Speaker 1: This is what the flux.
Speaker 2: I'm Brett and I'm Justin and it's Wednesday, seventeenth of
Speaker 2: December Fox. Today we are doing a recap of some
Speaker 2: of the biggest tech stories of twenty twenty five. In
Speaker 2: twenty twenty five, we saw some of the biggest acquisitions
Speaker 2: we've had in years and even bigger earnings results. But
Speaker 2: not just that, we also saw markets reacting, sometimes very quickly,
Speaker 2: when expectations were met. It was part of this recap.
Speaker 2: We're not going deep on AI because it deserves its
Speaker 2: own dedicated recap episode, So enjoy this episode where we
Speaker 2: take a look back at the stories that define the
Speaker 2: tech world in Australia and around the world in twenty
Speaker 2: twenty five.
Speaker 1: Three splendid stories Today, Juzzy Boy, let's do it for
Speaker 1: our first domain, the Aussie real estate website, will be
Speaker 1: sold to US real estate giant Coast in a deal
Speaker 1: worth two point eight billion dollars.
Speaker 2: Ooh, Aria Group not happy right now, It's got a
Speaker 2: red competitor here be man, so tell me more well.
Speaker 1: Juzzy Boy Domain is the real estate marketplace that first
Speaker 1: listed its properties online in nineteen ninety nine, back.
Speaker 2: When those real estate newspaper fold outs were the best
Speaker 2: way to know which properties were selling.
Speaker 1: But Domain has always played second fiddle to real estate
Speaker 1: dot com dot a U in the digital real estate industry.
Speaker 2: Yet real estate dot com dot U has forty six
Speaker 2: percent more monthly unique visitors than Domain.
Speaker 1: But Josie Boy, that didn't stop a mystery buyer from
Speaker 1: acquiring a sixteen point nine percent stake in Domain back
Speaker 1: in February of this year.
Speaker 2: And spoiler alert that mystery buyer was the US real
Speaker 2: estate firm Coastar. Yep.
Speaker 1: They slid into Domain's DMS with an offer, which was rejected.
Speaker 2: Then they sweetened the deal, and.
Speaker 1: Now Domain's majority shareholder Nine Entertainment has backed this deal.
Speaker 2: Which was it a forty two percent premium to Domain
Speaker 2: share price before the proposal.
Speaker 1: And technically shareholders still need to vote on the deal.
Speaker 2: Given nine has a sixty percent steak in Domain and
Speaker 2: coast has now got nearly seventeen percent, there's not too
Speaker 2: much up for debate.
Speaker 1: Yep. So what's the key learning here?
Speaker 2: Controlling stakes don't just influence outcomes, they often decide them.
Speaker 1: Yep. When a company or a shareholder owns a large
Speaker 1: stake in a business, they can effectively control the outcome
Speaker 1: of major decisions.
Speaker 2: Everything from leadership changes to mergers and acquisitions.
Speaker 1: In this case, Nine owns sixty percent of Domain, which
Speaker 1: means their vote basically seals the deal with Costar.
Speaker 2: As long as Nine's on board, the deal is likely
Speaker 2: to go ahead.
Speaker 1: But does not all controlling shareholders are willing to facilitate
Speaker 1: a takeover like this deal.
Speaker 2: Remember when the private equity firm KKR try to acquire
Speaker 2: the Australian hospital operator Ramsey Healthcare in twenty twenty two
Speaker 2: for twenty billion dollars I do.
Speaker 1: The deal fell apart because the Ramsey family, which owned
Speaker 1: nineteen percent of the company, did not back the proposal.
Speaker 2: So be man at Controlling stakes don't just influence deals,
Speaker 2: they often make or break them. For our second story,
Speaker 2: Google has announced its largest acquisition in history, acquiring cybersecurity
Speaker 2: startup Whiz for thirty two billion US dollars.
Speaker 1: Holy Smokerroni's not bad for a four year old company.
Speaker 1: Juzzy boy, What is going on here?
Speaker 2: Ky So Whizz was founded back in twenty twenty and
Speaker 2: he's one of the fastest growing startups of all time.
Speaker 1: Is an Israeli company that's New York based and sells
Speaker 1: security tools that protect information stored in data centers.
Speaker 2: And we know that the data centers are the second hottest
Speaker 2: word right now behind.
Speaker 1: AI so jes wait. Google has now announced its acquisition
Speaker 1: of Whiz for thirty two billion US dollars, and this
Speaker 1: is Google's largest acquisition by a country mile. The next
Speaker 1: biggest is Motoroller Mobility in twenty eleven for twelve and
Speaker 1: a half billion US dollars, which it.
Speaker 2: No longer owns the men. Whiz currently works with others
Speaker 2: like Amazon and Microsoft in the cloud market too, but
Speaker 2: it's possible that Google will make the tech exclusive for
Speaker 2: Google customers in the future.
Speaker 1: And interestingly, this isn't Google's first interaction with Wiz Nope.
Speaker 2: Last year, Google tried to acquire Whiz for twenty three
Speaker 2: billion US dollars, but they rejected the offer.
Speaker 1: So now Google's having a second bite of their cherry,
Speaker 1: and this time it's been successful, but paying forty percent
Speaker 1: more than its original offer and thirty times Whizz's forecasted
Speaker 1: future revenue.
Speaker 2: So what is the key lenny here?
Speaker 1: When big companies by smaller ones, they often assess value
Speaker 1: using a multiple of revenue or a multiple of earnings.
Speaker 2: For example, when Microsoft acquired LinkedIn, it was for eight
Speaker 2: point seven times their revenue, and.
Speaker 1: Into It acquired Mailchimp for about a fifteen times multiple
Speaker 1: on their revenue.
Speaker 2: But in this case, being Man Alphabet is paying thirty times.
Speaker 2: Wiz is forecast at future revenue of one billion dollars,
Speaker 2: or roughly sixty times their existing revenue. Because Wiz is
Speaker 2: growing like wildfire YEP, It's one of the fastest growing
Speaker 2: startups of all time according to the Wall Street Journal.
Speaker 1: Top of that, cybersecurity tools are in very high demand right.
Speaker 2: Now, so be man. Sometimes buyers will pay a premium
Speaker 2: when they say strategic.
Speaker 1: Value, like Google securing a partner that also works with
Speaker 1: its two biggest cloud rivals. Remember when Meta acquired WhatsApp
Speaker 1: for nineteen billion US dollars in twenty fourteen.
Speaker 2: YEP.
Speaker 1: At the time, WhatsApp was believed to be earning about
Speaker 1: thirty million bucks in annual revenue.
Speaker 2: It was a huge risk, but eventually a huge payoff
Speaker 2: because What'sapp generated one point three billion revenue in twenty
Speaker 2: twenty three.
Speaker 1: Google's hoping Whiz will follow a similar part.
Speaker 2: For our third and final story, Meta share price has
Speaker 2: jumped nine percent after its quarterly earnings smash past investor
Speaker 2: expectations that the spenderthon is continuing.
Speaker 1: Not only Zuck bulking right now, but metas profits are too.
Speaker 2: Tell me more you No Meta. The company bid Facebook,
Speaker 2: which started in the Harvard dorm back in two thousand
Speaker 2: and four.
Speaker 1: Since then it acquired Instagram and WhatsApp.
Speaker 2: And the man we know that the part man, part Cyborg,
Speaker 2: Mark Zuckerberg loves to chase the next big thing.
Speaker 1: For a hot minute, it was creating a digital currency
Speaker 1: called Libra.
Speaker 2: And there was the hot a minute when it was
Speaker 2: creating the metaverse.
Speaker 1: And now the hottest minute with Meta focusing on competing
Speaker 1: against Open Ai, Google and Anthropic for AI dominance.
Speaker 2: But now Mark cyborg Berg has revenue of forty seven
Speaker 2: and a half billion US dollars for Meta's last quarter, up.
Speaker 1: To twenty two percent. Year on you next minute, share
Speaker 1: price up more than nine percent, and.
Speaker 2: The Man Meta says that AI is becoming a real
Speaker 2: revenue driver for the business. While investors clearly like the vision,
Speaker 2: they also like the projected dollars coming through.
Speaker 1: But Josey Boit growth in revenue means next to nothing
Speaker 1: if it's not coupled with a growth in earnings as well.
Speaker 2: So what is the key learning here?
Speaker 1: Well, revenue tells you how much a company made. Earnings
Speaker 1: tell you whether they actually kept any of it.
Speaker 2: For example, Meta earned forty seven and a half billion
Speaker 2: dollars in revenue this quarter.
Speaker 1: Earnings, also known as profit or net income, is what's
Speaker 1: left after the bills are paid.
Speaker 2: Think staff wages, AD spend, R and D and yes,
Speaker 2: those billion dollar data centers as well.
Speaker 1: And jes a boy for investors. Both metrics matter a lot.
Speaker 2: But be man. In this quarter, Meta didn't just scre
Speaker 2: a revenue. It also grew its earnings per share by
Speaker 2: thirty eight percent.
Speaker 1: And that was well above expectations.
Speaker 2: So yes, Meta's AI dreams are expensive, but this quarter
Speaker 2: at least it looks like they're starting to pay off.
Speaker 1: And for shareholders who were worried that AI was becoming
Speaker 1: a money pit, it's a reassuring sign.
Speaker 2: Because it means the AI arms race might actually deliver
Speaker 2: financial returns. Box Sham, thanks for listening to the biggest
Speaker 2: tech stories of twenty twenty five. On Friday, we'll be
Speaker 2: talking about the biggest stories from the streaming world this year.
Speaker 1: Thanks for listening, and we'll see you on Friday.