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BIG TECH TALKS--SUMMARY OF COMMENTS ON CAPEX (early 2026 results)

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  BIG TECH TALKS—Justifying the biggest capex spend in history I have put together quotes from the last earnings call on what Big Tech are seeing and why they are investing. MSFT META AMZN GOOG CONTEXT Below are selective quotes from the four big AI spenders' recent results. MSFT is perhaps the most conservative and has to manage the OpenAI relationship that is a double-edged sword for them. Without a huge in-house AI pedigree, they have the challenge of staying relevant to their large commercial customer base. Working to embed an interface between clients and LLMs is how they plan to defend their turf. Meta is perhaps the most zealous and effusive for AI, being founder-led. Meta is also perhaps the company that has proven the AI use case in an operational sense, with spectacular profit growth in its ads business. As per below, they are enthusiastic to continue the progress on the core ads business and are also spending on personal superintelligence, which is more speculative...
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AMZN FY25 result--top 10 holding--AMZN are going all in. May be a bumpy ride.

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  AMZN FY25 RESULT Very solid result from AMZN with the numbers modestly above my estimates, with revenues +12% and NPAT +31%. There was a large MTM amount for the Anthropic investment of about $13.3B pre tax. If we remove that, NPAT growth becomes 15%. Overall, good results. There were also various other negative one-offs, including a $1.1B tax charge in Italy, $730m severance charges and $610m impairments in NA stores. Most of these were in the retail section. Retail NA sales were 10% higher and operating income 18% higher, International 13% and 26% respectively. These numbers included the one-off charges mentioned above. Advertising continues to drive results as AMZN has a structural advantage in having direct intent of customers when placing ads. Incremental ad revenues were $12.4B, compared to combined operating income growth of $5.5B. AMZN continue to promote product range, speed of delivery and sharp pricing as features of the business, together with prime membership...
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GOOG FY25 --Top 10 holding--Ontrack to be the worlds most valuable company?

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  GOOG FY25 RESULT—ON TRACK TO BE THE LARGEST COMPANY IN THE WORLD? GOOG reported very strong numbers, with revenues and NPAT both being above my estimates. There were some accounting issues, PCP had charges that dropped out, as well as a $2.1B Waymo charge due to increased valuation (staff costs), offset by MTM gains of up to $3.2B. Nothing significant here, and the quality of the result in cash reconciliation was very good. ROE ended at a record 32%, 10Y ave 22%. Overall, revenues were 15% higher, and EPS was 34% higher, big numbers. Segments on a year-on-year basis were positive. Search grow 13%, a slight reacceleration, YT up 12%, Networks were 2% lower and continue to be a less relevant part of the group. Subscriptions were 19% higher and reaccelerated, and cloud was 36% higher with a significant reacceleration. In terms of income, Google Services were 15% higher and Cloud 128% higher. The two standouts here were the Cloud margin acceleration from 18% in the Q125 to 30% ...
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REA FH26--Top 10 Holding--Platform under threat?

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  REA FH26 RESULT Some moderate exits and acquisitions muddied the reported numbers, but revenues on an underlying basis were +8% and NPAT +10%. The reported numbers were slightly lower with the business mix changes. The revenues were negatively impacted by listing weakness in the Brisbane and Perth markets, down 12% and 20% respectively. Overall listings are expected to be 1-3% down for the year. Yield growth was strong, 12-14% guide, and is expected to continue into 2027. The yield growth is a mix of price increases and product mix, with the higher yield products gaining share. Geographical mix could impact yield, if Brisbane and Perth improve, with the smaller cities having lower yield. The half saw -6% new listings, which was a disappointment and led to a weak result. With the weaker revenue growth, jaws closed, raising concerns that costs will increase more than revenues going forward. REA commented that they continue to target opening jaws going forward despite some more ...
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PNI FH26--top 10 --position--strong growth continues

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  PNI  SUMMARY FH26 FH26 results were $67m (pcp $76m), excluding Performance fees (PF) saw a 37% increase in underlying profit. EPS was down 18% pcp, including the large PF in the pcp numbers, and up 27% excluding PFs. FUM was $205B, up from $179B in June. These are all promising numbers. Affiliate profits before PFs were 52% higher pcp. PNI disclosed $56B of FUM is exposed to PF, and this result saw a different mix of managers achieve PFs, evidence of manager diversity. Growth is shifting to international and retail, which are both higher-margin. Net flows were a record at $17B (FY25 $23B), headcount is being added in the Uk and Canada, as well as lesser amounts across the globe. The following quote gives an idea of what growth management is expecting to occur. “Chambers keeps saying we're pushing against an open door . We just keep finding more and more opportunities overseas.” PNI disclosed that the new UK-based fund manager, Life Cycle, has reached $30B in FUM over...
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MSFT FH26 Top 10 Holding

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  MSFT FH26 MSFT reported revenues up 17%, Op Y up 21% and NPAT 23%, there was a positive Open AI MTM (omitted). These numbers were slightly better than my expectations. The segmental breakdown showed the software-based Productivity Processes up 16%, Intelligent Cloud, which houses Azure, up 29% and More Personal Computing, which is gaming and PC’s, up 6%. The consumer businesses continue to be a disappointment. An impairment charge was made against the gaming assets. The Activation Blizzard acquisition now looks ill-timed. As MSFT is a huge software business, there is no sign of AI disruption so far in these numbers. Apart from the consumer businesses, the results were good. MSFT highlighted the strategic position they are in to utilise and embed AI into their customer base and the progress made in selling Copilot into the base. The company mentioned that 15m paid seats of MSFT365 were in use. Although the trend is positive, will it be enough, and will execution continue? Ar...
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SUMMARIES OF RESULTS FOR ASML META RMD UNH & LVMH

 Note the disclaimer. i have not included any of the charts for these as they are a painful exercise to insert into this format. If anyone wants the full report, please ask.  LVMH 4Q 25 LVMH is a well-run company. Why do I say that? Firstly, we can see operational cost control with margins only falling from 24% to 23% 2024 to 2025 despite poor revenue growth. We can also see operational cash flow improving despite lower profits as working capital is managed well. We can also see value being added to acquisitions that benefit from being in the LVMH stable. Management appears genuine, longer-term planners and growers of the business. all good. They are also active in the management of the businesses and in the portfolio. Arnault has recently moved above 50% ownership. The result was unusually hit by FX volatility, being the relative strength of the EUR compared to third currencies. FX is hard to predict, and we can take that as an uncontrollable. There are issues with the ...
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