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- [00:01]
Scott Galloway
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- [01:56]
Kara Swisher
Hi everyone, this is Pivot from New York Magazine and the Vox Media Podcast Network. I'm Kara Swisher.
- [02:01]
Scott Galloway
And I'm Scott Galloway.
- [02:03]
Kara Swisher
Scott, things are happening at Vox Media. We're going to do something a little different today and start with a voicemail from a listener who's going to explain the situation. Let's play a clip. Hi. After listening to Pivot today, I saw that James Murdock is buying part of Vox Media and I was curious how that might change the freedom you guys have on your various podcasts. Anyway, love your shows. Just finish Burn Book and listen to all Your podcasts. Keep up the good work. Jenny from Texas. Oh, that's a very good question, Jenny from Texas. So in case people don't know what she's talking about, James Murdoch's company, Lupa Systems, is acquiring Vox Media, Podcast Network, New York magazine and the Vox site. The other parts of Vox Media, including Eater, the Verge, SB Nation, are becoming a different company, a new independent company. The deal's expected to close in the coming weeks. There's a few legalities and this and that. From what I understand, Lupus Systems has not disclosed the purchase price, but it's reportedly around 300 million. The podcast network is the more attractive asset, though. We love New York magazine and it does rather well and love docs. And so Scott, people want to know what we think about this because a lot of people have bad information. One, first of all, Jim Bankoff is staying as CEO of this unit. It's a spinoff essentially of these assets which have been fast growing. So explain, Mr. Business, explain the situation.
- [03:32]
Scott Galloway
Well, about a decade ago people thought, wouldn't it be great to aggregate kind of this alternative media or build alternative media companies for a new world? And so Buzzfeed, Food52, CNET, Vice was it called Mike Mashable and Vox and back when they thought probably six, seven years ago, that if we bring together sort of these good little media assets, some digital, some not, and group them together, we can spack it and it'll go public at 1, 2, 3 billion dollars. And so Jim, logically the CEO of Vox thought this is a good idea, bought New York magazine, had a bunch of very fast growing websites, Eater, Verge, Vulture, and then started some nascent podcasts, right? And then essentially what happened was the market never said, okay, there was never the bloom came off the rose. And basically of all these companies, basically they're competing against monopolies who extract rents. And then their margin was, you know, the margin of all these companies is Google and Meta and Amazon's opportunity. And they slowly but surely sucked the oxygen out of the room. And Buzzfeed, from peak valuation to sales price was off 86%. Food52 lost 96% of its value. CNET lost 94% of its value. Vice was, I think basically went bankrupt, but sold some assets, was down at least 93%. Mashable off 80%. I mean just on and on and on and on. Tumblr, my favorite, 1.1 billion to 3 million. If you're an investor in Union Square Ventures, thank God that the guy with the Caesar's haircut I forget his name. Was able to convince probably one of the weaker CEOs in digital history to buy his bag of shit for 1.1 billion Tumblr.
- [05:28]
Kara Swisher
That was Marissa Mehr at Yahoo.
- [05:29]
Scott Galloway
Marissa Mehr, right. So effectively this has just not worked out. Now, Jim, our guy who we like, has always said, Scott, be honest and always told us to be honest. So let me be honest. They spent a lot of money to create a company with negative synergy. There's some real assets there. New York Magazine is a trophy iconic asset. The sites themselves, the digital assets are actually do pretty well. But again, see above, they're swimming upstream against giants. And then the smaller division that started out as an afterthought has become the growth engine and the crown jewel. And Jim is a smart guy and realized that the whole was less than the sum of its parts and basically decided to break them up into what was going to be three buckets. And. But my understanding is, and I do not have inside information here, and I don't want it, is that Jim Murdoch or James Murdoch, who wants to be in the media business, said I'll take New York magazine because I think he likes it and it's an iconic asset. And what I really want is the podcast network, which is growing. I'll stop there. Where did I get that right or wrong?
- [06:37]
Kara Swisher
No, you got that all right. And I think Jim of all of them has cantily moved that into a space. Obviously buzzfeed just bought by Byron Allen. You know, they all. Vice has had a much less happy situation. You know, Mike, I don't know where that went. Like there were a lot of them and it was very exciting. And one of the reasons I sold my tiny little site to Vox many years ago, Recode, was because they were ridiculously priced and were sort of pricing me at I was even a smaller minnow. And so when I got to Vox, I understood the ad market was really a problem here. Although we did great. Let me just. The only thing you're leaving out is so much great journalism by so many of these sites and so much really interesting independent media. Absolutely. The Verge eater, you know, all of them. And New York Magazine just won the General Excellence award and the National Magazine Awards. Wonderful.
- [07:32]
Scott Galloway
Under David, that was punches above its weight class.
- [07:35]
Kara Swisher
Yes.
- [07:35]
Scott Galloway
It's like the HBO of magazines is the way I would describe it.
- [07:38]
Kara Swisher
Right, Exactly. It's amazing. So anyway, so it's really nice parts. They're really nice parts. But what happened was exactly what Scott said and what I thought, which is one of the reasons I went to Jim 12 years ago and said, I'm gonna start this little podcast called. It was Recode Decode at the time. Or it might have been something else. I don't remember what it was. Cause I really did have an interest in this area and felt that was shifting. And then they added on. The Ezra was on there. There's a whole bunch today explained a bunch of things. And what essentially happened after that? After that I met Scott Galloway and the rest is history. Like, we've done really well.
- [08:13]
Scott Galloway
The bald man with erectile dysfunction, James Murdoch. It just all makes sense. In the Murdochs.
- [08:19]
Kara Swisher
In the Murdochs. And I worked for Super Mario Life.
- [08:21]
Scott Galloway
It's so rich, isn't it happen.
- [08:23]
Kara Swisher
I know, right? I know people are thinking. It's very funny for me, especially because I knew James from a million years ago when he was actually around for digital stuff very early, when I was covering the early digital industry. And he tried very hard to move his family's company digitally. But Rupert always did something idiotic. Like whether it was the way they handled MySpace or there were so many. I can't even tell you, like Disney, they had 19 of these things. And especially the iPad news thing that I thought was ridiculous. And so we left. We left the Murdoch empire largely over Rupert over problems. He was doing all sorts of nefarious things. And we wanted to come out on our own and then ended up selling to Vox. And so everything comes around, essentially. I met Scott, we built Pivot, and we built each of our other stuff on. And all the Prof. G. Stuff, which is wonderful. And over time, in our recent renegotiation, we became partners with Vox and they sell our advertising. They help us mount the events, which they're excellent at. And Scott has his own way of doing things. He just started a great substack. And so it's a really, actually fertile time. But there's all these different configurations and I would say for people to understand. I have met with James Murdock and his wife Catherine, who is also very involved in this. I have nothing but good feelings for them. I don't have good feelings for his father. Neither does he. Which has been well documented. And so we have complete freedom to do what we want. We own these podcasts that we have. Scott Owens, his, I own mine. And we own Pivot together in a death grip to the end for whoever, which one of us survives. And so we'll keep doing what we want. And we really like working with Jim and now this other Jim and the rest of it. And we hope there'll be more synergies between them. We're not a total believer in all synergy, but they've got some cool things like Art Basel and a number of Trabeca Film Festival. Tribeca Film Festival, which I'll be at, interviewing Marc Maron on stage. And so there's lots of opportunities here, but most of the. Mostly it's not going to change from, you know, not going to change our deal. We like the deal we got. We again, own our things. And so we're happy to take suggestions from, you know, the same thing. Like Jim will suggest something. We will either ignore him or we'll not like. He might have a. He just had a great idea this morning for me and I'll take it. So. And I really do think of James Murdoch has always been very smart digitally. I think I like him. You can't just put Murdoch on it and say they suck. I would agree about Rupert Murdoch. I would not be owned by Murdoch and we're not owned by anyone. So I think that's it. Anything else?
- [11:11]
Scott Galloway
Oh, when Reuters called me, I said, look, we like the gyms and we have a lot of power here and we didn't ask for anything. We just asked for everything to stay the same. I sell Pivot is a joint venture between Swisher Galloway and Vox. You own on. I own Prof. G. But both on and Prof. G uses Vox for. We do a revenue split where they sell our ads. And if we could. I mean, this is gonna sound self absorbed, but it's true. We could have killed this deal and we didn't. And we didn't ask for anything extra. We just said, yeah, we just want things to stay the way they are. And Jim Bankoff has never once asked me to tone it down, to stop the dick jokes, to reconsider.
- [11:53]
Kara Swisher
I have, but.
- [11:54]
Scott Galloway
Doesn't matter. No, you have, but you're trying to save me from myself. And you're also posing for your woke friends.
- [11:58]
Kara Swisher
Oh, stop it. You're so much woker than I.
- [12:01]
Scott Galloway
No, anyways, I'm so much woker than you.
- [12:03]
Kara Swisher
I'm the w. Get a tear.
- [12:05]
Scott Galloway
But let me go to just some of the learnings here. Basically, the business model for tech has been have great technology, find a very compelling leadership team that's able to craft a narrative to raise more capital than anyone else, deliver an unbelievable product at below price, and then consolidate the market, and then start sucking the oxygen out of the entire ecosystem. So let me give you an example. And then everybody else gets crushed. Google And Meta have been increasingly pushing users away from external sites in favor of their AI overviews, which they can monetize. So HuffPo, between 2022 and 2025. So basically the last three years that we have data on this, HuffPost's organic search traffic has been cut in half. The Washington Post down by nearly half. Business Insider has seen their organic traffic cut in half. NYT organic search, as a share of their total traffic fell from roughly 44% to 36.5%. And the wall Street Journal's organic search as a share of their total traffic fell from 29% to 24%. And let me just go back in history and pat myself on the back. In 2006, when I joined the board of the New York Times, in literally my first meeting, I said, they said, okay, you're the digital guy. What should we do? And I'm like, shut off Google. Don't let them crawl your content, because eventually they're going to commoditize your content. Stop driving traffic to us, and all you're doing is building them into the ultimate toll booth. And Martin Nissenholtz, who's a very smart guy, said, well, if we can't figure out a way to compete against Google and we're making money from the traffic they send us, then shame on us. I'm like, yeah, go to Murdoch, go to the new houses, go to the Financial Times and consolidate and turn off Google and then license your content to the highest bidder. And at that point, Microsoft had Bing and we would have been able to get a lot of money and say, look, if you want to crawl this gorgeous content from Thomas Friedman and from Vogue and from the ft, you got to pay us. But instead they said, no, we like the traffic. They were pursuing this Eyeballs thing, and now it's way too late. And these companies are the Internet, and very few people go directly to NY. Thenewyorktimes.com they get served stuff on Meta. That's how they decide where they're going. Or Google is now entirely. They don't take you to the best place. They take you to a place they can further monetize. And Jim, you know, Jim has managed to get on the last helicopter out of Saigon. Oh, wait, do you want to hear some of the threads I thought of? I was thought, I'll test the limits of our new ownership. I was walking around Lisbon yesterday, and it was beautiful, and I was bored. So as soon as I saw the announcement, I thought, I'm going to test the limits of my Freedom. My first thread, My first thread was alternative media is like a vegan restaurant. Virtue signaling loses money and a billionaire bails you out. That was my first one. My second one was that. That picture of Jim Bankoff and James Murdoch where it looks like the 30 year reunion of Abercrombie and Fitch. They're both very handsome.
- [15:13]
Kara Swisher
They're very handsome.
- [15:14]
Scott Galloway
And I wrote Romeo Michelle's high school reunion two post transition. And that one I'm especially proud of.
- [15:22]
Kara Swisher
Oh, okay, Last one in the week.
- [15:24]
Scott Galloway
What was my third one? Oh, God. I wrote something about, I don't know, but it just been late. Late stage capitalism. But anyways, and then I started doing it and I'm sitting there in the park and I'm like, do I really need to be an asshole?
- [15:39]
Kara Swisher
Not today.
- [15:40]
Scott Galloway
Tomorrow.
- [15:41]
Kara Swisher
Tomorrow.
- [15:41]
Scott Galloway
And I give them their moments.
- [15:42]
Kara Swisher
Give them their moment.
- [15:43]
Scott Galloway
Give them their moment before. Before we start making their lives difficult.
- [15:48]
Kara Swisher
No, you know what? Let me, let me just end this. We've got to end this. So two things, Jim. He said we don't. We can say whatever we want. I don't see that problem from James Murdoch or gather at all. They might be irritated by us, but there's no going to be no change in that. And let me be. I hate to say this, but Rupert Murdoch never asked me to change a thing like that is one thing I never experienced when I worked at the Walls. I just don't. I think he's a heinous. Well, I think he's heinous the way he's done Fox News and the other stuff, but. And has degraded democracy quite a bit. But he's not. James is not him. And so. But that said, Murdoch never meddled in my stuff and he certainly could have for my entire time there. I just didn't like him. But one of the things we have to say, we get to do what we want. We will do what we want. And also just. I know Scott was sort of putting sort of an ugly picture on it, but actually New York magazine is profitable. So are the podcast networks are doing great and very profitable. A lot of these websites are. So it's not like, it's just not a, like a. It's not a crazy business, but it's not. These are not suffering properties. And last of all, a lot, many of them, most of them provide amazing journalism. And I think David Haskell deserves all due credit for New York Magazine winning that award. And awards are one thing, but they certainly, they were up against some amazing journalism this year from the Atlantic and from ProPublican, Wired. So they're very good property. He's bought some good properties here in that reg. Not. They're not falling knife properties.
- [17:18]
Scott Galloway
They make money. But the crown jewel, shockingly of all this is the podcast. New York magazine is a vanity asset.
- [17:26]
Kara Swisher
It is, but it does. Okay. It doesn't. It's not. It does.
- [17:29]
Scott Galloway
Fine. You become one of the sexiest men in soho when your rap is, I own New York magazine.
- [17:33]
Kara Swisher
We're gonna stop there. It's very. It's great journalism too.
- [17:36]
Scott Galloway
Okay, that's great. So is npr. It doesn't make any money.
- [17:41]
Kara Swisher
Yeah, but this one does. So anyway, speaking of not make any money, let's talk about some IPO news. Some really not any money. SpaceX has filed an IPO prospectus and it is revealing while the company brought in $791 million in profit in 2024, it swung back to $4.9 billion in losses in 2025. For context, 200 companies in the S&P 500 had more revenue than SpaceX last year, including Tesla. Also revealed in the. By the way, they buy a lot of stuff from Tesla, so there's a lot of round tripping happen at these companies, all controlled by Elon Musk. They also revealed in the filing anthropic is paying SpaceX and thank God for it, $1.25 billion per month through May 2029 as part of the compute deal. The two sign meaning Grok will not be using that space in Colossus 1 and 2. SpaceX is reportedly targeting a $1.7 trillion valuation. I mean it goes on and on and on. A lot of these. A lot of words like human, I don't know, like connection. There's AI mentioned a lot. Just it's. This business is not economically and mass speaking, it's not worth 1.7. I mean it's just the Elon, that guy gets a lot of credit for using this number because even the stuff they're promising seems problematic. But he hasn't done it before. He just moves from one lily pad to the other in terms of from Tesla to this. But the big winner in this that I read is Starlink does great. The others Grok and the rocket company is not so much. Go for it.
- [19:18]
Scott Galloway
I got a lot.
- [19:19]
Kara Swisher
Okay, good. I can't wait. I'm excited.
- [19:22]
Scott Galloway
Yeah. What was. Spit it out at 3am I was reading the S1.
- [19:26]
Kara Swisher
I know you were.
- [19:26]
Scott Galloway
What were you doing? So first off, I have some notes here. The first 14 pages of the S1 are pictures of rockets. AI is mentioned 1200 times in the S1. There are 277 pages of the prospectus. For context, it's longer than the Great Gatsby and the Catcher in the Rye. And some direct quotes from the filing. These are direct quotes. We do not want humans to have the same fate as dinosaurs. Well, thank God you're here, Elon. For decades, a reality where humanity travels between the planets and the stars has felt tantalizingly close. But still.
- [20:01]
Kara Swisher
Would you mind if I ate my protein powder where you do this? Because I'm hungry and I also am fascinated. Keep going.
- [20:06]
Scott Galloway
For decades, a reality where humanity travels between the planets and the stars has felt tantalizingly close, but still locked in the pages and screens of science fiction. The sun contains approximately 99.8% of the solar system's energy. And as a result, we believe it is the only truly scalable solution to terrestrial energy constraints in the age of AI. Oh, Jesus fucking Christ. All right, hold on.
- [20:30]
Kara Swisher
Talk about woke up.
- [20:31]
Scott Galloway
We believe the next paradigm shift for humanity is the creation of a resilient, perpetually expanding, space faring civilization.
- [20:38]
Kara Swisher
Ultimately, I have a sexy voice. Please, I mean, I need more sexy.
- [20:41]
Scott Galloway
Ultimately preparing us to Kardashev type 2 status defined in the filing itself as a civilization that harnesses the full energy output of the sun. Remember, Wework. Its mission was to elevate the world's consciousness. That sounded grounded.
- [20:56]
Kara Swisher
Yes. No, this seems like it sounds like a Mayan. He sounds like a Mayan. But go ahead.
- [21:00]
Scott Galloway
So let's talk about the numbers here. Headline valuation, 1.8 trillion. They're whispering. They can go out at 2. That's roughly the GDP of Canada. So let that marinate. The core business is genuinely an excellent business. Starlink generated 3.26 billion in revenue in a single quarter with 1.2 billion in operating income. That's 36% operating margin on a monopoly satellite Internet business with no serious competitors in sight. It's a great business. If this were the whole company, it would be one of the great businesses of our era. But the problem is it's not stapled to this rocket ship. Is XAI a business that is, clinically speaking, a money furnace? In 2024, XAI lost 1.6 billion on 2.6 billion in revenues. By 2025, losses ballooned to 6.5 billion on 3.2 billion in revenue. So revenue revenue went up 20%, but losses went up 310%.
- [22:02]
Kara Swisher
Can I ask you quickly? These revenues don't seem like killer. It's 30%. It's not like wow. They're not wow growth. Right? It's sort of good, solid. Am I wrong there?
- [22:13]
Scott Galloway
No, it's. Well, let's just talk about SpaceX, the best business. It's growing 20% a year and it's trying to go out at 100 times revenue. When Google went public, it was growing 240% a year and went out at 10 times revenues. So just back to Xai Xi is losing money on the way to losing more money. And in Q1 2026 alone, the net loss of 4.3 billion on 4.7 billion in revenue total CapEx 10.1 billion in 90 days, 7.8 billion of that for AI cash on the balance sheet cratered from 25 billion to 16 billion in just three months. They burned 9 billion in cash in a single quarter. That's $100 million a day. That's not investing in the future, it's the future. Billing you in advance.
- [23:05]
Kara Swisher
Right. This anthropic thing is critical. Do you think he's moving into being the infrastructure player rather than the AI player here?
- [23:12]
Scott Galloway
No, it's him having spent too much capex thinking that it Xai his AI would need it. And he woke up and realized he didn't. It's like this has happened to me. A million. Every time I start a company, I raise too much fucking money. I go get a giant office space in soho and before I know it, I'm renting it out to a bunch of shitty startups to try and recoup some of the capital. That's what happened here. Total debt on the balance sheet.
- [23:35]
Kara Swisher
Thank goodness for that, right? Presumably from the anthropic money.
- [23:38]
Scott Galloway
Total debt on the balance sheet is 29 billion. So just for context, that's more debt than it's on the Delta Airlines, United Airlines and American Airlines combined with all their planes and those they carry passengers. SpaceX has Starship, which has cost over 15 billion in development and is still on its 12th test mission. So look, the bottom line, you're being asked to pay 1.75 trillion for a great satellite Internet company. A rocket business that loses money. An AI product losing $6 billion a year and falling further behind its competitors, that has 29 billion in debt and a CEO who, and this is my favorite part of the filing, purchased $131 million of his own recalled cybertrucks with company cash.
- [24:27]
Kara Swisher
He's propping up Tesla. Propping up Tesla, that's right.
- [24:31]
Scott Galloway
So in sum, Starlink Is the golden goose, an amazing company. Everything else is Elon's hobbies. And at this valuation you're paying full price for all of them. So you know Snow White is fucking hot, but you gotta, if you marry her, you're taking on these little non value add weirdos. This is so this company, you have an amazing company buried in all of these other money furnaces, right? And he's asking you to pay essentially a hundred times revenue.
- [25:07]
Kara Swisher
And people will so talk about that because look, it is not. I read it, I'm like, wow, this is not a. There's one good business in there, right? Really good business. And by the way, easy to disrupt that business by the people will come into this business and there'll be more competitors. And so that's my worry about Starlink is like, sure, he has the win for today. It doesn't mean he will have the win forever, just like Tesla. The second thing is, well, it doesn't matter because people will just buy into this and run it up because it's him. And these promises which you left out a little bit here is there's going to be all these robots in your home. There's going to be. He made a lot of promises in this prospectus too about the future. Like you have to assume he's going to kill it in robots. And by the way, I have heard from many people his robot technology is really advanced, but it has to get to people, right? It's got to, got to get to people. It's got to become a product. And so just it feels very hand wavy this entire thing, but I don't think it's going to matter. I mean be a Wall street person and say what would you do as an investor here?
- [26:15]
Scott Galloway
You might want to play it for the pop. But I actually think that there's going to be a ton of people and analysts that will look at this thing. The more scrutiny on this thing, the worse it's going to be for the IPO. And does it go out at 1.8 trillion? I wouldn't be surprised if the bankers try and manufacturer scarcity and it gets a small pop. But I think by the end of the year it's well below a trillion dollars. There's no way to justify this thing is a cash incinerator. And also certain components of the business feel very weworky in the fact that as they grow, they burn more cash. There's no operating leverage even with this
- [26:49]
Kara Swisher
anthropic deal because that's all he can sell. That's right. It's like he's selling the chairs or something. Right?
- [26:54]
Scott Galloway
Yeah. He built out infrastructure that he doesn't need because his AI is not growing the way he thought.
- [26:59]
Kara Swisher
Right, exactly. And he's got it. He's got Colossus. And of course he's facing lawsuits all over the place because he's gonna buy more of these methane engines that's gonna. And trust me that they're gonna put a stop to that eventually. So how would you do it here? People are listening. What would you do here?
- [27:16]
Scott Galloway
I won't tell you what to do because I have been wrong about Tesla. I thought Tesla was a sell in 2017 and it's gone up 8x.
- [27:24]
Kara Swisher
No, you were right, but you were wrong about what people were doing.
- [27:26]
Scott Galloway
I think we have to squarely say I was wrong. Wrong. So the what I'm going to do is if someone called me and no one's going to call me, but if Elon Musk called me and said do you want allocation the ipo, I would probably say sure, and I'd sell it on the first trade. They will manufacture scarcity. Goldman and everybody will tell him, okay, this is what it looks like. Put out press releases saying you're 30 times oversubscribed, it'll get a pop and then get out. Because again, an amazing business can be a shitty investment even at some valuation. And a shitty business can be an amazing investment at a certain valuation. This is an amazing business surrounded by businesses that are not scaling where he's trying to play catch up. And at a valuation that makes just abso fucking lutely no sense.
- [28:16]
Kara Swisher
Glomming Xai in here was a way to save his ass. His own ass. Correct.
- [28:21]
Scott Galloway
So it's the cheapest form of capital he could find by attaching it to an amazing business such that he could try and catch up. And even the amazing business on its own, which is doing 16 billion in top line revenue and 8 billion in EBITDA.
- [28:38]
Kara Swisher
This is Starlink.
- [28:39]
Scott Galloway
Yeah, give it 25, give it 100 times EBITDA. It's worth 800 billion. 100 times EBITDA is. No one trades at that. But you not only are trying to get it out at 1.7 to 2 trillion, you've attached onto it all of these businesses that look to have negative leverage.
- [29:06]
Kara Swisher
And he's using the business to help Tesla out by buying shitty cybertrucks.
- [29:10]
Scott Galloway
Well, that was the most eye popping thing in the whole thing.
- [29:13]
Kara Swisher
I know, I agree.
- [29:14]
Scott Galloway
Was that it reminded me of, and this is the argument against win or when governments decide to start cosplaying business. The Irish government or the UK government said DeLorean is the future and they gave them a bunch of loans. And then these pictures came out of a ton of deloreans sitting in a warehouse in Ireland unsold. So the worst product, arguably the worst tech product other maybe than the Oculus or Siri, the worst tech product of the last decade is hands down the cybertruck. So he went out, a bunch of them recalled and he used money from this organization to buy back cybertrucks. You're not supposed to do that. You're supposed to say, okay, Tesla has a turd of a product and we're going to take a write down and you just take your, you know, you take your pain. This is Elon brings a level of awareness magic people have done investing with him. He is an unbelievable visionary. But you know, this goes to something broader and that is, this is all part of an entity that will cement where I believe we are now. And that is I finally believe we are squarely in 1999.
- [30:27]
Kara Swisher
Yeah, I would agree with you. That's what I felt after looking at. I didn't look at it over as carefully but I thought, oh no, no, no, this is not good. This is, you know, I don't really care about the luminous humanity bullshit and flying to the stars and the sun is going to power our world. I like that's all his. I've had to listen to that nonsense from him for many years and great, I'm glad you think that. I mean I don't really care if everyone, if that's what turns him on, that's great. But it was the Tesla thing. There was several things in here that were very. Speaking of late stage capitalism, I felt it was late stage Elon. Right. That's what it felt like to me.
- [31:04]
Scott Galloway
Look, his job is to get capital as cheaply as possible. He's going to do that. I think it's smart for him to do this. But I think investors. In sum, if you look at what happened. So there was a really interesting analysis done in the FT and that is at the peak of the dot com boom about 60% of GDP growth was coming from capex related to telco infrastructure and the Internet. It's now 93% is coming from AI including loosely and also these companies would be grouped into that. In addition, the total Capex inflation adjusted was about 850 billion in 99 up until that point. Now we're at about one and a half trillion and every time you have over 2 or 3% of GDP going into the build out or capex of something, whether it's railroads or highways or the telco infrastructure of the late 90s, two years later there's a crash. Two to three years later there's a crash. Railroads, all of. But we are there. And one of these companies, or more of them is going to experience what every big tech company has experienced when they get out over their skis. And that is you're going to see a 70 to 95% decline in the value of one or more of these companies. Nvidia, I mean all these companies, there's the expectation of they're increasing their CapEx 20% a year while increasing their revenues, optimistically 15% a year, that's negative operating leverage. And eventually the music's gonna stop here.
- [32:37]
Kara Swisher
Yeah, I felt Drunken Sailors had a feel of this. I don't know.
- [32:40]
Scott Galloway
The way I would describe it is I think Nvidia is a casino and we're all drunk people at the blackjack table asking for it.
- [32:47]
Kara Swisher
And it will affect very good businesses. And then along with the tariffs and all the other corruption around Trump, it just gets to be a real problem here.
- [32:55]
Scott Galloway
Nvidia's an amazing business. SpaceX is an amazing business. They should, oh my God, they should be working worth, they should be worth a trillion dollars and $300 billion respectively. So down about 50 to 80%. And the technology, I think the technology will live up to its expectations, more on the optimistic side than the pessimistic side. But the valuations won't.
- [33:16]
Kara Swisher
All right, well, Speaking of which, OpenAI is preparing to confidentially file a draft of its IPO perspective as soon as Friday. I expect you to read it over the weekend and tell me about it next week. As you're listening to this, the company is valued at over $850 billion by private investors. The things I'm looking all across investments with Altman involved, I'm probably interested in that. Where the trends are in terms of their subscriptions and where their spend is, I think those are the things I'm looking at. What are you looking at there very briefly?
- [33:46]
Scott Galloway
Well, just to distill it, to justify the $1 trillion valuation that OpenAI is pursuing at its IPO, it needs to grow from 13 billion in revenue to the size of today's Microsoft in four years. So they're saying they're going to be the size of Microsoft in four years. And I just don't think revenue did triple to 13 billion. But the company burned 9 billion. And right now it has negative momentum relative to anthropic. And what they have said is, get out right away. We need the perception that we're the leader. And also, Sam Altman looks at SpaceX and says, there's not room for. There's only so much retail money that's going to come into the ecosystem. Get out. Because it's going to dry up. Because if SpaceX goes out of pop and comes down, retail investors are going to start to get queasy. And then when you have these enormous IPOs, in other words, at some point retail investors are going to run out of money to invest in these things. So he's like, get out. And the cfo, Sarah Fryer, who I'm shocked, still has a job because she's not towing the company line. She worked at Goldman and McKinsey has reported previously to colleagues at OpenAI saying, We're not ready for an IPO because the risk from its spending commitments. And the company is committed to spending 600 billion.
- [35:00]
Kara Swisher
I know her, she's a very. She's like that.
- [35:02]
Scott Galloway
She's like a Ruth Peratt. She's an adult.
- [35:04]
Kara Swisher
Yeah.
- [35:05]
Scott Galloway
The company is committed to spending 600 billion over the five years across vendors. And their Oracle deal alone requires 60 billion a year starting in 2027, nearly five times OpenAI's entire 2025 revenue. Again, this is. Is we are squarely in 99.
- [35:20]
Kara Swisher
99. All right, well, we'll go with that. All right, Scott, let's take a quick break. When we come back, Jeff Bezos. Oh, good God. Speaking of billionaires behaving badly, speaks out on all sorts of things. Support for this show comes from ShipStation. As much as we talk about AI, it's only as smart as how you use it. And real breakthroughs happen when the AI is built to test tackle specific problems. That's why shipstation's AI isn't a general purpose tool. It's specialized, trained on decades of real shipping data and billions of actual orders. Shipstation is an end to end order fulfillment platform for e commerce businesses. Powered by AI, shipstation is trained on decades of data from billions of shipments across the world. ShipStation adapts to your unique business, alerting you when stock is low, recommending the best carrier selections and rates and automating tasks save you time so you can stay one step ahead. With features like inventory syncing across your sales channels, a branded returns portal that helps transform returns into revenue, automatic rate shopping, and integrations with accounting and CRM software, ShipStation eliminates the need for multiple tools in your workflow. The sooner you switch, the sooner you start saving time and money. Get started with Shipstation today and get 60 days free at shipstation.com with the code pivot. That's shipstation.com codepivot shipstation.com codepivot taxes and fees apply.
- [36:47]
Scott Galloway
Today's show is brought to you by Vanguard. To all the financial advisors listening, let's talk about bonds for a minute. Capturing value and fixed income is not easy. Bond markets are massive, murky and let's be real, lots of firms. So a couple flashy funds your way and call it a day. But not Vanguard. Vanguard bonds are institutional quality. Institutional quality isn't a tagline, it's a commitment to your clients. It means top grade products across the board. The Lineup includes over 80 bond funds. They're actively managed by a 200 person global squad of sector specialists, analysts and traders. A lot of firms love to highlight their star portfolio managers like it's all about that one brilliant mind making the magic happen. Vanguard's philosophy is a little different. They believe the best active strategies shouldn't be locked away with one person, they should be shared across the team. So if you're looking to give your clients consistent results year in and year out, go see the record for yourself@vanguard.com audio. That's vanguard.com audio all investing is subject to risk. Vanguard Marketing Corporation Distributor. Support for the show comes from Indeed. When you're looking for talent, Indeed sponsored Jobs can just be the boost you need. It matches you with quality candidates fast, so you don't need to spend months searching for that new hire. According to their data, Sponsored jobs posted directly on indeed are 95% more likely to report a hire than non. Sponsored jobs. Join a 3.3 million employers worldwide that use Indeed to connect with quality talent that fits their needs. Spend less time searching and more time actually interviewing candidates who check all your boxes. Less stress, less time, more results when you need the right person to cut through the chaos. This is a job for Indeed sponsored Jobs and listeners of the show will get a $75 sponsored job credit to help get your job the premium status it deserves@ Indeed.com podcast just go to Indeed.com podcast right now and support our show by saying you heard about Indeed on this podcast. That's indeed.com podcast. Terms and conditions apply. Need the ride? Hire faster? Then this is a job for Indeed sponsored Jobs.
- [38:59]
Kara Swisher
Scott we're back. Jess Bezos sat down for an interview with Andrew Ross Sorkin, our favorite Canadian, on Wednesday let's talk about some of the things he said. First up, Bezos said that Trump was more mature and more disciplined in his second term. The Washington Post owner defended massive cuts he made to the newsroom earlier this year, saying he doesn't want a post to be a charity. I have some things to say about that because I think he's the one that drove it into a wall. Bezos also backed the idea of elimina income taxes for the bottom half of us earners. Let's hear what he said to say about his own taxes.
- [39:28]
Scott Galloway
People sometimes say that, you know, I don't pay taxes. So true. I pay billions of dollars in taxes and it's a perfect. Again, if people want me to pay more billions, right, then let's have that debate. But don't pretend you know that this, that that's going to solve the problem. You could, you could double the taxes I pay, and it's not going to help that teacher in Queens, I promise you. Let's try.
- [39:53]
Kara Swisher
Let's try.
- [39:54]
Scott Galloway
Let's see what happens.
- [39:55]
Kara Swisher
Let's see what happens, Jeff, if we
- [39:57]
Scott Galloway
take his effective tax rate from 16 or 17% to 32 or 34 like the rest of us. I don't know. Let's just give it a whirl.
- [40:04]
Kara Swisher
Let's just give it a whirl.
- [40:05]
Scott Galloway
Let's see what happens.
- [40:07]
Kara Swisher
So disingenuous in this situation.
- [40:08]
Scott Galloway
Let's see what happens.
- [40:09]
Kara Swisher
Let me, let me start and then I'll let you go first up. The more mature. Come on, Jeff. Like, seriously, I get that there's a lot of facework going on and a lot of other enhancements, but it's gone to your fucking head. Like, I get what he means. It's good for me. Instead of saying more mature, more disciplined, as he's more focused on giving me the shit I want. I would just prefer that if he wouldn't mind like, saying that. Whatever. He can say what he wants. He's never been a particularly liberal person, but now he's just, he's just now being just disingenuous. The Washington Post thing drove me crazy because he's the one who kept the same management in place, then hired an incompetent like Will Lewis, did nothing that the New York Times took moves after Trump left office to do something. He, he created all manner of situations where people just, just left, cut their subscriptions, which were, which were slightly growing, but they were definitely stabilizing. And then after he put his dirty little fingers in the editorial process, he messed it up a huge Exodus of talent. Blaming the talent, which then went to successful properties like the Atlantic and many other. And the Wall Street Journal and other places which are doing okay. They're doing. They're. They're making businesses. New York Times, Wall Street Journal, the Atlantic, everything else. So every time he says this, I'm like, why don't you look over at Lorraine Powell Jobs, who's managed to do a very nice job over there at the Atlantic by not meddling and supporting and not los. The income tax thing, I'll let you take. But it was so full of disingenuous stuff. And again, let's try Jeff. Even if you pay billions, you have billions, and you pay the fact that I pay more of a percentage of my taxes than you. And then the corporate. Don't even get me started with corporations. So anyway, the whole thing was. And also, he didn't look well, in my opinion. And since he spent so much time on cosmetic stuff, I feel like I can comment upon that. This. Go ahead.
- [42:08]
Scott Galloway
Jeff Bezos pays himself $82,000, just enough such that he can claim a child tax credit, which, by the way, he takes. And then he puts all of his additional money such that the value of his shares go up. He borrows against those shares, not triggering a taxable event, likely has a lot of those shares in a trust. And then after leveraging the unbelievable infrastructure and culture of the great state of Washington, he then, the post office Every. Takes his $120 billion in shares and moves to Florida to spend more time with his father and then starts selling shares. Now, granted, just as every prisoner has an obligation to escape, I think every individual has an obligation to avoid taxes. I don't blame him for tax evasion. I blame our government for letting him engage in it. But quite frankly, Jeff, when you start trying to wallpaper over the tax avoidance of billionaires by claiming you care about nurses, teachers. Sit the fuck down. Down. Just sit down. This is a misdirect. And it's like when Jensen talks about, yes, tax me more. Okay, thanks, guys. But I just don't think they're in a position when a guy has so optimized the dynamics of supply and demand of labor, such that his delivery drivers have to pee in bottles to make their quotas. You're just not the person to pretend to have empathy for that nurse in Queens. So I'm not even gonna. I'll talk about his idea, but give me the mother of all eye rolls. When Jeff Bezos claims to be concerned about the tax rates of the nurse In Brooklyn, when I've advised or when I was talking to Andrew Yang when he was running for president, Mayor, I said, you fucked up. It shouldn't be universal basic income. It should be basic income. And to get Republicans on board, you need different frame it. Don't call it universal basic income because it sounds like socialism. Call it a negative income tax. Republicans love tax breaks. I do believe there's something to the notion of saying anyone who makes below $50,000 should not only not get taxed, but maybe get a tax credit in the form of services or maybe just cash, quite frankly. Because most of the studies show that when you create a government infrastructure to deploy social programs, they're inefficient and never go away.
- [44:28]
Kara Swisher
Just give them the money. Just give them money.
- [44:29]
Scott Galloway
Just give them the money. Just cut them a check. You're in a household, you have kids, whatever. They did a bunch of studies in Africa and quite frankly, I'm going to be a sexist here. When they give money to the men, the prostitutes and the bars do well. When they give money to the women, the kids get taller and fatter. You couldn't do that in America and just give money to single mothers, which is what I would like to see happen. But if you gave, just gave money, nationalized healthcare, there's a lot of good taxation ideas. What he said was very accurate, is that if you had a tax holiday for people under the age of 30. He didn't say this, but if you gave a tax holiday, which is what he's saying, or cut the taxes of people making less than $75,000, you don't lose that much tax revenue. Because it is true that only 1%, the top 1% in New York, pay 48% of the taxes, and the bottom 25% really don't pay much. So he's right. They wouldn't be giving up much. But he is just not. We need an alternative minimum tax on people like Jeff Bezos of, I believe 60%. Because the earner that's making 2 million bucks working her ass off as a baller partner at Scadden Arps in Manhattan is paying 54. And fine, maybe she pays. Maybe the person making 10 billion or 10 million a year makes 60%. Because here's the whole objective of taxation. You want the least taxing tax. If you started taxing education and food and housing, you end up with homelessness, less educated people, people who put off their mammogram and die of metastatic breast cancer. Those are taxes that are too taxing an Alternative minimum tax on corporations making above a billion dollars and people say making over 3 million a year. They don't lose any happiness. The Bezos. And also do away with the estate tax exemption. If the Bezos children inherit 20 billion instead of 30, no loss in happiness but that 10 billion that could potentially be divided amongst the million. $10,000 to the million poorest households. A lot of incremental happiness.
- [46:32]
Kara Swisher
You know what the contrast was? His ex wife like she doesn't say a word.
- [46:37]
Scott Galloway
My hero.
- [46:37]
Kara Swisher
She doesn't do an interview. She gives me the sun wheels. No ribbon cuttings, no cosplaying, no whatever weirdness you're doing to your body. Jeff just and doesn't lecture us. That's the tone was what was crazy. I know I got like bent out of shape about the post stuff, but all of it had this tone. The Post stuff was disingenuous in the extreme. He's the worst media owner of any media owner. And it's a low fucking bar, let me tell you. I take Rupert Murdoch twice every day of the week and twice on Sunday to Jeff Bezos. At least he understands media and likes it. But you know, the tone was so obnoxious. And this is why this general. You know he talked about people demonizing billionaires. Well, stop. Stop talking. Stop appearing like I honestly it the damage these people are doing to the brand of capitalism. Brand capitalism and brand AI and brand tech is so vast that you can see why these polls are showing up this way. I know my own sons who both are incredibly hard workers and it has nothing to do with me. They often don't listen to me. They don't listen to anything I do at least. And I'm fine with that. But they have these feelings, right? It's just. I don't know. And then it gives rise to too much demonization. Right. Because of the way these people behave. So I don't know.
- [48:05]
Scott Galloway
So I have stories about. About Mackenzie Scott and Melinda French Gates. I'm involved in two nonprofits. I'm involved in something called the Jed foundation that tries to train high schools around how to identify what is kind of normal, strange adolescent behavior and adolescent behavior that should raise red flags around depression and suicide. And they leverage the infrastructure of public schools and educate them. And they are amazing. It was started by a couple that lost their son Jed. It's run by this wonderful management team. They do a great job. I got right after, right after I sort of got involved, they called me and said they did a big thing event and we got great News. I'm like, what's that? And he goes, we got a $10 million wire yesterday and we're trying to figure out who it's from. Mackenzie. Scott didn't want an rfp, didn't want to meet with them, didn't want her name on anything. She just wired 10 million bucks. And then another association I love, the American Institute for Boys and Men, which focuses on the struggles and mental health of young men and boys, run by one of my role models, Richard Reeves. Melinda French Gates. $10 million, recognizing the majority of her funds are focused on the struggles and gender equality and struggles of young women. But she said, without thriving young men, women aren't going to continue to flourish. And she just sends 10 million bucks. And then someone who shall remain nameless contacted the firm. Firm. And I get it. He's trying to be. Or contacted one of these companies and said, can I meet with so and so and Scott? I want to hear about the strategy. And I'm like, typical fucking rich dude. We gotta go sing for our supper. We gotta like go talk to him as if it's a business. And return on investment. Whereas these women are just like, you're doing good work. Excellent.
- [49:49]
Kara Swisher
Here you go.
- [49:49]
Scott Galloway
Get back to work.
- [49:50]
Kara Swisher
You don't hear from them, God be with you. They definitely check you out. But it's not. It is. It's such a different way of giving. I couldn't dislike Jeff Bezos more after this interview.
- [49:59]
Scott Galloway
He was dumb to do the interview.
- [50:01]
Kara Swisher
I thought. I honestly thought Sorkin could have. Could have pressed him harder. Honestly, I didn't think Sorkin pressed him hard enough on this stuff and let him get away with some stuff that I wish he had. But that said, we got to see him the way he is. And that is the way he is, folks. So.
- [50:15]
Scott Galloway
And let me go to the. Let me make the conservative, or at least give some sunshine the conservative part of this. I can't stand it when people on the far left say Jeff Bezos didn't earn his money.
- [50:24]
Kara Swisher
Oh, he did.
- [50:25]
Scott Galloway
Because he was born to a single mother at the age when she was 17. I believe he deserves to have earned $120 billion. I think we deserve to elect people who have the backbone to tax him at 60 or 80%.
- [50:39]
Kara Swisher
Yep.
- [50:40]
Scott Galloway
But don't slow him down.
- [50:41]
Kara Swisher
Right.
- [50:42]
Scott Galloway
He's not a bad person. He's doing what we all do. He's optimizing for his own self interest. You may say he's more self interested than some people. People, fine. We're not doing our job. Elizabeth, Elizabeth Warren and Bernie Sanders. You've been in Congress for fucking ever and the taxes keep going down under your watch.
- [51:00]
Kara Swisher
Yeah, let's do something.
- [51:02]
Scott Galloway
You want to demonize him? No, tax him.
- [51:04]
Kara Swisher
Tax him. That's the best way. Like, hey, look you, whatever you want to do. Now let me switch to another billionaire because this was something that happened. We have not said a lot. Some of our listeners are not going to like what I have to say here and I don't really care. But I do care. But I don't care. Unexpected sighting in D.C. this week. Mark Cuban standing alongside President Trump. Cuban endorsed Kamala Harris was a big supporter in 2024 and it's been one of Trump's most vocal critics. But the two appeared together as the. Trump announced a major expansion of Trump Rx's administration's online drugstore. The site is adding more than 600 low cost generic medications through partnerships with Cuban's Cost plus drugs, Amazon Pharmacy and Goodrx. At this event, Trump was asked about his new alliance with Cuban. It's only on this issue just for people to be clear. Let's listen.
- [51:53]
Scott Galloway
It's pretty remarkable seeing you and Mark
- [51:55]
Kara Swisher
Cuban up there and the fact that
- [51:57]
Scott Galloway
obviously Mark endorsed Kamala Harris back in 2020. Well, he made a mistake. It was a big.
- [52:03]
Kara Swisher
What does this say about what you two are building here?
- [52:07]
Scott Galloway
Well, it says we love people, we love our country. He wants to, he's got a good company and he's going to do a lot of business with this and I'm going to get drugs out through Amazon, through the whole group and we're going to get drugs out. And Mark wanted to be a part of it. And I think Mark was very gracious. He said this is something that really works.
- [52:26]
Kara Swisher
Cuban later posted on X. If anyone thinks I'm going to put politics ahead of helping Americans reduce their cost of health care and pharmaceuticals, they're a fucking idiot. He took that down because he thought swearing undercut his argument. He's probably right. Let me just say a few things. The stuff out there about him making a bank or he's mobbing up with Trump is just not true. You don't have to like that. He stood there. I get, get it, I get it. But he, this, this business is to get drug prices down. He does not make a ton of money here. This is more, it's not a charity either. He's trying to build a business. But this, the, the stuff that's out there about what he's doing is just inaccurate. And it's not if you don't like him standing there and you think he betrayed you. And I saw a lot of these. I now can't like him. I thought he was a good guy. He is a good guy guy. He is doing something that I'm sure makes him deeply uncomfortable for a very good thing, which is to bring lower prices. He's got to get in this Trump rx. He essentially took control of Trump Rx in a weird way, because you've got to get these things if Trump is doing this site. And I hate that Trump's name is on it. I hate it. But look, he's an ego Mainer who puts his name on every fucking thing and there's nothing we can do about it. And if he sat up there with Biden, you'd love him for it or whoever, a Democratic president, and he would sit up with anyone. The only thing I would say was that I'm not sure he got gretched. I sent him a note. I said, you just got gretched. When he first he started Talking about this $1.776 trillion slush fund for people who. Criminals who attacked the Capitol. I don't know. He got gretched. He was sitting there when Trump was going on about something that's obviously illegal and also a slush fund. I don't know what would he. Should he walk out? Should he leave? I don't know. He did laugh at that. You voted for Kamala Harris. I'm not sure what you do in situa. Should he have sat there and said, I still would. I don't know. He would have gotten lost out this deal. I don't know. And it's not great to have to stand with Trump. We get it. We get it. I wouldn't do it, but if I had something that mattered a lot, I might. And the only other thing I would say is Zoran Mandanmi went there, there and stood right next to Trump, and everyone praised that. And I. The difference was, is. But he didn't insult Trump and he didn't, like, slap him or do anything rude. He also didn't say much and he didn't get gretched. And so he needed something for New York and he got it from Trump. And so I'm not quite sure what the difference here is, because that's what I think was happening here with Mark. And you can hate on me all you want saying, I love the billionaire, but I think what he's doing is an important thing for bringing drug prices online. And you cannot wait for three years to do so. Your thoughts, Scott?
- [55:14]
Scott Galloway
If your emotions and political partisanship trump the health of Americans, then the problem is you, not Mark Cuban. The partnership between Trump RX and Cuban's Cost plus drugs will unlock cheaper prices for millions of Americans. This week's expansion adds 600 generics, nearly seven times the previous catalog. They'll be available to anyone, regardless of insurance status. And in many cases, the cash price through Costplus is actually lower than what insured people pay at the pharmacy counter. After CO pays, CostPlus drugs sells the cancer drug, I believe it's called atanaminib for $17. The same drug runs over $2,000 at conventional pharmacies. Three PBMs, OptumRx, CVS, Caremark and Express Scripts control roughly 80% of the US drug access and are untouched by this deal. Deal. Look, something has to change and I respect and the US government has a scale and capital that no one can match. And if you have something that's good for America that requires that scale and that capital, you act like an adult and you go there. So if you think that Mark Cuban sold out, then all right, you go buy people's cancer drugs. I can't imagine Mark enjoyed this. But helping people get access to life saving drugs at a reasonable value is more important than him getting dragged by a bunch of bots and people virtue signaling and applying purity tests from their keyboard.
- [56:53]
Kara Swisher
Right? I would agree. You just didn't have the right information. The inaccuracy is what drives as always, inaccuracy desires me. And to say that he's gonna make bank at this is just not true. It's just absolutely not true. And you, I wouldn't want to have to do this. I don't know if I could stand next to him. But he's there for the next three years and someone needs these drugs now. And if he has to take the reputational hit, that's fine. I guess that's fine. The fact that you're dragging him is a pro. I understand the and I don't want to in this case for the first time I thought derangement. Don't be so fucking deranged that you don't understand what Marc just did, which is he had to like put, put his like ego in his pocket. He remains, by the way, Mark is not, I would say he's liberal or conservative. He's quite. It can vary all over the place, but there is absolutely no way Mark Cuban would vote for Trump at this moment in time or support Trump politically. So I don't know what you want from him, but to me, I thought it was just a bad look for the left. I thought I really did. I just was sort of disappointed, very disappointed.
- [58:06]
Scott Galloway
So.
- [58:07]
Kara Swisher
But they're going to drag us for it, so too bad. I don't care. All right, Scott, let's go on a quick break. When we come back, we'll talk about Nvidia's latest earnings. Support for this show comes from npr. NPR understands your curiosity is boundless, but your time isn't. That's why they made up first. Up first is a podcast that covers the three biggest news stories of the day with reporting and analysis to understand them in under 15 minutes. Look, there's no shortage of news right now, but Upfirst doesn't just give you the headlines, it gives you the context. Recent episodes covered how American citizens are getting caught in ICE's growing surveillance web and what the Iran war means for the U.S. economy and why Attorney General Pam Bondi's exit is bigger than it looks. Three stories, fully reported every morning in under 15 minutes. Up first does something most daily news shows don't it asks better questions to get better answers. Now, not just what happened, but how it came about, why it's a big deal, and what happens next. That's the difference between knowing the news and understanding it. Follow NPR's Upverse podcast so you can understand what matters and what happens next. It's hard news through a human lens, and while you're at it, give money to npr. They're fantastic and everything they do is something I hugely admire as a journalist. Hi, I'm Maria Sharapova, host of the Pretty Tough podcast. Each episode, I sit down with high achieving women to discuss the pursuit of excellence without apology. This week on the show, comedian and best selling author Chelsea Handler gifts her tips on independence and aging gracefully. I would argue that 50 now that I am 50 and I understand life more than I did when I was 30 or 40 is that you get so much more wisdom and you get so much more experience that you actually feel like you're beginning again. Check out pretty tough new episodes on Wednesdays. You can watch it on YouTube or listen in your favorite podcast podcast app. I'm Mitch, first two time indivisible champion, championship MVP and forward for the US Women's National Team. Before I went pro, I graduated from Harvard with a degree in psychology, which comes in handy more than you think. Any athlete pursuing greatness knows there's a certain mentality you have to have what people don't know is what that costs. In my podcast, Confessions of an Elite Athlete, I sit down with the best athletes in the world and explore the psychology, mindset and unseen battles on the path to greatness. So take a seat and learn from the Confessions of an elite athlete on YouTube or wherever you get your podcasts. Scott, we're back with more news. Let's talk about Nvidia's latest earnings. You just called them a casino. The company's profit for the quarter was over 58 billion. They're benefiting from what's happening now, which is up 211% from a year earlier. That is a number. It's not 30%, it's a lot. Three years ago, profit was 2 billion. Nvidia projected sales in the current quarter would reach 91 billion, as spending on AI infrastructure would reach 2 to 3 trillion in 2030. This is an insane growing streak, but like you said, they're benefiting from this huge spend by all these other companies. Thoughts very quickly.
- [61:25]
Scott Galloway
Well, not a casino. They're the house. And all of these companies spending just a crazy amount of money on 1.6 trillion on capex are kind of drunk gamblers is the way I would describe it. And they're benefiting from it. They're the house. They're the house. When billionaires show up sharks who are drunk and have unlimited credit at the casino, that's the way I would describe it. But just in terms of the earnings, the revenue was $81 billion, up 85% year on year, which was a beat. Earnings per share was a beat. Data center revenue, $75 billion, up 92%, as you said, year on year, accounting for 92% of total revenue. Again, a beat. Their Q2 guidance, $91 billion above the $86 billion expectations. Another beat in their shareholder returns. Dividend was raised 25x from $0.01 to $0.25 per share. $80 billion in new buybacks authorized. And I mean, the reason he's on that plane to China is there's no shipments right now. And he looks at the stock price and thinks, I have got to continue to beat. And the only thing that I found really interesting here was despite beating on every conceivable metric, the stock was flat. Which says to me that the expectations of the stock price are so enormous now that that people don't expect Nvidia to beat, they expect them to massively beat. Which says to me that the first time Nvidia even whispers things might be slowing down, it craters. So unbelievable. Company 15th beat in a row. But I just think the expectations that are built into this valuation, I think it's the most valuable company in the world now, are pretty significant, as evidenced by the fact that it beat on every conceivable metric trick and the stock didn't move.
- [63:09]
Kara Swisher
Right, Right. That's interesting. That's a really good point. Anyway, we'll see. We'll see what happens. There's a lot. It's. It's precarious. It feels precarious is what I frag.
- [63:17]
Scott Galloway
By the way, stock's off 2% today.
- [63:19]
Kara Swisher
Yeah, but let me see. A lot. Several different Wall street people called me and they said everything feels so fragile. So we'll see. All right, Scott, one more quick break. We'll be back for predictions.
- [63:33]
Scott Galloway
Whatever your thing, it could be anything. Canva helps you make that thing. Thing a thing. Canva is a simple online tool thing. It's a way to design, with our magic AI tool, things you can social media your thing, generate images or videos of your thing, make decks or presentations to show your thing, whatever needs to be done for your thing. Canva can make it an even better and bigger thing. Canva, the thing that makes anything a thing. Okay, so today we're driving to southern New Jersey and heading to a data center. Couple weeks ago, I read a story in NJ.com and it was all about how there's a data center going up in Cumberland county, the poorest county in New Jersey, that's receiving some community pushback. And this immediately got my attention because data centers are going up all across the country. I feel like we should be hearing politicians talk more about this, but we haven't really heard a consensus. Are data centers really a necessary evil? Well, let's find out. This is technology we've never seen before, right?
- [64:40]
Kara Swisher
Experiment. We're gonna experiment down here. And we're the guinea pigs. And we're the guinea pigs. Exactly.
- [64:46]
Scott Galloway
One thing that happens in this country is there's no planning for the future.
- [64:51]
Kara Swisher
Is it benefiting people, or is it
- [64:53]
Scott Galloway
benefiting the elite and the money that's
- [64:56]
Kara Swisher
going into their pockets?
- [64:57]
Scott Galloway
This is not about abstract politics. It's about people's everyday lives. That's this Week on America actually.
- [65:03]
Kara Swisher
Why is this? It's still, like, burning inside of me that I feel like I am missing something. I prayed so hard for my girl. I prayed like every night. Prayed, prayed, prayed. And when I lost my babies, it was so hard so that when I had them, I thought that was going to be the thing. Like, I am finally getting the thing that I prayed for. And it's going to fulfill me. And this is everything I want, want and more.
- [65:29]
Scott Galloway
And it was.
- [65:31]
Kara Swisher
But it was also something missing. I'm Ravin Arson and this is the remix from Project Swagger. This series is about defining our own versions of motherhood. I am bringing in a mama I adore and admire, my friend, fellow peloton instructor Kirsten Ferguson. Listen now at the end, Project Swagger. Okay, Scott's bringing you predictions in a second. We're going to be off on Memorial Day for Tuesday. We'll be taping a show on Memorial Day for Tuesday, but we'll talk about these laws banning prediction markets. And the Trump administration is suing Minnesota after Minnesota became the first law banning prediction markets from operating in the state. But we'll talk about that all next week. Go ahead.
- [66:24]
Scott Galloway
We talked about, about late state or 99, but I just can't help it. I don't think SpaceX is going to price near $2 trillion.
- [66:32]
Kara Swisher
Okay.
- [66:32]
Scott Galloway
The financials suggest otherwise.
- [66:34]
Kara Swisher
Like that. You're going for it.
- [66:35]
Scott Galloway
Well, you're going to have so many people pouring over this S1 and it's just pretty ugly. You just read this thing and you start thinking, okay, this feels a little bit, you know, ayahuasca. It just, it's a lot. And if, and if you take each of the three business lines, space, connectivity and AI, and apply a comparable price to sales multiple to each Rocket lab for space, viasat for connectivity and Anthropic for AI, which are very generous, you know, healthy valuations, and you add them up, you end up with a valuation of 547. Bill, my hero on this stuff. Aswath Damodaran valued the thing at 1.1 trillion. And if you double each of those price to sales multiples, you assume that each business will command evaluation. That is two times the typical market rate, you are still about $750 billion away from SpaceX's projected valuation.
- [67:34]
Kara Swisher
Yeah, that's being kind.
- [67:36]
Scott Galloway
You're saying if you just get very aggressive and value every piece of this as a leader in its respective field
- [67:41]
Kara Swisher
and add The Elon Musk plus, you
- [67:43]
Scott Galloway
get 600 billion and then you go, okay, Elon effect, double it 1.2 trillion. So I've always been wrong around Elon, but I'm saying I think 2 trillion is a real stretch for here and it's going to price below that.
- [67:55]
Kara Swisher
All right?
- [67:55]
Scott Galloway
And then the other one is just boring one. I think you can expect a deal between the US and Cuba in the coming months. Cuba is currently in a Full blown crisis. I absolutely think the smartest thing we could do is be providing humanitarian aid and let people decide that they want to be the 51st state or at least get along with it.
- [68:12]
Kara Swisher
Us.
- [68:12]
Scott Galloway
Yeah, I agree the collapse is comparable. It's not getting any news because of everything else going on, but the collapse is literally comparable to the 1990s crash that followed the fall of the Soviet Union.
- [68:20]
Kara Swisher
Yep.
- [68:21]
Scott Galloway
Between December of 2025 and April of 26, Cuba received just one of the eight monthly fuel shipments. Its economy's required requires to function. And blackouts are now, get this, 20 hours a day.
- [68:33]
Kara Swisher
I mean, it's crazy. No, we should just help them become part of the world again, 100%.
- [68:41]
Scott Galloway
But there's going to be a deal here. Because Rubio is reportedly having secret talks with Raul Castro's grandson, bypassing official Cuban channels. Trump told reporters in February. Cuba wants to make a deal. Just yesterday, Rubio sent a video message to the Cuban people proposing 100 million in aid and blaming Cuba's leaders for shortages of electricity, fuel, and fuel. Rubio was born to two Cuban immigrants and this is a deal that he has personal investment in. He sees this as his run, his next, his next ticket on his run for president.
- [69:09]
Kara Swisher
It will win back all the people.
- [69:11]
Scott Galloway
Sets him up well for a 2028 run. Cuba is in a deep dark corner. And also Trump, he doesn't want another military excursion. There's just, there's no fucking way.
- [69:20]
Kara Swisher
There's a way to do this. Just let it fall apart and we come in and help pick up the base.
- [69:23]
Scott Galloway
It's already, well, it's fallen apart.
- [69:25]
Kara Swisher
Right. You know what I mean? It's like, you know, interestingly, I agree with you here because I do think it should be welcomed back into the nations. It's. I've always wanted to go there, you know, my, my, actually everyone in my family has been there but me, which is interesting there.
- [69:39]
Scott Galloway
It's great.
- [69:39]
Kara Swisher
Yeah. I just feel like it's wonderful people and it'll help Rubio immeasurably. This is at the heart of his presidential camp. You understand that, like it's very clear for at least for Florida. And one of the things, speaking of collapse, I've heard from so many foreign affairs people who I really trust and think are smart, that Russia is very in much distress. Putin is under much stress right now because of the situation in Ukraine, the economy, everything else. And that they had thought this is the first time they see a light at the end of the tunnel. Putin's rule. Just saying that. Just putting that out there.
- [70:19]
Scott Galloway
I don't see it as light at the end of tunnel. I think the end is nigh.
- [70:22]
Kara Swisher
The end is nigh. Yes, whatever. Anyway, so it's just interesting. And we should do this, you know, let me quote that more on Brendan Carr. We can do this the easy, the hard way or the easy way. Let's do it the easy way with the Cubans, right? Let's show them the bigness of the United States and really help them. And then Scott and I will open our hotel there and retire. Okay.
- [70:45]
Scott Galloway
It's got great mojitos, great cigars, Great
- [70:47]
Kara Swisher
mojitos, great cigars, everything else. In any case, we want to hear from you. Send us your questions about business, tech or whatever's on your mind. Go to nymag.com pivot to submit a question for the show or call 855-51-Pivot. Okay, that's the show. Thanks for listening to Pivot and be sure to like and subscribe to our YouTube channel. We'll be back next week, actually on Friday as we do not have a live Memorial Day show the day after Memorial Day. Thanks for listening to Pivot. Be sure to like and subscribe YouTube channel. We, as I said, will be back next week.
- [71:17]
Scott Galloway
Today's show is produced by Lara Naimon, Zoe Marcus, Taylor Griffin and Todd Wiseman. Brandon McFarland engineered this episode. Thanks also to Drew Bros, Ms. Saverio and Dan Shalon. Nishat Kharaz, Vox Media's executive producer podcast. Make sure to follow Pivot on your favorite podcast platform. Thank you for listening to Pivot from New York Magazine and Vox Media. We'll be back next week for another breakdown of all things tech and business.