I F’d up‼️

Summary

The presenter reviews portfolio performance and recent earnings, emphasizing that investors should judge companies by their financial results and outlook—not simply by the share-price reaction.

Portfolio snapshot

• AMD: The position reportedly gained another $46,000 that day and was up nearly $1.2 million, or 418%, in the public account.
• RH: Up about 3% that day and nearly 17% on the position, with a five-figure profit.
• Meta (META): Another roughly $7,700 loss that day.
• Netflix (NFLX): Down almost 15% in the public account.
• ServiceNow (NOW): The presenter cited a $100,000 position that had been up 52%. After the report, he said he would likely sell the remaining shares, having already taken some profits.
• Salesforce (CRM): The position was about $48,000 in profit.
• Alphabet/Google: The presenter said the investment had more than doubled.

The opening also mentions an unidentified holding that was up 4.5% that day and about 85% overall. The subtitles do not reliably identify it.

Company and market commentary

Alphabet / Google (GOOGL, GOOG): Bullish; buy/hold

The presenter called Alphabet’s results strong despite the share-price decline:

• Revenue grew 25% year over year, on a quarterly base of more than $100 billion.
• Operating income rose 30%, to $40.5 billion from $31.2 billion.
• Google Cloud revenue increased 103%, from $15.1 billion to $30.7 billion. Cloud operating profit more than tripled, from about $3.6 billion to $11.1 billion.
• Management said AI investments are contributing to search growth, with annual growth in search queries at its highest level in five years.
• Google’s TPU chips were presented as a lower-cost alternative to scarce, expensive Nvidia chips. The company is reportedly selling or licensing TPUs to firms including Anthropic and working with Oracle.
• Net income fell 24% and diluted EPS fell 26%, largely due to $8.2 billion in other expenses tied to marketable-securities valuation changes. The presenter treated this as a temporary accounting effect; net income was about $26.4 billion.
• Capital expenditures on fixed assets were $51.3 billion, nearly twice reported net income. Operating cash flow was rising, but free cash flow was falling as the company invested heavily in infrastructure.
• The presenter estimated a forward P/E of about 19, versus a four-year historical median near 23, and called the shares undervalued and a buy/hold. He cautioned that large technology stocks can still fall 30–50%, citing Meta’s roughly 70% decline in 2022 as an example of possible drawdowns.

ServiceNow (NOW): Bearish; presenter plans to sell remaining shares

The presenter criticized the quarter and outlook, especially relative to the company’s valuation and expectations:

• Q3 adjusted EPS was $1.00, versus $1.02 consensus.
• Q4 subscription-revenue guidance was $4.24–$4.255 billion, roughly in line with the $4.25 billion analyst estimate.
• Revenue grew 21%, while subscription cost rose 58% and total cost of revenue rose 56%. Gross profit increased only 10%.
• Sales and marketing expense rose 20%, R&D 27%, administrative expense 11%, and total operating expenses 22%.
• Operating income fell 33%. The presenter also cited net income down about 45% and diluted EPS down 44%.
• He said the results did not justify the stock’s high expectations and described expenses as poorly controlled. He preferred Salesforce and Palantir and said he expected to sell his remaining ServiceNow shares. The subtitles also suggest the stock had fallen around 20%, though the precise reference is unclear.

Salesforce (CRM) and Palantir (PLTR)

The presenter expected Salesforce to face pressure following ServiceNow’s results but said he preferred Salesforce as an investment, citing lower expectations and greater confidence in CEO Marc Benioff.

He praised Palantir’s ability to convert AI demand into results without comparable expense pressure and said he wanted to hold Palantir rather than ServiceNow.

The Cheesecake Factory (CAKE): Bullish; hold into the 2030s

The presenter described the report as substantially better than expected:

• Revenue grew 14%.
• Operating income rose 101%, net income 92%, and EPS 80%.
• Management expects 11–13 Flower Child openings next year, versus 7 this year.
• The presenter sees Flower Child and North Italia expansion as long-term growth drivers. He suggested the company could reach net margins above 10% by 2030, compared with a historical range of roughly 2–6%.
• His view was to hold the shares into the 2030s, citing the expansion runway, menu innovation, pricing, and cost control.
• He also argued that political attention around the brand could provide free publicity. This was presented as a marketing observation, not a change to the financial outlook.

Microsoft (MSFT) and implications for chip stocks

• Microsoft revenue grew 19% year over year, while Azure revenue rose 48%.
• Capital expenditures and finance leases were $45.2 billion, up about 30% year over year but more than $5 billion below analysts’ expectations of over $50 billion.
• The presenter attributed some of the shortfall to delayed capacity deliveries. About 75% of capital spending was on non-durable assets such as chips, versus about 66% in the prior three quarters.
• He said spending data from Microsoft, Google, and Meta made a major AMD revenue surprise less likely, though he still thought AMD could beat revenue expectations and raise guidance. He noted that profitability or EPS could still produce a positive surprise.
• He framed AMD as a longer-term investment through 2027 and argued that short-term dips have historically attracted buyers. This is the presenter’s opinion, not a guaranteed outcome.

Investing framework

The presenter’s earnings-analysis approach was to:

• Avoid inferring business quality from whether a share price rises or falls after earnings.
• Read financial statements and listen to earnings calls, especially for companies you own or are considering.
• Compare revenue growth with costs and expenses, and assess how they affect gross profit, operating income, net income, and EPS.
• Update business forecasts when results or management commentary change expectations.
• Compare the share price and valuation with the company’s growth outlook and historical valuation.
• Consider cash flow and capital expenditure needs alongside earnings, particularly for AI- and infrastructure-heavy companies.
• Account for downside risk: even large, high-quality technology stocks can experience substantial drawdowns.

Assets and instruments mentioned

Stocks: AMD, Alphabet/Google (GOOGL/GOOG), ServiceNow (NOW), Salesforce (CRM), Meta (META), Netflix (NFLX), RH, The Cheesecake Factory (CAKE), Palantir (PLTR), Microsoft (MSFT), Nike (NKE), Celsius (CELH), Starbucks (SBUX), Chipotle (CMG), Amazon (AMZN), Broadcom (AVGO), and Intel (INTC).

Other instruments and areas: Nvidia GPUs and Google TPUs; cloud and AI infrastructure; marketable securities; capital expenditures; and free cash flow.

The subtitles mention several company names imprecisely. “Google McDougall” refers to Google/Alphabet. The unidentified holding with an approximately 85% gain is not assigned a ticker.

Disclosures and cautions

• No explicit “not financial advice” disclaimer appears in the subtitles.
• The presenter discusses his own holdings and trades and makes direct buy, hold, and sell judgments. He also promotes a paid investing product and a Halloween sale.
• He repeatedly cautions that short-term stock-price movements and large drawdowns are possible.

Presenter/source: Jeremy Lefebvre, Financial Education. He also refers viewers to his reaction channel, Jeremy Lefebvre Makes Money, and to company earnings reports and conference calls.