Today on Prof G Markets, Ed Elson and Scott Galloway are joined by Aswath Damodaran to break down the biggest takeaways from Big Tech earnings. He explains what the latest results reveal about the AI race, why he's becoming increasingly concerned about the Magnificent Seven's AI spending, and how he values the hyperscalers. They also discuss how much AI risk is already priced into the market and whether SpaceX's current valuation is justified.

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Timestamps:
00:00 Preview
00:32 Today's number
00:49 Today's episode
04:38 Interview with Aswath Damodaran
05:05 What are your reactions to Big Tech earnings?
06:19 Does the negative free cash flow concern you?
07:53 What type of companies were these five years ago and what type of companies are they now?
09:30 Do you agree with the markets right now that the CapEx has gotten out of control?
12:21 What are your thoughts on Apple making a big bet and deciding not to engage in the AI CapEx wars?
15:29 Is it possible the hyperscalers still don’t know the ROI on their AI investments?
17:43 How big of a problem is it if all of that is true?
21:23 Ad break
22:53 Are these companies trying to give themselves corporate Botox to look young again?
28:13 How should investors value companies that are deeply tied to AI frontier labs?
36:07 What do you make of the shift from a supply crisis to a potential demand crisis?
38:33 Am I overstating the threat of these inexpensive LLMs out of China?
42:39 Ad break
44:05 Do you think that OpenAI and Anthropic will ever figure out the unit economics?
47:23 How much of this anxiety is priced in right now?
49:38 Are you comfortable with current valuations in Big Tech?
51:51 Are companies using their credibility to reduce shareholder risk or hide their debt?
54:45 Would you ever value OpenAI or Anthropic?
56:15 Would you ever value OpenAI without the full story?
58:59 What are your reactions to SpaceX?
01:00:45 Where do you see the parallels or not from 1999?
01:03:41 Credits

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