion, beating estimates of sixty six point oh seven billion. 0:14:39.560 --> 0:14:42.440 To the downside, Intel shares are down more than eight 0:14:42.440 --> 0:14:47.120 percent here, biggest maker of PC processors. Lacklow luster forecast 0:14:47.120 --> 0:14:49.880 from the company for the current quarter, indicating it's really 0:14:49.880 --> 0:14:52.960 still struggling to kind of find its way back to 0:14:53.080 --> 0:14:54.800 the top, if you will. Sales in the second quarter 0:14:54.840 --> 0:14:57.560 will be about thirteen billion. That compares with an average 0:14:57.560 --> 0:15:00.200 analyst estimate of thirteen point six billion a quarter to 0:15:00.240 --> 0:15:03.200 our data here at Bloomberg Profit Again, the outlook will 0:15:03.200 --> 0:15:06.200 be ten cents of share minus certain items versus a 0:15:06.240 --> 0:15:10.040 projection of twenty four cents, So that's a pretty big miss. 0:15:10.320 --> 0:15:12.760 We're talking with James chockmock partner and tech analyst ever 0:15:12.760 --> 0:15:16.840 at Clockwise Capital. James, is there's some underlying theme. We're 0:15:16.840 --> 0:15:19.440 not through all the MAGS seven companies. We've got what 0:15:19.640 --> 0:15:20.640 Amazon next week? 0:15:20.760 --> 0:15:22.920 Yeah, we've gotten video in a while, right, so. 0:15:23.320 --> 0:15:25.800 We've got some other plays to get through. But is 0:15:25.840 --> 0:15:28.280 there any themes that you're finding, certainly for the investment 0:15:28.280 --> 0:15:31.960 community when it comes to especially these big tech names 0:15:32.520 --> 0:15:35.840 the mag seven often who haven't always been so magnificent 0:15:35.920 --> 0:15:39.400 as of late, what they're saying and kind of their 0:15:39.440 --> 0:15:41.880 impact on the overall market. Is there some big takeaway 0:15:41.880 --> 0:15:42.440 here for you? 0:15:44.360 --> 0:15:47.320 I think the biggest takeaway is that the sellers of 0:15:47.400 --> 0:15:51.400 these data center services are the best place to be, 0:15:51.600 --> 0:15:56.440 you know, from Navidia to Dell. The server side, like 0:15:56.480 --> 0:16:02.040 we own VRT, which helps with the cooling system comfort systems, 0:16:03.240 --> 0:16:05.040 you know, so there's a lot of these companies that 0:16:05.160 --> 0:16:08.920 play into building out the companies that are selling to 0:16:09.000 --> 0:16:12.520 the hyperscalers. I think will continue to be in a 0:16:12.560 --> 0:16:15.280 great position now that as far as the Max seven 0:16:15.360 --> 0:16:18.200 is concerned, I do think, you know, the market is 0:16:18.280 --> 0:16:23.960 still in a state of shoppiness and volatility, and I 0:16:24.000 --> 0:16:26.200 think that's going to last until we have better clarity 0:16:26.200 --> 0:16:27.920 on what the FED is going to do. And you 0:16:27.960 --> 0:16:31.360 saw the GDP numbers today, so there's there's mixed messages 0:16:31.400 --> 0:16:34.480 as to which direction macro is going versus tech and 0:16:34.520 --> 0:16:38.040 which one to prioritize, because if you've prioritize the economic cycle, 0:16:38.320 --> 0:16:41.080 then that means valuations are at risk. If you prioritize 0:16:41.240 --> 0:16:44.480 the text cycle, that means that earnings are the focus. 0:16:44.520 --> 0:16:48.240 And right now we're in this world where some days 0:16:48.480 --> 0:16:52.040 valuations are in focus and other days earnings like today, 0:16:52.440 --> 0:16:54.760 So I think you just got to stay nimble at 0:16:54.800 --> 0:16:55.640 the end of the day. 0:16:55.560 --> 0:16:57.960 Hey, James, last question thirty seconds. Here, I'm looking at 0:16:58.040 --> 0:17:00.960 time US Equity on the Bloomberg terminal. This is the 0:17:01.120 --> 0:17:04.639 clockwise Core Equity and Innovation ETF. It is up this 0:17:04.760 --> 0:17:08.880 year a whopping eighteen point three percent, out performing all 0:17:08.920 --> 0:17:12.560 the benchmarks. Amazon is your second biggest holding after T 0:17:12.760 --> 0:17:17.080 bills make accounting for five percent of the portfolio. We 0:17:17.160 --> 0:17:20.440 got Amazon coming up. Thirty second preview of Amazon. 0:17:22.040 --> 0:17:25.000 Yeah. Amazon, it's it's the only of the mag seven 0:17:25.160 --> 0:17:28.919 that we feel that we haven't cut exposure to. You know, 0:17:28.960 --> 0:17:31.560 it's a five percent or give or take weight, and 0:17:31.600 --> 0:17:34.960 we're maintaining that. I think the data that you saw 0:17:35.040 --> 0:17:37.920 from Microsoft and today is the really to the cloud 0:17:38.000 --> 0:17:41.000 is a very good omen. They're firing across all three 0:17:41.040 --> 0:17:44.680 other businesses, you know, on the on the grocery side, 0:17:44.680 --> 0:17:47.960 the retail side, the cloud side, and this is the 0:17:48.000 --> 0:17:50.640 first time in a while that you've seen everything going 0:17:50.640 --> 0:17:53.400 in the right direction and most especially on the margin. 0:17:53.520 --> 0:17:56.080 So you know, we like the risk loard here. You know, 0:17:56.200 --> 0:17:58.680 I think next year you could get the two twenty five. 0:17:59.359 --> 0:18:02.800 This year the upwards of two hundred, So you know, 0:18:02.840 --> 0:18:05.480 it's one that definitely keeping the portfolio for sure. 0:18:05.960 --> 0:18:07.800 All Right, we're going to leave it on that note. Hey, James, 0:18:07.800 --> 0:18:10.360 thank you so much. James. Chuck Mack, partner and tech 0:18:10.400 --> 0:18:13.360 analyst at Clockwise Capital joining us on Zoom from Miami. 0:18:13.440 --> 0:18:15.480 A lot of names move in here in the aftermarket,