WEBVTT
00:00:00.000 --> 00:00:04.559
Each week on quarters we sit with public earnings calls and listen for the human part.
00:00:04.799 --> 00:00:14.000
These calls are long, mostly numbers and caution language, but every once in a while a person leaks through or tries to.
00:00:14.160 --> 00:00:18.160
Sometimes the leak is confidence, sometimes it's the absence of it.
00:00:18.480 --> 00:00:19.440
Alright, hey everyone.
00:00:19.519 --> 00:00:20.640
Thanks for joining today.
00:00:20.879 --> 00:00:26.719
I'm Terry, and today, Meta Mark Zuckerberg, July 29th.
00:00:27.120 --> 00:00:29.839
He opens like the planet already signed up.
00:00:30.160 --> 00:00:38.399
We had a strong quarter for our community and business with 3.6 billion people using at least one of our apps each day.
00:00:38.719 --> 00:00:40.640
We reached several milestones.
00:00:40.880 --> 00:00:43.759
Instagram reached 2 billion daily actives.
00:00:44.000 --> 00:00:49.679
Threads crossed 500 million monthly actives, making it the fastest growing conversation app ever.
00:00:50.079 --> 00:00:58.000
3.6 billion people, Instagram 2 billion a day, WhatsApp peaking at 30 million messages a second during the World Cup final.
00:00:58.240 --> 00:01:00.320
That's not a customer base.
00:01:00.560 --> 00:01:04.319
That's weather, that's the species checking in.
00:01:04.719 --> 00:01:09.439
And uh Wall Street looked at the receipt and said, cool story, down roughly 9%.
00:01:10.159 --> 00:01:13.680
The opportunity in front of us is massive.
00:01:13.840 --> 00:01:20.560
Uh first, we're now at a point where our investments in AI are accelerating every major part of our core business.
00:01:20.799 --> 00:01:32.640
Quick and ugly, revenue about$60.8 billion, grew hard, beat the top line, earnings$6.18 a share, missed profit down.
00:01:32.879 --> 00:01:43.040
Free cash flow,$784 million, down something like 91% year over year, capex this quarter, about$31 billion.
00:01:43.680 --> 00:01:48.079
Full year CapEx guide,$130 to$145 billion.
00:01:48.560 --> 00:01:49.519
That's the episode.
00:01:49.680 --> 00:01:51.760
We could end it here, but we won't.
00:01:52.000 --> 00:01:57.760
We also shipped some strong new models from Meta Superintelligence Labs and released new glasses.
00:01:58.000 --> 00:02:08.400
Overall, the scale and reach of our community across our apps is pretty remarkable, and it gives us a strong platform for delivering new innovations to billions of people.
00:02:08.719 --> 00:02:10.879
This is the part that makes me tilt my head.
00:02:11.120 --> 00:02:19.439
Wall Street is punishing the stock like Meta is some fragile little growth story that forgot how to earn, brother.
00:02:19.759 --> 00:02:28.159
Half the phones on Earth are already in the living room, Facebook, Instagram, WhatsApp, Thread, the whole messy family.
00:02:28.479 --> 00:02:31.360
The critique isn't nobody wants this.
00:02:31.599 --> 00:02:37.520
The critique is you're spending the house to build a second house in the sky, and we can't see the sky yet.
00:02:37.840 --> 00:02:41.599
We continue to invest aggressively in infrastructure to meet the demand.
00:02:41.840 --> 00:02:51.840
Yesterday, as part of our metacompute effort, we announced a new strategic venture with BlackRock to develop a new one gigawatt data center in El Paso, Texas.
00:02:52.159 --> 00:03:01.680
Overall, we expect that a significant portion of our compute is going to go towards training our models, growing our core business, and delivering personal agents and new products.
00:03:01.840 --> 00:03:06.240
But we also expect to grow a large business serving large customers as well.
00:03:06.560 --> 00:03:13.120
We've built our API, we're rolling out business agents, we're getting a lot of offers for compute at a significant premium over what we paid for it.
00:03:13.439 --> 00:03:13.759
Okay.
00:03:14.479 --> 00:03:17.439
Character time, and I'm not going to do the wholesome deli thing here.
00:03:17.520 --> 00:03:19.120
That was Bill, this is Mark.
00:03:19.280 --> 00:03:24.960
There's a kind of earnings call, stand-up, uh, not jokes, posture, chin up, future tense.
00:03:25.199 --> 00:03:31.439
We think that there's a very big opportunity to ship a few types of agents that are aligned with our mission and business.
00:03:31.680 --> 00:03:33.520
The first is personal agents.
00:03:33.680 --> 00:03:43.759
Uh, soon we will have agents that can work 24-7 on your behalf to help you achieve your goals and improve your life, your health, your relationships, your finances, whatever you want.
00:03:43.919 --> 00:03:52.240
Um, the first domain uh that agents have really taken off in is coding, but engineers are more technical and willing to spend time making those agents work.
00:03:52.400 --> 00:04:03.520
So to build great personal agents, this needs to be a great consumer product that just works out of the box and is easy enough for billions of people to uh adopt and use.
00:04:03.759 --> 00:04:06.960
I'm very excited about this, and we're gonna have more to share soon.
00:04:07.199 --> 00:04:12.560
When CapEx was cute and margins were expanding, that posture read as vision.
00:04:12.719 --> 00:04:14.400
Now the costs are in the numbers.
00:04:14.479 --> 00:04:17.199
Yeah, free cash flow basically wave goodbye.
00:04:17.360 --> 00:04:26.800
And the same posture reads like acting, not evil, not cartoon, just thin, like the confidence got outsourced to the adjectives.
00:04:26.959 --> 00:04:31.759
He's been asked over and over how this spending turns into money you can touch.
00:04:31.920 --> 00:04:40.959
He answers with the portfolio: train models, grow the core, personal agents, business agents, sell compute at a premium, APIs, coding tools.
00:04:41.199 --> 00:04:48.160
We are developing new personal agents that will be the foundation for our next wave of products and revenue lines in the months and years ahead.
00:04:48.480 --> 00:04:49.519
It's a lot of doors.
00:04:49.680 --> 00:04:54.240
When you open every door at once, it can sound like you don't want to stand in any of them.
00:04:54.560 --> 00:04:59.680
Now I get, you know, we are um, you know, we're we're gonna ship this at some point soon, and that's gonna be very exciting.
00:04:59.759 --> 00:05:01.360
Um, and we we haven't done that yet.
00:05:01.519 --> 00:05:07.920
So um, you know, so this is there's there's kind of only so much that I can that I can say on an earnings call about this.
00:05:08.000 --> 00:05:16.480
But I I think um this is a very large opportunity and one that that um I think is is um here's the line he's actually selling.
00:05:16.720 --> 00:05:26.639
Uh soon we will have agents that can work 24-7 on your behalf to help you achieve your goals and improve your life, your health, your relationships, your finances, whatever you want.
00:05:26.800 --> 00:05:35.199
Um, the first domain uh that agents have really taken off in is coding, but engineers are more technical and willing to spend time making those agents work.
00:05:35.279 --> 00:05:46.480
So to build great personal agents, this needs to be a great consumer product that just works out of the box and is easy enough for billions of people to uh adopt and use.
00:05:46.639 --> 00:05:49.439
I'm very excited about this, and we're gonna have more to share soon.
00:05:49.680 --> 00:05:51.920
And it's almost science fiction soft.
00:05:52.079 --> 00:05:56.240
Agents for your health, uh, your relationships, your money.
00:05:56.480 --> 00:06:01.120
24-7 just works out of the box for billions.
00:06:01.279 --> 00:06:02.959
That's a cathedral pitch.
00:06:03.120 --> 00:06:06.800
And then in the same breath of honesty, that slips out.
00:06:06.959 --> 00:06:09.279
They haven't shipped that yet.
00:06:09.519 --> 00:06:11.279
More to share soon.
00:06:11.600 --> 00:06:13.279
I believe he believes it.
00:06:13.439 --> 00:06:18.240
I also believe belief is doing a lot of cardio on this call.
00:06:18.560 --> 00:06:19.759
Line of the quarter.
00:06:20.480 --> 00:06:24.000
Not a catchphrase this time, a scale sentence.
00:06:24.480 --> 00:06:26.240
3.6 billion people.
00:06:26.800 --> 00:06:29.759
3.6 billion people a day.
00:06:30.000 --> 00:06:31.279
That's the customer.
00:06:31.439 --> 00:06:34.240
The whole messy world already showed up.
00:06:34.399 --> 00:06:38.079
Wall Street isn't arguing about product market fit.
00:06:38.240 --> 00:06:40.879
They're arguing about the construction bill.
00:06:41.199 --> 00:06:49.360
Quirk of the quarter, free cash flow of 784 million next to Capex of 31 billion.
00:06:49.519 --> 00:06:54.959
That's a company that made a fortune in the morning and spent it on servers before lunch.
00:06:55.199 --> 00:07:01.439
Lunatic engineering courage or lunatic receipts, depends which ear you use.
00:07:01.759 --> 00:07:11.920
Thing that actually means something, and even some of the business plainly, Meta's core machine still prints attention and ads at planetary scale.
00:07:12.319 --> 00:07:15.360
Revenue grew like a beast.
00:07:15.519 --> 00:07:27.839
The print is about whether AI CapEx is a bridge or a sinkhole, and whether personal agents slash enterprise compute become real lines before the market's patience expires.
00:07:28.000 --> 00:07:34.800
Guidance nudge Capex up, soft Q3 revenue guide, stock got spanked.
00:07:34.959 --> 00:07:36.079
That's the status.
00:07:36.240 --> 00:07:46.160
Empire intact, cash flow dressed for a funeral, CEO selling the next chapter hard, and then Mark, the human ending.
00:07:46.319 --> 00:07:48.879
I'm gonna be harsh and still try to stay human.
00:07:49.040 --> 00:07:56.240
Mark Zuckerberg does not sound on this call like a man who is easy in his power.
00:07:56.480 --> 00:08:03.279
He sounds like a man who learned that the world punishes him for being weird and awkward.
00:08:03.439 --> 00:08:08.399
So he built a second voice, a brighter one, a keynote voice.
00:08:08.639 --> 00:08:14.800
I just published an op-ed about why I'm so optimistic that we are building a positive future for everyone.
00:08:15.120 --> 00:08:19.120
A I'm optimistic about the potential ahead voice.
00:08:19.279 --> 00:08:25.439
When the money was melting upward, that second voice looked like leadership.
00:08:25.519 --> 00:08:42.080
When free cash flow collapses 91%, and you're still raising the Capex floor, that second voice can look like stand-up, not comedy club stand-up, corporate stand-up, the act of certainty.
00:08:42.240 --> 00:08:45.360
I don't think he's fake about wanting the agents.
00:08:45.519 --> 00:08:49.919
I think he wants them with a kind of cold romantic hunger.
00:08:50.240 --> 00:08:57.759
This is a very large opportunity and one that that um I think is is um almost inevitable that someone does.
00:08:58.240 --> 00:09:09.840
A brilliant, strange stared at his whole life person, trying to outrun the old internet jokes by narrating the future louder than the cash register.
00:09:10.399 --> 00:09:11.519
I'm Terry.
00:09:11.679 --> 00:09:14.399
If you like this, please subscribe to Quarters.
00:09:14.480 --> 00:09:16.879
No stock tips, just the human part.
00:09:17.039 --> 00:09:18.399
See you next print.
00:00:00.000 --> 00:00:04.559
Each week on quarters we sit with public earnings calls and listen for the human part.
00:00:04.799 --> 00:00:14.000
These calls are long, mostly numbers and caution language, but every once in a while a person leaks through or tries to.
00:00:14.160 --> 00:00:18.160
Sometimes the leak is confidence, sometimes it's the absence of it.
00:00:18.480 --> 00:00:19.440
Alright, hey everyone.
00:00:19.519 --> 00:00:20.640
Thanks for joining today.
00:00:20.879 --> 00:00:26.719
I'm Terry, and today, Meta Mark Zuckerberg, July 29th.
00:00:27.120 --> 00:00:29.839
He opens like the planet already signed up.
00:00:30.160 --> 00:00:38.399
We had a strong quarter for our community and business with 3.6 billion people using at least one of our apps each day.
00:00:38.719 --> 00:00:40.640
We reached several milestones.
00:00:40.880 --> 00:00:43.759
Instagram reached 2 billion daily actives.
00:00:44.000 --> 00:00:49.679
Threads crossed 500 million monthly actives, making it the fastest growing conversation app ever.
00:00:50.079 --> 00:00:58.000
3.6 billion people, Instagram 2 billion a day, WhatsApp peaking at 30 million messages a second during the World Cup final.
00:00:58.240 --> 00:01:00.320
That's not a customer base.
00:01:00.560 --> 00:01:04.319
That's weather, that's the species checking in.
00:01:04.719 --> 00:01:09.439
And uh Wall Street looked at the receipt and said, cool story, down roughly 9%.
00:01:10.159 --> 00:01:13.680
The opportunity in front of us is massive.
00:01:13.840 --> 00:01:20.560
Uh first, we're now at a point where our investments in AI are accelerating every major part of our core business.
00:01:20.799 --> 00:01:32.640
Quick and ugly, revenue about$60.8 billion, grew hard, beat the top line, earnings$6.18 a share, missed profit down.
00:01:32.879 --> 00:01:43.040
Free cash flow,$784 million, down something like 91% year over year, capex this quarter, about$31 billion.
00:01:43.680 --> 00:01:48.079
Full year CapEx guide,$130 to$145 billion.
00:01:48.560 --> 00:01:49.519
That's the episode.
00:01:49.680 --> 00:01:51.760
We could end it here, but we won't.
00:01:52.000 --> 00:01:57.760
We also shipped some strong new models from Meta Superintelligence Labs and released new glasses.
00:01:58.000 --> 00:02:08.400
Overall, the scale and reach of our community across our apps is pretty remarkable, and it gives us a strong platform for delivering new innovations to billions of people.
00:02:08.719 --> 00:02:10.879
This is the part that makes me tilt my head.
00:02:11.120 --> 00:02:19.439
Wall Street is punishing the stock like Meta is some fragile little growth story that forgot how to earn, brother.
00:02:19.759 --> 00:02:28.159
Half the phones on Earth are already in the living room, Facebook, Instagram, WhatsApp, Thread, the whole messy family.
00:02:28.479 --> 00:02:31.360
The critique isn't nobody wants this.
00:02:31.599 --> 00:02:37.520
The critique is you're spending the house to build a second house in the sky, and we can't see the sky yet.
00:02:37.840 --> 00:02:41.599
We continue to invest aggressively in infrastructure to meet the demand.
00:02:41.840 --> 00:02:51.840
Yesterday, as part of our metacompute effort, we announced a new strategic venture with BlackRock to develop a new one gigawatt data center in El Paso, Texas.
00:02:52.159 --> 00:03:01.680
Overall, we expect that a significant portion of our compute is going to go towards training our models, growing our core business, and delivering personal agents and new products.
00:03:01.840 --> 00:03:06.240
But we also expect to grow a large business serving large customers as well.
00:03:06.560 --> 00:03:13.120
We've built our API, we're rolling out business agents, we're getting a lot of offers for compute at a significant premium over what we paid for it.
00:03:13.439 --> 00:03:13.759
Okay.
00:03:14.479 --> 00:03:17.439
Character time, and I'm not going to do the wholesome deli thing here.
00:03:17.520 --> 00:03:19.120
That was Bill, this is Mark.
00:03:19.280 --> 00:03:24.960
There's a kind of earnings call, stand-up, uh, not jokes, posture, chin up, future tense.
00:03:25.199 --> 00:03:31.439
We think that there's a very big opportunity to ship a few types of agents that are aligned with our mission and business.
00:03:31.680 --> 00:03:33.520
The first is personal agents.
00:03:33.680 --> 00:03:43.759
Uh, soon we will have agents that can work 24-7 on your behalf to help you achieve your goals and improve your life, your health, your relationships, your finances, whatever you want.
00:03:43.919 --> 00:03:52.240
Um, the first domain uh that agents have really taken off in is coding, but engineers are more technical and willing to spend time making those agents work.
00:03:52.400 --> 00:04:03.520
So to build great personal agents, this needs to be a great consumer product that just works out of the box and is easy enough for billions of people to uh adopt and use.
00:04:03.759 --> 00:04:06.960
I'm very excited about this, and we're gonna have more to share soon.
00:04:07.199 --> 00:04:12.560
When CapEx was cute and margins were expanding, that posture read as vision.
00:04:12.719 --> 00:04:14.400
Now the costs are in the numbers.
00:04:14.479 --> 00:04:17.199
Yeah, free cash flow basically wave goodbye.
00:04:17.360 --> 00:04:26.800
And the same posture reads like acting, not evil, not cartoon, just thin, like the confidence got outsourced to the adjectives.
00:04:26.959 --> 00:04:31.759
He's been asked over and over how this spending turns into money you can touch.
00:04:31.920 --> 00:04:40.959
He answers with the portfolio: train models, grow the core, personal agents, business agents, sell compute at a premium, APIs, coding tools.
00:04:41.199 --> 00:04:48.160
We are developing new personal agents that will be the foundation for our next wave of products and revenue lines in the months and years ahead.
00:04:48.480 --> 00:04:49.519
It's a lot of doors.
00:04:49.680 --> 00:04:54.240
When you open every door at once, it can sound like you don't want to stand in any of them.
00:04:54.560 --> 00:04:59.680
Now I get, you know, we are um, you know, we're we're gonna ship this at some point soon, and that's gonna be very exciting.
00:04:59.759 --> 00:05:01.360
Um, and we we haven't done that yet.
00:05:01.519 --> 00:05:07.920
So um, you know, so this is there's there's kind of only so much that I can that I can say on an earnings call about this.
00:05:08.000 --> 00:05:16.480
But I I think um this is a very large opportunity and one that that um I think is is um here's the line he's actually selling.
00:05:16.720 --> 00:05:26.639
Uh soon we will have agents that can work 24-7 on your behalf to help you achieve your goals and improve your life, your health, your relationships, your finances, whatever you want.
00:05:26.800 --> 00:05:35.199
Um, the first domain uh that agents have really taken off in is coding, but engineers are more technical and willing to spend time making those agents work.
00:05:35.279 --> 00:05:46.480
So to build great personal agents, this needs to be a great consumer product that just works out of the box and is easy enough for billions of people to uh adopt and use.
00:05:46.639 --> 00:05:49.439
I'm very excited about this, and we're gonna have more to share soon.
00:05:49.680 --> 00:05:51.920
And it's almost science fiction soft.
00:05:52.079 --> 00:05:56.240
Agents for your health, uh, your relationships, your money.
00:05:56.480 --> 00:06:01.120
24-7 just works out of the box for billions.
00:06:01.279 --> 00:06:02.959
That's a cathedral pitch.
00:06:03.120 --> 00:06:06.800
And then in the same breath of honesty, that slips out.
00:06:06.959 --> 00:06:09.279
They haven't shipped that yet.
00:06:09.519 --> 00:06:11.279
More to share soon.
00:06:11.600 --> 00:06:13.279
I believe he believes it.
00:06:13.439 --> 00:06:18.240
I also believe belief is doing a lot of cardio on this call.
00:06:18.560 --> 00:06:19.759
Line of the quarter.
00:06:20.480 --> 00:06:24.000
Not a catchphrase this time, a scale sentence.
00:06:24.480 --> 00:06:26.240
3.6 billion people.
00:06:26.800 --> 00:06:29.759
3.6 billion people a day.
00:06:30.000 --> 00:06:31.279
That's the customer.
00:06:31.439 --> 00:06:34.240
The whole messy world already showed up.
00:06:34.399 --> 00:06:38.079
Wall Street isn't arguing about product market fit.
00:06:38.240 --> 00:06:40.879
They're arguing about the construction bill.
00:06:41.199 --> 00:06:49.360
Quirk of the quarter, free cash flow of 784 million next to Capex of 31 billion.
00:06:49.519 --> 00:06:54.959
That's a company that made a fortune in the morning and spent it on servers before lunch.
00:06:55.199 --> 00:07:01.439
Lunatic engineering courage or lunatic receipts, depends which ear you use.
00:07:01.759 --> 00:07:11.920
Thing that actually means something, and even some of the business plainly, Meta's core machine still prints attention and ads at planetary scale.
00:07:12.319 --> 00:07:15.360
Revenue grew like a beast.
00:07:15.519 --> 00:07:27.839
The print is about whether AI CapEx is a bridge or a sinkhole, and whether personal agents slash enterprise compute become real lines before the market's patience expires.
00:07:28.000 --> 00:07:34.800
Guidance nudge Capex up, soft Q3 revenue guide, stock got spanked.
00:07:34.959 --> 00:07:36.079
That's the status.
00:07:36.240 --> 00:07:46.160
Empire intact, cash flow dressed for a funeral, CEO selling the next chapter hard, and then Mark, the human ending.
00:07:46.319 --> 00:07:48.879
I'm gonna be harsh and still try to stay human.
00:07:49.040 --> 00:07:56.240
Mark Zuckerberg does not sound on this call like a man who is easy in his power.
00:07:56.480 --> 00:08:03.279
He sounds like a man who learned that the world punishes him for being weird and awkward.
00:08:03.439 --> 00:08:08.399
So he built a second voice, a brighter one, a keynote voice.
00:08:08.639 --> 00:08:14.800
I just published an op-ed about why I'm so optimistic that we are building a positive future for everyone.
00:08:15.120 --> 00:08:19.120
A I'm optimistic about the potential ahead voice.
00:08:19.279 --> 00:08:25.439
When the money was melting upward, that second voice looked like leadership.
00:08:25.519 --> 00:08:42.080
When free cash flow collapses 91%, and you're still raising the Capex floor, that second voice can look like stand-up, not comedy club stand-up, corporate stand-up, the act of certainty.
00:08:42.240 --> 00:08:45.360
I don't think he's fake about wanting the agents.
00:08:45.519 --> 00:08:49.919
I think he wants them with a kind of cold romantic hunger.
00:08:50.240 --> 00:08:57.759
This is a very large opportunity and one that that um I think is is um almost inevitable that someone does.
00:08:58.240 --> 00:09:09.840
A brilliant, strange stared at his whole life person, trying to outrun the old internet jokes by narrating the future louder than the cash register.
00:09:10.399 --> 00:09:11.519
I'm Terry.
00:09:11.679 --> 00:09:14.399
If you like this, please subscribe to Quarters.
00:09:14.480 --> 00:09:16.879
No stock tips, just the human part.
00:09:17.039 --> 00:09:18.399
See you next print.
