00:00 Tan
I think this debate around the spending levels will continue uh through this week and into the uh into the next couple of quarters and and into 2027. You’re seeing the cloud growth. uh we saw it with Google. It’s it’s very, very strong and so that’s incenting them to spend. I think you’ll also see accelerating uh Amazon Web Services growth and so Amazon is likely to continue uh being aggressive with their spending. With Meta, uh the digital advertising business, I think will remain healthy. I think they’re going to continue to spend um uh substantial amounts and there’s potential for them to look to build out a little bit of a cloud business. It’s very, very early for them, but we could learn more about that uh later this week, which could uh change the the discussion or the narrative uh there a little bit. But the key for all these companies remains their ability to to innovate to execute on their product cycles and drive strong revenue growth.
00:46 Speaker A
Um, Tan, how much are these companies themselves benefiting from AI, not from selling cloud services or excess capacity in the in the potential potentially in the case of Meta, but in terms of making their existing products or introducing new products that’ll generate more revenue?
01:05 Tan
I think these companies are are reinventing themselves in a very dramatic way. If we look at search as one example, you have longer, more complex queries that users are able to put in. and so it it creates more value for the users on one side, which provides more signal to the advertisers on the other side, which helps drive Google’s growth in that example. And so search is being reinvented. The cloud businesses, the the way uh the the models and the use of the models and the new solutions, uh those are being developed with AI. And so that is also driving a an explosion of new workload growth. And so these companies are are harnessing this technology internally and I I think the opportunity for them remains substantial. It’s lumpy, there’s a lot of experimentation going on, but with each passing quarter, they’re seeing what works. With meta for example, the recommendation engines uh to provide content that users value and of course advertisers value on the other side. So I think the opportunity internally is significant.
