Telegram Key Posts

1/ After the 2000s smartphone revolution, Apple chose to reduce Capex and returned it to shareholders 2/ A paradigm-breaking shift happened in the 2020s — following Apple's lead, major Big Tech companies (Microsoft, Google, Meta) also expanded shareholder returns instead of Capex 3/ We experienced an ambiguous period where tech stocks straddled the line between growth and value during the 2022 Russia-Ukraine war aftermath (Big Tech's shareholder returns during the high-rate era were incredibly attractive) 4/ Big Tech didn't have anything worth investing in anyway — except Meta's all-in bet on the Metaverse 5/ Now our M7 has changed. They're showing a clear investment purpose for the first time. It's AI 6/ Big Tech companies are the most profitable in the world. The market may always question current Capex levels, but up to $700B is coverable by FCF. Will this be sustainable next year? Looking at OCF growth rates, Capex above current levels appears feasible 7/ So what future do they see? They want full automation. Amazon in particular has spent massive Capex on process automation for a decade, and through strategic investment in Anthropic, has captured both Robotics and AI simultaneously 8/ If this investment bears fruit? How will M7's cashflow change when they no longer need to spend massive labor costs on planning and paying for simple tasks? How much value should we assign to the creative destruction they're creating? 9/ If you think about companies that can hire thousands of AI agents more capable than humans — maybe we're looking at the market too naively right now