Alphabet is the best valuation that's out there among the
Max 7.
It's a 24 PEI mean A4 Pi believe is 19
there.
There are PS in the in the 30s and 40s
and and much higher.
And I think Alphabet has declined since in August, since
August when the when the when the judgment came out
against them.
And I think that the AI story is very early
on.
I mean, this is, this is a search company, 70%
search, 20% YouTube, 10% cloud.
As far as where, where the profitability of this company
comes from and, and, and what investors should be concerned
about is this these new AI unconventional search, you know,
they're not just competing against Bing and Edge and AOL
and and DuckDuckGo anymore.
They're they're competing against, they're competing against ChatGPT anthropic perplexity.
In fact, I saw an article in the Wall Street
Journal that said Chat GT PS AI search was was
was 1% in June.
It's already up to 8% now.
And obviously that is coming out of Google's search business.
And their search market share is the 60% in the
US, 90% around the world, mainly because of India and
Brazil.
But but the 60% search is supposed to fall below
50% in the United States this year for the first
time in a decade.
Jake, the problem though with these numbers and Bertha alludes
to this is we are seeing something of a CapEx
slow down.
Is that just taking a breather, integrating the capacity additions
or, or is this going to be a consistent theme
across the peer group?
And what I guess what is it telling us about
the AI narrative?
Well, what tells us about the AI narrative is AI
is expensive.
It is expensive.
I think I, I think I read a story that
said the 5000 data centers we have now will increase
to 10,000 in the next six to seven years.
Goldman Sachs put out a study that said the power
usage of those debt driven by the data centers will
go up 160% in the next four to five years.
Meta taught us that that CapEx creasing CapEx and decreasing
CapEx is a is a very tightrope to walk.
And we saw Meta get hammered in fall of 2022
and Zuckerberg thumbed his nose as shareholders and says, I'm
going to spend whatever I want.
I'm going to spend five, $10 billion year on Metaverse.
I don't care what you say.
And then that he they had a much more kind
or gentler tone.
And look at look at Meta's stock price.
It's doubled this year and it would be the number
one stock in in the market, except the videos has
tripled this year and, and, and Google is even close
to the highs.
It's all the 1191 a few weeks ago.
So I to me, Google's as long as CapEx, it
may, it may decline some, may increase some, but as
long as it stays in that sweet spot, I think
they're going to put the money where they need to
to make sure that they're one of the leaders in
AI going forward.