00:00 Speaker A
Shouldn’t this report by by Alphabet, uh, really good from top to bottom, really good earnings call, any way you sliced it. Shouldn’t this be the report that stops this sell-off in software?
00:13 Mike
Yes and no. I mean, I I agree with both yours and Ines’s take. This, you know, Alphabet is the winner, Google’s the winner in AI right now. Um, I they’re the one to watch out for. The capex is just them defending their position. The line on the conference call that caught my attention was when the CFO said that about 50% of their coding’s being done by AI agents.
00:43 Speaker A
And to me that creates that just you know reinforces the alarm the market has had about AI agents over the past week or so. Mike that is that is a damn good point. I have to admit, I’m going to I have to tell you right here, I missed that one. I did not see that. But yes, Ines, you know what? That brings up a good point. That essentially fuels uh should might fuel uh more of a, I guess more selling pressure on these software stocks. It’s so hard. I was talking to Tom Saznoff uh about this yesterday, to find the bottom, Ines.
01:12 Ines
Yeah, it’s almost like this productivity is sort of feeding on itself because you heard about this in their uh conference call about the productivity of of engineers, but you also heard with it meta as well and and their uh productivity growth, uh when it comes to their engineers and um I think the meta mentioned 30% output, an increase of 30% output. So, I I mean, to that point, yes, this shows that there is massive productivity that is coming from AI. So what does it mean for companies like the software companies and and I would also take it one point further that you have seen some companies that have been announcing layoffs and you have to think to yourself, are they cutting out because of AI and also cutting out because they need to fund AI as well.
02:00 Speaker A
It’s a really good point. And and Mike, amidst all of this uh software selling pressure, one stock that’s doing well, maybe because they have no AI, it’s Apple.
02:13 Mike
Yes. And they’re partner with Google, right? They they decide not to spend all that money on investment in capex, and then they partner with Google who at the time, you know, there were a lot of questions six months ago about the search anti-trust and whatnot, because AI was going to displace them and then all of a sudden they clear up the search issues with the Department of Justice. And now they have the best AI model out out there right now. So they’ve really navigated 2025 extremely well, and that’s why the stock has performed so well over the past six months.
