Mad Money w/ Jim Cramer 8/5/25

Summary

Mad Money w/ Jim Cramer – Episode Summary (August 5, 2025)

Host: Jim Cramer
Podcast: Mad Money
Release Date: August 5, 2025
Description: Jim Cramer navigates the complexities of Wall Street, offering insights, stock picks, and engaging discussions to help investors make informed decisions.

---

1. Market Overview and Sentiment

Timestamp: [01:24] - [08:42]

Jim Cramer opens the episode by addressing the prevailing market sentiment. He observes a day dominated by "simple profit taking" following a significant uptrend in the previous session. The S&P 500 declined by 0.49%, and Nasdaq shed 0.65%, marking "a day of simple profit taking after a huge up day yesterday" ([01:50]).

Cramer criticizes the prevalent negativity in financial journalism, stating, "Enough with the knee-jerk negativity, people. It's really starting to cost you a lot of money today" ([02:00]). He argues that analysts and journalists are stuck in a binary narrative—either markets are about to "roll over" or "they're already rolling over," leaving little room for nuanced perspectives ([02:15]).

He further elaborates on factors influencing the market, such as weak unemployment numbers and the impact of tariffs, emphasizing the importance of viewing these elements beyond political biases. Cramer emphasizes that the real focus should be on company fundamentals rather than macroeconomic fears ([04:00]).

---

2. Deep Dive: Kotara Energy

Timestamp: [13:57] - [20:51]

Cramer transitions to discuss energy stocks, focusing on Kotara Energy, an oil and gas exploration and production company within his charitable trust. Despite strong management execution and a 3.6% yield, the stock has faced challenges.

Key Highlights:

• Strong Financials: Kotara Energy reported better-than-expected earnings, cash flow, and production guidance. Despite this, the stock struggled to maintain momentum, reflecting broader challenges faced by energy companies ([14:30]).

• Interview with Tom Jordan: Cramer hosts Tom Jordan, Chairman and President of Kotara Energy, who underscores the company's resilience amidst volatile commodity prices. Jordan emphasizes the significance of their natural gas portfolio in Northeast Pennsylvania and strategic deals like the purchase agreement with CPV Basin Ranch, which enhances their energy supply and operational efficiency ([16:11]).

• Strategic Positioning: Jordan highlights Kotara's balanced approach between oil and natural gas, allowing sustained activity regardless of market fluctuations. The company prioritizes debt reduction over aggressive buybacks, aiming to strengthen financial stability for future opportunities ([20:01]).

Notable Quote:
Jim Cramer: "We don't get tossed around by commodity price volatility. That's the way to play this long game." ([18:50])

---

3. Spotlight on Spotify: A Buying Opportunity?

Timestamp: [22:00] - [47:58]

Cramer shifts focus to Spotify, analyzing its recent stock performance and quarterly results. Despite being a top performer with a 75% year-to-date increase, Spotify's stock has retracted nearly 18% from its highs.

Key Points:

• Quarterly Performance: Spotify reported a 15% total return year-over-year but fell short of both analyst estimates and management guidance, primarily due to underperformance in the ad-supported segment ([22:30]).

• CEO's Acknowledgment: CEO Daniel Ek candidly addressed the shortcomings in the ad business, citing "an execution challenge" and expressing dissatisfaction with the current state ([24:00]).

• Subscriber Growth: On a positive note, Spotify saw an 11% increase in monthly active users, reaching 696 million, and a 12% rise in premium subscribers to 276 million ([25:30]).

• Strategic Initiatives: Spotify is expanding into video content and leveraging Generative AI to enhance user personalization through tools like Spotify DJ and Generative Playlist creation, which have nearly doubled user engagement over the past year ([30:00]).

• Pricing Power: Recent subscription price hikes in several regions have been well-received by investors, with the stock rising by 5% following the announcement ([35:00]).

• Buyback Authorization: Spotify increased its buyback authorization from $1 billion to $2 billion, signaling potential future stock repurchases ([40:00]).

Investment Thesis:
Cramer posits that Spotify's dip presents a "tremendous buying opportunity", highlighting the company's dominant market position and robust growth strategies despite recent setbacks. He emphasizes the strength of Spotify's user base, content diversification, and technological advancements as key drivers for future growth ([45:00]).

Notable Quote:
Jim Cramer: "That's another story. Even though Spotify came up short on some major line items, there were some still legitimate positives in the quarter." ([30:05])

---

4. Listener Interactions and Stock Recommendations

Timestamp: [08:42] - [22:00]

Throughout the episode, Cramer engages with listeners, providing personalized investment advice:

• Betsy from California ([08:42] - [09:58]): Betsy shares her success with following Cramer's advice on GE Aerospace, noting a "78% institutional support" and increasing stock performance. Cramer praises her diligence and reiterates the importance of consistent investment strategies ([09:28]).

• Mark from Pennsylvania ([29:28] - [30:17]): Mark expresses gratitude for how Cramer's guidance has facilitated a comfortable retirement for his family. Cramer responds warmly, emphasizing that his mission is to help listeners succeed financially ([30:05]).

• Listener on Netflix ([30:17] - [40:40]): A young investor discusses his small position in Netflix, which has faced recent declines despite strong fundamentals. Cramer advises cautiously "picking up a little more right here at 1147 and then wait for to 1100", encouraging incremental investment during downturns ([30:45]).

---

5. Analyzing Palantir's Valuation and Potential

Timestamp: [43:08] - [47:58]

In a comprehensive analysis, Cramer examines Palantir, addressing its high valuation and exceptional performance metrics:

• Performance Metrics: Despite trading at over 200 times next year's earnings estimates, Palantir boasts a "Rule of 40" score of 94.4, combining a 48% revenue growth rate with a 46% adjusted operating margin ([43:22]).

• CEO's Vision: CEO Alex Karp's ambitious claims about the company's efficiency and potential tenfold revenue growth are discussed. Cramer supports Karp's vision, citing Palantir's ability to deliver substantial results, such as reducing Citigroup’s customer onboarding time from nine days to seconds ([45:00]).

• Market Perception: Cramer criticizes professional money managers for overlooking Palantir's strengths, attributing its sustained growth to investor belief in its long-term potential despite short-term market skepticism ([46:30]).

Notable Quote:
Jim Cramer: "Palantir might be able to keep working its magic for years. It's the steadiest high performer I've seen in ages." ([47:00])

---

6. Lightning Round: Rapid Fire Stock Picks

Timestamp: [40:57] - [43:08]

In the high-energy Lightning Round segment, Cramer provides quick buy, sell, or hold recommendations:

• Lum Sang from Wisconsin: Advises a buy, emphasizing the stock is "down from 210" and represents a good opportunity.

• Joe from New Jersey: Questions Qualcomm's future, but Cramer dismisses the notion of relying solely on upcoming earnings from competitors like Skyworks ([42:00]).

---

7. Closing Thoughts

Timestamp: [47:58] - [43:50]

Cramer wraps up with a focused endorsement of Palantir, reiterating its strong fundamentals and growth potential despite market skepticism. He encourages listeners to look beyond traditional valuation metrics and consider innovative companies that defy conventional analysis.

Final Remark:
Jim Cramer: "Palantir is a genuinely great franchise. It’s a very exciting company. Read their earnings. If you think the stock still has more room to run, it's time to consider it seriously." ([47:50])

---

Key Takeaways

• Negativity Bias: Cramer warns investors against the pervasive negativity in market narratives, advocating for a focus on company fundamentals.

• Energy Sector Resilience: Despite sector challenges, companies like Kotara Energy demonstrate strong financial health and strategic positioning.

• Spotify's Growth Opportunities: Even with recent setbacks, Spotify's dominant user base, content diversification, and technological advancements present significant investment opportunities.

• Valuation Metrics: Innovative companies like Palantir can exhibit exceptional performance metrics that may not align with traditional valuation methods, presenting unique investment cases.

• Listener Engagement: Personalized investment advice underscores the importance of informed, strategic decision-making in building a robust portfolio.

---

Note: All opinions expressed by Jim Cramer are his own and should not be construed as investment advice. Investors should conduct their own research or consult with a financial advisor before making investment decisions.

Transcript

[Keith Lansford]

This episode is brought to you by Schwab Market Update, an original podcast from Charles Schwab. Join host Keith Lansford for this information packed daily market Preview delivered in 10 minutes or less, including projected stock updates, monetary policy decisions, and key results and statistics that may impact your trading. Download the latest episode and [e-mail] MarketUpdatePodcast or find Schwab Market Update. Wherever you get your podcasts.

[WhatsApp Voice]

On WhatsApp, your personal messages stay private between you and whoever you send them to. So things like the passport numbers for your honeymoon stay between you and your fiance and that video call for your gran's 80th stays in the family. Even your streaming password stays between you and your college roommates, who still ask for it every week in your group chat. Because on WhatsApp, your personal messages are yours. No one else can see or hear them, not even us. WhatsApp message privately.

[Jim Cramer]

Hey, I'm Kramer. Welcome to Mad Money. Welcome to Crame America. People make friends. I'm just here to try to make a little money. My job is not just entertain, but to put things in context, to teach it. So call me at 1-873CBC. Tweet me Jim Cramer Enough with the knee jerk negativity people. It's really starting to cost you a lot of money today. Like so many other days, so many stocks got deep in the hole recover as the session went on down 62 points. S&P declined 0.49%. Nasdaq shed 0.65%. I got to tell you, to me, this was a day of simple profit taking after a huge up day yesterday. I've been studying this Post Liberation Day rally pretty intently, trying to figure out why so few seem to be taking advantage of it. And I have some ideas I want to share with you so you won't be left out in the cold. First, the journalist slash analytics analyst complex only seems to have two narratives. For the moment, things are either about to roll over or they're already rolling over. There's not much else we almost never hear. It is time to never. Let me give you some examples. Friday session was nasty. Right or wrong. The unemployment number is incredibly important. It was weak and the revisions were weaker. I was in post 9 9am for squawking the street. I was almost gleeful about the results. I never want to see anyone laid off. I'm a full employment kind of guy. But I also want the Federal Reserve to cut interest and they can't do that if the economy's too strong I was confident that these softer labor numbers would do the trick that Chief Powell have to act. Not once did I think it was a referendum on the President's job. That's the job of the averagers. They're the referendum. Dallas and B5 hundreds. Trump used to say to me all the time, I think the softer job numbers have more to do with the endless negativity about the President's tariffs. I'm less worried about that because in theory it is a one time event. The only issue is that they refused to end. The President would do himself and the world a great deal of good by saying all tariff negotiations will be over by October and if countries don't come to the table, it'll be case closed. The relentless drumbeat makes people feel insecure because they don't know what they'll have to pay for their favorite goods. It'd be a huge sign of strength for this country to show confidence that every country has to play ball with us or else. Second, I think employment is getting weaker because it's dawning on managers that is here and it makes them feel uncomfortable hiring aggressively. I don't blame them. You obviously don't want to hire a bunch of people now only to fire them six months from now when AI is in more general use. Or to put another way, only the President took that labor virtually only him. I only care about how the bond market took it in the bond market too. Well, ever since then, the housing and retail sectors, they've been in good shape, which is important because it gives this market real breadth. We don't want to go back to a situation where it's just a magnificent segment and nothing else. Then the President weighed in on this BLS situation or more accurately fired the keeper of the numbers. Sadly, just like he cracked down on the Chinese without realizing that they own the rare earth minerals that make much of American industry tick, including the Air Force. The President didn't come in with a plan here, so it just looked like peak. For years I've been advocating that we outsource these numbers to private sector to get more accuracy. If he'd said that, it wouldn't have looked so terrible. But we need to stop freaking out about the optics of this presidency. Which brings me back to the horrendous negativity from Friday. First, we had people say that this was the beginning of the big rollover aided by the President called dictator who wants important numbers fudged. I hear. I heard from people who haven't weighed in with me for months saying that this kind of meddling is a sign that nothing is sacrosanct. I had to laugh at that because of course nothing's any more sacrosanct. I thought the White House made that clear months ago. Second, in this business we're supposed to care about companies and their profits and the profits are indeed bountiful. Yet the investing class is so scared and so negative because they buy into the narrative that everything's about to roll over. Let me give you a couple of cases in point. I'm about to have a book called Coming Out. It's called well here how to make Money. One of my axioms is there's never, never, never anything to do with the stock of Caterpillar when reports until you've listened to the conference call. Do you know that when I was doing my final draft I almost took it out? Why? Because I've said it so many times. I hope people be bored by sure enough the cat number prints this morning. I know the earnings are relevant because the stock trades on inventories and orders which you don't get until the conference call. But no, the negatives when they want to get out so badly, they sell it down 20 points of pre market trading. 20 points. And then what happens when they're done? The Stock then rallied 25 points from there until they've finished. Until finished unchanged. Why? Because the orders were great. Because the inventories are low. Now I have a word for these panic sellers. They're called morons. Understand though they probably wouldn't have made such a stupid mistake if they weren't constantly being bartered, bombarded with negativity. The tariffs. Most companies are mitigating them fairly well. Not as well as Wayfair, the online furniture store that a lot of wise guys were busy shorten not realizing that Wayfarer may have the single best logistics operation out there. Locating lower untapped merchandise to keep prices down. The shorts thought the way for was hostage to China and other high tariff countries. They were wrong. And this stock shot up and just gaffed the shorts. I mean like I haven't seen in a long time. Or can we just admit that it's getting ridiculous how the market now hates Apple and Amazon even as they did report really good numbers. Now I know that each has its Achilles heel. Let's stress trace about Apple doesn't have the strategy that needs Amazon doesn't have the right chips to get the big developer business away from open AI. But what the negative is don't or won't realize is that these are just Money issues and these two companies have all the money they in the world. Amazon could call Jensen Huang right now, added video and say you know what? I'll take all the Blackwell chips that you can possibly make plus 25% of the Vera Rubin chips that come out next year that are really fast and it could win all the business back from open air and go back to being king again. Mammoth is CEO and Jassy, it's good to be the king. In fact Amazon's already taking action. Little notice blog post I saw today tie up with OpenAI which could keep Amazon web service customers from gravitating away from a system that's perceived as inferior. When I saw that today I thought the stock should be up. I thought it rally five points. Nobody cared. How about Apple? It could just go by perplexity. It's got all the money. It doesn't wouldn't even cost them that much. Or it could buy the streams it needs for Flexi or could pair up with Mark Zuckerberg at Med. I developed some really cool apps. I'm not going to go as far to say graphics do any of these things. And the Apple Stock we have 50 points. That is not why Tim Cook does things and I respect that. But it would move at 50 points now. These are all the examples of what people are blind to right now. There are too many people who think that Trump is going to wreck this market like we saw in April. But I think he did his very best to wreck the market Liberation day and it still didn't work. There are too many people who think interest rates aren't coming down. They sure are if that labor report. There are too many people who think the tariffs will seriously hurt profits. That hasn't happened yet for the most part. And there are too many people who seem to have an aversion to investing when stocks are put on sale. I can't help any of those people. But the bottom line, I can still point out that the companies themselves are doing a bang up job in spite of all these negatives or more likely perceived negatives. And that's all that matters. Betsy in California. Betsy.

[Betsy]

Well hey Jimmy, this is California. This is Betsy California. And I have to say I owe you so much for teaching me how to do the homework. Not just, not just the numbers but how to do it.

[Jim Cramer]

I saw, let me say Betsy. I met bumped to a woman, Leslie last night. I'm walking home and she said the exact same thing and I felt so weird because I'm not always going to be here I am so thrilled you said that. I taught you how to do it. That is the essence of what I'm trying to do here. How can I help you now?

[Betsy]

Well, I have to. The reason I'm calling is one of my thank yous for you is when you first mentioned GE Aerospace. George. Okay, I. You said, geez, you know, I really like this guy, Larry Culp.

[Jim Cramer]

Yeah.

[Betsy]

He's a great executive. And I thought, okay, so what is what I thought? Because I'm a skeptic. And then I did my homework like you taught me, and what I found out was this. And it's true to this day, he's made book the last four quarters. He has almost 78%, 77.95 or 6% institutional support.

[Jim Cramer]

Yes, he does. But how much should we do? Do you want to know what we think he can do going forward? Hello? Oh, okay, Betsy, I'm sorry. I think the GE Aerospace is going dramatic. GE Electric, now, General Electric is going much higher. Will it go much higher right now? No. But this is one where you must, must, must stay the course. And I'm gonna throw in another one for club members. Know this. I think that G.E. vernova is even better. Sorry, Larry. I really think G.E. vernova is Even better. A lot of people who think that rates aren't coming down fast up or tariffs will kill profits. All you can say is the companies themselves are what we care about and they're doing a very good job, maybe a great job. Only money tonight. Oil and gas stocks have been frustrating to own lately, haven't they been? So I'm turning to the CEO of Kotera for answers about why his stock's been stalling and what the company plans are. Here then, is Spotify playing the right tracks in this ad space. You know, the stock's been weaker lately. I'm sharing whether or not I'm still pressing play on the stock. And ad tech player Moving Mountain just reported his first quarter as a public company and I've got the CEO for an exclusive, hot off the tape. So stay with Kramer.

[Mad Money Producer]

Don't miss a second of Mad Money. Follow imkramer on X. Have a question. Tweet Kramer Madmentions. Send Jim an email to madmoneynbc.com or give us a call at 1-800-743-CNBC. Missed something. Head to madmoney.cnbc.com.

[Fifth Third Bank Voice]

Commercial payments of Fifth Third bank are experienced and reliable, but they're also constantly innovating. It might seem contradictory to have decades of experience, but also be on the cutting edge of the industry. But Fifth Third does just that. They don't believe in being just one way for your business, because your business has more than just one need. Like needing your payments to be done on time, safely and without any bumps today, but also needing to know you won't be hitting any bumps tomorrow. That's why they handle over $17 trillion in payments smoothly and effectively every year, and were also named one of America's most innovative companies by Fortune magazine. After all, that's what commercial payments are all steady, reliable expertise that keeps money flowing in and out like clockwork. So Fifth Third does that. But commercial payments are also about building new and disruptive solutions. So Fifth Third does that too. That's your commercial payments.

[Keith Lansford]

A Fifth third better this episode is brought to you by Schwab Market Update, an original podcast from Charles Schwab. Join host Keith Lansford for this information packed daily market Preview delivered in 10 minutes or less, including projected stock updates, monetary policy decisions, and key results and statistics that may impact your trading. Download the latest episode and [e-mail] MarketUpdatePodcast or find Schwab Market Update Wherever you.

[Indeed Voice]

Get your podcasts, you just realized your business needed to hire someone yesterday. How can you find amazing candidates fast? Easy. Just use Indeed. When it comes to hiring, Indeed is all you need. Stop struggling to get your job posts seen on other job sites. Indeed Sponsored Jobs help you stand out and hire fast. With Sponsored Jobs, your post jumps to the top of the page for your relevant candidates so you can reach the people you want faster. According to Indeed data, Sponsored jobs posted directly on indeed have 45% more applications than non sponsored Jobs. There's no need to wait any longer. Speed up your hiring right now with Indeed and listeners of this show will get a $75 sponsored job credit. To get your jobs more visibility at indeed.com madmoney just go to indeed.com madmoney right now and support our show by saying you heard about Indeed on this podcast. Indeed.com madmoney Terms and conditions apply. Hiring Indeed is all you need.

[Jim Cramer]

Last night we got results from the only energy holding in my charitable trust, which is called Kotara Energy. It's an oil and gas exploration production company. Frankly, it's been a little frustrating to own. I mean, even though management executes well, the Stock supports the 3.6% yield. It has a hard time getting traction, as do many of the oil and gas stocks. In the last 24 hours, the company reported a really fine set of numbers $0.03 earnings be better than expected cash flow, really terrific cash flow thanks primarily to strong production management. Also give good production guidance for the current quarter raises full year forecasts. They also raised their capital expenditure forecast. Basically they're producing more oil, but they have to spend a little more gas too. But after initially trading higher, then it turned down and then it opened, then it went back up. But frankly in the end it's an energy company and right now energy companies, they're very tough to finish the day up 1.6% though. So what the heck do we do with this one? Even as it's the best of the best. Let's check in with Tom Jordan, the chairman presidency of Kotara Energy. Get a better read the situation. Welcome back to Man Money.

[Tom Jordan]

Thanks, Jim. Glad to be here.

[Jim Cramer]

Tom, you delivered a number if we want to use a key measurement, I like this one, which is the free cash flow yield that was better than any segment, not just in oil but in the entire market. And yet I find that people can't won't give you credit in part because you're an oil and gas company in the end. And that's just not in favor. So out of favor right now in the stock market.

[Tom Jordan]

Jim, that will change. You know, it's about energy. It's not about type of energy. It's about energy and our nation and the world needs energy and Kotera is second to none. Our ability to deliver it with free cash flow and durability for that free cash flow. So, you know, physics is hard to refute and oil and natural gas are essential for the world's energy crave.

[Jim Cramer]

Well, it's very clear right now because of a deal that I really love that you guys made a purchase agreement with CPV Basin, Basin Ranch that we've heard of. I want to get that in a second. First, the natural gas portfolio that you have is, is I think widely underestimated. I think people don't realize that Northeast Pennsylvania, where I'm from turns out to be great. That was the Cabot Oil and gas. Your natural gas production was terrific. Tell us about that part of the operation.

[Tom Jordan]

Well, that's a terrific operation. In fact, as I said in our call today, it's currently our highest returns on capital. We're drilling some phenomenal wells, really bringing on tremendous low cost volumes and we'll be there. You know, we're on the hunt for additional marketing agreements in Pennsylvania that's becoming a real center of electricity demand and that's just a jewel asset in our portfolio now.

[Jim Cramer]

Also, the, the idea that you basically are, you're selling 50 million cubic feet of gas per day to a power plant and then you also have the right to purchase up to 250megawatts per day of power from the facility. These are the kinds of deals that are going to power this country, aren't they?

[Tom Jordan]

Well, that second point was I think one of the critical ones. Not only is our sale at a really nice power pricing, it's not, it's not denominated in terms of natural gas, the price is denominated in terms of power. But our ability to purchase that additional electricity really secures U.S. electricity supply for our own operations in the Permian Basin. Electricity is becoming tighter and tighter and so having access to that power will be important to us.

[Jim Cramer]

Now this morning when his own earnings call, Diamondback Energy, Matthew Hoff, he's a smart guy, said there's still a lot of firms that see oil prices as much lower next year. I don't know if I believe that they're going to be that low, but it's certainly hard for me to get extremely bullish today. Diamondback's a good operator. What do you think about their short term predict prediction?

[Tom Jordan]

Well, I have a lot of respect for Diamondback and the team, I'll just say that up front but you know, we all do a terrible job of predicting prices. And you know, I made a point in our call today, Jim, that we've gone back. You know, we do a lot of look backs on our own history and all the wells we've drilled and how we've performed over time. And we found because of the long lead time of investment decision to first production, some of our best investments have actually been made in that low trough when people are most gloomy about the price because it tends to recover in the timeframe that's there when the production comes on. So our conclusion for Kotera is because of our consistent cash flow with our balance of oil and natural gas, we can keep a sustained level of activity and not be tossed around by these peaks and valleys and commodity pricing. And we think that's the way to play this long game.

[Jim Cramer]

Absolutely. I mean, look, I see way too many oil and gas companies be like bad investors in the stock market when they like to chase and then when things go down, they blow it out. I mean it seems like that you, at least, you know, you have a very different attitude. But it seems like every time you have to teach a couple of the analysts that you have this different attitude and you're going for free cash flow.

[Tom Jordan]

Well, Jim, I wish I could argue out to that, but that's a very well deserved. I think our industry has had a history of inverse dollar cost averaging. Buy high, sell low. But you know, that's a problem because most companies only have the cash flow when the price is high. And so that, you know, again, that's why we like having that balance because we don't get tossed around by commodity price volatility. The way if we were all gas.

[Jim Cramer]

Or all oil, why is nat gas solo? There's tremendous demand for it and we're also exporting. I don't understand the price.

[Tom Jordan]

Well, yeah, there's, there's hope on horizon, Jim, certainly with the, with the electricity demand, with the LNG exports, I think one has to only be constructive. And then if we can get some infrastructure built so we can make a more efficient US network with interconnected, then a lot of this problem goes away. You know, the problem with natural gas is we have separate constrained basins because of our inability to build infrastructure. It's nutty. It needs to stop. And I hope that we'll get some infrastructure built in this country.

[Jim Cramer]

Okay, one last thing. You bought some great properties, but they also, I think must have been why you've cut back the buyback. You know, half a billion buyback at this point. Now you're up for 47 million last year. You don't want to buy back stock even down here because you got to pay down that debt. Right?

[Tom Jordan]

We do. We, you know, it's, we love them both. But right now we think our best positioning is let's get that debt paid down. We're on track. We think we'll retire that billion dollar term note this year and then we'll be back. Aggressive buyback. I mean it's not, it's not either or. It's just staging.

[Jim Cramer]

Right.

[Tom Jordan]

And we just, we think we're better positioned for taking opportunity in the future if we buy that debt down.

[Jim Cramer]

Well, I agree. I look, I'm a very conservative investor and I think you are too. Tom Jordan, Chair, President CEO of Qatar Energy. Thank you for being on the show, Tom. Appreciate it. Always, always. Good.

[Tom Jordan]

Thank you.

[Jim Cramer]

Thank you. That money is back after the break.

[Mad Money Producer]

Coming up, shares of Spotify have pulled back recently, but Kramer's plugging in to see if a bounce back is coming up next on the playlist for the audio streaming giant.

[Keith Lansford]

This episode is brought to you by Schwab Market Update, an original podcast from Charles Schwab. Join host Keith Lansford for this information packed daily market Preview delivered in 10 minutes or less, including projected stock updates, monetary policy decisions, and key results and statistics that may impact your trading. Download the latest episode and [e-mail] MarketUpdatePodcast or find Schwab Market Update wherever you.

[Fifth Third Bank Voice]

Get your podcasts At Capella University, learning the right skills could make a difference. That's why our business programs teach you relevant skills you can take from the course room to the workplace. A different future is closer than you think with Capella University. Learn [e-mail].

[Jim Cramer]

While the broader market hovers near all time highs, not every stock's getting in on the celebration. In fact, some of the year's best performers are now well off their highs, including men in my favorites. Know what that is? Opportunity. Take Spotify. That's the world's most popular music streaming subscription service, with the company boasting a user base of nearly 700 million strong. Many of you are users. You might even be listening to this episode on Spotify right now. Over the past couple of years, the stock's been one of the market's top performers, formers rallying 138% in 2023 and then, weirdly enough, tacky on another 138% in 2024. House of pleasure spot by late June, Spotify has surged to an all time high of $785 and was up 75% year to date at that point. But even after the Stock fell about 10% from its highest going into the quarter, when Spotify reported last Tuesday morning, the darn thing dropped another another 11.5%. While the stocks recovered a bit since then, it's still down almost 18% from its highs. So it's worth figuring out if this is a buying opportunity or if there was something genuinely wrong with the quarter. Now, first off, you don't have to look far beyond the headline numbers to figure out what the problem was. While Spotify's total return rose 15% from the prior year on a constant currency basis, that number still came in lighter than expected below both the analyst estimates and management's own guidance. Now, some of that miss was related to currency fluctuations. See, this is a European company, the big American business, so when the dollar gets weaker, it hurts their bottom line and almost never gets weaker. Most of this, though, came from a shortfall in Spotify's ad supported business. Remember, even though roughly 90% of the company's revenue comes from their premium subscription services, the other 10% comes from free content that's supported by ads. And Spotify's advertising business came in substantially lower than expected, even if it was still up 5% on a constant currency basis. Management solidier and they didn't hide their disappointment. The advertising side of the business. On last week's conference call, CEO Daniel Eck noted I'm going to quote here that the one area that hasn't yet met our expectations is our ads business. We've simply been moving too slowly and it's taking longer than expected to see the improvements we initiated to take hold, end quote. He went on to say this shortfall is due to, quote, an execution challenge, end quote. And that he was, quote, unhappy with where we are today. Wow. I mean, no sugarcoating there, huh? That's pretty harsh words from the CEO. But given how the stock reacted to the quarter, the shareholder base is pretty unhappy. To make matters worse, Spotify's outlook for the current quarter didn't do much to restore confidence. After their average revenue per user growth for premium users decelerated 3% last quarter, management only guided for flat year over year growth for the current quarter. As a result, management also guided for merely flat margin growth for the current quarter, leaving investors, let's say, befuddled. So we know that the latest results missed the mark and the guidance for the current quarter didn't have much going for it. But is that enough reason to give up on a stock like Spotify? It's been a serial outperformer for years. If it was still a seven eight five, I throw in the tab, but down here at 647, that's. I think that's another story. Even though Spotify came up short on some major line items, there were some still legitimate positives in the quarter. Monthly active users grew 11% year over year, reaching 696 million people, comfortably ahead of expectations. Premium subscriber growth also came in ahead of expectations, going 12% to 276 million, about 3 million higher than the analysts were. That used to be the key metric. It's hard to overstate how massive these numbers are. Based on the results we got, roughly 3% of the world's population is a paid subscriber to Spotify. Imagine believes they're only scratching the surface here. On the conference call they reiterated their long term ambition, what they call their big hairy, audacious goal of reaching 1 billion subscribers. Management even said that they could see a path to eventually reaching 151 5% of the global population. Makes sense to me. This is the best streaming audio platform around. Now it might be hard to imagine a company this big continuing to grow at a meaningful pace, especially when they're already holding 45% of the subscription market share in the regions where they operate, 65% of all global music streams are happening on their platform. But you know what? Spotify has been able to get this big because it offers incredible value proposition. For 119899 per month in US you can have access to over 100 million music tracks as well as 6.5 million podcast titles. Plus, Spotify is trying to expand beyond its audio. In 2024 they invested heavily in video. Now they host over 4,430,000 video podcasts. That's part of the business growing fast. Video consumption is up 20 times faster than audio only streaming. They've been cleaning up the audio books too. Sure, people might roll their eyes when Spotify throws a few hundred million dollars at Joe Rogan, but can you honestly say he's not at least a little responsible for doubling the growth in monthly average users since he joined the platform? Don't get me wrong, it's a lot of money. But unlike with music, Spotify doesn't have to be pay high royalties. So the deal makes a bit more sense. And hey, it never hurts to have more content on the platform. If Taylor Swift can't make someone a subscriber, maybe Joe Rogan can. Matt also laid out a compelling case for how Generative AI is enhancing their product experience. In the past, personalization was based on simple signals like skips or replays. Useful, but too blunt for them to give you exactly what you want. Now, with tools like Spotify DJ and Generative Playlist creation, users can actually tell the app what they want to hear. In plain English, engagement with Spotify DJ has nearly doubled over the past year. Management says it's just getting started. The better the experience, the more time users spend on the platform, and the longer they can keep you there, the more pricing power they have. Hey, speaking of pricing power, just yesterday Spotify announced premium subscription price hikes in several regions outside the U.S. including parts of Europe, Southeast Asia, South Asia and the Middle East, Africa, Latin America, and the Asia Pacific region. We're talking about the price going from €11 to €12. Maybe some users in Europe are unhappy, but with the stock jumping 5% on that news yesterday, it's clear the investors are thrilled. As for the ad business, even though last quarter was a letdown, I appreciate the management isn't sugarcoating it. They've acknowledged their shortcomings and laid out a plan to fix it. And look, despite the weakness in ad revenue Spotify grew monthly active advertisers by 40% year over year. They also know that most of the heavy lifting on their ad tech stack is now going is now complete. You remember Netflix wasn't that easy. Didn't have had a time to had a hard time doing this when they moved into it. Going forward, Spotify plans to focus on driving adoption, launching new advertising tools and improving performance. They even said they're seeing early signs of progress in their programmatic ad sales business. That's pretty good. One more positive, Spotify recently increased its buyback authorization from $1 billion to $2 billion, leaving about $1.9 billion still available. Company hasn't bought back stocks since 2022. But this expanded repurchase authorization signals that I think they might be getting ready to buy their own shares right along with. And yes, I'm well aware that Apple continues to invest in its own music offering. I use it, it's really getting better. And Amazon's in there too. You get theirs free with Prime. I use that one too. I never take competition with Apple or Amazon lightly. But Spotify still the clear market leader for a reason. For now, nobody else comes close. So the bottom line here, this kind of interesting tough story. Even though Spotify's latest quarter didn't come up short, no one's denying that. I think total breakdown. The stock has created tremendous buying opportunity and this is a genuinely great franchise. Let's go to Mark in Pennsylvania. Mark.

[Betsy]

Hey Jim. Lifetime lifelong booyah. Go Phillies. Go Birds. First 18 year old viewer and a founding club member. Thank you so much for all that.

[Jim Cramer]

You do for us. Thank you.

[Betsy]

So excited to speak. I feel like I spend my whole day with you with squawk on the street in the morning, then, then the club meeting, text from you all day long about what's going on and then finally mad money. I, you know, you have you created basically a comfortable retirement for me and my family and I.

[Jim Cramer]

Well Mark, I got to tell you, I do it for you. I do it, I do it for you. And I'm not kidding. People who know me, everybody who knows me knows who I do it for. I do it for you. How can I help you now?

[Betsy]

So I don't have a large position in Netflix. I know it's not a club name and I know it's not even in the bullpen. But I do have a small position and I think it's more of a general nature of I started to add to my position a little bit before they reported earnings and after the earnings Everything looked, you know, the fundamentals looked really good. And yet, and yet the stock is now kind of being hated a little bit.

[Jim Cramer]

Well, you raise a great point. I mean it has come down a great deal. When I saw it was down 23, I said, wow, they're really taking the wood to this thing. And it's a very, you know, it's a very highly valued stock. How about this? Why don't you pick up a little more right here at 1147 and then wait for to 1100. Okay. Just give it that wide berth. As you know, because you're a club member. You know, that's how we think. And that's how I think you build that position to the right size right into the weakness. And thank you for the kind words. All right, guys, this is a really tough story. I know. I want to go against the grain here. I think Spotify is offering a huge buying opportunity right now. And in the music streaming space, this company is sitting at the top of the charts now. Much more, including my Swiss was Mountain. The ad mo tech company just posted first reports is going public. So is the performance TV pioneer living up to the hype or could Wall street be primed to change the channel? I'm getting the latest and CEO and every time the market thinks that, that, that Palantir is overvalued, the company proves investors wrong. I'm sharing where I come down. And if I think the stock still has more to room to run. Of course oil calls rapid fire in tonight's edition of the lightning round. So stay with Kramer. Tonight we got the first ever earnings report from Mountain, the ad tech company that helps small medium sized businesses take advantage of connected TV advertising. It was doozy. Mountain came public at $16 in late May and in less than a month it's run to $31 and change of tonight's close. Well, Matt reported after the close we saw even more reasons to like it. Better than expected revenue, better than expected earnings for interest, taxes, depreciation, amortization, not to mention the Ryan Reynolds seal of approval. He's the chief creative officer. At the same time, management gave very strong guidance for the current quarter. Still stock is trading low after hours. I think it's because the quarter included a large gap bottom line loss. Something that's really just a result of the IPO process. It should not matter to investors. So are you getting another chance to get a quality stock into weakness? Earlier we had a chance to speak with Mark Douglas, presidency of Mountain to learn more. Take a look. Mr. Douglas, welcome everybody, thank you.

[Mark Douglas]

Happy to be here.

[Jim Cramer]

Oh thank you. Now we've seen you on and we've seen you, you great spokesperson for the industry. But now I'm going to ask you to be a spokesperson for Mountain and make the case for Connected TV as an advertising venue.

[Mark Douglas]

Absolutely. So Connected TV is, takes television and makes it digital. So all the other mediums you use, social, search, all these things are digital platforms where you can really precisely find your next customer. And now with Connected TV you can do that also but on a big screen, 65 inches, people paying attention, watching their favorite show and can reach those consumers.

[Jim Cramer]

Now I am so impressed that you have so many small, medium sized businesses advertising. Now this is our wheelhouse. You know that we support small medium sized businesses throughout our program. How do they know about it and how are they doing?

[Mark Douglas]

Well, how they know about Mountain is we actually use our own platform. So our number one marketing channel is Mountain Ads. Our own ads that we run on Mountain. Plus a lot of people find out about us on LinkedIn or through referrals. And then to become a customer you just go to a website. It's like creating a Google AdWords account except this one, it's a Mountain Performance TV account for streaming television. It's really easy to do.

[Jim Cramer]

Now I know that have started a lot of business. Know many who have. When you have five people or 15 people, the thing that you're most, you just, you're intimidated about everything.

[Mark Douglas]

Yeah.

[Jim Cramer]

And yet I see a lot of first time advertisers on Mountain.

[Mark Douglas]

That's a really good point. So 97, as of this quarter, it's now 97% of our customers have never advertised on TV before. They come again, they go to Mountain.com and they create an account we help them with, we have the technology to help them with everything. Who's a target customer? Most importantly, 97% of our customers don't have TV ads. And that's where I think, you know, Ryan Reynolds involved the company and that's why he got involved because creative is usually the biggest challenge for these small brands. So he is Ryan's knowledge to help build the tools and the network of independent creators to help those brands build their TV commercial do at a reasonable cost. And then of course Mountain gets them onto every streaming network and you have.

[Jim Cramer]

An amazingly clear white paper on your site which does not take long to read but has a couple of Ryan Reynolds promotions for it. And to me it seemed like if you can do a file, if you can do anything and send it right, just Send it to you guys, you will get a return most likely.

[Mark Douglas]

Yeah, the, the, I mean you have to have a product people want of course. So product market fit is always important. But most of our customers they're already using like advertising on Instagram, advertising on TikTok, but these things that's like a 6 inch screen as a, opposed to 65 inch screen on the wall in people's home where you get this kind of outsized attention in 30 seconds uninterrupted time. So these are good marketers. They know what they're doing and now they can do it on street.

[Jim Cramer]

Look at the democracy, the democratic aspect of what you're doing appeals greatly to us because we know in a world where people are going to lose their job because of. I've been a believer in what Jensen Wong says in video which is they'll create, many of them will be able to create new companies and they can't do it without you. So tell me, where are the top connected TV destinations for my mountain customers?

[Mark Douglas]

Well, we partner, like I said, pretty much every streaming network. So we have partnerships with Comcast, Paramount, Discovery, HBO Discovery, Visio. Yeah we are Vizio Televisions, lg, Samsung, so the entire ecosystem. So when you launch a campaign on our platform, our technology decides which of these networks. But one thing that's interesting, we not only help our customers grow, we help the media companies grow because it's like, well it's like new jobs in America come from small mid sized business.

[Jim Cramer]

Right.

[Mark Douglas]

The growth in the media industry is going to come from small mid sized businesses.

[Jim Cramer]

Well that's important because the consumer packaged good companies, candidly I've been following them for all the earnings that they reported. They're all cutting back.

[Mark Douglas]

Yeah, they. Well when they're doing brand advertising and those budgets are fixed.

[Jim Cramer]

Right.

[Mark Douglas]

And when times get a little tough, they, they cut their budgets. In performance advertising, I'm talking direct response, search, social, performance tv. When times are tough, companies tend to double down. They want, they don't want to give up their growth aspirations. They just want it to be more measurable and more targetable.

[Jim Cramer]

Okay. So I'm a small business person. I've got a special kind of blanket that I have made out of recycled fiber. Yeah. And I'm selling how do I know how much I can attribute to what mountains give?

[Mark Douglas]

So we have tools built in our platform that's at its performance attribution common. Our customers are doing that. We provide them that data as part of our platform. Virtually all of our customers use also use third Party tools from companies like Google and Google Analytics is one of the big ones, Rocker Box and others. And they use these tools to measure the. So they're not just taking our word for it, they're measuring it independently. This is something they're used to doing. The key is, is we're sharing that information of course with our customers, but also with these partners.

[Jim Cramer]

We get some real people that people recognize on. On Mountain. Gwyneth Paltrow.

[Mark Douglas]

Yeah, I think there was a recent commercial done by Max Max. So we're part, you know, Max effort. Yeah, we're tightly teamed up with Maximum Effort and they produced the ad with Gwyneth as a temporary spokesperson. Worse than that, I think it hit pretty hard. I went by as viral as something pretty much overnight. But that's what, you know, something learned from that that took less than five days to do. So it didn't take months of time and huge budgets. There was a moment. Maxim effort calls this fastbetizing. They hit a moment, they just go with their, you know, their gut and they put something out there and if it resonates, you know, you, in that case, you turn a situation around. In many cases you like State Farm last year and with NFL games, you know, they, they just really capture the moment. So that's the way to do it is just go with your gut.

[Jim Cramer]

A young company is watching, they've got a product, they're intrigued by Mountain. What do they do now in order to be able to have an add on?

[Mark Douglas]

So it's really simple. Go to mountain.com, just type or we own the domain.

[Jim Cramer]

You own the domain. Okay, I wanted to know.

[Mark Douglas]

Yeah, so we have it both ways. You go there, you can get a demo of the product, you can create an account and then you're going to need creative. Chances are you have a lot of creative, just not meaning video that you're posting on YouTube or you just don't have in the form of 30 second commercial. So we have basically tools, we have independent network of creators to help you turn that into a 30 second TV commercial. And then we get it into our platform. Figure out who your customer is using AI and you're now in front of millions of people.

[Jim Cramer]

Well, I am very impressed and I love the ease of use and you know how much much. These are the people who are changing our country and they're going to go to Mountain first. They're not going to go to the big guys but that, you know, maybe they do one day but I think yours is more effective.

[Mark Douglas]

Yeah, well I think we Are the big guy.

[Jim Cramer]

I think you really are going to be by far because linear is like this and you like this. That's Mark Douglas Mountain president and CEO. It's mnt. It's a symbol. It's a very exciting company. Read their earnings. Is a really good point. Their money's back if you break. Thank you. Thank you.

[Mad Money Producer]

Coming up, Kramer takes your calls. And the sky's the limit. It's a fast fire lightning round next.

[Jim Cramer]

It is time. It's the white brown quarterback. Name is Todd. Started by to be clear Software let us up and then the lightning round is over. Are you ready? Ski d Tell the light of the summer Lum Sang in Wisconsin. Lum Sang this is love Fire up. All right, let's have it. Pa Alto is a buy here. We were going to buy some for the channel trust. I can't emphasize enough. The stock is now down from 210. I think you got a real good idea. Let's go to Joe in New Jersey. Joe. Hello, Mr. Kramer. Thank you for taking my call. Joe, how you been and where you been? How you been and where you been? I. Yeah, I've been busy working and I've been busy managing my money that I'm making. Sounds good from the stocks. All right. Yeah, yeah. With a low ope. Should I still continue to own Qualcomm? And by the way, Qualcomm could go up because tomorrow Skyworks, Skyworks reported a good number which is highly unusual. Tomorrow I think Qualcomm goes up and then I want you to. No, we're not done. That's ridiculous. Let's go to lesson Ohio less. Hey, Jim, thanks for taking the call. You often say that you want to teach us and help us make money. Well, here's what I'm saying because I need. I need some learning. Sure. I don't use this. I don't have any short term use for this money. But I'm up over 800% with Robin Hood. Do I sell now? You made things very. You made my life very easy. Here's what you do. You take out your cost basis. You sell your cost basis tomorrow and then you can't lose. You're playing with the house's money, my friend, and you going to really crush it. And that led you Lightning Round.

[Mad Money Producer]

The Lightning Round is sponsored by Charles Schwab. Coming up, has Palantir's prolific rise changed the way to evaluate growth stocks? Kramer sharing where he comes down on the company's recent run.

[Jim Cramer]

Next. Booyah for the emperor of Framerica. Honorable James J. Kramer, you got me.

[Mark Douglas]

Jumping around my office right now.

[Tom Jordan]

Thank you so much for all you do for us.

[Mark Douglas]

I enjoy your show and they find.

[Jim Cramer]

It very entertaining and informative. I watched your first ever episode of.

[Betsy]

Mad money back in 2005 and I've been watching every single episode ever since.

[Mad Money Producer]

Don't miss Mad Money every night at 6pm Eastern. Plus, join the CNBC investing club and stick with Kramer around the clock.

[Jim Cramer]

Sometimes traditional stock analysis just let you down. That's how I feel about the stock of Palantir. And it is the best acting stock in the s and P500, up almost 8% today after great earnings and 109% year to date. After this spoiled quarter, Palantir has bedeviled many of the analysts who've covered the company ever since it came public almost five years ago. They have a difficult time evaluating it because it seems so overvalued. The software company Slash a consultant trades at over 200 times. Next year's earnings estimates make it the most expensive stock in the S&P 500. And look, if you're relying on traditional metrics like most analysts, Palantir's valuation looks psychotic. But I think Palantir is one of those rare stocks that defy standard analysis. When we're dealing with fast growing software companies, I don't use earnings per share. I like to judge them based on something called the rule of 40. It goes like this. You take the revenue growth rate and some measure of profitability, maybe the operating margin, maybe free cash flow margin, and if they add up to more than 40, your stock might actually be cheaper than it looks. Palantir's revenue growth accelerated 48% and its adjusted operating margin stands at 46%. That's an extraordinary combination that yields a score of 94. 4. That's on the rule of 40 tests. I follow you. Some stocks, I don't know a single other one even remotely near that terrific number. Palantir may be cheap, maybe incredibly ridiculous on earnings per share, but on Rule 40 yardstick, it's ridiculously cheap. I'm not kidding. Why you palate. Your exalted status is not based on small Numbers. They had $1 billion in revenue this quarter. Two years ago. They did $2.2 billion in revenue over the course of the entire year. What makes Panther so elusive? First is the seemingly bombastic claims of CEO Alex Carp. He says that because his company is hyper efficient, he expects to get 10 times the revenue that the company has. With 3,600 employees, they now have 4,100 employees. People hear that and they say that's absurd. But I'm willing to give Karp the benefit of the doubt because he keeps delivering. I think he's going to hit his target. The other problem here, people don't really know what Palantir does this quarter. They gave two solid examples that hint at the style and breadth of what they can do for an organization. The Chief Revenue Officer Ryan Taylor points out that Citigroup shared that that the customer onboarding process and relevant know your customer and security checks that once took nine days. Now take seconds, thanks in part to Palantir. Or how about this one? Quote Fannie Mae recently announced their working with Palantir decreasing the time to uncover mortgage fraud from two months down to seconds, saving the US Housing market millions in future fraud losses. End quote. And yes, I am trying to be as dispassionate as possible because the rah rah rhetoric and the special terms that the company uses to describe its business leave a lot of investors cold. I mean, who the heck talks about ontology in this business when Karp says that the quarter is a, quote once in a generation, truly anomalous Quarter and reverse. Very proud. And we're sorry that our haters were disappointed. Disappointed. But there are many more quarters to be disappointed, and we're working on that, too. He sounds like a paranoid maniac, but he's actually a scene. He's insane. Speaker the bluster has scared professional money managers away from the stock, even as it delights the amateurs who beat the stock up endlessly both before and after the market. I've been behind it the whole way. When it was at $50, I said it would go to 100. When it got to 100, I said it would go to 150. And when it got to 150, as it did last month, I said it will go to 200. We're already well on our way. How did I know this? Because of the Rule of 40 valuation method, and it truly does work. Palantir might be able to keep working its magic for years. It's the steadiest high flower I've seen in ages. But if the stock's going to keep climbing, the bears need to keep betting against it. Those are the people who don't understand Palantir's greatness. They are the ones whose backs this remarkable run is built upon. Once all the bears become bulls, that's when you run out of upside. Fortunately, that hasn't nearly happened yet. I said, as always, Mark Summer promise just for you may have money. I'm Drew Kramer. I'll see you tomorrow.

[WhatsApp Voice]

All opinions expressed by Jim Cramer on this podcast are solely Kramer's opinions and do not reflect the opinions of cnbc, NBC Universal, or their parent company or affiliates and and may have been previously disseminated by Kramer on television, radio, Internet, or another medium. You should not treat any opinion expressed by Jim Cramer as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinion. Kremer's opinions are based upon information he considers reliable, but neither CNBC nor its affiliates and or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. To view the full Mad Money disclaimer, please visit cnbc.com madmoneydisclaimer@ Capella University, learning.

[Fifth Third Bank Voice]

The right skills could make a difference. That's why our business programs teach you relevant skills you can take from the courseroom to the workplace. A different future is closer than you think with Capella University. Learn more at Capella Eduardo.