Quarters
Quarters listens to public earnings calls for the human part: the odd sentence, the little flex, the person behind the numbers. Affectionate. A little dry. Not financial advice.
Quarters
Weekend on Quarters: Cook’s Last Call, Zuck’s Receipts, Bill’s Catchphrase (July 27–31)
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Weekend on Quarters: Week of July 27–31.
Three full Director’s Cuts this week: Bill McDermott at ServiceNow, Mark Zuckerberg at Meta, and Tim Cook’s last earnings call as Apple CEO. Then a quick walk through the high-ticket rooms we didn’t cut full episodes for )Amazon, Microsoft, Alphabet) and one weird hallway stop at Coastal Financial’s first-ever earnings call!
Line of the week: Bill. “We are who we said we were.”
Not financial advice.
Each week on quarters we sit with uh public earnings calls and keep the human part on weekends. We do something a little different, we revisit the people we already sat with this week. It was Bill, Mark, and Tim in little blips. Then we peek into a couple of high-ticket rooms we didn't cut full director's cuts for. I'm Terry, and this is the weekend rap, week of July 27th. Okay, so three full cuts this week. A Long Island deli guy, a man selling agents for your relationships, and Tim Cook last earnings call as CEO. We started with Bill Service Now, July 23rd.
SPEAKER_07We're feeling real good about it. What does it all mean? We are who we said we were.
SPEAKER_03That's still the line of the week on pure character alone. He sounds like he might make you a sandwich after the call. Big catchphrase guy.
SPEAKER_04Hey, hey, here's the big one.
SPEAKER_03Then Meta, Zuck, July 29th.
SPEAKER_04Alright, hey everyone. Thanks for joining today. We had a strong quarter for our community and business with 3.6 billion people using at least one of our apps each day. We reached several milestones. Instagram reached 2 billion daily actives. Threads crossed 500 million monthly actives, making it the fastest growing conversation app ever. Facebook has reached more than 2 billion daily actives for a while now. WhatsApp just hit an all-time messaging record, peaking at 30 million messages sent per second during the World Cup final.
SPEAKER_033.6 billion people. Wall Street looked at the receipt though. Capex, about 31 billion, free cash flow, now a puddle. The stock was down hard after hours. On the call, it was keynote voice.
SPEAKER_04The opportunity in front of us is massive.
SPEAKER_03Stand-up optimism.
SPEAKER_04I'm very excited about this, and we're gonna have more to share soon.
SPEAKER_03A lot of doors opening all at once.
SPEAKER_04Soon we will have agents that can work 24-7 on your behalf to help you achieve your goals and improve your life, your health, your relationships, your finances, whatever you want.
SPEAKER_03Thursday, Apple, Tim's last earnings call as CEO.
SPEAKER_01We reluctantly raised prices, I would say. And we did it because we're in uh what I would characterize as a hundred-year flood on the memory pricing, uh with uh exponential increases in memory prices.
SPEAKER_03Best June quarter they have ever had. And the stock still slipped on supply, huge flood on memory, scrambling. But the human part wasn't the iPhone number. It was a man handing over the microphone like the principal at graduation.
SPEAKER_01As you know, this will be my final earnings call, and John will lead these calls going forward. The transition is going seamlessly, and I am beyond excited for John to step into his new role and lead Apple into its next era. He is truly one of a kind, and there is no better person to take the helm of the company.
SPEAKER_03Same night as Apple, we didn't cut a full Amazon episode, but we pop in high-ticket Andy Jassy.
SPEAKER_06I'll start with AWS, which is booming right now, and I'll share the numbers, what we think is going on, and why we're enthusiastic about the ROIC equation, even with heavy capex for the next few years. First, the numbers. Revenue growth of 36.7% year over year, accelerating for the fifth straight quarter, our fastest growth in 18 quarters back when AWS was less than half its current revenue size. We added over $4.6 billion in revenue quarter over quarter, about 80% more than our largest increase ever. And our backlog stands at $496 billion, growing triple digits year over year. AWS is now a $169 billion annualized revenue run rate business, which for perspective would place it 24th on the Fortune 500 list if it was a standalone company. Our chips business now has an annual revenue run rate of over $25 billion, growing triple-digit percentages year over year.
SPEAKER_03AWS booming AI and chips, each past $25 billion run rate, he says. Also, free cash flow underwater on the build-out, net income juiced by a giant paper gain mostly from Anthropic, CapEx raised again, memory costs, same ghost haunting Apple's call. In fact, the demand we already have for 2028 is striking. Microsoft, Satya, July 29th, same day as Meta.
SPEAKER_05Microsoft cloud surpassed $214 billion up 27, and Azure surpassed $100 billion up 41.
SPEAKER_03Satya talks like a white paper that somehow has a pulse. Tokens into outcomes. Azure past 100 billion, copilot seats stacking up. Wall Street usually likes his CapEx story more than Mark's.
SPEAKER_05Now let me turn to the apps and agents we are building on top of this platform for individuals and organizations. When it comes to knowledge work, we now have over 30 million paid Microsoft 365 copilot seats with net seat ads more than doubling quarter over quarter. Alphabet Sundar, July 22nd.
SPEAKER_00Hi everyone, thanks for joining us. We have exciting momentum. Alphabet revenue grew 24% year over year. Our AI investments are redefining what's possible across every part of our business. Our momentum starts with search, where people are adopting one seamless search experience across AI overviews and AI mode. We saw 17% revenue growth in search and other, and YouTube ads grew 13%. Cloud revenue grew 82%, powered by strong demand for AI infrastructure and AI solutions. And cloud backlog grew to $514 billion.
SPEAKER_03Sundar, exciting momentum, cloud on fire.
SPEAKER_00Approximately 22 billion tokens per minute.
SPEAKER_03CapEx climbing to meet demand. And here's something interesting. Thursday, a bank you've probably never heard of, Coastal Financial out of Everett held its first quarterly earnings call. First words energy, welcome to the big room.
SPEAKER_02This is our first quarterly earnings call. As our company has grown, we believe it is important to provide investors and the broader community with more direct access to management and greater context around our financial performance.
SPEAKER_03Then we lost $42 million this quarter because of one partner.
SPEAKER_02This morning we reported a gap net loss of $42.1 million or a loss of $2.76 per diluted share for the second quarter. That result was driven almost entirely by $68.8 million in pre-tax accounting adjustments associated with a defined CCBX portfolio company and its consumer loan portfolio.
SPEAKER_03Stock got cut nearly in half the same day. New executive chair, CFOs leaving. They killed a deal they've been looking at. The chair said they're not treating it as the end of the world. Which is a sentence you usually don't need in your first uh earnings call. Anyway, line of the week, Bill McDermott.
SPEAKER_07We are who we said we were.
SPEAKER_03Thing that actually means something. This week the mega cap story split three ways. Bill, product market confidence with catchphrase gravity. Mark, reach intact, cash strained, future tense working overtime. Tim, demand so hot, the supply chain can't keep up, and a succession done with manners. Andy. The capex arms race has a receipt and a backlog, so not gonna rank them like fantasy football. I would say if you only listen to one full cut from this week, listen to Tim's goodbye because there won't be another. If you want the CapEx argument with a face on it, listen to Mark. If you want to feel affectionately weird about enterprise software, listen to Bill. I'm Terry. If you like this, please subscribe. Full Directors Cuts for Service Now, Meta and Apple are on the channel.