the 65 is live and we are a day early yes we are a day early and I want to thank you all for checking in and so why are we early well Pat could be getting another medical procedure I might get one every single day no I actually don't it seems like I do but uh yes bright and early I'm getting a 3D clearly calcium heart scan at my uh local Outlet here so we're going early and I we should R to a commercial this this show has been brought to you by Patrick morehead's Health one of Patrick morehead's doctors exactly functional medicine doctors no seriously uh man it's been a great week so far Dan you and I uh were in our second home for Tech analysts CEOs of tech analyst companies and that is Las Vegas we were out there at Oracle but Dan it is great to see you my friend yeah man look it's uh it's good to see you too um you ever seen the movie Ace Ventura Pet Detective I am happy to say I've never watched the full show oh my gosh there's this part where I can't remember exactly what happened but Jim Carrey's character looks and he goes obsessed much um that's Pat and health now he's found his Groove he's found his thing I went used to go to Tech conferences and talk about technology now I go to Tech conferences and I talk about wearables for health care so you know what you found your blend man that's still health and Tech so pat pat Health Tech care cat oh we can't make cat comments this week be way too weird that's correct that would be weird we got a great we do have a great show for you but but before I talk about what we're going to talk about I do want to give the typical caveat is that we are going to talk about publicly traded companies but don't take anything we say in investment advice we're not certified uh we don't make uh price Target illegal price targets like uh some people who uh are not certified finra certified I believe um but hey let's dive in wey got this great show here we're gonna be talking about Apple glow time oh gosh are we going to get the 19th version of the iPhone looks exactly like the previous seven versions I don't know let's see uh we're going to talk about uh the conference Oracle had a cloud uh world this week and big big announcement with AWS we're gonna be talking about Oracle earnings inter arresting they did earnings while that they are at the event we're going to be talking about our seventh favorite topic and and that is antitrust uh EU is putting the keybos on both Google and apple it's hard to keep track of this stuff on which one they're doing but uh we're going to help uh Traverse that open AI going in for more money uh are they really worth $150 billion I don't know maybe their announcement uh today might have been a hint uh that they are but let's dive in and Adobe just went to dep print earnings Q3 how they do is AI clicking in or not I don't know we'll see Dan let's dive in iPhone iPad airpod lover Daniel Newman let's talk about the glow Time Event hold on let me put my airpods in Oh you mean all right all right here we go so glow time everybody was waiting this was the moment it was the time we were going to have a super cycle we're going to get five % more 10% more everybody's going to be running to their local store to get the next iPhone because Apple intelligence this was the thing this was the rage this was the future I couldn't tell you if that was what happened because I fell asleep in the 90 minute long presentation just kidding but Pat look um I I I'll just start off I'm G to be straightforward disappointed I'm not going to say I'm disappointed in perpetuity I just think it was a setup problem the setup was that this was going to be this moment this gamechanging lifechanging AI powered device and what we ended up getting was a camera slider button on the side by the way 2010 Windows phone did that as well um we got some camera enhancements that I still don't think match the Samsung devices uh we've got some new colors colors are cool um and we got basically I think the theme of this week's glow Time Event Pat was something along the lines of coming soon um meaning that basically nothing that they're talking about whether it's some of the photo um you know in in in augmented reality capabilities uh whether it was some of the automations and productivity tools basically none of them are going to work out of the box so what you got was a device that has a an mpu that's I I personally think is a little light on memory coming out of the box at eight gigs of memory dude I know I know I don't understand that that is supposed to be a a you know this next Generation AI device and I think what it was ended up being another kind of hype cycle now on the on the positive side Pat this something I'm going to let you talk more about is I thought they did some interesting stuff with the health technology I think some of the new stuff um with the watches uh some of the the health capabilities I think the hearing aids um offering and helping people take you know something that's about 10% of the cost of a professional hearing aid and turn it into an enhancement that might enable people with hearing disabilities uh ttis I talked about that a little bit when I was on uh on Fox Business this week uh but Pat what I what I didn't find at least personally was that convincing I got to jump out of my chair I got to run to the store and I got to buy now I'll leave it with this because like I said there's so much you could cover we could cover a18 we could cover how this is good for arm and v9 we could cover how this is good for tsmc and their basically boundless demand for their 3 nanometer process but what I couldn't talk about was that run out of my chair have to go buy this next device I'm sitting here now still with my 13 Pro Max still unconvinced that I need a new device um and I know that I need a 15 Pro or newer to take advantage of Apple intelligence pack um but I didn't see enough features there I didn't get the run out of my chair moment that's what I wanted last thought I do like that a lot of this can be done in software we cannot fix the eight gigs of memory that will not be fixable so when you don't have enough memory that's going to cause some um problems in terms of running significant large language models on a device um having said that a lot of these features will be upgradeable so as you're using the device longer you can add more Apple intelligence featur features as they come Pat C minus D+ that's how I rate it over to you no I think that's I think that's pretty fair and I I don't want to make this an apple slam Fest but let me explain first of all why I'm so tough on on Apple so they uh have a monopoly in the United States on smartphones and their bad behavior with developers uh Compu app stores uh and not paying their suppliers to the point where they want them to go out of business they steal intellectual property as we've seen with Qualcomm and and mimo I mean they're just they're just a nasty company and they can they can do better but I do want to give them Kudos on on hearing aids uh I do think that I mean hearing aids are are very expensive uh and I'm hoping that this will disrupt that market I have my brother-in-law who is analyzing uh the signal wave intensity to see just exactly how uh well they compare to gosh 1, 5,000 uh uh hearing aids that seem to squeak and Creek uh whenever I talk to my dad and my father-in-law uh so uh kudos to Apple to take the risk to do this um you know after using a ton of Health apps and really getting into the whole Wellness thing uh Apple is woeful on the software uh they really give you no idea of how to mitigate stress how to make your sleep better uh things to eat uh not to eat it has no insights into recovery and and resilience and it's pretty uh it's pretty horrible they can do better now um I think sleep apnea was a good thing to add as Samsung has that in in over 42 different countries uh and know by the way Samsung also has blood pressure in h 42 42 different countries uh as well and unfortunately not here FDA approved in the United States so Apple can do better and I don't know if it's the risk Prof file um they certainly have more money than anybody so it's not funding um or maybe on the app side they're trying to give their third party developers like athletic uh that I uh use in my iPhone um but you guys got to check out Samsung watch and Samsung ring it's exceptional experience will tell you more I can even do body segment analysis on on the Samsung watch where I to totally did not believe it they said it was 95% uh as accurate on body fat and muscle mass as a dexa scan but sure as heck it was the closest one it's even uh better than my dedicated segment wiing scale that told me this morning that I'm gaining fat and losing muscle after going hardcore I did notice that so weird uh I asked my trainer said probably it's probably fluid buildup doesn't know how to distinguish between fat and fluid that comes into your muscles and the blood that uh starts pumping but anyways I uh I digress a couple things came up too wait wait wait wait did you think it could be the breakfast you've been posting online I mean I think the world should know Pat that you eat four eggs six ounces of steak four pieces of sourdough an avocado and just a tiny Taste of burnt half browned potatoes every morning forast breakfast and then you like to tweet about how you're burning fat that one blew up in my face baby you know we'll uh we'll see but I think uh anyways I've got my trainer on a on kpi bonus plan that uh give me 10 pounds of muscle mass in in in in six months and he gets a he gets a bonus so I don't know we'll see you know and this got me into a couple other conversations Apple came out and said their bionic processor was more powerful than a desktop uh processor that's on a geek geekbench single thread I got to tell you I cannot wait for this new Qualcomm uh a part to come out on the smartphones and you know I don't know how um geekbench St and Mt got leaked uh on that on the processor but I just it's time that Apple I don't know um gets shown that they're not the only G in town when it comes to smartphone processors I mean the PC folks in Qualcomm surely showed Apple uh that um they're not the only game in town on a a high performance uh low power notebook chip that's for sure uh we will see and the final thing I'm going to say is what would it take for people whove had iPhones for five or six years to defect um apple as a monopoly in the United States 51% market share uh but the rest of world it it's more uh in the uh the 20s and 30s so it's not about defecting there are a lot of people out there who do not use uh apple and sometimes we forget all of the goodness of the Android ecosystem and all of the people uh who uh buy that anything else you want to add Dan no I mean I think uh I think we hit that one on the head we we got a lot more to go buddy so let's uh let's rock forward yeah I thought the uh the most interesting thing about Apple intelligence conversation with Craig federi doing H parkour I love that guy I wish I could meet him someday but let's uh let's dive into our next topic here it's Oracle database uh at AWS so a little background here um AWS has been around for 15 years they invented cloud computing as a service and for about 10 years they have been trying to kill off the Oracle database and you might say oh Pat that just so that's such a strong uh comment why would you say something like well maybe it's because aw has a database called red shift uh and oracle's primary color is red and they might want customers to shift from Oracle to Red shift and I would say the last seven uh reinvents that I've either watched online or attended maybe not last year there were direct swipes at at Oracle particularly when Andy jasse was uh delivering the message so hopefully you believe me that they were trying to kill uh Oracle well here's the deal AWS did a deal where it is going to put exod data uh racks so literally non AWS infrastructure inside of an AWS hyperscaler data center let that snc in even Nvidia with dgx Cloud are not dgx boxes okay I believe this could be the only non AWS infrastructure inside an AWS hyperscaler uh data center so why on Earth would AWS do this so it's because a first of all they're not going to kill off the Oracle database right we always talk about the 80% of data that's on Prem uh for 15 years into the cloud a lot of that data is sitting inside of an Oracle database AWS wants to wrap every ancillary service whether it be Bedrock machine learning a hundred services around that and they need Oracle data to light that up and that's why they want to do this why does oracle want to do that what's the benefit Oracle database can be the lingua Fran sorry I speak German not French um it essentially becomes my favorite term Dan what am I gonna say multicloud fabric Oh I thought you say connecting the back to the front with multic cloud fabricc that's what yeah the multicloud fabric essentially if you standardize an Oracle database you can access services from Google Cloud a AWS Azure and of course inside uh oci and baby on Prem pretty cool what is the biggest inhibitor right now to Enterprise data sorry enter Enterprise AI it's getting your data act and gear so I brought this up on uh on Yahoo finance essentially uh this puts Oracle in the position to be the AI data broker for those very large very uh regulated and highly secure uh organizations my final comment is going to be on uh on security uh where you know what every vendor out there says they're the most secure and I've had a couple uh vendors you know do the wink wink nudge nudge to me on we do you know the three-letter acronym agencies out there freaking Oracle got the CIA on stage uh to talk about how secure Oracle was I'm gonna read this read this quote from lah Jones the CIO of the CIA say that 10 times fast the CIO of the C CIA I can barely say it twice uh she said we appreciate that orgle cares as much about security as us Dan does it get any better uh than that any bigger what what customer number was a CIA for Oracle number one thank you for asking me anyways there was a lot of stuff that went on I mean there was uh you know we talked to Steve Miranda who ran um um who runs Oracle Fusion uh we talk to leadership CEO Evan Goldberg of net Suite um and maybe you know one of the topics you might want to talk about is AI pricing yeah well that's a that's a really interesting one as well Pat I mean you hit the database news really look so Pat this is a bit of an inflection on our whole hybrid and lots of workloads are on Prem all these companies that have sort of leaned hard on that a lot of the um conversations about repatriation um interesting here you know what's the biggest on Prem workload for most Enterprises today it's their Erp it's going to be their core Enterprise data workloads that's Erp CRM workload sometimes if you have older systems but those are often in the clouds already uh supply chain data HR data other things that you you've run on on Prime and of course you have different analytics platforms long and long and longer has been you know not having AWS and Oracle synced up has been sort of a boond a boond doogle for some of the on prems now you suddenly have a situation where no matter which public cloud provider you use you get exod data uh Oracle in the cloud in their data center fast speed low latency high quality Pat you know you said Health frozen over I mean look I just saw that as a partnership that would never happen and now it has happened and I think it really changed the trajectory out of everything in that particular space right now it also really uh positioned Oracle well you Oracle like to say that it was kind of the only full stack um we know and we agree that that's not necessarily the case Microsoft has a very full stack you know Hardware database software application but having said that there really are only a couple and when it comes to the volume of the workload the the Erp database uh workloads Oracle the them and sap the biggest too in that particular workload so all of a sudden that you know you youve really changed the trajectory of the whole business any cloud and of course they you know it runs incredibly well on its own cloud and its own cloud grew really quickly so Pat this was good news big news I think it sort of stole the show at Oracle Cloud World um and I think this really sets us up pretty well to flow into the next topic the next topic wow did you just team me up for the next topic only the next topic well is it the next topic the it is the next topic absolutely I'm sorry buddy I'm not trying to mess with you Oracle earnings q1 Larry was on fire talk to me well I mean look let's just me kind of finish where we started I mean so Oracle made this big announcement and then you saw I think oracle's stock is actually up 20% in one week again this isn't Nvidia this isn't AMD this isn't like some like cool paler this is Oracle this is Oracle like really so or had a strong you know strong beat guide it led with this Oracle database at AWS and it led because it was just that shocking to people and like I said such a big moment and I think people are starting to see the capacity for growth the scale for growth that this deal could give to the company and you and I had the chance to spend time with their EVP of Revenue Ops Jason Maynard we actually have a full pod I think it may be dropped or it'll drop any time now you know we're just kind of talking about the evolution here but this is a company that has sort of you know is it's sort of seen its growth go exponential if you actually look at its valuation shift over like the last decade it's it's like a 6X magnitude it's incredible yeah companies nearing like half a trillion dollars in value now um and it's doing so through you know the through being able to diversify being able to successfully enter the cloud space on the app side and on the infrastructure side the fastest growing infrastructure it is smaller but their Cloud infrastructure uh is is is is wielding towards 12 billion dollars now it's not this is not a small business and obviously they've been able to take advantage of their database and their Cloud so all that migration of on Prem to the cloud they offer one alternative that's been doing pretty well now they can do it on theirs you can do it in AWS you can do it in Microsoft you do it in Google wherever you want to run it it's it's Pat it's it's encouraging and then you know Larry was really on fire I mean talking about going from hundreds of data centers like 162 to talking about thousands of data centers over the next several years he's talking about you know going from megawatt 800 megawatt to M multi- gigawatt he's talking about expansion he's talking about using the the the utility relationships to build nuclear local nuclear to be able to power these things um by the way looking great at 80 years old up there on stage amazing I want to be when I grow up you want to be we all do we all want to be Larry olon when we grow up um you know and and then of course you know you have the growth across the board you got Nets Suite growth we sat down with CEO Evan Goldberg we got apps growth double digit 10% plus uh you know we heard from Steve Miranda um Pat you know the company just overall is is really really well positioned uh the autonomous technology is is Market leading you know again it's it's hard to get Swoon over Oracle you know it just is it's historically just been a tough company to be Swoon about but like I literally looked at these earnings I'm like this is just really good and then he talked about 3,000 um what was it this uh wait three billion sorry is the number I'm looking for in GPU commits now we don't know exactly what those contracts look like what the per hour rate is and how much money the company's making but Pat one thing we did hear over and over whether it was Evan whether it was Miranda whether it was Clay mcgurk whether it was Jason Maynard is they believe AI is part of what they're charging for which is interesting because I had felt that being able to show incremental value was going to be super important they seem to believe if it makes their products great people will pay more for them they will stick with them but much more incremental uh in terms of how they're thinking about it rather than sort of any sort of onetime charging and you and I both hammered on that pretty hard throughout the course of the week yeah it's great stuff Dan so uh Oracle had their investor conference today in uh in Las Vegas I was in back to back to back to back to back back meetings but um I think what the company has to show F first and foremost you know Larry talked about 100,000 data centers uh what's the capex going to look like on that because right now they're not spending they're spending about um a little over 10% of what um some of the mag seven companies are spending now if you compare put that in comparison that they don't have a consumer franchise that they have to to pay for like uh Google and and Microsoft but it's more equivalent to let's say an AWS who deals with Enterprise and then if you narrow that into very large very highly reg related require the highest level of security uh you still have to get to something other than I think um AWS say 7x the the capex I'm really interested to see as small as they might be what kind of capex is going to be need to uh put in there uh on that uh it's also very uh clear to me you know that that bump from bump on their earnings I think also had to do with the realization with the smart investors on what this can mean for the future if you are the database the uh database of record uh and and it it it really enables multicloud that really hasn't taken off and also you know let's say 80% of that data on Prem becomes 50% on Prem that's going to be 30% more data going into the into the public Cloud imagine what that could do for uh the hyperscalers uh and and and what they can do I know we're here talking about Oracle but I think it's as important to talk about the network effects and ecosystem effects that that this type of of move um uh can uh can make you the apps business is going to be interesting um you know it's I think humming along at uh you know double digits uh there and listen overall apps are are are are hard uh to move there I can't tell you I can put a I mean they're doing well obviously uh they have a lot of uh openness particularly around Erp of uh both Nets suite and and fusion but I'm wondering Dan it's unclear to me what can turn that into deep double digit right from you know 10% to 20% to 30% to to to 40% if they're not they're not charging uh extra for AI and as Steve Miranda said it's not free it's included so uh interesting stuff there uh Dan uh Oracle overnight became a more interesting company to investors out there I think you and I always thought they they were an interesting company for various reasons but it's now on the radar screen and if nothing else they're going to be lumped into the AI the very rich AI a AI category good anything else Dan no man it's your show let's run all right man I just want to give you the last word you're my bestie okay let's jump into uh open AI so according to Bloomberg um open AI fundraising is out there to get the startups valuation to $50 billion uh talking about raising six and a half billion dollars in equity financing and maybe H maybe a cool five billion dollars uh with uh with debt you know Daniel valuation comes down to a couple things and I think uh first and foremost on a company like this it comes up with differential advantage over time there was no doubt that when open open AI came out with chat GPT it it was the differential advantage on top of everybody wasn't even close and then Google came out with Bard stumbled their toe came out with Gemini stumbled their toe um and you know apparent 90% of of even Tech unicorns are are using open Ai and and then and then what happened is you had meta uh come along and with llama and essentially enabled almost as good of results um for free okay A a complete uh disruptor you have Microsoft that created its own mod models with uh Fe or fi I never know if I'm using the right word there uh and then you've got uh companies um like ad us who are embracing um open source but also have their own models like Titan and IBM is in the uh in the same uh uh category there uh today um open AI dropped a new piece of technology not GPT 5 but gbt 401 that apparently in uh particularly two three or four different use cases looks uh Superior clearly they brought this thing out to to to help butress their debt and Equity financing but I gotta tell you Dan I don't see this as a runaway like Nvidia meaning it's going to be hard for people to catch up uh llama is is close okay and that's probably the next best thing particularly for Enterprise Gemini is getting uh better the ecosystem is embracing uh free llama from meta out there and the Enterprise and and if you don't have uh I would say a guaranteed and perceptual two to threeyear lead over everybody all the time I I just I'm struggling to find the mo the other part is although there are rumors about Open Eye making Asic or an xpu with multiple vendors uh 75 to 85% of their cogs are going to Nvidia and um they are burning cash uh precipitously so I'm not seeing it in the cards I don't understand this uh this valuation it looks like uh the rest of the open source industry is is kind of surrounding it and and doing uh and doing good enough you know I don't know if I'm cynical P for saying this but I as I watch this number grow I just think Ponzi scheme interesting listen I I what I'm saying is like you have companies that have just poured massive Capital into this thing at high valuation how do they ever get out of it you're losing five billion a year you've built a technology that is somewhat like you said it it may be Market leading but the subs number and the revenue number you're running billions a year in cash you don't have by any means like a moat that truly allows you like language models like Claude grock llama uh cohar there's different models out there path that all in you perplexity that most of us would argue Google Gemini that are all pretty good and somewhat interchangeable to use so what is the IP that this company holds that turns this thing into you know anything more than like the way we run our federal government right now you just keep stacking up valuation so that people can exit and new people come in at higher valuations and then they turn money by bringing in like so what's the next round going to be Pat another five billion in a year at 300 billion Val more than right now it's worth two intels right it's worth two intels and I'm not saying intels are you know in a great shape right now but like you actually look at the number here pad and you I just can't figure it out and so what is it that they have that's proprietary That's Unique I mean clearly they've done some incredible work the data is not really theirs the data is everyone else's um everyone else is training on this they do have a ton of cap capital that's invested in order to have this model but what was uh what is Sadia in for when they when they went 50% when they bought 49 was it 20 billion it was 20 billion Val they put 10 in 20 so you're telling me m Microsoft is 8x its uh its value since it put the money in and by the way Microsoft is so emphatically in belief in this company that they believe they're a competitor now that's how much they believe in the technology that they're going to build their own to compete with it the company's got all kinds of weird toxicity inside of the business with leadership with people leaving with turnover and I I mean look you and I often do have the inside scoop I can truly sit here and be honest when I say I'm going to be genuine I I don't have the under the hood here I've not been inside I do not know what you know what IP they have I don't know how close they are to AGI I know strawberry hit today or something announced today Pat wasn't there an announcement I I've been so heads down I haven't had a lot of time to look at it but like Pat I don't know I mean I just don't know where this comes from how we get to this valuation but what I know is this is like if they get another double in the next valuation they're bigger than AMD and Qualcomm they get another double in the next valuation they're worth more than broadcom right you know and then one more after that Pat they're more than tsmc I mean when do you actually have to build something and actually have a robust cash generating company because public companies are held to in incredible scrutiny you know we'll talk about it Doby a little bit later you know they beat uh considerably this quarter uh they missed on guidance and their company lost 8% of value this company's earning $5 billion or more of cash per year with no plan to be cash flow positive anytime soon and they get their valuation 8X in 18 months so yeah it's interesting uh Amazon went years without making any money and you know some companies when investors view that there's this differential uh Advantage they just they just dial in man yeah absolutely so so I don't know Pat like I said I I love seeing the AI thing the story evolve um I know the company needs money they want to build their own accelerators by the way that's more cash you know what's the development on one of those like 600 million on average 5 600 million or more just to just in development costs yeah um you know they have some licensing ideas they have a subscription model but they have a lot of competition and Pat I don't know I use Gro I use llama based tools and I use uh every day and chat GPT but I'm telling you there's it's not so good that it's the only one I could use if I didn't have access to it tomorrow I think I'd be fine yeah so I agree okay let's move on uh in antitrust news um Europe basically said NOP Google uh you're gonna pay and on a t Irish tax issue Apple was forced uh to pay as well is this just the EU trying to uh regulate uh itself and be the most Innovative regulatory uh Beast out there or are these just big companies acting poor poorly yeah I love this stuffy listen um so this was an interesting week just because Apple had its event Apple had um you know a lot was getting a lot of attention and then Apple got strapped with a you know 13 or so billion dollar tax bill company would been fighting on the onus that it had paid taxes in uh the US so it shouldn't have to pay taxes and and and this came back to me and I did some some you know kind of second tier TV about this but I was talking about how like one is you you you really can't avoid paying taxes anywhere so you know you know tax efficiency is the strategy of every company they take advantage of every loophole and companies like apple have more lawyers than ever necessary more lawyers and accountants than ever necessary to figure out ways to pay less tax in different regions like Ireland's often been a a a market that has been particularly ripe for um avoiding or delaying or deferring taxes there was a period where under Donald Trump you were able to bring uh you know repatriate dollars um to the US at a lower penalty or lower cost which a lot of companies took advantage of and now what's happening is Europe is coming home to Roose on the fact that maybe you did or didn't pay a fair share of tax over in Europe you know Pat I'm always one of those people that if the law is written a certain way I I would I admire companies for finding a way to be as efficient as possible but if their taxes are due the taxes are due um I'm sure they're going to try to find a way to kick this can down the road for another 10 years um you know before they'll actually have to pay it because the fundamental belief of these companies is they'll do more with a dollar than than the government will which I don't think I could disagree with in any circumstance they also could then use this money to do some absorbent and buyback if anyone's ever checked the chart of Apple BuyBacks it's it's remarkable um so that that's kind of the situation on Apple I mean you know EU I say this every time pat that we end up in talking on this topic their Innovation is stagnant the economy is not growing their best companies tend to leave and that's because it's just not a great place to build a company it's it's entire focus is on you know they've got this privacy Focus but this privacy focus is more about data control the data control practice is all about giving strong abilities for these companies to find uh the dma to be able to charge tax and find these companies and speed bumps and tolls for existing you know companies like Spotify and others that have been successful in Europe they they leave Europe they they want to redomicile because it's not a a great place to build companies and that's unfortunate but this isn't like unique I mean Google also got hit with a$2 and a half billion dollar fine for uh search they've had over eight billion dollar in fines over the last like five years or so um you know one was related to search one was related to shopping um you know they're and the entire thing with Google similarly to the Apple thing is just they're looking at fundraising activities so there's very little GDP growth there's very little startup few unicorns they don't seem to exist there so the way that uh vtiger historically in EU competition and leadership in this particular area make money as they as they find companies does that mean that I genuinely believe these companies do no wrong absolutely not I'm not suggesting by any means that these companies do not take advantage of their technology to give themselves preference or misuse data um I'm just saying that the the there is a conflicted policy set in Europe that continues to make doing business there not particularly Luc lucrative for big tech companies and startups you're seeing features not being rolled out in that Market uh frequently by companies and eventually if it gets too strict they may just not roll features or come to these markets at all so you know Pat it's been it's been a revolving door it's been Google it's been Microsoft it's been Qualcomm it's been Intel it's been Apple it's been Amazon it is a merry go round of 10 figure plus findes in Europe what I'm not seeing though right now or I'm at least not understanding right now is what is their plan to actually stimulate and create enthusiasm and excitement protect participate to grow to invest both at the startup end and then of course for big Tech it's getting kind of murky over there yeah it's hard for me to peanut butter any of this stuff uh uh going on there because some of those some of these I I totally get I mean statistically speaking Google has a monopoly in the digital advertising uh market and not only um do they have the you know double click is probably the biggest weapon and by the way they bought double click when I was at altim Vista like the best acquisition uh that that that that was made here and this is before most advertising was was digital so technically they they they do have a monopoly and I don't even think it's the fines that that that make any difference at all I mean uh Google has wrapped up 8. 8.25 billion uh dollars in in fines but that doesn't mean anything so 8.25 billion euros um over the last uh decade it means it means nothing to these companies speed speed unless they have to charge I think you know with apple they have 48 billion dollar left of cash okay that they can't buy any big companies um they are can't overinvestment [Music] is is share BuyBacks so that they're in this weird this weird conundrum but but only if you make them change something is it going to hurt so for instance uh Apple having to allow third-party uh app ecosystems into their store that is going to be difficult for apple and we've seen uh Apple try to not do what it's been asked to do multiple multiple times and I'm sorry I am not buying this security thing I I think Apple is is acting you know quite frankly like a little baby uh who was told it can't play uh with this toy and it's going to sit in the corner it's going to scream it's going to gnaw and it's going to Nash uh but you know you can sideload on Android you have adults you can you can do that I think the Android not being secure uh is is is enough issue at this point I keep you know waiting for the cataclysm uh cataclysmic event that Apple keeps talking about with Android and who knows maybe in 10 years uh it might but I just think it's an excuse and when it comes to a lot of these big companies they just want to be the biggest monopolist uh biggest monopolist uh uh out there so Dan let's go into our last topic here so about uh was it 30 minutes or an hour it's been an hour it's been a little over an hour I mean I don't know you and I we were time zoning when we put this on the calendar but yeah what's it three o'clock here the market closes so about an hour and a half ago so um the company beat on EPS by a range you would expect that it's done over the last three quarters between two and three% it beat by 2.49% and on Revenue it beat on a very s similar structure which was 65% you can say it met uh it beat but that was very eerily similar uh to the previous uh three beats of. 3 71 and 0.59 uh but as we know it's all about the guide it missed on Revenue it's slightly missed uh on EPS for the fourth quarter and Dan as you said it is down roughly eight% uh after uh hours but let's talk about growth here so digital media grew around 11% digital experience grew 10% uh digital experience Revenue grew by 12% and digital uh media ARR uh was 4 500 million of net new ARR I mean very clippity business you know what I'm saying like they just deliver EPS $465 I mean that's just absolutely uh astonishing I think the important thing that everybody is looking at from Adobe is unfortunately or fortunately investors want to know what are you doing uh in in AI Adobe is not making it very easy to parse out uh exactly uh what that that growth uh is um I am certainly paying gosh almost 20 bucks a month uh to have my be able to query my uh my my PDS I'll be honest the experience uh is not great and sometimes I feel like I get much better results taking that PDF having it sucked uh into perplexity and giving me answers uh but but listen for large Enterprises Adobe is is the language um of creative professionals and I would say um after Salesforce when it comes to um overall CX and and marketing and being able to tie the creative with the actual uh marketing and the campaigns uh Adobe is is right in there and um my my final comment well I guess the reason why their target market of of I would say Enterprises is important is I don't see Enterprises just willy-nilly moving off to some new startup uh technology like uh Sora let's say and the reason for that is is that uh Adobe I think looks uh and I think in in many cases is actually a more internally Reg ulated company when it comes to these types of things wouldn't you hate to be Ford Motor Company you use all of adobe's tools you send out all the creative uh for print advertising digital media advertising and then you realize that um my gosh um you used some copyrighted something uh or other and then you're getting takedown requests in every single country on the planet you're ripping down Billboards uh you're getting uh DM uh dmca notices uh it just gets it gets it just gets ugly and there's a lot of workflows inside of big companies and my daughters work for a big tech company and their entire workflow and all their creative uh comes from Adobe they're just not going to rip out something by the way if Adobe waited too long on something like a a video service I think they've shown when it comes to uh still images and integrated in all their Creative Suite that uh they've been able to uh light up um experiences that people are actually using and and F find valuable but when it comes to the end to endend uh process uh here um you're GNA not have any Enterprise that's going to move unless Adobe would be one or two years behind uh final comment uh Adobe you know in the spirit of of not being behind in certain things uh they dropped me see what date was that oh it was yesterday an update uh on generative AI bringing generative AI video with adobi firefly video model they gave a little bit of a fun little update on some examples that they put out there and you know again like I said before highlight that says all of which designed to be commercially safe and available in beta later this year sign up for the wait list here so it's not ready it's not commercialized but there is a sign of life for um Adobe Firefly video model right on so listen um first of all Pat we were joking about you know company misses slightly this is a company that in the last quarter generated a net income of one point hold on I'm GNA pull this number up here it had $465 of earning and it recorded 1.68 billion of net income this quarter yes positive market cap of the company at close was $260 billion after they dropped a% it just went down to about 240 so it's barely more valuable than open AI at this point apparently so anyways this is why I know I sound sardonic a little bit about it but um it's been a bit of a like tumultuous run with the kind of reactions this stuff is hard like these image generators and trying to figure out what's licensed and you and I both knew that one of the biggest problems and challenges that were going to have to be solved going forward is going to be rights usage for AI and so Adobe did its best to train and make sure it was had the right rights for all stubbed it stubbed its toe a few times and it stubbed his to a few times and you know that's definitely been a bit of of an area I mean it's been performing I think at times as CEO shantu had to had to say hey it's a little slower it's a little conservative Pat you and I have kind of talked about this this is the economy too it's not that good out there people I'm sorry like it's just where's the first area what do you cut first marketing marketing exactly and so you know while companies are looking to get more efficient use generative AI you know we saw um you know the subscription Revenue grew double digits by the way 11% right on par with what s screw right up like this this is what Adobe apps screw this is how much that market is growing right now it's about 10% for Enterprise uh application so they're sweet that's sweet infusion Erp boom 10 yeah they actually grew a little faster but same thing yeah I mean they were in that sub20 and so the point is is you're everything is slowing the Market's slowing the econom is slowing um you know we're seeing inflation drop a little bit I'm not meaning to make this all about economy but sometimes company performance when you're CEO you have to have have the gall to say it's getting slower out there I'm not going to overpromise I'd rather take the hit now overd deliver later you know the 11% growth um in in digital media with firefly you know it's good I think people want to hear this AI growth thing though they want to hear it's growing a lot it's growing fast and there's a ton of money coming in from it and you know Pat We you and I have gone that kind of the Gambit today we talked about Oracle saying we're not going to charge it all for it companies like uh Adobe have been able to make money with tools like Firefly using and rights and I don't think we've settled on which is the right approach just yet um I think near term though investors want to hear we're making more money because of AI I still like Adobe a lot of recurring a lot of predictable Revenue the company is in good shape it's got those little toe stubs to deal with Diversified across different parts of creative and more traditional marketing and documents um and Pat they beat I mean look nobody's ever going to be okay with a with a with a bad guide or a down guide um but hopefully that guide sets the company up to have a better performance next quarter versus expectations yeah good stuff Dan and just a correction uh Oracle Enterprise SAS was 10% growth uh when you uh peeled back the onion uh on Fusion Cloud Erp it was 16% and site net Suite was 20 so yeah uh good good catch on that I was correcting uh myself so Dan great show uh I want to thank everybody for uh tuning in uh we are off to Salesforce dreamforce uh next week and then I'm going to shoot up to uh Seattle to do an unnamed unnamed meeting with uh some companies you would never even guess but Dan what's uh what's on the agenda for you buddy yeah I know we're going to dream Force yeah I'll be at dreamforce um maybe a couple of other things while I'm in tending the time 100 dinner while I'm there nice um I I didn't make the list um I don't think Elon Musk did either but uh but Scarlet Johansson did so that's good um wow yeah don't even get me started man I just I don't get it I can't hold myself can't hold myself yeah but hey I want to just thank everybody for uh tuning in to this show we are early uh tell your friends who watch the Pod come back uh you know this is live right now but it's obviously on time release on every platform you would actually want to to watch this on including YouTube LinkedIn and X so hey thanks for tuning in everybody uh we appreciate you we're signing off and bye-bye