Big Tech Earnings Week With Alex Kantrowitz, Two Small Caps on Josh’s Radar, Robots Take White Collar Jobs at Amazon

27:03They do have some nice tools to build AI models like Bedrock, and people are using that or build AI applications. But they don't have the juice right now. So I mean, it's really hard for me to tell exactly what they need. You'd want basically the state of the art. They actually made their own attempt to build their own models, but no one talks about them at all. And that was announced a year ago. So I think that like what Amazon could do is this is still a sales. It's a sales business. So it will have to step up sales, maybe give credits, maybe, you know, figure out a way to get programs to build programs where they can get AI startups to be working with AWS more than they are.

27:47I mean, there's still there. It's not lost for them. They still do a lot of really meaningful work with AI. But it is one of those moments where you do have like the proprietary models. They're they're uneven right now. Now, maybe, okay, so one philosophy about this is maybe you wait for all these models to commoditize, which they might eventually, and then it sort of doesn't matter which model you have. So Amazon's going to spend about a third of its conference call talking about groceries. And you will not hear that on the NVIDIA call or the Alphabet call. So that's one thing. Matthew Stevik in the chat says, I remember Jassy making a very small thing that stood out to me on the April 25 earnings call about how the NVIDIA chips are so expensive.

28:35That's a really great call out, Matthew. And I remember that too. And there's a lot of talk about application-specific integrated circuits taking the place of NVIDIA GPUs for certain workloads. They're more cost-efficient, et cetera, et cetera. And it strikes me that we're not in the phase of AI adoption and build out where cost effective is the thing that gets investors excited, I think, or programmers excited. I think people really want the best tools, not the cheapest. And if that's where Jassy is going with their priority roadmap, maybe that's problematic in and of itself. What do you think about that idea?

29:16I mean, it's spot on. And just to sort of put a bow on that, when I speak to people who are deploying this technology, they will tell me that the difference between deploying a model that gets like 99 % of the stuff right versus 95 % is massive. You almost can't work with something that has that big of a gap. So that is basically the whole ballgame here is that some AI models will just be more accurate and better and therefore worth a massive premium, even if the almost as good models can do effectively almost what they do, but for a fraction of the cost. Because ultimately, errors in the stuff and economically valuable activity are going to be quite costly.

29:58Can we keep you for two more real quick? Yeah, let's do it. All right, let's do Microsoft. One-year chart, please. Microsoft, it appears to me, has godfathered this whole situation. They seem to be the only company that has Altman in a position where he's got to do deals that maybe aren't perfectly advantaged to open AI, but offer a lot of advantage to Microsoft. And that's a pretty good place to be in. Today, they made it official. I don't have the numbers in front of me, but Microsoft's going to keep 20 % of the profits. which is a lot of money potentially, also sort of has the inside track on all things chat GPT, open AI in a way that it wasn't clear even six months ago or three months ago if they would keep that.

30:46Constant headlines about they're not getting along, the playground's not big enough for both of them, blah, blah, blah. I don't know if they've totally put that to bed. The share price and reaction in Microsoft today tells me the street seems to think that they have and this is now paving the way for OpenAI's full conversion to a for-profit, ultimately an IPO'd company. Am I on the mark here with that interpretation? Yeah, I mean, one thing I'll say, first of all, there have to be profits. I mean, OpenAI is expected to lose something like $120 billion by 2029. So there might be some time there.

31:23But here's what Microsoft gets with this deal. You know, the equity was a little bit less than some people might have expected given the extent of the profit they were entitled to and the money they put into open ai but microsoft gets such a large chunk of open ai 27 of the public benefit corporation it gets an entitlement to the profits it gets access to the ip and i think most importantly for microsoft is it sort of gets off the sam altman roller coaster it has its stake if open ai succeeds microsoft gets a piece of that If OpenAI doesn't succeed, its downside is limited. Whereas like if Microsoft says - There's no secession, in other words.

32:02Like they're going to, they're together. Well, correct. But also like if Microsoft were to like, so Microsoft basically, I think Microsoft had this option in front of it. Keep funding OpenAI and basically betting the entire Microsoft on OpenAI or allow OpenAI to go to the Oracles, the NVIDIAs of the world to build the infrastructure and then just kind of negotiate with OpenAI for a piece. And Microsoft went with that second option. And I think that's brilliant because it's basically like we'll get 27 % of the company if these big risky things that Oracle and NVIDIA are doing with OpenAI pan out.

32:33And if they don't, basically very little downside. They actually had this crazy thing written into the agreement, which I think is now put to bed, where once OpenAI achieves AGI, Microsoft like loses a whole bunch of their stake. Like could have been tens of billions of dollars. Like that was the deal. and who declares when OpenAI has achieved AGI? OpenAI declares. Polymarket, polymarket. Right now, there's an independent board that will review that, so. But it's a financial, now it's about replacing actual workers. It's not this nebulous concept. Like it's a financial test to see whether or not they've achieved AGI.

33:16It's like if you were Saudi, you were just kind of sweating it out, hoping Sam wouldn't say those magic three letters. Yeah, last one. Apple, give me a one year. So Apple made it a record high today, hit$4 trillion in market cap, stocks 269, Michael say it. I already did. Nice. Look, it's$102 billion in revenue expected when they report, which I think is Thursday. That's only 7.6 % year over year growth, but it's huge numbers. Earnings,$1.77 would be almost 8 % year over year growth. And it looks like the new phone is a hit. What else do you think is relevant to know going into the what what should we all be watching for when they have their call?

34:00iPhone 17, I think, is all that matters. I mean, they're going to give us some numbers on a week of iPhone 17 sales. All the reports, the third party reports have said that those sales have been through the roof. So it would be great if the Apple confirmed that that would be great news for the company. I mean, it went through a couple of years of low to stagnant growth on the iPhone. And if that could be restarted, there was 13 % iPhone growth in the most recent quarter. If they could restart that, that would be massive because the only thing that really was growing at an impressive clip was services, and that was on a fairly low base.

34:32So to me, the company is the iPhone company. It's always going to be the iPhone company. And if it's able to revitalize the growth in that business, I think that's really all you need if you're Tim Cook. in the chat. Situation Zero says Apple will make a deal for Gemini to power Siri. So I was talking on CNBC about this today with Microsoft and the OpenAI soap opera now resolved. To me, this really puts pressure on Apple to not just rely on its App Store partnership with ChatGPT, but to like really do something that can power Siri and set it apart. And I just felt like the most obvious thing is that once again, Google and Apple run into each other's arms.

35:17If you had to guess when Apple revamps its Apple intelligence and Siri product in 2026, if you had to guess, would in fact Gemini be the technology that that's going to be built on? Or is there some dark horse like a perplexity deal or Apple's own foundational model? Like, what do you think is going to happen there? I mean, the dark horse for me would be Anthropic. We know that Anthropic and Apple have spoken. Apparently, Anthropic wanted a lot of money to be able to power Siri, and that sort of broke down. So I think Google probably is the most likely candidate. If you're Google, it's great. You get more data for your models.

35:52You get exposure. You might get people to sign up for big personal cloud deals, and that would be good if you're Google. And you know Apple is desperate. So you probably get some pretty good terms if you make that decision. I want to tell you, you are the best. it's so important that we talk to people like you that are eating, sleeping, and breathing this stuff. We're Wall Street. We're Morlocks and you're in Eloy. I don't know if you know the reference. I listen. You know your stuff. All right. So you're among the Eloy and you are out and about in that world and we have to hear from you. So thank you so much for stopping by.

36:31I know the audience appreciates your time. let's tell everybody where they can uh where they can listen to you on an ongoing basis yeah so uh you can listen to me on big technology podcast we're in all podcast apps uh we have the ceo of medium coming on this week to talk about how ai is going to change writing and we break down all the ai news every friday so it's been great having you both on and it's always fun to speak with you you guys thank you thank you so much alex all right have a great night i love him do you love him i do love him what's not to love right he knows he knows what's going on and he knows how to explain it.

37:04That was rhetorical. Yeah. No, he's the best. Okay. Let's do a little bit of stock market. I got some darn catch. No, I don't. Let's do some stock market stuff. So the stock market is ripping, more buyers and sellers. And one of the reasons, of course, is because companies just can't stop, won't stop. Throw up this charge on U.S. companies, at least to be clear, companies in the S &P 500, are beating estimates to a degree that we haven't seen since the days of the pandemic. Pretty hard to believe, huh? Look at this. It's crazy. And this is with tariffs. Right? And it's not like – dude, it's not like estimates.

37:52Remember in 2022, we spent a lot of time talking about estimates need to come down, estimates need to come down. They're not coming down. Like, it's not like, I mean, analysts are not being super conservative. The bar's here, keep jumping over it. Yeah, no, I think that's exactly right. And I think like the analysts are tired of getting sandbagged and having low estimates and then seeing these companies succeed. Because it's not that the analyst cares that much about the published number versus their estimate and being so close. You feel stupid in front of clients who are trying to trade these stocks and you keep telling people to curb their enthusiasm and then they go up 20 points.

38:31I think the analysts don't want to be in that position anymore. But they also don't want to get out over their skis where it's like, guys, come on. How can you - At this point, what are you more worried about though? If you're doing sell-side research on AMD and Micron, you're way more worried about getting leapfrogged than you are about getting over your skis. Me personally, I feel like the risk is always to the downside. Like I would much rather be conservative and companies just question and you just go, listen, right? As opposed to like getting all bowled up at the top. It's like, you donkey, like now?

39:02Yeah. Well, yeah, I guess that's probably a pendulum just like everything else. Sure. All right. One other thing I want to mention, ChartKid made this. I've never seen it before. Here's what we're looking at. We're looking at the number of all-time highs in a year juxtaposed with the max drawdown for the year. So all the way on the left, you see - Oh, this is so sick. All the way on the left, the companies that are on the zero of the Y-axis are companies, or I'm just companies, are years that didn't see an all-time high. Okay? Those are bear markets by definition. And then what we're looking at, the red dot is 2025 year to date.

39:44looks very similar to 1998, where you had a 20 % give or take drawdown and yet tons of all-time highs, 35 year to date. 98, of course, was LTCM and the Russian ruble and all that sort of stuff and market hiccup for a second and then boom, off to the races again. What a charm, huh? This is so great. And I'm going to tell you another thing. in 90, in the summer of 98, when, um, keep this up in the summer of 98. So you had, all right. So this is saying in, in 98, in the full year, you made almost 50 new, new, new all-time highs unreal. And then a 20 % drawdown. I remember that 20 % drawdown. It was in the summer and Greenspan came out and dropped rates, like not by a little bit.

40:34I forget the actual number, but it wasn't 25 basis points and it wasn't on schedule. It was a surprise rate cut. It was in response to the fact that they were trying to do this long-term capital bailout hedge fund blow up. They were trying to like do a workout with other banks on the street. They did a self bailout basically without taxpayers being involved, but they were also countering like just massive disruption across Asia. It wasn't just the Russian ruble. It was the Thai bot. It was all these currencies that on the surface, you feel like it's obscure. It doesn't matter. But when it's every currency, one after another, blowing up.

41:12And bond markets go and kablooey too. Yes. So they did this sort of one-off intra-meeting surprise cut. And it immediately brought order back to the markets and the NASDAQ. And I remember it like it was yesterday, even though it's like 27 years ago. I wasn't managing money. I was like a cold caller, but I was watching the TV with all the brokers. And that reminds me a lot of how fast the turnaround was this April, where it was like, we're going to do these insane tariffs. And then like a few days later, no, we're really not going to do that. It's literally, it's eerie how much those two things match up.

41:53So shouts to ChartKid, Matt. That's a really sick visual. I love what this guy's doing. All right, let's talk about the robots. Wait, last thing. Put that chart back up. So by definition, is 1995 the best year ever for the stock market? Yeah, because it went straight up. There was no chill. 80 new all-time highs and no drawdowns. It was that and then 2017 to my memory. Yeah. So guys, if you're staring at this chart, that's 95 is all the way to the right. No drawdowns. 2021 is right next to it. Yeah. Yeah. Great chart. Love it. I'm stealing it. Okay. So there's been articles written about what Amazon is doing inside of the warehouses.

42:31They've got all sorts of robots. Some are newer than others, but able to do all sorts of things in terms of moving gigantic things around the factory and then taking up the packages and all sorts of robots, machines. Okay. So obviously, a lot of factory workers are being displaced, replaced. But then we got news yesterday or this morning, actually. There was speculation that they were going to cut 30 ,000 corporate jobs. It's 14 ,000 corporate jobs, obviously a meaningful number. They wrote a blog post today about it. They said, this generation of AI is the most transformative technology we've seen since the internet, and it's enabling companies to innovate much faster than ever before.

43:13We are convicted that we need to be organized more leanly, with fewer layers, and more ownership to move as quickly as possible for our customers and businesses. And the rest of the street, and it's already happening, is going to take this AI as cloud cover to get lean and do whatever they have to do. And the street is rewarding it. So it's scary. Yeah. But it's – look, it's where it's going. And it started out with, all right, we're just not going to hire more people. so anyone that resigns or retires before we add that person back, like add a new version of that person back, let's see if we don't have to.

43:54And that went on for a while and now it's flipped over and now it's just like straight up. We have too many people. Like how could we ever maximize the potential of this AI technology if we have this many people in the way, so to speak? Here's the New York Times. Internal documents show the company that changed how people shop has a far-reaching plan to automate 75 % of its operations. Amazon's U.S. workforce has tripled since 2018 to 1.2 million. But the automation team expects the company can avoid hiring more than 160 ,000 people in the United States it would otherwise need by 2027. That would save about 30 cents on each item that Amazon picks, packs, and delivers to customers.

44:40That's dystopic. So here, by the year 2033, that would translate to more than 600 ,000 people whom Amazon didn't need to hire. Put this chart up. Number of Amazon employees per facility on the left. You can see that is now cascading lower since the pandemic. Packages handled is rocketing higher. Packages handled end-to-end per employee. So these are the pick and pack robots. These are the conveyor belts. These are the truck loading robots. This chart is never going to reverse. Do you agree with that? I do, I do. So throw up a few more charts that we made. So Amazon went crazy, particularly during the pandemic.

45:32It wasn't their fault. All sorts of supply chain disruptions and issues, and they overhired. And they've spent the past couple of years riding that ship. and this number will never reach a new all-time high. 1.5 million employees. And did you know that they are the second largest employer? I did know this. In the United States. Behind Walmart, yeah, I did know this. And Walmart is only behind the federal government and that's it. Like, you know what I mean? Like, these numbers are insane numbers of people. and yeah, if Amazon is gonna stick to its roots of it's always day one and there's always room for delighting the customers with more efficiency, of course this is where it's headed.

46:19But I think what's shocking people, Michael, is that these aren't warehouse jobs. This 14 ,000 is white collar employees. So this is everything from engineers to like assistant vice presidents. But this is no longer about people in the warehouse. This is now biting into bone. Well, one of the people quoted in one of these articles, there's been so many over the past week, said, when I got hired, Bezos was like six, there was like six managers between me and Bezos. Now there's like 28 or whatever the number is between me and Jassy. Like there's so much bloat and fat. That's how tech companies die.

46:54All right, Wall Street Journal. This is not just the story of Amazon. This is now the story of corporate America. How's this for a lead? It is the corporate gamble of the moment. Can you run a company increasing sales and juicing profits without adding people? Yes. American employers are increasingly making the calculation. They can keep the size of their teams flat or shrink them through layoffs without harming their businesses, AI, blah, blah, blah. Many companies seem intent on embracing a new ultra lean model of staffing where more roles are kept unfilled and hiring is treated as a last resort.

47:31At Intuit, every time a job comes open, managers are pushed to justify why they need to backfill it. Quote, that typical behavior that settles in and we're all guilty of it is historically, if Jane Doe leaves, I've got to backfill Jane. Now when someone quits, the company asks, is there an opportunity for us to rethink how we staff? 100%. This is the story. You made a comment at the top of the show about profitability and margins. And this is where it's coming from. Less bodies. Revenue growth minus headcount growth. It's great for earnings. Terrible for society. So UPS was in on the mix today.

48:16Here's a headline from Bloomberg. UPS jumps after sweeping job cuts, push profits above estimates, throw this chart up. UPS has been a dog for the last 10 years. But interestingly, I didn't realize that it actually kept pace with the market until 2022. They announced earlier in the year that they are severing ties with Amazon, who is their largest and least profitable and most time-consuming customer. The stock fell 15 % that day. It was like the worst day in two decades or something like that. So I was looking through its call today. And operational update. This is the first thing they wrote.

48:47Integrated agentic AI into our next-gen brokerage capabilities to streamline formal entry processes. They spoke a lot about this on the call. Obviously, Amazon was mentioned a million times, but they're laying off tens of thousands of people. And guess what? The stock market loved it. You know, it's a cold world. Loved it. But the stock was up, I don't know, 9 % today. Same thing with Target. Target cuts 1 ,800. Corporate jobs, corporate jobs, not people in the store. No, these are paper pushers. It's first major layoffs in a decade. And look at the chart. Again, I mean, this thing has been punished a long time, but the stock market loves it.

49:19So it's going to keep happening. I think it'll keep happening so long as the share price reaction is positive. And it will be positive because I think Wall Street now understands the year of efficiency is becoming the decade of efficiency. Like there's no end in sight to the levels of efficiency that these companies need to pursue. Great for investors. I don't want to say horrible for society because I don't want to go crazy. No, it is. We don't have enough time on the show to cover it, but it absolutely is. And if this wasn't your signal to own the robots and be an investor in the market, I don't know what you're waiting for.

49:54I told you 10 years ago that was the name of the game.

50:00Strategy is the first digital asset treasury company to receive a rating on its debt. S &P issued its first ever rating in the space, and it gave strategy a B-, which is junk. But I think with a very good explanation why, it's not a commentary on the way the company's being run at all. It turns out it's just a lack of dollar liquidity, which is incidental to the company's whole point of existing, which is to not hold dollars. I mean, B minus is not bad. We were C students. It's not bad. That's right. No, that's my point. They're not saying this company is trash. They're just saying like, typically when we look at other companies, we would want to see more dollar liquidity.

50:50In the case of strategy, the whole purpose of its existence is to be short dollars and long the coin. So it's like it's not a disrespectful B minus, but it's a B minus nonetheless. less. But it forced S &P to actually look at this thing like a company on the debt side because they were a big debt issuer. What are your thoughts? Yeah, no. I mean, I have nothing else to add. I want to throw some charts on because – can I have a critique? Could you stop with the price and the market cap charts? I mean, throw this chart up. Yes, Sean, to make this? This is garbage. Come on. This is beneath you. Wait, what did I do?

51:29This is a thing that you do. You ask for the price and the market cap, and it's the same chart. Here's what you do. I wanted the market cap number. I wanted to point out it's an$80 billion market cap with B minus rated debt. I wasn't comparing the price with the market cap. I wanted the data. I wanted the data because I think that's highly relevant. I wanted to ask you, how many junk rated publicly traded companies do you think have a market cap above 10 billion dollars well almost none i wish so that's what i was that's what i was looking for because we could have found it all right let me so let me this is how you chart this is how matt this is you went to sean no offense hold on i went to the chat is the chat is not happy with you so just saying mommy and daddy are fighting tell michael to chill i will not chill we have standards here we we we are professional chartists so i brought the good stuff you're getting cooked i brought the good stuff oh yeah oh yeah this is how you cook chart on please all right what i show you made the same chart no i didn't asshole i'm showing the value of their bitcoin versus their market cap this is not the same as what you did and then hold on chart off Yeah, what's so funny, moron?

52:55What's so funny? Mommy and daddy are fighting. I feel like this is my fault. All right, chart back on. Okay, look at this chart. So the Bitcoin versus the market cap. And then what ChartKid did on the right-hand side was he divided it. So early on, when strategy was the only game in town, formerly known as MicroStrategy at the time, it was the only way for people to get crypto exposure in their brokerage account outside of GBTC. In like a stock wrapper. This was the vehicle of choice and it traded at a mega premium. And even in the early days of this most recent bull market, look at that run. Holy cow.

53:30It was 3.5 times a premium to its underlying. And guess what? Whoosh. Other way. This thing is getting cooked. One more chart. One more chart. Next one. Okay, here we go. So this is that chart zoomed in a little bit. Actually, I'm sorry. This is a different chart. My bad. This is strategy divided by Bitcoin. And investors are just not having it anymore. They said, listen, I don't need MSTR to get my leveraged exposure to crypto. If I want leveraged exposure, I could literally just get it. I don't need this anymore. And I don't know how this premium comes back. This is Jim Chanos' trade from the short side.

54:08He's long Bitcoin. I don't know if he's using the ETF or not. I actually think I'm seeing him for dinner in a couple of days. I'll ask him. It is working. Yeah, it's working. He's killing it with this trade. And look, this is one of those things where when he rolled it out, I'm like, yeah, of course that's going to work. And then two minutes later, I was like, no, wait a minute. Of course that's not going to work because everything's because everything's stupid now. But it did work and I'm really happy for him. I think I think your explanation like it was the only way for people with traditional brokerage accounts to be long Bitcoin.

54:43And then all of a sudden it wasn't. I think it's just leaving one thing out. I think you're right. I think you're missing one component. there was a moment shortly after the election, but before the inauguration of Donald Trump, where all of these crypto things were being one by one, the Trump family, all of them, Don Jr. Polonia coin. Like they were all like saying, don't worry. Gensler's done. That era's over. Everything's gonna get fixed. David Sachs in the White House, blah, blah, blah. There was like, I don't, I want to say that was like a four to six week period of time. Michael Saylor was on TV five days a week in that period of time.

55:25That's when he, like the Saylor phenomenon, we had him at Future Proof in Miami, which was March. So like there was this season, the season of Saylor, where he was like, you couldn't turn your head left or right without seeing somebody talking about strategy or him explaining it to somebody. and that I think played a really big role in getting the share price to three and a half times the value of their Bitcoin. And I think I would just point out, it's really hard to keep that media momentum up. I seem to be the only person that's capable of doing it for more than a year or two. So it is not easy to make those appearances and tell the story.

56:10And so I think that's a miss. I haven't seen them around lately. there comes a point where you can't, there's no more podcasts left to do. Well, if you don't have a new story, they don't book you on the shows. I am excited to listen to the call because everything that they've been, that he's been saying, it's not working anymore. And I don't know how you get that mojo back. I mean, I would offer myself up as a, as a consultant if he wants. All right. Uh, anyway, interesting though, uh, for people that are interested in reading about micro strategy, strategy as an issuer, visit S &P. I think we've come to make the case.

56:47I have two small cap stocks breaking out. One of them is your idea, but it was my idea a generation ago. Let's put this up. That is true. IMAX. I told you I found my pitch from 2004 when I was selling this shit over the phone. Anyway, I was right 21 years ago, and you were right, and you were right one years ago. So IMAX is the most important entertainment company in Hollywood other than Netflix and Disney. I would say it's number three. Every major release coming out in the next year, but probably the next five years, is desperately locking up as many IMAX theaters as they can. They're building new 70-millimeter theaters because that extra-large format is not available enough.

57:38the converted theaters at AMC and Cinemark, like the distributors, the studios, the Chris Nolan Odyssey. Okay. They're actually, this is true. IMAX said there is so much demand for tickets that the exhibitors, the theater companies themselves are converting as many of their theaters to IMAX as they can so they can get in on the selling tickets early thing. like as soon as possible. They put the tickets up for IMAX format a year in advance. No one in the film industry has ever thought to do this. It's the first time. They sold it out in like an hour. Yeah, it's crazy. You cannot see the Odyssey.

58:23And it's the greatest cast ever assembled for a movie like this, we should point out. But it doesn't matter. It's proof of concept. We're now treating movies like concerts. We're buying tickets six months a year in advance. and there's not enough capacity for IMAX. So they're going to make a lot of money selling the cameras, the equipment, because Chris Nolan filmed this movie in IMAX, which is the thing that we should point out. It's not a regular movie converted. It's filmed in IMAX. They call it FFI on the call. That's like a thing now. Yes. Filmed for IMAX. Yes. So they're going to sell a ton of equipment to other studios who want to have one of these a year, which they all should.

59:02This is how you get a billion dollar movie, by the way. the conversion fees, existing theaters that want to become IMAXs. I read that the backlog is 500 theaters or something and growing. They announced a huge deal at the Cinemark yesterday. Yes. So there's tons of money to be made. This is a small cap stock. It's some weird thing where it's like Canadian, but it's based in New York, blah, blah, blah. I think this is just the crown jewel of the film industry. And it's become the most indispensable part of opening a movie. they're going to have things like Netflix commission Greta Gerwig who made Barbie to do Narnia and it's exclusively coming out in IMAX you can't see it in a regular theater like there's stuff coming out in IMAX that I think is paving the way for this to be a much bigger story and I think the stock continues to work so bravo to you I'm not in it I'm waiting for a sell off to buy it it'll probably go to 50 before I have a chance do we have that chart up one more time um i had a technical chart i don't know where this thing came there we go like this is gonna go right there's still time it didn't leave you like what are you waiting for all right next whoa whoa whoa whoa hold on i have two things to add i can't let you go without this i love the case um on the call they said the north american box office was down 11 in the third quarter and the imax box office globally was up 50%.

1:00:26Throw up this chart. This is the share of the box office, domestic, China, global, international, ex-China. And it's up and to the right, obviously. Look at the next chart, top 10 grossing IMAX titles. So to your point, it is a concert. When people want to see something on the big screen, they're going to IMAX. And then you mentioned the slate that's coming up. Yeah, it's huge and everybody's in on it. So it's going to continue to work. look at right you have a super mario movie coming you have another avatar you have toy story 5 the superman spinoff supergirl like these are all gonna open so big on imax screens dune avengers yeah it's working there's a oh yeah dune 3 there's so much on on the slate for imax and i like companies cannot live without that now if they plan on exhibiting um it's not enough to just put these films in theaters you're not gonna hit your potential you need them in imax theaters And I can't believe this stock is not fully reflecting that reality yet.

1:01:25David Ellison should buy the company. It's a billion-dollar market cap. There is an overhang with the China business. It's like a subsidiary. And I don't think it's wholly owned with IMAX. And I think that's part of what's been a problem with the stock in this era. But I feel like that's the kind of thing that could get cleaned up if they figure it out. Or maybe they already have. What's the other one? A twofer. Yeah, Etsy. We buy charts that look like this, right? Let me see. We certainly do. Can I show you? We certainly do, but I don't like this company. Here's just a price chart. We buy charts like this.

1:02:05No, we do. But is Etsy, Chotsky, Chotsky's? What is this? It's sort of a cross between Amazon and eBay with a twist. This is people who make their own crafts. And I know that sounds ridiculous, but like, let me cook. There's a lot of home design stuff. It's not just people making keychains and bracelets. There are people who like fashion these incredible fixtures, metal. It's people. It's basically like a Shopify. I shouldn't have said Amazon. It's a Shopify mixed with an eBay. It's a combination of vintage things with crafts that people actually make. And the people who use it absolutely love it.

1:02:48I've never bought anything from Etsy. I've never sold anything on Etsy. So I don't have that firsthand experience, but I'm gonna tell you three things. Number one, when prices in the economy are high, Etsy is a pretty obvious go-to place to buy people gifts because you're not buying from corporations. You're buying from the people who make these things. Number two, they just announced AI seller tools. They're in the AI business too. The goal is to keep people on the site and not bounce off because they can't find the thing they're looking for. And they're going to utilize AI to make that process smoother and more efficient, basically sell more things.

1:03:28Number three, Lone Pine just took a huge stake in the company. And that guy almost always, Steve Mandel, that guy almost always wins. And this is the area that he wins in. This is what his fund has become synonymous with. These consumer facing platforms that have the ability to get much larger. He tends to invest at these kind of turning points. I know we don't have a long-term chart of Etsy. This stock went into an 80 % drawdown and is now on the verge, is now making a, hold on, making a 52-week high, but it's really erasing like years of underperformance. And it sort of looks like it's finally figured out its business model and it's having a moment.

1:04:11So I'm not in this stock. It's a small cap. So be careful. I think the market cap is like$7 billion. It's tiny. Its name is much bigger than its market cap. Most people who are on the internet are aware of Etsy. Very few investors are aware of Etsy, the stock. I love that disconnect. I feel like IMAX benefits from that disconnect. Yeah, I like the story. I think it was a good pitch. Was out of my radar. So look, don't say I never gave you nothing. I brought two gems, two small cap gems to the table tonight. Yeah. Okay. Mystery chart time. John, if you would please. All right. Would you catch this falling knife?

1:04:52Well, is it a ratio chart or is it a penny stock? It's a ratio chart. But would you catch this falling knife? No. Okay. Next chart. Wait. Back. Back. If I were in the knife catching business, I would catch this falling knife because it looks like it just got, it went from a downtrend to a caricature. So stretch too far to the downside. Yes. I would agree. Next chart. Okay. Would you take profits here? Would you sell this chart?

1:05:25Maybe. I don't have enough information to say yes. I'm just purely based on the charts. No, because I never sell anything. Good for you. That's why you're a good investor. Okay. These are the same charts. One is I just flipped the numerator denominator. What are you playing games with me now? I am. I'm playing games with your heart. You're playing mind games with me? Wait, it's the same chart, but you showed it to me upside and downside? Yeah, John, go back. And I said two different things about what I would do? That's not good. No, no, no. You were pretty consistent. No, honestly, that was better than I thought because you were pretty consistent.

1:05:56Okay. All right. So these are – I can't give clues without giving it away. Just guess. Honestly, I can't give a clue without giving it away. What do you mean you can't give a clue without giving it away? We spoke about this dynamic at the top, top of the show. Ooh. We did? We did. Okay. So one is Amazon and the other is - Think bigger. Think broader. Zoom out. Okay. Oh, all right. So one is tech and the other is the S &P? Close enough. It's the S &P divided by the equal weight. I mean, this thing really crashed or reverse crashed, whatever. Wait. So which is going up though? the S &P is going up.

1:06:39Correct. So cap weighting destroyed equal weight over the past couple of sessions. Like destroyed. Do you know, chart off, do you know there are four of these bad boys, four mag seven stocks in the Dow? There's four. All right. So I forgot. Wait, Amazon. Two of them got added last year. I didn't even know. I didn't realize. Google, Apple, Nvidia is not. Yes, it is. Nvidia is in the Dow? Yeah, I think so. I think they added it last year i no no yeah i think it replaced intel did it uh let me ask gemini you said big if true i i think they did so meta's not in yeah they replaced intel on november 1st 2024 boy was that a buying opportunity in intel by the way you didn't realize that did you i had no idea do you know that do you know that amazon's in the dow yeah i said amazon apple and google so what's not and microsoft Meta's not?

1:07:34Meta is not. Isn't that interesting? And Tesla probably never will be. Meta is not in the Dow. It's the only one other than – it's Elon and Zuckerberg are not in the Dow. That's disrespectful. I wonder why Meta doesn't make a car. Isn't that interesting? Wait, I have one more thing to say. Meta and Tesla are not in the Dow, and they're the only ones with their original founder as CEO. other than NVIDIA. So Microsoft's in the Dow with the third CEO, right? Alphabet's in the Dow with the second, Amazon's in the Dow with the second CEO. Alphabet, I think, is on its third. The Dow is so weird. Eric Schmidt.

1:08:17So of the top five companies, by weight, it's Goldman, Microsoft, so that's the only one, Caterpillar, Home Depot, and United Health. Yeah, because it's price. Yeah, sure, why not? Because it's price, but Apple's important in there. Nvidia is getting to become important wow wow wow wow isn't that interesting I had no idea that Nvidia was in there this is a great place to put a pin in it and say thank you to everybody who joined this for the live hey guys two things number one thank you so much for the huge outpouring of affection and feedback for the episode we did with Jim Cramer if you haven't seen that yet it's right here on the channel or listen to it on our podcast feed we put it up as a special last night thank you so much we really love all of your comments and all the nice things that everyone said and hope we can see you at the next live tecaf that we do tomorrow is Animal Spirits first thing in the morning we'll do ask the compound later in the day and then at the end of the week we have an all new compound and friends new guest and it's going to be a good one new guest same old Michael and Josh so thank you guys so much for watching and listening we love you we'll talk to you soon Thank you.

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