Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: Right now, Daniel Ives joins us, and he's the greatest
Speaker 2: thing about Ives is when he's right, he doesn't do
Speaker 2: the rhyme right, I'm right and right thing. He just
Speaker 2: moves on to the next analysis. So I'm gonna go
Speaker 2: CFA on you, Dan Ies joining from Webbush. The thing
Speaker 2: I don't get is the terminal value of revenue growth
Speaker 2: for these juggernauts. The media is out one quarter, if
Speaker 2: we're lucky, three quarters a year, the streets out two years.
Speaker 2: I was trained to go out five or even seven years.
Speaker 2: Do they have persistency of revenue growth out to two
Speaker 2: thy thirty two?
Speaker 3: I look, I think, for really the first time maybe ever,
Speaker 3: big tech, because of this AI revolution, the visibility and
Speaker 3: the demand that they're seeing gives them what I believe
Speaker 3: is almost hypergrowth into the next call it, you know, five.
Speaker 4: Six, seven years.
Speaker 1: And I think that's that's essentially what we're seeing play
Speaker 1: out here, whether it's on digital media, whether it's on cloud,
Speaker 1: across the board, even in the tariff uncertainty, Big Tech,
Speaker 1: Rocker Gibraltar, I mean, it's it's playing through as we
Speaker 1: see it.
Speaker 5: Hey, Dan, I'm looking at a Microsoft. I mean, here's
Speaker 5: a three trillion dollar market cap company, stocks up pre market.
Speaker 5: I mean, it's just amazing. Here. Talk to us about
Speaker 5: what's got the street enthus tier about Microsoft this morning?
Speaker 3: Well, first off, I mean think about all the rumors
Speaker 3: abandoned data centers here and there that, well, how about
Speaker 3: them apples? Right, you don't see I don't think those
Speaker 3: a banded datas and that story is gonna gonna disappear, right.
Speaker 4: Because the reality is like Azure two.
Speaker 1: Hundred bits above street accelerating into the next quarter or two.
Speaker 4: I mean to put some numbers in, I basically think
Speaker 4: like you.
Speaker 3: Could be looking at for a typical Microsoft customer, you
Speaker 3: could be looking at thirty to forty dollars of every
Speaker 3: hundred hours that they've already spent, thirty to forty incremental
Speaker 3: just on AI spent. You put that together and you
Speaker 3: can essentially be looking at cloud numbers are essentially double
Speaker 3: every two years.
Speaker 4: Dan.
Speaker 5: Prior to the beginning of this year, all we talked
Speaker 5: about was AI for the past couple of years, and
Speaker 5: for the last you know, four months, we've talked about
Speaker 5: nothing but tariffs. How is the AI story unfolding. Now,
Speaker 5: can you give us an update?
Speaker 4: Yeah, look, i'd say, and we talk about it.
Speaker 3: You know that that Tom reference. In the last few weeks,
Speaker 3: like all of our checks, I mean, we've seen some
Speaker 3: eccent almost and acceleration and a.
Speaker 6: Lot of the AI spend because I think companies are
Speaker 6: basically saying like this is you cannot touch this, because
Speaker 6: this is really what's driving the strategic shit a view
Speaker 6: of a lot of these comings over the coming years.
Speaker 3: And I think we're talking two two and a half
Speaker 3: trillion that's gonna be spent with AI, with really a
Speaker 3: small amount.
Speaker 4: Of companies that are going to benefit. D I think
Speaker 4: when it comes to taps is not impound.
Speaker 2: I got a return on invested capital folks, that one
Speaker 2: of the best screens in the Bloomberg terminal is wacc
Speaker 2: way to the average cost of capital study. It's what's
Speaker 2: called a stern Stewart study from a million years ago.
Speaker 2: And I got a persistent twenty five percent return on
Speaker 2: invested capital for Sachin company Dan ives. I got revenue
Speaker 2: pre pandemic of one hundred and twenty six gazillion. They've
Speaker 2: done a double to where we are. Now, do they
Speaker 2: get out to I can't believe I've never said this number.
Speaker 2: Are they going to get out to five hundred billion
Speaker 2: in annual revenue two thousand and thirty one, two thousand
Speaker 2: and thirty two? What's in the way of that?
Speaker 3: I mean, I think four fifty to five hundred. I mean,
Speaker 3: it's it's hitable because just given I don't see what's
Speaker 3: going to stop it, just given where companies are going,
Speaker 3: and just to I mean you put in perspective today
Speaker 3: like you only have two percent of US enterprises that
Speaker 3: have gone down the true AI path. It just shows
Speaker 3: that's just US. None in Europe, none really, I mean
Speaker 3: outside of China, it's minimum in terms of agent. It
Speaker 3: just shows where this is going, despite obviously tireff uncertainty.
Speaker 5: Hey Dan, we're going to get our good friends from Coopertino.
Speaker 5: Apple's gonna report after the close here today. What are
Speaker 5: you looking for?
Speaker 3: I feel like they're not going to give guidance, right,
Speaker 3: I mean, I'd be shocked, And I think I think
Speaker 3: the big question for them is the quarter itself actually
Speaker 3: was pretty strong and even something that could be pulled forward.
Speaker 7: The big question for them is like, how do you
Speaker 7: navigate coming out with iPhone seventeen in a typical cycle
Speaker 7: with these tariffs, what are you waiting for from the administration?
Speaker 4: Is there a? And I think that's the question. There's
Speaker 4: the timing.
Speaker 3: Get the way we've talked about for Apple obviously being bullish,
Speaker 3: you know, for for a ducade, this is you don't
Speaker 3: look at it over the next three months. You gotta
Speaker 3: look as you know, as tom Owi's reverence, you got
Speaker 3: to look over the next twelve to eighteen months. I'll
Speaker 3: give free cash flow, I'll get the install base, and
Speaker 3: even if things move around and then I then negotiations
Speaker 3: ultimately come through, and I think they will be much
Speaker 3: more unscathed relative to.
Speaker 4: You know where we see things stay when it comes
Speaker 4: to tiers.
Speaker 5: Tom Apple's gonna have over one hundred billion dollars for
Speaker 5: free cash flow. Yeah, I mean, well, Dan, what do
Speaker 5: they do here with this free cash flow here?
Speaker 4: I mean, look, M and A has obviously been minimal
Speaker 4: to that. The way that they view it in Cooper Tino,
Speaker 4: it's it's basically from an R O I C.
Speaker 3: It's about to buy back and it's about ultimately how
Speaker 3: they how.
Speaker 4: They're going to continue to return that to Cheryl.
Speaker 7: Right.
Speaker 2: You can notice you don't see this on Bluebrig radio,
Speaker 2: but you see it on YouTube. What I've does is
Speaker 2: he's at some golf courses. He in Arizona, I don't
Speaker 2: know he airport, he drops in the webbush backdrop of
Speaker 2: some class hotel room. He's like at a Motel five
Speaker 2: or a Motel Force somewhere instead of some two thousand
Speaker 2: dollars a night golf course in Scottsdaleer you know one
Speaker 2: of the places sweet he's been.
Speaker 5: Dan.
Speaker 2: I look at the belief here and what I see
Speaker 2: more than anything is mag seven is under owned by
Speaker 2: disbelieving institutions. Retail America loves Apple. Okay, that's a generalization
Speaker 2: of my part. But what happens when we wake up
Speaker 2: this morning with thirty three percent as your growth rate,
Speaker 2: what we get from Amazon tomorrow, whatever? I just count
Speaker 2: the boxes at the bottom of the scots d and
Speaker 2: I where is the institutional wall street? The belief in
Speaker 2: these companies?
Speaker 3: I think what I ken nailed it Retails, stuck with it,
Speaker 3: institutional They've hit the exit, and I think they got
Speaker 3: and they've got scared out a lot of the mags Haven,
Speaker 3: a lot of attack and now I guess what's gonna
Speaker 3: happen over the coming weeks.
Speaker 4: They're they're gonna have to double down.
Speaker 3: And I think that's why I think the run here
Speaker 3: that we can see intact over the next three four weeks,
Speaker 3: especially as we go through this, I think could be
Speaker 3: massive because it's under own institutionally.
Speaker 4: Christ well Is Paul talked about stock being up nine.
Speaker 4: There was a view that they were gonna miss ager.
Speaker 3: They absolutely, I mean, this is an Aaron Judge like performance.
Speaker 5: Hey, yes, it is Aaron Judge. Happened even a better
Speaker 5: year this year than last year, if that's eaves impossible exactly. Hey, Dan,
Speaker 5: talk to us about Tesla and I think a lot
Speaker 5: of people are probably most interested in Elon Musk. We
Speaker 5: haven't heard from him much over the past month or
Speaker 5: two on the Doge front. Where do you and I
Speaker 5: know you've been very very public and very outspoken about
Speaker 5: suggestion that he really needs to get back to his
Speaker 5: day job at Tesla. What do we know about Elon
Speaker 5: Musk and Tesla these days?
Speaker 3: Yeah? And then obviously you know the Journal article which
Speaker 3: obviously a board denied then that I came out last
Speaker 3: night about you know, looking for.
Speaker 4: A CEO potentially, Look, the reality is a must. That
Speaker 4: was a Code RED situation and it was the most
Speaker 4: important comments.
Speaker 3: Call he ever had to do, and he handled it.
Speaker 3: I think the best I've ever seen him. Pick Tesla.
Speaker 3: He's going to lead them into this next chapter when
Speaker 3: it comes to autonomous robotics, and ultimately I think that
Speaker 3: more and more a growth rebound that we see in
Speaker 3: China and his days at the White House are done.
Speaker 3: However you want to call it one to two days
Speaker 3: that we I mean, I think this is the being
Speaker 3: and the end. The board was not gonna take it.
Speaker 3: CHERYLD is not going to tape it. But but that's
Speaker 3: you're talking about one of the biggest of the technology
Speaker 3: comans through a muscus, Tesla's musk
Speaker 2: And your community across the nation this morning and of
Speaker 2: course on YouTube, Dan Eyes with Us with White Bush