Transcript
0:00 THAT'S GOING TO DECIDE IT AND NOBODY KNOWS RIGHT NOW. I THREW OUT A NUMBER LAST NIGHT. I DON'T THINK 420 IS RIDICULOUS GIVEN HIS HISTORY. BUT OBVIOUSLY THE MARKET IS STRUGGLING WITH WHERE THE VALUE TESLA BASED ON WHAT WE THINK IS GOING TO HAPPEN. >> ALL RIGHT. LET'S GET MORE ON ALL THESE EARNINGS AND BRING IN GENE MUNSTER DEEPWATER ASSET MANAGEMENT WHERE HE IS A MANAGING PARTNER. GENE. GOOD TO HAVE YOU WITH US. >> HELLO. >> WE'VE GOT A LOT TO GET THROUGH BUT LET'S KICK IT OFF WITH META. DID YOU HEAR ENOUGH ABOUT MUSE TO SATISFY QUESTIONS ABOUT PATH TO MONETIZATION?
0:30 >> WELL, I THINK DAN WAS TAKING SOME ISSUE ABOUT RETAILERS JUMPING IN HERE. AND ZUCK SAID THAT BASICALLY THE QUESTION CAME UP LIKE, HOW ARE YOU GOING TO GET RETAILERS ON BOARD WITH THESE BOTS IN THE COMMERCE? HIS RESPONSE WAS, THEY'RE GOING TO HAVE TO GET ON BOARD. HE SAID THAT IN A NICE WAY. CFO STEPPED IN AND KIND OF TONED IT DOWN A LITTLE BIT AND SAID, IT'S GOING TO TAKE A LITTLE BIT OF TIME.
0:54 BUT I THINK THAT THAT'S A BIG KEY TAKEAWAY HERE, IS JUST THAT WE'RE STILL VERY EARLY IN WHAT'S GOING ON WITH THE BOTS, AND THEY'RE GOING TO HAVE TO DO A LOT TO GET RETAILERS COMFORTABLE. BUT MAKE NO MISTAKE, MUSE IS THE FUTURE OF THE COMPANY. THIS IS WHETHER IT'S GOING TO BE COMMERCE BASED. THAT'S THE BIG DRIVER RIGHT NOW. THAT'S THE NUMBER ONE USE CASE. THEY HIGHLIGHTED THAT IT'S COMMERCE. BUT EVEN BEYOND THAT, WHAT I THINK IS INVESTORS NEED TO TAKE INTO CONSIDERATION HERE IS THAT MUSE IS EFFECTIVELY THE NEW PLATFORM. AND SO YES, THEY'LL STILL HAVE INSTAGRAM.
1:24 THEY'LL STILL HAVE FACEBOOK, WHATSAPP. BUT FROM AN ENGAGEMENT PERSPECTIVE, THEY'RE SEEING THAT THIS, THE, THE PERSONALIZED AGENT SIDE WILL BASICALLY START TO TAKE MORE AND MORE OF OUR TIME. AND SO I THINK THAT'S AN IMPORTANT, AGAIN, DISTINCTION. AND WHY THAT MATTERS FOR INVESTORS IS BECAUSE YOU JUST HAVE TO THINK ABOUT EVERYTHING THAT THEY'VE DONE AS GROW THIS BIG BASE OF 3.65 BILLION PEOPLE. IT'S NOW CONVERTING THEM OVER TO MUSE. AND WE'RE AT A WHOPPING. THEY DIDN'T GIVE THE NUMBER, BUT MY GUESS IS WE'RE PROBABLY ABOUT 10 MILLION DAILY USERS OF MUSE, WHICH IS JUST REMARKABLY LOW.
1:59 WE GOT A LONG WAY TO GO HERE, BUT THAT'S THE REAL SUBSTANCE. HERE IS A SIMPLE QUESTION. DO YOU BELIEVE IN MUSE? >> WHY WOULDN'T THEY GIVE THE NUMBER, DO YOU THINK GENE? WHY WOULDN'T THEY GIVE IT? >> IT'S SO SMALL IS. AND WHEN YOU PUT IT IN THAT CONTEXT OF THEIR OVERALL DAILY USERS OF 3.6 BILLION, IT'S A LITTLE BIT OF ALMOST AN EMBARRASSING NUMBER. BUT THEY GAVE ZUCK KICKED OFF THE CALL TALKING ABOUT HOW HOW MUCH FASTER THIS IS THEIR FASTEST GROWING PRODUCT EVER. AND THE ENGAGEMENT GOES UP AS PEOPLE USE IT MORE, WHICH IS SOMETHING THAT THEY TYPICALLY DON'T SEE.
2:29 AND SO THEY GAVE KIND OF THE SOFT STUFF. BUT TO ANSWER YOUR QUESTION IS, I DON'T THINK THAT THEY'RE TOO EXCITED ABOUT IT. IT WOULD PROBABLY THROW COLD WATER ON SOME OF THIS CONVERSATION, BUT IT SHOULDN'T. AND THE REASON WHY IT SHOULDN'T IS THESE AGENTS, IF YOU HAVEN'T DONE IF YOU HAVEN'T USED THESE, I HIGHLY RECOMMEND BECAUSE YOU REALLY CANNOT UNDERSTAND THE CONVERSATION AROUND INVESTING IN AI UNTIL YOU'VE USED SOME OF THESE PERSONALIZED BOTS. AND I THINK YOU WILL FIND THEM REMARKABLY USEFUL AND A TOTAL CHANGER, VERY SIMILAR TO WHAT HAPPENED WITH GENERATIVE AI AND THE CHAT BOT A FEW YEARS AGO. I THINK THE PERSONALIZED BOT IS GOING TO HAVE THAT IMPACT.
3:01 THAT'S FRONT AND CENTER. THAT'S THE CENTER OF THE BULL'S EYE FOR ZUCKERBERG RIGHT NOW. SPOILER ALERT HERE, THEY DID NOT GIVE THE CAPEX GUIDE FOR CALENDAR 27. YOU'RE HAVING A CONVERSATION ABOUT RAISING MORE CAPITAL THAT THAT WINDOW OPENING STARTS AT 196 BILLION FOR NEXT YEAR. I BET WHEN THEY REPORT DECEMBER, THEY PROBABLY TAKE IT TO ABOVE 225 BILLION. I DON'T THINK THE STREET'S GOING TO CARE. BUT JUST TO GIVE YOU SOME CONTEXT, WE'RE STILL NOT DONE WITH THIS BUILD OUT.
3:28 >> HEY GENE, YOU'RE THERE ARE FEW BETTER THAN YOU KIND OF TAKING A LONG TERM VIEW ON A LOT OF THIS STUFF. AND, YOU KNOW, OBVIOUSLY SOMETIMES I TEND TO TAKE A VERY SHORT TERM VIEW. BUT IF I LOOK AT WHAT I'VE BEEN USING AND I LOVE INSTINCT, OKAY, I WILL NEVER USE MUSE BECAUSE I DON'T, I DON'T TRUST THAT COMPANY. AND THEY BROKE OUR BRAINS. AND SO I JUST DON'T WANT TO GIVE THEM ANY ACCESS TO MY BRAIN THAT'S ALREADY KIND OF BROKEN. BUT WHEN I THINK ABOUT LIKE AN INSTINCT, WHY WOULDN'T AMAZON, YOU KNOW, THEY HAVE AN LLM, YOU KNOW, ON THE SITE, YOU KNOW, A LOT OF THEIR SALES, RIGHT? GO PEOPLE GO DIRECT TO THE SITE, YOU KNOW, IF THEY WERE TO BUY LIKE AN INSTINCT, RIGHT? THINK ABOUT THAT. AND IT JUST TURNS INTO YOUR SHOPPING AGENT. AND YOU KNOW, MANY OF US DON'T REALLY NEED TO GO TO MANY OTHER PLACES THAN AMAZON OR MAYBE IT'S WALMART OR SOMETHING LIKE THAT. SO I JUST WONDER IF A LOT OF THESE KIND OF VERTICALS ARE GOING TO START DEFENDING THEIR MODE A LITTLE BIT.
4:17 >> I MEAN, THE BEST ANALOGY I HAVE IS KIND OF WHAT HAPPENED WITH THE RECORD LABELS. AND WHEN WE STARTED TO GET THESE STREAMING MUSIC SUBSCRIPTIONS AND THEY, THEY INITIALLY THEY HAD LIKE BMG HAD THEIRS AND DIFFERENT RECORD LABELS. VIRGIN HAD THEIR KIND OF STREAMING SERVICES, BUT IT TURNS OUT PEOPLE JUST THOUGHT ABOUT STREAMING. THEY JUST THOUGHT ABOUT MUSIC. THEY DIDN'T THINK ABOUT WHERE THEIR RECORD LABELS WERE. AND I THINK WHEN IT COMES TO COMMERCE, IT'S SIMILAR.
4:37 PEOPLE THINK, YES, THEY WANT TO DO THEY WANT TO TRANSACT ON AMAZON IF POSSIBLE, BUT THEY JUST WANT HELP TRYING TO FIND WHAT THEY'RE LOOKING FOR. IF IT HAPPENS TO BE ON AMAZON. AND SO WILL IT MAKE SENSE FOR AMAZON TO KIND OF BEEF UP WHAT THEY'RE DOING THERE? THERE'S THIS SWITZERLAND PIECE WHERE YOU REALLY NEED TO BE THERE. AND THAT'S THE ADVANTAGE THAT MUSE HAS IS THAT THEY CAN KIND OF GO EVERYWHERE. AMAZON'S NOT GOING TO WANT TO SHOOT TRAFFIC TO SOMEPLACE ELSE FOR SOME SORT OF A TAKE RATE. THAT'S THAT'S UNLIKELY. SO I THINK STRUCTURALLY THEY'RE GOING TO HAVE TO OPEN UP. I MEAN, THAT'S THE REALITY IS THIS THE FUTURE OF MARKETING IS NOT TO HUMANS.
5:08 IT'S BOT TO BOT. I MEAN IT'S JUST IT'S CRAZY. AND AGAIN, I UNDERSTAND WE'RE TALKING 10 MILLION PEOPLE HERE AND I'M MAKING SOME BIG ASSUMPTIONS. WE'RE GOING TO BE AT MULTIPLE BILLIONS OF PEOPLE USING THESE PERSONAL BOTS THE NEXT THREE YEARS. BUT I THINK THAT'S THE PATH WE'RE ON. AND IF THAT'S THE CASE, EVERYTHING WE TALKED ABOUT IS GOING TO CHANGE IN TERMS OF HOW THESE COMPANIES ARE GOING TO HAVE TO APPROACH COMMERCE. >> GINA MENTIONED FIRST TIME IN TEN YEARS, FREE CASH FLOW, NEGATIVE DEBT MARKETS ARE WHAT THEY ARE. WHAT ARE THE CHANCES THAT YOU HEAR OUT OF THE BLUE, A SECONDARY FROM FACEBOOK? AND MORE IMPORTANTLY, HOW DO YOU THINK THE MARKET WOULD INTERPRET THAT OR RECEIVE IT?
5:39 >> JUST BEFORE I HOPPED ON, THAT QUESTION GOT ASKED AND THEY SAID THEY JUST WANT TO BE READY. TRANSLATION IS THEY'RE PROBABLY GOING TO HAVE TO RAISE CAPITAL. YOU TALK ABOUT THE FREE CASH FLOW BURN I MENTIONED WHERE THE CAPEX IS PROBABLY GOING TO GO NEXT YEAR, SO THEY'RE GOING TO HAVE TO RAISE 25, 50 BILLION, SOMETHING LIKE THAT. IF WE ARE AS EAR