Shares of Meta traded down 11% on the March quarter guidance that the company is entering into a multi-year investment cycle starting with AI capex in 2024 tracking to be 12% higher than previous expectations. We believe investors are missing the point. Meta has a golden opportunity in the next decade to leverage its data and build AI tools and products for billions of users, advertisers, and businesses.

Shares of GOOG were up 11% on March earnings driven by a combination of growth acceleration in Search and GCP, along with an outlook for improving margins. Additionally, the company is making massive investments in generative AI, as evidenced by capex increasing 91% y/y. In short, the two biggest concerns for Google investors, what the future of Search will look like and is the company moving fast enough in AI, were put to ease for the moment. Long-term, I believe Search revenue is here to stay and AI will be a material net positive for the company.

Tesla had a difficult March quarter, reporting the first year over year revenue decline (9%) since Mar-20. Most of the business metrics suggest 2024 will be a difficult year for the company. That said, shares of TSLA rose 11% given the company's announcement that the next generation vehicle will come about 9 months earlier than expected, along with optimism for a sales rebound this year, and the promise around FSD. Putting it together, investing in Tesla comes down to a belief in the company's ability to convert that vision into reality. We remain optimistic.

What’s my company worth? What makes you special? The two questions are inextricably intertwined. The more special your value add, the more your company’s potential value. It’s true at the individual level too. The value of your time or effort…

Joz, Apple's Head of Marketing, posted on X saying this year’s WWDC will be “Absolutely Incredible!” as in "AI". This will mark the first glimpse into the company's generative AI strategy and be a monumental day given it will usher in the biggest change in Apple's operating system design since the mid-80's point-and-tap/click interface. This will be a new communication interface driven by generative AI.

In 2020 Apple was more or less victorious over Epic games in defending the App Store. Now the DOJ is taking aim at Apple, largely focused on the iPhone’s role at promoting the sale of software and services and locking users into upgrading. The substance of the debate on shares of AAPL will focus on two topics: 1) What will the impact be to Apple’s Services segment? 2) How long will this take to sort out? While I believe this will take three years to sort out, I expect little will actually change, just like we saw 25 years ago with the DOJ going after Microsoft.

The news of Apple launching its own model and talking with Google and OpenAI to license a foundation model speaks to the degree that the company's growth North Star has changed over the past month. First, it was Project Titan getting canceled, now it’s considering doing something rare at Apple, license another company's tech stack. I believe Apple now gets it. AGI has the potential to have a profound impact on their business, and they need to add AI to the company's core competency of hardware, software, and services. To get there, I expect more investment, and a slight decline in margins in the near-term, and expanding margins long-term.