SpaceX's iPhone Competitor, June Jobs Report & High Gas Prices

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0:33You think you know a browser, but Gemini and Chrome? That's new. It can help you with practically anything on the web, like restoring a vintage motorcycle from a 50-page restoration block, or finally break down that long article you've had open for weeks. Gemini and Chrome is here for it. Ready to make anything online make sense? There's no place like Chrome. Check responses set up required, compatibility and availability varies 18+. Welcome back to the Rich Habits Radar, our Friday episode of the Rich Habits Podcast, where every Friday morning we're coming at you with the biggest headlines impacting you and your money.

1:05This episode is brought to you by VCX, the public ticker for private tech. My name is Austin Hankwitz, and I'm joined by my co-host, Robert Croak, and the three things sitting at the top of our Rich Habits radar this week include Meta turning into a neocloud company, the disappointing June job report, and SpaceX's new iPhone competitor. Yes, I just said those words. Very interesting. Be sure to stick around to the end where we talk about Amazon launching more satellites in space to also now compete with Starlink. Robert, let's dig into our first story. Definitely. On Wednesday, Bloomberg reported that Meta Platforms is developing plans for a cloud infrastructure business that will sell access to both AI computing power and AI models to outside customers.

1:48The company is debating whether to offer hosted models or raw compute or both. So Meta told their investors back in April that it plans to spend as much as$145 billion in capital expenditures this year building out these AI data centers and purchasing GPUs, the most aggressive AI infrastructure build-out of any company on the planet. $145 billion. That's so much money. And investors were pretty uneasy about all this spending. Metastock was down in the month of June when reports started to surface that the company might need to raise tens of billions for more AI spending if that was by diluting shareholders or increasing their debts.

2:25Like investors weren't happy about this. Yeah, I feel like Meta was late to the party. I think we talked about this a few months back, but this announcement, this cloud business announcement flips that narrative entirely. Instead of a cost center, all that infrastructure becomes a potential revenue generator for Meta. And Mark Zuckerberg first signaled this move during Meta's Q3 2025 earnings call and addressed it again at the company's annual shareholder meeting in May. It's definitely on the table, Zuckerberg told investors. If we get to a point where we have overbuilt AI infrastructure, that is an option that we have.

2:59And they're exercising that option as we speak. Meta has been one of the biggest GPU buyers on the planet, specifically from NVIDIA. I'm sure you guys remember when Mark Zuckerberg got on stage with Jensen Wang and like put on his jacket and like posted it on online. It was a whole thing. So if Meta starts selling that compute from those GPUs to the same startups and enterprises that CoreWeave and SpaceX's XAI are also trying to serve. Remember, XAI's Colossus is doing, what is it, Google Gemini, Anthropic, a couple others. They're making billions of dollars a month by selling compute. So now Meta's like, yo, I want to sell some compute.

3:35I want to make a couple, Billy. How do I get in the game? So once they jump in that, that competitive dynamic that's going on is just really going to ripple through this AI infrastructure market overnight. In Austin, meta entering this market means the hyperscalers are no longer just buying AI infrastructure. They're also selling it. So let's dig in. What does this mean for you and your money? So for the past two years, the investment thesis for the AI infrastructure trade has been very simple. Big tech spends hundreds of billions of dollars on AI infrastructure. That is a expense item for them, but it's a revenue item for the picks and shovels companies that are selling that infrastructure.

4:12The NeoClouds, the GPU suppliers, the data center real estate investment trusts, right? They all capture that as revenue. So Meta is saying, instead of spending a bunch of money, how about I take all of the capacity that I've built here with my infrastructure, my data AI center infrastructure, and then I turn it to a revenue generating machine like what XAI is doing. So for your portfolio, this changes how you should think about the AI infrastructure stack. NVIDIA does remain the safest play, in my opinion, because they sell to everybody. Meta's cloud business still needs those NVIDIA GPUs. Robert, I'm about to pull up NVIDIA on wallstreetfavorites.com, which is the easiest way to see what Wall Street thinks about your portfolio and, of course, other stocks in the S &P 500 and in the NASDAQ 100.

4:56And I'm seeing an average price target of$317 a share right now for NVIDIA, 61 % upside from current prices. So the stock is trading at a discount right now to where Wall Street thinks it should be. I agree with you totally. We've talked about this for quite some time now about Amazon and NVIDIA, but the companies most at risk are the pure play neoclouds. CoreWeave derives a massive chunk of their revenue from concentrated hyperscaler contracts. And if Meta, SpaceX and eventually others all start selling excess compute, the pricing power of the neoclouds erodes quickly. Robert, let's now jump to our second story, which is the June jobs report.

5:36We heard from the Bureau of Labor Statistics on Tuesday that non-farm payrolls increased by just 57 ,000 in the month of June. Less than half of the 115 ,000 economists were expecting. And a dramatic slowdown from May's already revised downward lower now to 129 ,000 jobs. What is going on, Robert? I just feel this is the big gut punch of the week and why the markets are all over the place. And speaking of revisions, May was originally reported at 172 ,000 and got cut by 43 ,000 jobs. April was also revised down by 31 ,000 to 148 ,000 jobs. So the labor market has definitely seen significantly weaker than we thought for the last three months.

6:23The unemployment rate did drop from 4.3 to 4.2, which is like, okay, that's great. But not really because labor force participation also dropped half a percentage point to 61.5%, which is the lowest it's been since March of 2021. Think about that. All the people out there that could be working, they're saying, I don't want to work. I can't find a job. I can't do this anymore. I can't keep applying. Don't even, I'm out. I'm not doing this, right? So that now means 507 ,000 fewer people are reported being at work in the household survey. People aren't finding jobs. So they're leaving. That's half a million people that just left the workforce entirely over the last four or five years.

7:05Yeah, it's crazy to me because you think of Taylor, my chef partner from the sushi place. He just moved to St. Petersburg last week. And in three days, he has four job offers, four good job offers. And I feel like it's just crazy, especially when you think about leisure and hospitality shed 61 ,000 jobs. The BLS said this reflected slower than usual seasonal hiring, which is remarkable considering the FIFA World Cup was expected to boost hospitality employment. So I don't know. It's confusing to me. It feels like everyone's hiring. We're hiring. Restaurants are hiring. Everyone's hiring. Yet there's so much job loss.

7:41It's definitely confusing for me. Yeah. And the experts are, you know, you look at Goldman Sachs, for example. who estimated that the World Cup would add about 40 ,000 jobs, but instead the sector went deeply negative that you were talking about, right? 61 ,000 jobs lost. Professional and business services, though, added 36 ,000 jobs. Healthcare added 22 ,000 jobs. Lower than its usual pace, but definitely in the positive. Government added about 8 ,000 jobs. We're seeing some positive momentum in specific little sectors here, but certainly not as fast as we saw in 2025, 2024. And again, that labor participation rate has just fallen off a cliff.

8:17Yes, an average hourly earnings rose 0.3 % for the month and 3.5 % year over year, both in line with expectations. So wage growth is holding, but with core PCE inflation running at 3.4 % as of the May reading, real wage gains are razor thin. Thomas Simons, who's the senior economist at Jeffries, said, and I quote, For the Fed, this number's fine. The pace of job growth is plenty strong enough to maintain a steady unemployment rate. and average hourly earnings are solid, but they're not accelerating. There's no imperative on their part to do anything with rates immediately, and the softening in the pace of job growth suggests that rate hikes are very unlikely to be necessary this year, which is music to my ears.

8:57I don't know if you remember this. Robert, we talked about like two weeks ago, Bank of America was saying three rate hikes in 2026, which like, dude, get out of here. No way. But Robert, what does this mean for you and your money? Oh, on one hand, this is bullish for markets in the short term because it kills the rate hike narrative. Fed Chairman Kevin Warsh spent this week at the ECB forum in Sintra saying inflation is too high and vowing to get it back to 2%. And markets were nervous he was laying the groundwork for a hike. A 57 ,000 print makes that nearly impossible to justify in July or September.

9:31So we'll wait and see. But on the other hand, this is the kind of data, if it continues, shifts the conversation from higher for longer to are we heading into a recession and we're already seeing those headlines. Labor force participation is at a four year low. So that's important to understand as well. And a half a million fewer people reporting work in a household survey. Three consecutive months of downward revisions is definitely not good. So if you're an investor, the question you need to be asking isn't just will the Fed hike? It's what's happening to earnings if the consumer starts pulling back.

10:03I think that's the key narrative here. And again, the companies that do well in a softening labor market are the ones with recurring revenue, pricing power, and low sensitivity to discretionary spending. As we head over to wallstreetfavorites.com, you can go pull up Costco and see that of the 36 analysts that are covering Costco stock, they are implying an upside of over 21 % with their price targets. So in a world where consumers are trading down and consolidating purchases, companies like Costco's membership and their pricing power make that company a fortress. So maybe Costco continues to do well as consumer spending reels back.

10:38The bigger takeaway is the labor market isn't exactly falling apart, but it's definitely cooling and the direction matters more than the level itself. So, Robert, round us off with our third story here about SpaceX secretly building an iPhone competitor. Yeah, this is crazy. We watched that interview and I was like, this makes sense for Starlink. And according to the Wall Street Journal, SpaceX recently showed select investors and stakeholders a prototype for a handset-like device designed to reshape how people interact with artificial intelligence. This device is slimmer than an iPhone, runs on a proprietary operating system, integrates XAI's technology directly, and is built on Qualcomm's Snapdragon chipset.

11:21So wow, what an update. SpaceX told their investors the project is still early stage and the design could change, but the fact that a physical prototype exists and is being shown during the company's IPO window tells you that this is more than just a brainstorm. This is where the company could be headed. As recently as February, though, Musk denied SpaceX was developing a phone, pushing back on a Reuters report about a Starlink-connected device. Last October, he said, and I quote, the idea of making a phone makes me want to die. But if we had to make a phone, we will. And that framing of if we have to, we will certainly seems like they are trying to.

11:55I mean, in the interview, he alluded to the fact that he believes within two years, this could all be at scale and happening. And he talked about how there would be no need for AT &T and Verizon and all this, which is crazy. But if you think about it, for people that travel a lot, especially international travel, if you had one phone, one service with no droppage, that would be game changing for millions and millions of people. So we'll see. But Musk isn't just building a phone. He wants to compete with Apple and hardware as well. He's building a platform because he doesn't want to depend on Apple and Google to distribute the XAI, X and Starlink and whatever else comes next.

12:33And a lot of this is drawing from Elon's everything app vision, a super app concept that he championed back when he acquired Twitter, you know, changed it to X, X the everything app. In Asia, this model already dominates China's WeChat and Alipay owned by Tencent and the Ant Group. function as this all-in-one platform where you can transfer money, you could order food, you could book travel, you can play games, all without ever leaving the app. So Chinese companies are now layering AI agents on top of these super apps, and maybe that's what Elon wants to build. Yeah, and ByteDance already released a smartphone powered by its DeBow AI model designed to help users shop and book across platforms, though competitors have restricted its access to their services.

13:13The U.S. has never truly had a super app, And Musk may be betting that that is the way to build one isn't through software alone. It's by controlling the hardware, the OS, the AI layer, and the connectivity, which he'll get through Starlink. Yeah, they've already sold those Starlink dishes. They already offer direct-to-sell service through T-Mobile. XAI has Grok. X already has payment infrastructure and development. They're offering 6 % APY right now. Like, proprietary device can really tie all this together into a single ecosystem that doesn't have to depend on an Apple or a Google. So we'll see what happens.

13:44Yeah, and OpenAI is also developing a family of AI-first devices. The race to define what the post-smartphone AI interface looks like is accelerating, and the companies building it aren't the traditional hardware players. They're the AI companies that want to own the relationship with the user from end to end. This is an exciting one, Austin. I think it's huge, huge news for SpaceX and Starlink and everything that's happening. So break it down. What does this mean for you and your money? I think this is less about whether SpaceX can go sell 200 million, a billion of these like handset devices.

14:17I think it's more about what this signals for the competitive landscape of the AI ecosystem right now. Right now, every AI company, if it's XAI, if it's OpenAI, if it's Anthropic, if it's Google, they deliver their products through Apple or Android. And that could be a choke point, depending on your perspective. Apple takes 30 % of in-app revenue, controls what apps can and can't do. So if Elon is building a device that can bypass that entirely, it could change the economics of AI distribution for everybody. And also important, Qualcomm, since they're the ones powering this device, that could just be pure upside in the stock.

14:51Another major customer for the Snapdragon chips, new device category, sign me up. For Apple, it could be a long tail threat. not because SpaceX is going to outsell the iPhone, but because of, you know, AI first devices is kind of like a category and all of its own. And if this category takes off, it validates a future where the iPhone isn't the default platform for AI interactions. Again, SpaceX's AI device, open AIs, AI hardware device, like if more and more of these are there, people are going to say, wait a second, why isn't Apple having an AI device? Should I make a switch? Like what's going on there?

15:22Yeah, as we discuss this, I'm actually shocked to think of how long this bottleneck has occurred with Apple and them taking 30 % of the revenue from everybody. It's just crazy to think. And the most important tech battle of the next five years isn't who builds the best AI model. It's who controls the device, the distribution, and the platform that the AI lives on. And Musk is trying to own all three. And this prototype is the first physical evidence that he's serious about it. And we'll see how he pulls it off. Those are our top three stories. Now, Robert, it's time to jump to our radar points, which are kind of like a little show and tell action.

15:56I've got three headlines. You've got three headlines. And they caught our attention this week. And we got a show with the audience. But before we do that, let's take a moment to hear from this episode sponsor. That's right. Support for this show comes from VCX, the public ticker for private tech. For generations, Americans have moved the world forward through their ingenuity and determination. And for generations, everyday Americans could be part of that journey through perhaps the greatest innovation of all, the U.S. stock market. It didn't matter whether you were a factory worker in Detroit or a farmer in Omaha, anyone can own a piece of the great American companies.

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17:07This and other information can be found in the fund's prospectus at GetVCX.com. This is a paid sponsorship. Robert, why don't you kick us off with your radar points and then we'll get into mine. Yeah, I'm excited. We have some really good radar points. And my first one today is the Trump administration lifted its export ban on Anthropik's Fable model. The episode created a de facto government approval for frontier AI models that has the entire industry on edge. OpenAI also restricted access to its newest GPT 5.6 models over similar cybersecurity concerns. concerns and anthropic is now working with amazon microsoft and google to build a shared framework for evaluating ai safety risks while critics warn the u.s is handing china an advantage by throttling its own labs i don't know if i agree with that i think we need to be winning this battle and keep winning so letting them be able to do some self-monitoring and putting it with some of the largest hands in the business companies in the business i think is a great step forward number two, Tesla delivered 480 ,126 vehicles globally in Q2, and listen up, up 24.9 % year over year.

18:15So they really broke through. The company discontinued its 100k Model S and Model X in May and is now down to just three vehicles, the Model 3, the Model Y, and the Cybertruck. Tesla's robo-taxi service is still limited to just dozens of cars in Texas, and Musk admitted the autonomous software still gets stuck in literal infinite loops around construction zones. Full earnings drop July 22nd, so we'll keep an eye on that. And my last one leading into the 4th of July weekend is gas prices are at their highest in the last four years at$3.84 a gallon. And I know that stinks for everybody, but that's where we're at.

18:52Prices have dropped 2 cents per day over the past several weeks after Brent crude fell below$72 a barrel following the U.S.-Iran agreement to suspend the Middle East conflict and reopen the Strait of Hormuz. Gas Buddy's Patrick DeHaan says we could see low to mid$3 gas by Labor Day, which Bank of America notes would be a meaningful tailwind for lower income consumers, half of whom currently describe their finances as poor or terrible. That's the K-shaped economy right before our eyes where gas is affecting people that much. I think my favorite calling on this is the anthropic fable model. If you have not yet played around with Fable, Fable 5, all that fun stuff going on, go check out Fable.

19:33I don't know if you have to have a Pro subscription or a Max subscription or whatever's going on, but definitely go play around with it. Check it out. It is the most capable model yet. I think they even nerfed it from before, which I saw some posts online about, which would be interesting to dig into or not. But it's still very capable, much more capable than Opus 4.6, 4.8, 4.whatever. This is Fable 5, so go check it out for sure. But it's interesting to see how the government is now sort of looking at this of a, hey, this is too capable. You need to go through an approval process before this goes into the hands of the public.

20:03Yeah, I agree. And that is a great call out. I just want everyone listening and watching, play around with these models, get the free trials, learn and see what works for you, because it is important. But the key here that what you just mentioned for me is if we throttle it too much by the government, we'll fall behind China and we'll lag in the development of all of these models. And so having some sort of way to move it forward quickly while still keeping control of it, I think, is super important. Completely agree. Now, before we jump to my radar points, got to give a shout out to Aura ETFs and the U.S.

20:35Defense ETF trading under the ticker symbol DUTY, DUTY, which I think is just perfect for the 4th of July. As geopolitical tensions rise and governments around the world continue increasing defense spending, many investors are looking for ways to gain exposure to one of the fastest growing sectors in the global economy, military defense, aerospace, and cybersecurity. DUTY is designed to provide targeted exposure to companies supporting America's national defense infrastructure, including advanced military technologies, defense manufacturing, cybersecurity, and space-related defense innovation.

21:09And what makes DUTY different is its mission-driven structure. Aura ETFs has committed to donating 10 % of the ETF's revenue to charitable organizations supporting American veterans, aligning investor capital with support for those who have served with a minimum commitment of$150 ,000 during the fund's first year of operations. Which I just think is incredible. Now, for investors seeking exposure to the long-term growth of America's defense and national security ecosystem, DUTY offers a different approach to defense investing. To learn more about the U.S. Defense ETF, visit usdefenseetf.com. Investors should carefully consider the investment objectives, risks, charges, and expenses before investing.

21:50For a prospectus or summary prospectus containing this and other information about the fund, please call 888-824-4467 or visit www.usdefenseetf.com. Please read the prospectus or summary prospectus carefully before investing. Investing involves risk and possible loss of principle. And this ETF is distributed by Foresight Fund Services, LLC. All right, Robert, my first radar point is Ford recalling over 740 ,000 of their vehicles. If you're driving an Expedition, a Navigator, a Ford Explorer, a Ford Aviator, which I think is Lincoln, right? or any of these F-150s from 2018 to 2021, be careful because your transmission might be messed up.

22:31They got a transmission defect that can engage the park function while the car is still moving, which could cause your car to roll away. This comes after Ford recalled 1.4 million F-150s back in April for unexpected downshifting. In 2025, Ford issued more recalls than any other automaker, affecting nearly 13 million vehicles. Not a great look for a company. already navigating some export-import tariff uncertainty and a crazy price-to-earnings ratio of 30 times. So if you drive a Ford, be careful. You might have got a recall here. Now, here's my next story, Robert. Apple's ramping up their foldable iPhone ambitions, asking their suppliers to prepare for 10 million foldable units this year in 2026, up from their earlier forecast of 7 to 8 million.

23:21So we all know that, you know, Apple comes out with these new iPhones every year, every two years, every three years, whatever. And they're now making this foldable iPhone, which I don't think is new news. I think people have known that for a while, but Apple saying, hey, we think more people are going to want this foldable iPhone than we were previously expecting. The company is planning to release at least five new iPhone models across the back half of 2026 in the first half of 2027, as they push into the high growth foldable segment that's currently dominated by Samsung and Huawei. So definitely check out that story alongside whatever the heck SpaceX is doing.

23:54I think both of those are pretty important right now, especially for Qualcomm. And finally, my last radar point is Amazon launching 29 more Project LEO satellites, bringing their total of satellites in low Earth orbit here of 396, enough to begin initial broadband services later this year. Starlink competitor coming at you. Now they could compete with Starlink, but Starlink does have 10 ,000 satellites in low Earth orbit serving 160 countries. So 396, 10 ,000 there, it's a little bit of a lead, right? Amazon plans to scale though, 3 ,200 more satellites and then hundreds of flight ready units standing by at the Cape of the dedicated integration facility doing more of these launches.

24:33So we'll see if they get thousands more satellites up into low Earth orbit, but it's pretty obvious that Starlink has that entire, entire business unlock. My favorite part of your call-outs today, and for everyone listening, we don't see each other's call-outs, our radar points before we film. My favorite one is that you covered Ford because if you remember in the Rich Habits Network this past Tuesday, I covered the fact that Ford announced that they had gone too far with AI and robotics and that they were bringing back, I think it was 550 seasoned engineers because of all the problems affecting so many vehicles.