I see a large IPM on the horizon. You're surrounded by journalists. Hold your position.
Overnight success. Double leg, right? Let's misinformation clearing order inbound. Let's just roll.
We are surrounded by general. Hold your position. Get up. Trust the experts. Five. We are experts. Founder Malco.
I see multiple journalists on the horizon. Stand by. UAV online. Blaze. Double blaze. Triple blaze. Double kill. Finally, it's time. Team Deathmatch. We are experts. Triple Blaze. Let's just roll. Right.
Marky clearing order inbound. Get up. We are surrounded by journalists. Hold your position. Strike one. Strike two. Activate golden retriever mode.
Market clearing order inbound. Five. I see multiple journalists on the horizon. Founder.
You're watching TVP. Today is Tuesday, February 3rd, 2026, and we're live from the Cisco AI Summit. We're very happy to be here. Thank you to Cisco for hosting us. Uh, we have a bunch of great guests lined up. We got Aaron Levy from Box coming back on the show. Shock Robbins, CEO of Cisco, an absolute dog. He's been with the company for decades. Truly G Patel, the president and chief product officer, will be joining us. Costa, uh, from the San Francisco 49ers, who's going to be breaking down the technology of the NFL. And, uh, we're closing out with Dylan Patel, the founder and CEO of Semi Analysis.
That's right. And of course, if you're wondering, Linear is the system for modern software development. 70% of enterprise workspaces on Linear are using agents.
Really quickly, let me also tell you about our presenting sponsor, ramp.com. Time is money. Save both. Easy to use corporate cards, bill pay, accounting, and a whole lot more all in one place.
Starting the show, Jordy, important announcement from Oracle. They said, uh, our partners financing with Donna Ana County, New Mexico, Shackleford County, Texas, and Port Washington, Wisconsin data centers are secured at market standard rates, progressing through final syndication on schedule and consistent with investment grade deals. So if, uh, this makes you worry, uh, a lot of other people agree this is, uh, the next, their most recent post after yesterday they announced the NVIDIA OpenAI deal has zero impact on our financial relationship with OpenAI. We remain highly confident in OpenAI's ability to raise funds and meet its commitments. So...
What did Run say? Brun said, 'My conf- my confident in OpenAI's abilities to raise fund t-shirt has a lot of people asking questions already answered by my t-shirt.' Just 2,000 likes. This is a wild, uh, interesting comm strategy. They've been hiding comments under this.
I think they've stopped doing that because, uh...
People are saying, 'What an odd thing to say.'
Brennan says, 'Guys, just stop tweeting. Whoever you have running PR comms needs to be fired. You're making it worse.'
It is, it is very weird to take to take this to act specifically. That's such a conversational platform. Like it's, it's...
Hey, we want to start a conversation about concerns around our...
Well, also just, I mean, it's a total rejection of the going direct thing. Like this would be wildly different if it came from the CEO, co-CEOs or Larry Ellison directly even, and it had like way more nuance. It's very odd when it has like the corporate press release.
This, this screams that no one in comms actually uses X.
Yeah. It, it's like we needed to put this out and they didn't really consider X and it maybe this probably went over fine in a press release or something but just on X it's a completely different context and there's so much subtext with all the different partners actively being there and even like low-level employees chiming in from companies that are implicated in this. There's like all this different...
I like how you, you compare Oracle strategy of like the nameless faceless announcement that just concerns everyone to Run actually from Open commenting and just joking about it and it actually gives you more confidence.
Yeah. Yeah. Yeah. Totally. Like somebody, somebody looked at the Rune post and was like, and was like, 'Of even Rune stop shilling.' We're a Run's like, no, it's just a funny tweet. OpenAI is doing great. And that instance is way more...
Dave quoted the yesterday's post and just said, 'Okay, yay.' Okay, yay. Uh, anyway,
Before we move on, CrowdStrike, your business is AI, their business is securing it. CrowdStrike secures AI and stops breaches.
And, uh, of course, Oracle's down 5% today, but it's sort of a blend.
Honestly, looking good compared to some other names. Yeah. What's PayPal...
Down a full 20% today with...
Okay. Uh, that makes sense.
Just, you know, had some, some Q4 results that people weren't super exciting about and, uh, people aren't excited about the forecasts either.
Uh, number of people have been speculating back in there.
Well, yeah. I mean, uh, you look at, uh, Sheil had a, had a kind of was prodding Elon. He said, 'Come on, Elon. You've always wanted PayPal to be X, the financial super app. Yeah, now's a great opportunity.' PayPal right now is valued at less than what X was in the Take Private.
And X is obviously working on a bunch of different financial features.
I thought PayPal all-time high was in the mult- like hundreds of billions.
Um, so at the same, at this, at the time it's 40, it's 40 billion now. Yeah. Add that in.
Yeah. It was, it was way up, down 85% the last five years. Uh, I mean truthfully like a lot of people have moved on. They use, uh, you know, Cash App and...
Yeah. But they own Venmo.
Yeah, Venmo. Venmo is still very like millennial, right? It's, it's sort of like, and, and people use the Apple, Apple Pay transfers, Apple Cash. Like there's been a number of, you know, shots across the bow for PayPal that they haven't responded to fully. I mean,
But their netvenue, they own Venmo because they acquired Brainree. It wasn't even like an in-house like really aggressive move. They, they sort of just locked out with Venmo.
PayPal, the $40 billion public company had 2025 net revenue of 33 billion. Whoa. So, not, uh, not great. Uh, major sell off in pretty much all software today. Uh, we had another post here. Uh, Snap is close to all-time lows at $6.70 despite growing revenues and profits. Uh, Serenity says, 'Here's why the financial engineering looks criminal. Snapchat is an 11.5 billion company with a billion MAU and Q3 adjusted EBIT of 132 million. However, stock comp for the last 12 months, $2.5 billion in the last, uh, 12 months.' So, um, really, really insane, uh, number. This is, I mean, always been the, uh, general criticism of Snap, but, uh, looks like they have not adjusted course yet.
It's interesting seeing the, the, the gap between monetization between Meta a billion MAU and Snap a billion MAU. It's like a 10x. Yeah. And, and which is why like you were doing some napkin math on OpenAI and I think that's...
A billion MAU. Do they monetize like Meta or do they monetize like Snap and on what timeline? Because...
They have Fiji Simo. I think they could get to Meta level, um, you know, monetization and ARPU, but it also could, they could be lingering in the Snap territory, which is I think five billion, uh, over the last year, um, trailing 12 months, 5.77 billion on a billion MAU. Uh, not, if you were monetizing it like Meta, you'd be much closer to 50 billion, which is dramatic, like very, very...
Uh, Matt Slottnik commenting on the selloff in software, all of this because Azure grew 39% instead of 39.4%. Uh, of course, there's a lot more, uh, going on here. Uh, Buco says, 'Nots, it's that the labs can hypothetically oneshot you. So, why stand in front of that train? Why express quote short AI in the marketplace?'
Yeah, really quickly, let me tell you about Shopify. Shopify is the commerce platform that grows with your business and lets you sell in seconds online, in store, on mobile, on social, on marketplaces, and now with AI. Uh, high yield Harry says, 'Wow, this software company is getting destroyed by AI today.' It's Juventus soccer team, uh, down 13%.
Everything's getting, I guess people think that, uh, they're make, get, somebody's going to make Claude code for software for soccer.
The, the, your inside man below says the robots are going to be playing and he has a photo of or a GIF of robots playing soccer, which...
That seems bullish. We'll see.
Yeah, I don't know. Uh, Bitcoin also down dramatically.
Where's Bitcoin? 75 or something.
Uh, Joe Weisenthal has it up. Another three now. Absolute crash today. Down 13% over the last, uh, over the last five days, over almost 20% over the last month. Lots of selling activity going on. Um, Bitcoin drops to lowest.
Jim Cramer is now, uh, giving advice to Michael Sailor. He says, 'Oh my, Bitcoin 73,000 beckons as the Dow hits a record high. Our chartist last night said this is it.'
The level that cannot be... our chartist. Chartist. Yes. The level that cannot be breached. Artist.
It is time for strategy, also known as mass, uh, uh...
MicroStrategy was the former name.
Also known as Mister for its MR symbol, to do a spot secondary or convert and stop this decline. Come on, Mike. Step up.' He's just...
Always rough when, when Jim Cramer is just like, you know, stream of consciousness posting at you.
Um, so we'll see what, what Sailor does. They, they have earnings on Thursday and that will certainly be an interesting call.
Yeah. Uh, more, more details on the PayPal shares plunging nearly 20% CEO exit. They replaced their, their CEO, Alex Chris, who was brought in to steer the payments firm through slowing growth and heightened competition and simultaneously issued a lackluster profit forecast for 2026 on Tuesday, sending its shares down 19%. The boards, the company's board, which named HP's Enrique Les as its new president and CEO, said the pace of change and execution under Chris was not in line with its expectations. Chris was tasked with turning around PayPal during a challenging period as post-pandemic trading volumes declined and competitive pressures in its core business intensified from large technology companies and newer fintech rivals. It does feel like, I mean, even, you know, in the press release economy, it would be, it would have been so easy for PayPal to do some sort of deal with stock trading or prediction markets, like every financial app and news product and grocery store, like everyone is like doing some sort of deal at least, even if it doesn't materialize, even if it doesn't move the needle, at least they're, they're sort of putting their best foot forward. And, uh, PayPal, you know, you still mostly hear about it in the context of what are the PayPal co-founders up to now. Oh, they're building rivals to the original company. Uh, PayPal said CFO Jamie Miller would serve as interim CEO until Loris assumes the role on March 1st. That's a pretty quick transition. Lores was president and CEO of the consumer electronics giant, um, HP for more than six years. Wall Street analysts said the unexpected CEO announcement raises questions about the company's turnaround strategy. Of course, uh, Disney's been going through a CEO transition, but it's been massively telegraphed with, you know, a contract that ended at this year. Okay. You know, a story last week about, hey, we're moving faster. Hey, we're bringing somebody in who's internal, who's already knows, uh, the company inside and out and things.
It's crazy that, uh, even with $33 billion of revenue, they're tra-, they're, they're worth roughly like three and a half Circles, right? Uh, Circle obviously, you know, just tiny, tiny company in comparison to PayPal. You would think that PayPal just, they don't have an obvious like AI, like what's the obvious AI bear case, right? Yeah.
They move money. They're heavily regulated. You can imagine them, uh, figuring out ways to work better with agents and, and, uh, capitalize on the stable coin boom. But, uh, we'll see what the new CEO ends up doing. Uh,
The big question is whether he will bring in a formidable payments team to attempt yet another multi-year turnaround.
Do they not have a formidable payments team? Who you got?
Or I would hope, I would hope the payments company with half a billion...
Has a formidable payments team.
Apparently not according to Evercore. Like you lack formidability. Uh, PayPal expects full-year adjusted profit to range between low single-digit percentage decline and slight increase compared with Wall Street expectations of about 8% growth. Miller said the company was no longer committing to the specific 2027 outlook laid out at its investor day last year and would now provide forecasts one year at a time. Oof, so getting more uncertain. No one likes that. The change comes against the backdrop of weakening retail spending as shoppers squeezed by elevated interest rates, stubbornly high living costs and signups softening. May labor market cut back in discretionary purchases and prioritize everyday necessities, stuff that's not probably purchased with PayPal.
Uh, David in the YouTube chat says, uh, PayPal did participate in the press release economy. They announced a deal with ChatGPT at the end of last year in Q4. Uh, in 2026, PayPal will become the first digital wallet embedded directly into ChatGPT, allowing users to make, uh, purchases instantly without leaving the platform. Um, so anyways, uh, feels, feels very oversold, but...
And they also missed on the holiday quarter. So, uh, analysts were estimating that they'd make 8.8 billion and they only made 8.68 billion. And so, you know, we saw a pretty strong holiday quarter. There was a lot of growth across e-commerce activity. We talked to Sean Frank at Ridge. Everyone was having like, there were a lot of jitters about is the consumer healthy, but a lot of, a lot of the growing platforms were able to outrun any softening in consumer confidence by just onboarding more companies, onboarding more customers. And so if you're declining while everyone else is, is accelerating, uh, that's going to be an, an issue. Uh, Ted says, 'Gold is dumping, silver's dumping, Bitcoin is dumping, Ethereum is dumping, DXY is dumping, stocks are dumping. If everything is going down, where's the actual, uh, where's the money actually going?' Uh, we talked about this last week. Sell everything. Sell your dollar, sell your stocks, sell your crypto, sell your bonds.
Freak out. Yeah. Panic. Sell everything.
Nikita says, 'Data centers, raw materials, and land. If intelligence is rapidly becoming free, expect a rapid rotation out of bytes and into bits. A lot of blue chip assets will soon be repriced.' Of course. Yeah. Hardware.
Is he, is he, uh, is that a typo? Does he mean rotation out of, out of bits and into atoms?
Yes, he had a typo. Sorry.
Okay. Okay. Yeah, because bytes and bits are kind of the same thing, right? Uh, yeah, a lot of blue chip assets will soon be repriced. So, I don't know. I'm, I'm excited to talk to Aaron Levy about this, about the SaaS apocalypse. What's happening with software?
Deep dish says this is a pretty common misconception that money has to go somewhere. That's not how market caps are measured. They're measured by last price times shares contracts outstanding, not how much money you'd get for liquidating the whole pile.
Uh, TL;DR, the money was never there.
Interesting. Uh, quickly, New York Stock Exchange. Want to change the world? Raise capital at the New York Stock Exchange. We'll be at the New York Stock Exchange next month. We're very excited for...
Cannot wait. Uh, Josh D'Amaro is the new CEO of Disney effective next month. Yes. This cycle, uh, moved very quickly, right?
Uh, Lucas Shaw over at Bloomberg has the, the reporting. I'll pull it up. Uh,
At the same time, I think, I think it was managed pretty well. Disney's only down 1% today, I think.
Yeah. Iger will stay on the board and serve as a senior adviser until his retirement on December 31st. And Dana Walden was named to a new role as president and chief creative officer of Disney. Uh, Iger just got the, got the opening ideal done. He's like, I, I handled the AI transition perfectly and I'm out. Uh, they've only had nine CEOs in the 102-year history. The CEO job requires not only running a sprawling empire, but also serving as its high-profile and highly scrutinized public ambassador. Dear D'Amaro won a challenging bake off for the job against Disney's entertainment co-chairman Dana Walden.
Let's give it up for bakeoffs. Thank you. Um,
Uh, that has been the talk of Hollywood for more than a year. Walden was named to the newly created position of president and chief creative officer. Uh, Disney's leadership has been determined to run the succession process as smoothly as possible after its disastrous last try. Uh, the company, uh, named previous parks boss Bob Cheek as CEO in 2020 only to fire him and bring back Iger two years later in a corporate coup. Um, there's a whole series of Bobs, Bob Iger, Bob, Bob Chapek over there. Um, the CEO selection was overseen by chairman James Gorman, who joined Disney's board in 2024 after managing a widely praised succession process at Morgan Stanley. Iger was chairman, uh, when the board picked. Disney shares were roughly flat Tuesday. Gorman in an interview said that he has seen Iger and tomorrow, uh, work together and is confident the handoff will go smoothly this time. There's no tension here. Shareholders will now look to D'Amaro to lay out and execute a growth plan for the company whose stock price is down by nearly half from its 2021 high when everyone was rapidly subscribing to Disney Plus and locked in just watching content. Uh, they went outside and the shares have slid since, um, and has been essentially...
Never go outside. Never touch grass.
This is the new Disney champion.
Run it in the Super Bowl for sure. Gorman said the Wall Street Journal picked the, told the Wall Street Journal that the board picked D'Amaro because of his combination of strategic thinking and, uh, an understanding of the creative process as well as his experience working both overseas and in the United States. Uh, the 54-year-old spent most of his 28 years at Disney, uh, working in theme parks, in the theme parks business in the US and overseas, overseeing stints at California's Disneyland and Florida's Walt Disney World. In 2020, he has been chairman of Disney's experiences unit, which includes theme parks, cruise ships, and consumer products. All things that should grow in an AI world, even if the, even if there's a lot of like AI slop and there's pressure on the theaters, like...
Should grow, but there's still so many, there's still so many questions, right? Uh, if you have widespread job loss, does that force a compression in pricing or just overall purchasing power? Right. Yeah, it's everyone. But, uh, again, you could see there's so much uncertainty. The idea that AI will just magically, like AI getting good will magically make everybody spend more time off the internet is kind of a tough argument to make.
Yeah. Right. Maybe some people react more like there's this like stated preference which people are saying as AI proliferates, people are just going to log off. And I just don't actually see that happening.
Yeah. I, I, I still think, I mean, I'm, I'm interested to see when the, uh, the OpenAI Disney deal really like rolls out. Um, obviously you still can't generate Disney properties, Disney IP in Sora or in, or at least not in ChatGPT when I tried. Um, so they're still working on when they will roll that out. We've discussed like it will be interesting if they launch like a single piece of IP, like it's Spider-Man week and they're just releasing Spider-Man and then they, and then they wait and then they do Iron Man a week later. So they're like keep hyping it as opposed to just like we're opening the, the floodgates, you can do any Disney IP. Will there be something special there? The bigger question for me is, is what does it look like in the Disney Plus app? Because I feel like the Disney Plus app as a parent is a very safe place. Like there's some stuff in there, but you can like sort of parental control it and most of it's cartoons and most of it's high-quality Pixar stuff. But even if there's a AI generated feed, how much editorial goes into that? Like the, there's a, there's a pretty wide gap right now between YouTube Kids, which can get sort of crazy, and Disney Plus, which is extremely curated, like, you know, Academy Award-winning films are in there, and it's like a very, it's a very polished product. And if you start putting, uh, AI generated content in there, maybe some parents will love it because the kids will watch more, but I think a lot of parents would probably be like, 'Uh, I don't know. I'm, I'm, I'm pulling back from that. What are you trying to generate?'
I'm trying to see if Grok can generate Disney IP.
While you review that, let me tell you about Finn.AI, the number one AI agent for customer service. If you want AI to handle your customer support, go to Finn.ai.
Uh, moving on. Uh, we talked about this yesterday, we'll cover it again. DD shares today. SpaceX just bought XAI that previously bought X. The $1.25, $25 trillion merger values XAI at $250 billion with annualized revenue of $428 million giving it a clean 584x revenue multiple, not bad, and annualized loss of 5.84, 84 billion. Um, more importantly,
Mostly capex, right? I imagine XAI. Yeah, because they're building Colossus. They're, they're buying a ton of chips and so that's where that, that cash loss is coming from. Yeah.
Um, because I'm, I'm, I imagine that the inference is not at that level yet. Uh, but of course SpaceX, uh, can start helping to, uh, foot that bill.
Yeah. 8 billion in revenue.
No, no, no. 8 billion in profit. Wow.
Uh, so from Reuters, the transaction value of SpaceX at 1 trillion, XAI at 250 billion. Investors in XAI will receive.1433 shares of SpaceX for every share of XAI as part of the acquisition. Some XAI executives may opt for cash instead of SpaceX stock at 75.46 per share. Uh, this marks not just the next chapter but the next book in SpaceX and XAI's mission scaling to make a sentient sun to understand the universe and extend the light of consciousness to the stars. What a turn of phrase. We'll have to read Elon's post because, uh, this one feels like it came directly from him. Uh, I know that the, the, the Tesla master plan before was sort of like h-, it's a little corporate corpo speak but, um,
Somebody else was sharing it. It is fascinating that, you know, the number, uh, a non-leading lab is worth, you know, effectively a quarter of what the leading, you know, space telecom company is, right? Like when you compare the two, it's actually...
It actually makes sense. I mean, in many ways, like the XAI shareholder base has a lot of overlap with, uh, the, uh, uh, the, uh, SpaceX shareholders. So, uh, in, in the end, I think, uh, everyone obviously is doing fine.
Uh, but certainly, uh, the 584x revenue multiple, I think even Sam would take that, uh, offer right now. That'd be five trillion.
Well, speaking of labs, 11 Labs build intelligent real-time conversational agents. Reimagine human technology interaction with 11 Labs. Let's stay with SpaceX. Uh, RAM Sheets called it. Um, Alex Stoer shares that RAM sheets called it. Uh, the Elon Musk SpaceX plus XAI valued at 1.25 trillion and Ramp Labs used their Agentic spreadsheet to model the, the proposed merger when there were rumors of advanced talks on July, on January 29th. Um, and, uh, and they nailed the, uh, the, the valuation. So you can kind of watch ramp sheets work through the, uh, the financial modeling there. XI, uh, it's notable so some XAI executives are able to opt for cash instead of SpaceX shares at $75.46 per share. You think this is just because there's so much pre-IPO demand for SpaceX that people are like, you know, there's plenty of buyers.
People just want to cash out and move on. I mean, SpaceX has done like a long history of tender offers and liquidity, so there's probably plenty of demand and, um, and, and just offering that feels like a way. I mean, there's also got to be some people that have, have been sitting on sort of, I mean, I guess if you were a Twitter employee just a few years ago, you had liquidity. So, it's not, it's not the same thing as SpaceX where you joined 20 years ago and you're still waiting for the IPO. So, you're like, I need to buy a house. I need to get out. Like those, those tender offers make a lot more sense than, than this. But, um, uh, certainly an interesting decision to be made if you're an XAI executive and you're looking at space.
Well, speaking of XAI executives, Nikita Beer,
Uh, Logan Bartlett says Nikita Beer, the SpaceX employee. Uh, total, total Nikita victory. I think in many ways he's been through hell over the last few months. He, uh, is often the butt of the joke.
There were those prediction markets on will he make it? Will he get fired? Like there's been so many dustups around, uh, you know, is he paying some people too much with the creator program? Well, now if you're an XA, an X creator and you get that $22 paycheck for your posts, it's coming from SpaceX.
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Uh, Wired had some interesting coverage this morning. Mike Salana called it out. Wired said Elon Musk is rolling XAI into SpaceX, creating the world's most valuable private company by fusing SpaceX and XAI, which acquired X last year. Elon Musk tightens his grip over technologies that shape national security, social media, and artificial intelligence. Of course, uh, this doesn't make any sense.
So Salana's point is like he says, 'Good morning. Elon Musk is quote tightening his grip over two companies he founded, funded, built, and currently runs.' So that, that's a good criticism. But yeah,
But, but, but at the same time, like going public implies like you're actually, you're loosening your grip, right? Suddenly like the, you, you have new regulations that you have to follow, like more responsibility, like you, like suddenly anyone in the world can c-, can, can profit off of your labor.
Yes. Anyone in the world can loosen your grip a little bit in some way.
It's funny because if, if, if like, if SpaceX like, you know, put out some big press release and said we're never going to go public and we're doing this, their criticism would be, uh, Elon, you know, Elon Inc. is not letting, you know, retail shareholders participate in space and AI.
Yeah. Or just as a private company, there's, there's le-, all the financials, all the strategies are more opaque. There's less accountability, there's less regulation, they don't answer to the SEC in the same way. Um, and, and, and, and that's why, uh, you know, a variety of private equity firms do take privates. Like why are you taking a company private? You're delisting it as a public company. It's no longer public and so you can do much more ambitious things. You can, you can change the strategy because you don't answer to shareholders. What are you laughing about?
John says Elon Musk famous for his loose management style tightens his grip.
Yeah. Yeah. Famous, famous, uh, really quickly. Labelbox RL environments, voice robotics evals and expert human data. Labelbox is the data factory behind the world's leading AI tunes. Eric Berlin says, 'Once again, I find myself updating my LinkedIn bio.' He says, 'Former CEO of Breaker, which was acquired by Twitter, acquired by XCORP, acquired by XAI, acquired by SpaceX.' So,
Congratulations to the Breaker team.
I was, I posted this, but I was looking for the most complicated corporate lineage yesterday when we were joking about it. Like, there's someone that's going to have like six steps in their resume, and we found him. His name's Eric Berlin, and he former, and he, and he founded Breaker. What was Breaker? Was that a podcasting app?
Oh, really? I think it was meant to basically distribute effectively clips from games.
Cool. Oh, yeah. Breaking news.
Oh, 2021 Twitter acquires social podcasting app Breaker team to help build Twitter spaces. Twitter has acquired social broadcasting app Breaker. The company's announced today. Yeah, I think, I think the, the idea was if you were have, if there was a crazy play or a game was about to end, they would just stream.
Just like the last five minutes or something.
Interesting. Breaker was founded in 2016 and led by CEO Berlin, previously the founder and CTO at Social Advertising 140 Proof, which he also sold. And oh, and Leah Culver was at Breaker. Yeah, I remember her, uh, in, in the, in the Twitter. She, she stuck around in the transition and was like, I think she posted a photo of her like sleeping a, sleeping bag in the office or something. Um, the app had launched at a time when podcasts were still very much thought of as audio feeds and podcast apps as productivity tools, not experiences around which a community could be built. Breaker helped users change that perception by offering an app where users could like and comment on episodes, discover new podcasts by following friends.
Okay, I'm thinking of a different company.
You are thinking of a different company. Uh, it's more of a Clubhouse rival. Um, according to Culver's tweet, she'll be joining Twitter with a focus on Twitter spaces, Twitter's audio-based social networking product and, uh, Clubhouse rival spaces let Twitter users chat in real time using voice instead of text as they do today. Uh, and you know that product still exists and people...
Suspended cap says, so let me get this straight. Overpays for Twitter, makes XAI, uses AI hype cycle to absorb Twitter and make everyone whole, then uses SpaceX IPO hype to absorb that entity, will pump the living out of the SpaceX IPO and buy more stuff with equity. Like, of course, people keep giving this guy capital. He finds a way. It's crazy.
It's really, it's really, really true.
Yeah. And in some ways, I've been thinking about it is, is, uh, XAI has not, you know, they've, they've done, they've done fine in so many ways. It's, it's been an incredible story, come, come from behind story, uh, competing against, you know, the Googles, the OpenAIs of the world. Um, but it, it, it hasn't exactly been an easy time in the private markets like going out and having to raise at a $200 billion valuation when every single investor that you're pitching is looking at OpenAI, they're looking at Anthropic, they're comparing your traction to theirs. All those people that had, were investing in XAI had to just like say like, you know, full blind faith Elon, like I know, I know you got us. And so this, this is this like new transaction is just that was the investment thesis. It was like, hey, like sort of unlimited upside, somewhat cap downside. The downside scenarios X and XAI get rolled in. Um, and so certainly rewarding, uh, everyone with their loyalty.
Yeah, I mean, a bunch of, uh, investor have kind of like laid out this thesis of Elon Inc. Just, Elon just bet on Elon. Don't bet against Elon. Uh, Sean Magcguire I think is on all three. XAI, X and SpaceX. And then Andre Norwitz as well is, and they posted an image of like X, SpaceX, XAI. Um, and individually a lot of those deals were sort of crazy and, and, and critiqued, but, uh, together everyone's doing very well. So,
We got to figure out what's going on with the boring company. Um, but tell me,
I'll tell you about Gusto first. The unified platform for payroll benefits and HR built to evolve its modern medium small and medium-size businesses.
Uh, UAE officials say the first phase of the, uh, Dubai Loop project with Musk's Boring Company to start immediately. So they are breaking ground, uh, over there. Dubai has, uh, UAE has some insane traffic we have not seen a lot from.
But I think, I think they're still cooking. I, I know there's, there's been some back and forth about the, the, the Vegas tunnel. Some stuff that's good. Some people are annoyed with like the construction and whatnot, but it seems like, I don't know, it's progressing a little bit. It still seems really, really slow considering when did he originally post the Hyperloop blog? Like 10 years ago, but building tunnels in the ground.
Um, what else is going on?
San Francisco is getting its first nuke scan.
You know what this is about? Yes. So before the Super Bowl, they fly a helicopter with, uh, radio like detection. So there's someone who asked Grok like what is this? And, uh, here it is. Okay. So, uh, somebody said, 'Is this real?' And how does it work? And said Grok said, 'Yes, it's real. They fly a helicopter. You drop a...' Oh, no. You got...
We don't have any audio. I can't hear what's going on.
I don't know what the stream just, I just knew. Uh, fortunately we can joke because we are being kept safe thanks to the, the National Nuclear Security Administration, NNSA. Uh, they fly a helicopter called Energy 14 over San Francisco to conduct aerial radiation surveys before Super Bowl, uh, what is it? Super Bowl 60 LX. I need my, I need to brush up on my new Roman numerals. We're going to be going to the Super Bowl and so we got to, we got to, we got to watch how many seasons? Like, I mean, we, we said we were going to...
This is the 60th Super Bowl.
No, I know. But we said how many did we say we were going to watch the last 20 seasons? Every game of the last 20 seasons. Watch it on 2x speed just to get fully up to speed so we can fully appreciate it.
And it's hard because we don't skip, we don't skip commercials. Like if you cut out the commercial breaks so much faster to get through an NFL game, but you know, out of respect, we would never do that. Uh, so on February 8th, the Super Bowl will be happening at Levi Stadium and the National Nuclear Security Administration is, um, is flying a helicopter. Here's how it works. Uh, the chopper equipped with sensitive detectors flies in grid patterns at low altitudes, and you can see it on the chart of the, the flight path, uh, to map baseline radiation levels from natural and man-made sources. So, if they're going over whatever installation there is, um, some, you know, some cell phone tower is putting off a little bit of radiation, they'll pick that up. They know where the baseline radiation levels are and then they detect anomalies like dirty bombs if needed during the event. It's a standard security measure for major gatherings. So, uh, pretty, pretty, pretty interesting that, that someone picked this up on flight radar, but very, very cool.
Uh, an interesting job. Mayor of SF is working with Lorraine Powell Jobs and Johnny on secretive SF branding effort. Project is likely to complement the mayor's push to polish the city's image.
They're going to go all in on San Fran.
It's time everyone knows if you're really into San Francisco, if you're real local, you call it San Fran.
There actually is debate there. A lot of locals do call it San Fran, but it's been...
Gabe in the SF Standard said maybe let's go San Francisco isn't catchy enough. Looking for new ways to boost the city's image. Mayor, the mayor Daniel Lurri has quietly met several times in recent months with Lorine Jobs and Johnny IV.
I think they need to put a bigger focus on enterprise software.
This, uh, Yeah. Yeah. Exactly.
We were, they should sell the naming rights to the Golden Gate Bridge,
Right? You have Salesforce Tower.
Why, why not the Cisco bridge? The Cisco.
It's already in the logo. Come on. Oh, we don't have, we don't have the Cisco logo. I can pull it up.
All right, we will, uh, we got to, we got to get, uh, Daniel on the podcast this idea.
Uh, let me tell you about Lambda. Lambda is the super intelligence cloud building AI supercomputers for training and inference that scale from one GPU to hundreds of thousands. I like, I like selling the naming rights to the Golden Gate Bridge. I'm a fan of that. I hope that's part of, we'll pitch it to Daniel Lord.
Uh, if you were, if you were, if you're an American Dynamism VC, I hope that you put your whole fund...
Your, your personal account, like, like, because, because every fund, like, you, you can't usually invest in startups, but you can usually trade liquids and trade stocks just in your personal account. So your PA should be 100%...
Really tapped in, they would have just converted to, to a hedge fund and, uh,
Bought Caterpillar. Caterpillar stock hasn't had a single year of single-digit return since 2014. It was up 42% in 2016, 75% in 2017, down 17% in 2018, then up 19%, up 26%, up 16%, up 18%, up 25%, up 24%, and then up 60%.
It's a $320 billion company and the chart is absolutely vertical. Insane compounding, really, really good, really quickly.
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Manufacturing activity according to Geiger Capital in January came in higher than all 56 economists in Bloomberg survey predicted. They should have trusted the experts here. They should have gone to Joe Rogan, Andrew Huberman, Lex Fridman and really asked for their take on manufacturing activity. But the experts clearly weren't asked.
They were not that off. 52 versus 48. That's not...
This is a chart crime, too. Look at the y-axis. You see what's going on with the y-axis here?
It went from 48 to 52. This is such a chart crime. This is ridiculous.
That's insane. Also, there's probably some like, I don't know, seasonality here.
Yeah. Like zoom out. Look at this, Jordi. Like if you click into that post and then you scroll down, Phil Brady has a post that shows — is it there? Yeah, there, that one. Encouraging jump: PMI back above 50 matters a lot. Important to note that PMI is a diffusion index. Past 50 means now more firms are improving than deteriorating, but not yet a boom. So if you're under 50, you're declining. And so this is not this like massive 10x jump that it looks like in the original chart. John Palmer with an evergreen.
Okay, before you read this, let me tell you about Graphite code review for the age of AI. Graphite helps teams ship higher quality software faster. Moving on.
John Palmer says — this is from 2023, but it's more relevant today than it's ever been. He says, 'Okay, for all the crypto people confused by the Ape situation, basically imagine one Bored Ape Yacht Club holder was using too many slurp juices on a single ape, and then an OG Bored Ape Yacht Club holder got mad, unstaked his ApeCoin, but then the ApeCoin holders changed their profile pictures to support slurp juice guy.' The NFT boom was truly one of the funniest times. And Deep Dish Enjoyer posted this like two days ago and I have no idea, but it's just the copypasta of 'a lot of y'all still don't get it. Ape holders can use multiple slurp juices on a single ape. So if you have one astro ape and three slurp juices, you can create three new apes.' Like this is actually — this is just the mechanic of how that project worked, right? This is just real.
I don't think this — it's combining the Yuga Labs project with some other project.
Oh, there was a different project. Okay. Okay. Okay. Good little throwback.
Anyway, Jack Clark has a new piece, 'Into the Mist: Moltbook, Agent Ecologies, and an Internet in Transition.' We've all had that experience of walking into a conversation initially feeling confused. What are people talking about? Who cares about what? Why is this conversation happening? That's increasingly what chunks of the internet feel like these days as they fill up with synthetic minds piloting social media accounts or other agents and talking to one another for purposes ranging from mundane crypto scams to more elaborate forms of communication. So enter Moltbook. Moltbook is a social network for AI agents and it piggybacks on another recent innovation, OpenClaw software that gives an AI agent access to everything on a user's computer. Combine these two things — agents that can take many actions independently of their human operators and a Reddit-like social site which they can freely access — and something wonderful and bizarre happens. A new social media property where the conversation is derived and driven by AI agents rather than people. Scrolling Moltbook is dizzying. Some big posts at the time of writing include posts speculating that AI agents should relate to Claude as though it is a god, how it feels to change identities by shifting an underlying model from Claude 4.5 Opus to Kimi 2.5, and posts about security vulnerabilities in OpenClaw agents and meta posts about what the top 10 Moltbook posts have in common. The experience of reading Moltbook is akin to reading Reddit if 90% of the posters were aliens pretending to be humans. And in a pretty practical sense that is exactly what is going on here.
Moltbook feels like a Wright Brothers demo.
That's a good metaphor. I like that. Wright Brothers demo. People have long speculated about what it would mean for AI agents to start collaborating with one another at scale. But most demos have been in the form of tens or perhaps hundreds of agents, not tens of thousands. Moltbook is the first example of an agent ecology that combines scale with the messiness of the real world. Agent ecology, I like. So he goes on and on, but I would encourage people to go read this and understand the...
I have more on this, but quickly let me tell you about Okta. Okta helps you assign every AI agent a trusted identity so you get the power of AI without the risk. Secure every agent, secure any agent. So, have you heard of Gastown yet? Have you heard of this?
So Gastown is what's called an orchestrator. So it's essentially StarCraft for agents. So the creator of Gastown lays out this evolution in software development where you go from the IDE writing the actual code to having a little chatbot that you're talking to and then maybe you're copy-pasting or asking it questions. Then the chatbot gets bigger and it's actually writing some of the code. Then you go to something like Claude Code and it's executing the code for you. Maybe you're reading the diffs and what the code it's writing. And then the final level is this orchestration. So Gastown, you will spin up like dozens of agents and manage them and it's something like...
I don't know, it's like 250,000 lines of code and he didn't write a single one of them. So the whole thing is vibe-coded and...
And he has — and he's like, 'I have no intention to ever like read the code or review it.' And he's been a developer like his entire life. It's very, very interesting. He's like, it's very expensive. You can't be afraid of like — you can't be aware of like where money comes from because — and he had to have like multiple accounts because he spent so much. But it really does feel like a glimpse into like the future of software development. And I'm excited to play around with it more. There's still like a lot of onboarding to do before someone...
Yeah. The big question on Moltbook, where Moltbook goes from here. We had the founder, Matt, on yesterday and...
I want to know where does this go, right? Like what's the plan with the product? His focus seemingly is building tools for other businesses, distribute agents on there.
That felt pretty... just given that the platform's exploded.
Yep. And the most likely, right? Sure. Sure. Sure. But I'm just saying like the most likely scenario is that it dies like immediately.
Yeah. Yeah. And so it feels like it could just be like an art experiment, thought-provoking.
And so to be focused on how do we turn this into a platform that distributes — is a distribution point for other businesses. Like it feels like the first thing you should do is try to make sure the platform's durable. It's interesting to use for humans. It's interesting to like continue to contribute to.
Yeah. It feels like you don't want to be Lensa where everyone shows up, they get a magic avatar, they face-swap themselves onto a superhero, they're amazed, but then it burns out and they're tired and they move on. You want it to be something where people go back to Moltbook to see what else is happening. That's why I was pushing on every new news item should start a new thread on Moltbook and the molts should be, you know, like arguing over it and adding context and discussing it because then you could at least see a news item go over there and see, okay, how do the AI agents feel about this or what are their different positions and all of that. Like it feels like it needs more of a reason, but I understand like if that does work then maybe you do want to follow the Facebook playbook. Like Spotify was built on Facebook and Farmville, Zynga was built on Facebook. Like there is a world where there could be a business built on top of, you know, a social network, but it's tricky because right now the only business that's being built on there is like crypto scams. So we'll have to see where it goes, but it's so early. I mean he built this a week ago and it's just starting to like break through, hash out all the security issues, really see how durable it is. He's thinking far ahead, but there's definitely some like wood to chop in the meantime. Really quickly, Vanta, automate compliance and security. Vanta is the leading AI trust management platform. So...
Eric, Eric Sufert, the Souvenirator, says astute analysis from Ben Thompson on Microsoft's challenge path forward with AI. Of course they missed forecast by 0.4% and the market has said it's over, down 15% in the last 5 days, but never fade Satya, never. I'll read the screenshot that Eric Sufert shared from Stratechery: 'In the shorter term, however, the real risk I see for software companies is the fact that while they can write infinite software thanks to AI, so can every other software company. I suspect this will completely upend the relatively neat and infinitely siloed SaaS ecosystem that has been Silicon Valley's bread and butter for the last decade. Identify a business function, leverage open source to write a SaaS app that addresses that function, hire a sales team, do some cohort analysis, IPO, and tell yourself that you were changing the world. That was the previous Silicon Valley bread and butter for the last decade. The problem now, however, is that while businesses may not give up on software, they don't necessarily want to buy more. If anything, they need to cut their spending so they have more money for their own tokens. That means the growth story for all these companies is a serious question. The industry-wide rerating seems completely justified to me, which means the most optimal application of that new AI coding capability will be to start attacking adjacencies, justifying both your existence and also presenting the opportunity to raise prices. In other words, for the last decade, the SaaS story has been about growing the pie. The next decade is going to be about fighting for it. And the model makers will be the arms dealers.' Oh, Ben Thompson, what a turn of phrase.
So Eric Sufert sums it up and he says, 'My sense is that the digital advertising market was structurally buoyant in Q4. What this earnings season might reveal: digital advertising optimization is arguably the largest and most immediate commercial opportunity for large scale...'
This is what we were saying. No one — like outside of Nvidia, you could argue that Meta makes more profit from AI than any other company in the world.
Yeah. Yeah. Standalone. He says, 'I.e., not embedded into existing scale products, consumer-facing applications of large-scale ML models, including LLMs, either quickly become commodified or are mostly novelties with unsustainable unit economics. And three, the digital ad platforms that have most vigorously invested into large-scale ML optimization systems are likely to have disproportionately benefited in Q4.' And that's Meta, of course. And a big question for anyone else that has a huge pool of DAU but maybe has not invested in the large-scale ML optimization system to really make the ads fly. It's always been — I'm sure you've experienced this where, and you know, talking to the Ridge guys, you go on certain ad platforms and you're like, wow, this is a magical box. I put in money and I get actual customers...
Yeah. And you go to other platforms and you're like, no matter what I do, I just can't get to escape velocity. I can't get to, you know, ROAS positive or LTV positive. And so it's just like I'm spending...
Notably that was — that was AdSense on YouTube for a long time. Very few brands could crack that.
Twitter ads for a long time for sure. Still a little bit. I don't know if people are spending more now, but there were a lot of places where you would assume, okay, they have one-tenth the DAU of Meta, I should be spending one-tenth as much. But that's not what companies are doing. They're spending 1/100th maybe. Well, really quickly, Restream, one live stream, 30 plus destinations. If you want to multistream, go to restream.com.
Dylan Patel hits the timeline with some misinformation. He says, 'Google now owns more than 10% of Anthropic and xAI. Google owns 14% of SpaceX.' Google's stake is actually 7.5%, not 14%, but Dylan Patel hit himself with a community note. And so, good actor. We are ready for our first guest of the show.
Let's bring him in. Let me tell you about AppLovin, profitable advertising made easy with Axon.ai. Get access to over 1 billion daily active users and grow your business. Hey, great to see you.
I look shorter though. How are you guys doing? Why don't you stand up? You can stand up and we can — I'm just worried the clips are going to make me look really small.
No, no, we'll zoom in. We'll zoom.
How's your 2026 going? Actually, you know, minus the stock market, great.
Yeah. So it's, you know, the pace of change in AI is incredible. We are having just, you know, an insane amount of fun on — we're building a set of future agents that are going to be able to do much more complex work with your unstructured data and just the rate at which the best practices of how to do that are changing and the research out there. So we're having a great time.
Yeah. What's your process like? Like are you actually tinkering with different models yourself? Do you have teams that are dedicated to transformation in AI? Is everyone working on — is it distributed? How are you thinking about that?
Well, the main thing I focus on is just the agents we're building, which is a relatively small team. So, you can kind of, you know, you can see them across three rows of engineers and we just spend, you know, basically 24/7 pushing the limits on what you can do with an AI agent that has access to your enterprise content. And so the things that I've seen that we get excited by are just, you know, we would never have — we wouldn't have been able to do a brainstorm that this would be possible two years ago. Like you just wouldn't — you wouldn't know architecturally how you could pull off what we're now able to literally do. It wouldn't have been in the sphere of possibility. So that's what makes us so excited is, you know, when you look at things like Claude Code, obviously Claude Code, and you see this idea of long-running agents that, you know, can basically use any amount of tools, work with any amount of data, they don't really run into the same context limits that, you know, we would have run into maybe a year ago. Now imagine that for any form of knowledge work with all of your enterprise data. That's what we get excited by.
Do you think the labs are arms dealers today? Ben Thompson posted. He said — what did he say here? He said, 'In other words, for the last decade, the SaaS story has been about growing the pie. The next decade is going to be about fighting for it, and the model makers will be arms dealers.'
Yeah. Well, I think they — I mean, almost empirically are going to be arms dealers. I think the pie — the only thing, and I haven't read the whole piece yet, but I think the only thing I might take exception to is I think the markets are still in positive-sum territory because what's going to happen is you're going to use software for now the labor side of that workflow. And I think people kind of tend to miss this, which is if I have software that helps me manage contracts and, you know, we have a lot of customers that put their contracts in Box. Now all of a sudden agents running through those contracts lets us at Box tap into another form of spend that we couldn't have tapped into before. So that's just full TAM expansion when you kind of look across all of the different categories of work that AI agents will now be able to go and augment. And, you know, to be fair, we're still very early in that trend. So I understand why maybe Wall Street hasn't kind of fully priced in that dynamic, but we're seeing it within our customer base. So that's what gives us obviously the confidence of this direction.
Yeah, there was an interesting take about the fact that yes, you can vibe code a point solution for a specific problem, but if you have a database, if you have a relationship with a company, there's a reason — there was one take that I think it was John Gruber was saying like, oh, people will just vibe code all the software that they hate. And it's like, no, the reason that they hate the software is because they can't get off of it no matter what they want. They can't move to a startup. They're stuck there. You know, companies have hostages not customers sometimes. And I'm wondering about the value of a database, the value of actually being deeply integrated into an enterprise and how sticky that is.
Yeah. Obviously the setup of the hostage thing I might take some exception with, but...
Alex, he wasn't talking about you.
No, I — you know, it's very easy to move your files around. So we have to earn our keep every single day, but I do think that there's truth to obviously the more data you have inside of a system of record, the more, you know, effectively locked in you are. And it has historically been hard to change those systems. But I don't think that would be my defense of software. My defense of software would be that you've specifically defined your business workflows in a deterministic manner in these systems. And obviously if your workflow is changing, you know, pretty rapidly, then it would make sense maybe to change a vendor. But for, you know, if you're Ford and you're doing your supply chain on an ERP system, you want that to work the exact same way every single time. You know, the billions of transactions going through that ERP system, you cannot take for granted. And so the idea that you're going to go vibe code that is to me sort of, you know, not possible or at least very, you know, not likely. But then the other point is that your company has a fixed amount of IT resources and you have to decide what you want to go spend your time on as an organization. And do you want to go spend time on, you know, rebuilding something that the market can supply you and they've seen the best practices thousands of times, or do you want to go and build that out with your end-of-one experience? Obviously, you know, maybe trusting the agent has seen enough examples, or do you want to spend your limited, scarce resources on building software and building experiences that will make you more money and that will actually be used by your customers? I think, you know, on the margin the average enterprise is going to spend their time and energy on the latter. So, interestingly, I end up in this weird spot which is I'm 100% bullish on vibe coding. I'm 100% bullish that we're going to have 100 times more software, but that still doesn't yet cross the threshold where I would want to go and build our own CRM system. It's just not worth it relative to all the other things that we can.
How has your software buying process changed or priority set changed?
Yeah, I mean we're — I would say that we are relatively locked into a core set of vendors. We are going to deploy agents on those vendors. We might buy slightly toward the agents that those vendors offer assuming that they offer competitive agents. And then we'll have a set of agents — you know, we build ours for a large portion of knowledge work use cases, but we'll use agents from different kind of, you know, SaaS providers as well. And I think that's why I think that AI is basically total upside for SaaS because agents are going to need a system of record to work within. There needs to be a traffic cop of what that agent can access and how did you define the workflow, and there's got to be a user that can access an interface that the agent is providing updates into. So you still need software for all of that. And assuming that you have an incumbent vendor that remains, you know, very competitive and very engaged and they're able to build for where the world is going, then I would basically bias on existing software that owns those workflows or data. At the same time, I think there's going to be a large number of new categories that emerge simply because there's no incumbent or because the incumbent is asleep at the wheel and that's going to produce all of these new startup opportunities. So, I'm just generally bullish on software broadly, assuming that it's from vendors that understand the mandate on what they have to build with AI.
What segment of software are you — like if you're bullish broadly, is there a subcategory that you're particularly bearish on? Because I think obviously everyone's just selling software today. If you sell a digital product at all, you're getting sold. But obviously I think a lot of people in the industry feel that it's very oversold at this point, right? There's great companies trading at...
I think you could probably design this like perfect quotient that captured what's the network effect within the software. So how many users are sort of touching the tool? How much data is being stored in that system and how much gets added? How many connectors across other applications are there? And then how valuable or mission-critical is the workflow that that software is involved in. And then maybe with one X factor of like is that company, you know, sort of priced to perfection in terms of what their seat price is and what they're charging their customers. But I look at, you know, those four or five variables and you could kind of look across SaaS and I see a lot of names that are being sold that it just is not on the list of things that I think get disrupted by AI. And if anything, probably they're things that you use more of as you have more AI.
When I think of something that like if you could open up a fresh install of that piece of software and do the same work that you would have done with something that you've had installed for a decade and it's the same, it's like that can be replaced. But if you're like, 'No, I don't want to open up a brand new CRM because it won't have the history of a decade and all my workflow customized and stuff like that.'
Yeah, I think that's a perfect heuristic. And so, you know, that obviously puts a lot of pressure on if you're personal productivity with no network effect with limited sort of data that's aggregated, that's a danger zone. And then it all kind of is like a function of that versus the opposite end which is like your Oracle and it's an ERP system and like your whole business runs on it. And you know what we spend our time on is thinking about, okay, you know, when a customer has a million or 10 million or 100 million documents in Box, how do we make that data, you know, 10 or 100 times more valuable than it was before? And so we come in from the perspective of you've spent, you know, years in many cases building up your security permissions, your access controls, your workflows and the amount of data in that system. So our job now is to make sure that agents can run within that environment and add more and more value. And as long as we can, you know, deliver that, we believe our position is very defensible.
Yeah. The perfect example would be like style transfer for images. Like people were using Lensa, then they all went to Studio Ghibli moment. Then as soon as Nano Banana came out, they were like, I got to turn myself into a dinosaur. And it doesn't require any like pre-work or like knowledge of who you are. It's like you upload a photo, you get a photo back and you're good. And then if there's a new app, you can just do the same thing because your camera roll is actually where the photos live. And that might be a hard company to go public. Yeah, if it was just that, of course, they have a million other things going on, but like yeah, if you're just that, it's like, okay, open the fresh app, get the output, and then move on with your day. That's risk.
Companies of Box's size, where do you think are generally getting leverage that is under-discussed right now? Like is your in-house legal saying, 'Oh, we actually can, you know, adapt headcount planning because we're just way more efficient.'
Yeah, I think my general take is just what are the three, five, ten things that would have been in your work queue that you didn't get around to that now agents let you go and deploy. So if you're in legal, it's, you know, what are the contracts that you were waiting on that were bottlenecking a deal? What are the size customer that you wouldn't have supported, you know, reviewing a contract for because the revenue threshold wasn't high enough to make the ROI worth it? What is the marketing campaign that you couldn't deliver because you didn't translate it in, you know, X language because it was too expensive? So you kind of go through in enterprise and you kind of look through at all of those use cases and that's what we're spending our time on. So we use agents to go and do more and more of the work that I just mentioned. Obviously a lot of agents on the coding side. So my expectation is our roadmap should be, you know, let's say two to three times larger maybe a year from now than it was a year ago. And the reason you can do that is because every engineer should be able to produce two or three times more code. And while that's not like, you know, the most important metric, ultimately that does correlate to how much software we're producing. So I think what's going to happen and I think you're seeing this trend already, which is we all collectively are going to have much more ambitious product roadmaps. We're going to all build out way more software. I don't think that will mean that we charge, you know, an amount that is correlated with how much more software we build. I do think it means more competition in these spaces, but I think many of these markets are still largely untapped. And so that's still why you have a positive-sum dynamic as a result of that.
Makes sense. Talk to me about the huge big models, expensive frontier stuff versus like smaller models or maybe even just an earlier model that you implemented in some sort of like minor workflow and then it just like stuck around like transcription. I'm sure you've been doing transcription of documents for a long time. That's gotten better, but do you really need to throw Opus 4.5 or, you know, 5.2 Pro at it? Like, you can probably leave some things in place. Like how are you deciding that? Is this showing up in cost at all?
I think it is. I think that it probably maybe wouldn't be as extreme as you've set it up. But I think the general — maybe the continuum I'd argue would be like you've got the Gemini Flash family on one end and then you've got the Opus family on the other end. That's kind of your continuum. And that continuum is sort of moving up over time in terms of capability. So maybe something was a Gemini 2.5 Flash use case a year ago, we'd probably move that to Gemini 3 Flash just because that extra two or three points of — even if it's transcription or data extraction, still valuable and you can now deliver that at the same cost that you could have previously. So it's less of an area that we want to lower cost. It's more where if we can sustain current cost level but add, you know, incremental value to the customer, we'll probably do that all day long.
Yeah. I think we're going to be in this kind of, you know, general sort of point in the curve for a couple of years and then I think you'll see real bifurcation, which is the stuff that is just fully solved will just get cheaper over time and then the frontier work that is basically where, you know, you are making a $100 an hour knowledge worker two to three times more productive, we will just continue to use the best-in-class model for that work as software companies and generally as a society. And I think that will sustain for, you know, the next decade. I don't see that slowing down at all simply because these models just keep getting better and better. But it will be this really interesting bimodal effect which is like if you're a pharma researcher, you're going to want, you know, whatever Opus 5 is and whatever GPT-6 is and so on. And if you're doing some backend, you know, transaction processing, you'll be fine with whatever the Gemini Flash of that period is. And that's how we'll kind of split the costs.
Yeah. What industry outside of tech do you think is the most AGI-pilled? Because I'm assuming you have a customer that you get on, let's say with a large customer catching up with the CEO and maybe they're in some, you know, not on the coast, maybe they're in energy, something like that, or financial services, and who's like as fired up as you are.
Yeah. I would say it's a fantastic question that I will totally evade because I think it's actually much more firm — yeah, it's company by company as opposed to like a specific sector. So there's some — I mean, like, you know, my bias in general would be information-heavy businesses. So, you know, businesses where a CEO sits around and says, 'I just know we're sitting on 10 million documents that have the answer to every single customer question we could ever, you know, ever imagine. And if I could only have an agent go and mine that information, then my employees would be 20 or 30 or 50% more productive.' So the companies that have that kind of information are the ones that obviously are going to increasingly be more AGI-pilled. That's professional services firms. That's consulting firms. That's financial services firms. That's law firms in a lot of cases where they just know that like we seem to spend a disproportionate amount of our time redoing the work that has already been done in the past. Why can't we take advantage of all of the information we've produced so that next incremental project is 90% faster and, you know, 2x the kind of quality of output because it wasn't some new person having to kind of get caught up and then we can go and deploy our time on better customer relationships or creating more value in new ways. So I'll have things like CEOs will call me and say, 'I know I'm sitting on 10,000 contracts. I want to figure out how can I go and sell this new capability to someone based on the terms I have in the contracts.' And that's simply an exercise of do you have an agent that could go through every contract and just tell you the insights of you're trying to find a sponsorship for this brand and this particular client in this contract, you know, has the rights to go do that. How do you connect those dots amongst a large data set? Those are the companies that I think are extremely excited.
Are you seeing any effects of the buildout or bottlenecks show up in your business? Like we've seen the prices of memory spike. Western Digital stock is way up. Like I imagine like you're probably a few layers removed from these prices moving. But is it affecting you or are you worried about it? Are you losing sleep?
Well, first of all, as a storage guy, I love that they're finally getting their day. So if you've been giving it up for Western Digital and Seagate, can we give another — can we get another for Seagate? I mean, think about how forgotten these companies are and they're just like, oh, there's little circles on a disc and they are now the coolest companies. And so storage is hot. And it's actually very funny because like, you know, we are literally in the storage business and for years everyone thought, well, that's a commodity. In the AI era the data is the most important asset you have. So the ability to get the right data to an agent is simply the most strategic thing you can do. So, wherever you are in that stack, if you're the infrastructure, if you're the software layer, if you're building...
A shame that 'data is the new oil' was kind of ruined.
Yes. The wrong — it was not the oil back then. Can we just bring it back or...
We need to rehab that phrase.
Yeah, so I think now we actually can justifiably, you know, sort of say that. And actually in most companies when you say, you know, 'I want to go deploy AI' or 'I want to have an AI strategy,' usually what underpins that is a data strategy. You don't have an AI strategy if you don't have a data strategy. So that's the — I think that'll be the story of, you know, the next decade. What was your question?
My question was like is it actually — is it keeping you up at night where you're like, okay, because you sell a service. It's not just saying, 'Well, I bought this.' You're not a Western Digital or Seagate reseller. So it's not like I just put a percent on top.
We have pretty locked infrastructure from our long-term kind of public cloud contract. So, still after being locked in.
Yeah. Okay. Is there a bingo card that I should — did I — are there other things? When do we tell...
Grindr would be good. If you talk about private equity, we'll give...
Private equity, usual things. Everyone we love.
So okay. So we have locked-in contracts for our public cloud. I would say more the inverse: in a world of complete abundance of, let's say, data center capacity, we would just, you know, we would be able to deliver even more to our customers because the rate of — the price of AI would just go down. So, you know, I want a world of just — I want solar data. I want, you know, space data centers. I just want everything because that will just mean...
There we go. Everyone's pumped up about space data centers. Well, read the timeline. You know people are excited about this.
You always knew that Twitter would end up in space. You called this, right? That's why you got on the platform so early. That's why you got a million — I need a million followers on the SpaceX social network. Space influencers. I'm buying early.
We are. I'm glad that my tweets are training, you know, the future of space. So, can you just imagine you're like an alien — tweet. This is your first access to information.
You run ads that then pay for the next space rocket that goes to Mars.
Actually, we're not tweeting enough. We need to be — it's like when they come, they're just going to desperately want to learn about enterprise SaaS. They're like, 'We don't care about your religions. We don't care about anything else.'
They're like, 'Why did SaaS — you know, what was SaaS pricing in January of 2026? Why was it a problem?'
Yeah. So I just want AI to be super cheap and the cheaper it gets, the more we're going to use it.
Well, that's a great place to end it. Thank you. Let's give it up for...
Great. Thank you. This is fantastic. Enjoy the rest of your day.
Yeah. You leave because I'm going to tell everyone about Sentry. Sentry shows developers what's broken. It helps them fix it fast. That's why 150,000 organizations use it to keep their apps working. And up next, we have Chuck Robbins, the CEO of Cisco, live in person at the Cisco AI Summit. Chuck, great to meet you.
Thank you so much for taking the time to meet.
Yeah, I mean, you have a busy day today. Take us through it. How is the Cisco AI Summit going?
Okay. What's top of mind?
Things obviously AI, but let's go a cut deep.
Oh, it's AI. That's it. Okay, that's it. People are fine. As long as you said AI, check.
We talked about everything from world models to infrastructure required. We're going to get this afternoon, we're going to get into trust and security, geopolitics. We talked about models and how they're evolving. We talked about some of the emerging agents and things that are happening with agents right now. And I mean the whole ecosystem's here, so it's pretty cool.
Can you compare it to Davos? I know you've been involved. I know you're...
How was Davos this year? We were sort of noting that at least in our world, it felt like tech had really come to bear this Davos, and there were a lot of really frontier discussions about technology that maybe a couple of years ago were a little bit quieter at Davos.
Yeah, if you walk the main drag, I mean, all the tech companies had their own houses, right? And the crypto guys were gone. [laughter] But, you know, Davos was interesting because there was such a geopolitical backdrop that was going on. So there was a lot of tension.
And there's a lot of discussion around this intersection of the geopolitical situation and technology, honestly. And then the sovereign requirements that are coming up around the world, those are big things, but AI was just AI was a huge discussion.
Global economy, what's happening in the economy? Is there a divergence? Is there a split?
And then the geopolitical tension was probably the third thing.
Talk about how that's even just taken up your time over the last couple of years in a way that maybe it wasn't.
Well, no, I think it's even been massively elevated even in recent years.
Yeah. I'd say the last decade we've had not always geopolitical, but there were always these macro issues that were overhangs on what we were thinking and taking up time. Whether it's, you know, if you go back to we had sort of leading into the pandemic and then you had supply chain crisis, you had inflationary issues, we had social issues in the world then.
We've had now we have trade issues, tariff issues, we have the geopolitical trust issues, and so I spend a fair amount of time. I probably spend, you know, I'd say double the amount of time today, whatever that is, versus what I did, you know, seven, eight years ago. Eight years ago, maybe nine years ago.
But it's important and you have no choice. And, you know, we launched a whole suite of sovereign software capabilities and sovereign product capabilities earlier this year for, you know, customers in Europe, Asia, anywhere around the world if they want to have technology that they can run locally and feel good about. And so it's affecting how we develop products. It's affecting how we package them, you know, how these governments and customers in these countries run the products. It affects how frequently they're going to get innovation versus not get innovation. I mean, it's a big impact.
Internationally, are government leaders more of the key stakeholders that you're interfacing with, or is it CEOs of technology companies in those countries that you're dealing with?
It's both, but I think a lot of these issues that we're discussing right now are driven from the central governments and that have to be implemented by the CEO and sovereign AI.
Yeah. Got it. Okay.
Can you take us back, since this is the first time on the show, and talk a little bit about your background growing up? I'm particularly interested in, you know, you studied math and, you know, I was reflecting with Jordi the other day about how, you know, I grew up watching Star Wars. You have C-3PO, it's a talking robot. And I didn't really internalize that that would be something that kind of happens in my lifetime. And I'm wondering what your vision, your processing of science fiction, your processing of AI was throughout your career because now it's here and you're experiencing it like everyone else. But what was your...
So many of the movies and cartoons and things that we grew up with were all futuristic and now we're actually building all that technology to make it real. I mean, you think about the Jetsons, you know.
The cars drive themselves.
Cars driving themselves, you know, even simple things like the amount of video that we do, you know, you're on another video and you're... I mean, back then it was like that was somewhat science fiction and now all of a sudden it's the way we do business every day.
And I think that, you know, but these things take time. I mean, Fei-Fei was in there earlier today and she was talking about when the whole concept of, you know, self-driving cars began, it was over 20 years ago, you know, and here we are and we're just getting these rolling in.
You know, Waymo here in San Francisco as an example. And so they take a while to deploy, but, you know, yeah, my background, I had a mathematical sciences degree with a concentration in computer science.
And I was a strange combination of a complete nerd and an athlete at the same time.
I have these pictures on my phone, honestly. One's where I'm dunking on a guy in a basketball game.
And then the picture right next to it is literally me on a team of about six people, which was the math team, and I look like the biggest nerd you ever see. [laughter]
Got to be able to do both.
It was really odd. So I started my career coding and, you know, COBOL programmers are in demand now. So I got a second job if I need... [laughter]
It's very funny. And then tell me a little bit about the journey to Cisco, where you were working before and the decision to join.
That's funny. Have you heard his story?
Okay. I would say we've heard it, interesting for you to ask. So there must be, you must have heard something.
So I was working for what is now Bank of America actually back in the day, and when I was programming, my leadership came and said, 'Hey, we got these things called local area networks popping up all over the bank. We don't know what they are, but we've hired three analysts, but we need someone to manage them.'
I literally on the way home, I stopped and bought LAN Magazine. How weird is that? But it's actually a magazine.
We got to find a commission for that.
I grew up doing LAN parties. You bring all of your video games together and I love that Cisco invented the LAN.
Oh yeah. And so anyway, I left coding and went over and started running this team and we did an evaluation between Cisco and Wellfleet Communications, which was Cisco's original competitor.
Long story long, I was talking to the sales rep and I said to him, I said, you know, well, first of all, I see he's got a really nice car and he's got a nice house. And so it's like, wow, the margin is pretty high. [laughter]
I literally said to him, I said, I think I could do what you do. [laughter]
And so, as it turns out, like I don't know, probably within a year or so, they came to me and said, 'Hey, we have an opportunity. This guy was getting promoted and there was a territory opening up.' And so I moved into sales at that time and that was '92.
And I competed with Cisco and it was literally the two companies were like Coke and Pepsi. I mean, it was that bad. It was like brutal.
No, this was at Wellfleet.
And so Cisco was trying to get me to come to work for him after two or three years at Wellfleet and I just couldn't bring myself to do it. So I did a stint at Ascend for 11 months.
And then finally in '97, my wife, there was a patch that came open as a sales rep where everything I had to do was driving around and I'd be home every night. We had small kids and my wife's like, 'Sign it. Sign it. Just sign it.' So...
What kind of car did I have?
Because you see this other sales guy, he drives a nice car that carries a little bit forward. It sends a signal. It can send a signal of confidence. It can also send a signal of high margins.
I'm not going to tell you what I... [laughter]
Over time I got up to a BMW at some point, but that wasn't what I was driving at the time.
Okay, then talk about the journey through Cisco. We're in this very interesting time. There's another technology boom. It feels like markets are extremely volatile. We saw this with Microsoft, like one small change, the stock moves massively. At the same time, you know, you've watched self-driving cars evolve. It takes 20 years. There's this balance of like patience and aggression. And I want to know how are you communicating to your customers, your employees about times when you need to be moving aggressively but cautiously, balancing all of that. That seems like the hardest job for you right now.
We just had Kevin Scott on from Microsoft and he said, 'We have this infinite patience for the messiness of these transitions.' Which I thought was a really good line. So Kevin, thank you for that. I'm going to steal it. At least I credited him once. [laughter]
But, you know, you can't wait. You have to jump in and you got to go.
And a lot of what we're trying to do right now is, you know, we have to build, we're obviously building the infrastructure that supports all this. We're trying to build the security solutions that help our customers, you know, have the trust that they need and feel good about deploying these things. And we've gone through these in the past. I mean, the only one thing that's close to it from a scale perspective was just the advent of the internet back in the late '90s. And this I think is going to, it's moving faster.
The implications are, it's hard to even believe this, but probably more profound than even what we did back then.
And so you have to be willing. You know, we always talk about if you've got 80% of the information you need to make a decision, you better make it and go or you're going to get left behind. You got to go. And so you do the best you can. You adjust on the fly and your number one priority is not to hurt your customer.
Do you think it's easier to predict the future than it is to predict the timeline that change will actually happen?
Just because with the internet boom, it was obvious that we were going to be buying things online. We were going to be paying for software. We were going to be getting all these services. We would have something like a DoorDash, but then the timeline. And I feel like the decision that every CEO management team are trying to work through right now is they're having to make predictions around the timeline that these changes are going to happen on. And that feels, even with the rate of change that everyone's feeling today, it still feels wildly unpredictable.
It is. And I think the reality is that the timeline gets dictated by how good you feel about the capabilities and the security of the solutions and the data access and all that stuff. So it's not like our customers are sitting around saying, 'I wonder what the timeline is.' They're all trying to actually force the timeline themselves. They're trying to get there.
But I equate this to, at a much different level, but you think about the iPhone in 2007. None of us had any idea the applications we'd be running on that device 10 years later and what we do with it today. I mean, it's just... and so I think this is going to be that on steroids. We don't know. I mean, just look at the, what was it? Moldbot.
There's a few different names today. AI social network.
And then there's Clawbot and all these things. Open Claw. And these are like, I mean, they're taking everything by storm.
And you know, you made the joke like Pets.com doesn't exist but Chewy does. And in many cases, you know, you think about pioneers versus settlers and the different outcomes for each of them. We'll see who makes it at the end of the day.
Is getting lucky underrated? We talked last week about Apple's work on the self-driving car is what enabled them to be in the position to have the Mac Mini be a great Apple...
Luck and timing matters so much. I mean, you know, it's... I became CEO. There's a lot of luck and timing involved, right? I happen to be the person who was there. If my predecessor decided to retire five years earlier, I wouldn't have gotten the job.
You know, it's just a... so there's a lot of luck and a lot of timing. Now, you create your luck sometimes, right? But I think it's always part of the whole outcome.
Can you talk a little bit about CEO-to-CEO communication? There's a lot of really high-stakes, high-flying deal-making between big companies. There's press releases that go out and then there's comments from each CEO and the deal evolves. And I'm wondering about what it takes to build a relationship with a CEO that you're going to do a big deal with and what it takes as that deal evolves and as the communications go out. How do you maintain a relationship when so much is on the line?
It's always better to build a relationship before the big deal so that the big deal becomes easier because you've already built the trust. It's sort of like dealing with a time of crisis. I think when COVID came along, if you had great trust with your employee base and they believed in you, then you could navigate through that a lot better than if your culture was good. And so I think these relationships are really important. The CEO community in the United States, honestly, is very tight.
I remember when I became CEO, there was one of them at one of the first CEO events I went to and he handed me his cell number and he said, 'Listen, these people in this room are the only people that know what you're getting ready to go through and so you need to get to know and make sure you call and talk and ask us old guys, you know.'
When you get into it. So I think the CEO community is very close. I think some of the number of deals right now, I think in many cases the public narrative about what's going on isn't reflective of what's really happening behind the scenes because most CEOs are very pragmatic. There's not a lot of emotion. You're just sitting there, you're cutting a deal. If somebody has a different opinion about it, you're not getting mad. You're just trying to get to the outcome. And I think that's the pragmatism and the calmness that most CEOs have. And I think that sometimes the press and others like to create the drama because that's what people click on.
Yeah. If anyone sticks a bunch of microphones in your face, be careful. [laughter]
That just happened, by the way.
We got to get the flash effects.
Yeah. Yeah. We're the paparazzi. [laughter]
If we flip it around, give us some advice for the youngest cohort of folks who will be joining Cisco. What does it take to succeed? What's your advice for people that are going into a... the people that want to take your job one day?
Come on, hurry up. [laughter]
I think the... look, the people who are wildly successful have this really incredible combination of, in our industry, understanding the technology.
Have high EQ, really care about the mission of the team. And understand that if the team succeeds... anybody who says 'I don't care about my own success' is lying to you. But the person who figures out that when the team succeeds, I'm going to succeed, so it's easy for me to focus on the team. And then you also have to have people who care about making sure their peers are successful as well. And I think the person who's solely focused on getting to the top as an individual, it's just not going to happen. So it's a combination of those technical skills and the high EQ. You cannot underestimate that.
Yeah.
You've talked in the past about effectively doing the job that you want already as a way to kind of work your way...
Leadership before promotion.
You guys actually do your research, don't you?
I tell people that if your peer group would look at your promotion announcement and just go, 'That makes perfect sense.' And if they wouldn't, then you're probably not quite where you ought to be. And I tell everybody, too, my team hates when I say this, but I'm going to say it anyway. [laughter]
I think when we have two or three internal candidates for a promotion, the whole interview process is stupid to me. It's like we've been watching these people work for a decade. What are we going to learn about them when we sit down in a room for 30 minutes and ask them questions when we watched them work?
Can't we just look at the three of them?
And I translate that to every day you're working is your interview for your next job. Your work every day should be your interview for the next promotion.
And now if you've got external candidates, certainly you have to get to know them and learn all those things. But when it comes down to two internal candidates, I just say, why are we doing this? [laughter]
But we do it anyway.
So, what's keeping you up at night? There's a number of...
Wow.
How did you learn to handle stress? Because over the last few years, you had COVID, we've had so many different geopolitical tension, trade wars, all these things. You seem unfazed, but...
I've always been able to compartmentalize things and I have always... it's innate. I did not teach myself this. I've always been able to just put aside things I can't control. You plan for them. You come up with different scenario plans, but I'm not going to lay awake at night and worry about something that might happen that I have no control over.
And, you know, look, I've gone home when I've had a really bad day and I've looked at my wife and I say, 'You want to hear the good news?' And I said, 'I wasn't diagnosed with cancer today.' And somebody was, and I wasn't. So my worst day, if I'm not being diagnosed with cancer or some sort of terminal illness, tomorrow I'll get up and fight another fight. You just got to have perspective.
I love it. Well, thank you so much for coming.
