Wall Street Made A Mistake - Snowflake Is On Sale #stockmarket #investing
Summary
TLDRThe script discusses the potential of the software company Snowflake to revolutionize industries through artificial intelligence, arguing that Wall Street misunderstands this potential. It focuses on Snowflake's CEO, Frank Slootman, and his replacement, Sher Rehman, who previously led Google AdWords, transforming digital advertising. The script contends Rehman can similarly lead the use of AI and data to replace human roles and decisions across sectors like insurance and government, massively improving efficiency, though markets dropped Snowflake's stock on shifted short-term spending priorities. Overall it predicts Rehman and Snowflake will change how commerce functions globally.
Takeaways
- 😀 Snowflake's stock dropped 20% after earnings, but the author believes this was a mistake by Wall Street
- 👨💻 The author compares Snowflake's CEO to legendary tech innovators like Gates, Jobs, Page, Brin etc.
- 📈 Snowflake is investing heavily to transition businesses to AI-driven decisions instead of human decisions
- 😎 The author believes Snowflake's tech will bring efficiency, reduce fraud/waste, and make better decisions
- 🤖 Snowflake's tech aims to replace human roles/jobs with AI and data-driven decisions
- 🔢 Snowflake posted strong revenue growth but also higher expenses, leading to losses
- 📉 Wall StreetAnalysts forecast higher revenue growth than Snowflake delivered
- 👷♂️ Snowflake plans to hire 1,000 more employees including engineers to build new AI systems
- 💡 The author connects Snowflake's potential to revolutionize business decisions to the prior digital revolution
- 💰 The author recommends buying more Snowflake stock due to the market underestimating its potential
Q & A
Who is the key person mentioned that will lead the AI revolution according to Carrie?
-S Dar, Remi (likely referring to Shardar Sharma, CEO of Snowflake).
What past technology leaders is Shardar compared to in terms of influence?
-Bill Gates, Steve Jobs, Serj and Larry, Jeff Bezos and Mark Zuckerberg.
What industry did Carrie used to work in that gives her insight into potential applications of Snowflake's technology?
-Carrie used to work in the financial advisor industry.
What specific Snowflake product announcement caused their stock price to drop 20%?
-Snowflake announced they would be increasing expenses by $90 million without a comparable increase in revenue projections. They also announced hiring 1,000 additional employees.
How much revenue and expenses did Snowflake have recently?
-$2.8 billion in revenue and $2.99 billion in expenses, for a $20 million loss.
What functions does Carrie predict AI can optimize in industries like insurance and government?
-Determining valid insurance claims, reducing fraud and graft in government contracting.
What change does Carrie think the new Snowflake employees will drive?
-The new engineers will build systems to replace many of Snowflake's existing staff, transitioning the company towards AI.
Why does Carrie think Wall Street misunderstood Snowflake's announcements?
-They don't understand AI and its transformative potential enough to see the long-term opportunity past short-term cost increases.
How does Carrie continue developing her investment ideas?
-She discusses investments every Friday with her paid membership community to get additional perspectives.
What previous Snowflake leader does Carrie say found the limits of his capabilities to lead the AI revolution?
-Frank Slootman recognized his limits and stepped aside, allowing Snowflake to bring on Shardar Sharma instead.
Outlines
😕 Wall Street misunderstands Snowflake and AI
Paragraph 1 explains that Wall Street misinterpreted Snowflake's earnings report and stock drop. Snowflake is investing heavily in AI to drive efficiency and replace human roles. The CEO previously led Google Ads and can replicate this AI transformation across industries.
😲 Snowflake aggressively investing for AI-driven growth
Paragraph 2 highlights that Snowflake is substantially increasing expenses for hardware, software, and sales staff to fuel AI product development. This will enable data-driven automated decisions to replace inefficient and biased human decisions across sectors.
💡 Snowflake CEO will drive next wave of AI innovation
Paragraph 3 asserts the Snowflake CEO will be regarded alongside tech luminaries for spearheading the next generation of AI. Snowflake's product strategy is misunderstood but will reduce inflation, create efficiency, and promote harmony.
Mindmap
Keywords
💡Artificial Intelligence
💡Snowflake
💡Digital Revolution
💡Wall Street
💡Decision Making
💡Commerce
💡Data
💡Efficiency
💡Future
💡Revolution
Highlights
Snowflake recognizes that AI will replace humans in many jobs, similar to the digital revolution in 2000
Snowflake's CEO could be compared to legendary tech leaders like Bill Gates and Mark Zuckerberg
Snowflake aims to use AI to make decisions in business more efficient, with less fraud and problems
The CEO led Google's AdWords, transforming digital advertising from a $1.5B to a $100B industry
Snowflake will leverage AI and data to replace human decision makers in many industries
This will increase efficiency and reduce things like insurance fraud
Snowflake spends what's needed to position itself as a leader in AI for business decisions
Wall Street misinterpreted Snowflake's earnings and plans, not grasping the AI potential
Snowflake is hiring engineers to build systems to replace many current employees
AI business decisions could greatly reduce government waste and graft
Wall Street rewards short term metrics, not seeing Snowflake's long term AI vision
Super Micro and Dell show growing computer infrastructure demand driving growth
Snowflake's CEO can lead the transition from human to AI-driven business decisions
Snowflake drop shows Wall Street doesn't grasp AI potential to transform business
Invest in understanding innovations like Snowflake's before the market catches on
Transcripts
this time Wall Street got it wrong or at
least they aren't farsighted enough to
see what is actually happening with
snowflake uh snowflake did their annual
report um or quarterly report earlier
this week and the stock dropped by
20% uh that was a mistake and it's
because they don't recognize exactly
what is happening they don't totally
understand how AI works and snowflake is
on sale and snowflake will quite
possibly become one of the icons of the
future relative to the use of artificial
intelligence and it's all driven by
snowflakes
recognition that AI is going to replace
human beings much as um the digital
revolution of
2000
created a new way for consumers to
consume products to to interact in many
facets of the world uh the key to this
is uh s Dar
Remi I know I screwed his name up but
you know who he is he is in my mind he
is going to be viewed comparable to Bill
Gates Steve Jobs Serj and Larry uh Jeff
Bezos and Mark Zuckerberg they are the
people who came and taught us how to use
digital uh to make our lives better to
make our worlds more efficient they
taught us that we adapted to it and we
use then
digital to to make us more efficient in
our world such as I use digital to
communicate with you I was unable to do
that until Google taught me how to do it
through through YouTube well we have now
moved into the era where uh digital is
going to teach us how to compute and
that is to say it's going to teach us
how to replace people using digital to
make better decisions and and think of
it in in this area in in the world of
insurance banking travel entertainment
real estate manufacturing for every face
that you engage in those Industries
there's at least 20 people behind doing
the support work to make what you want
to happen to happen What snowflake is
going to do is to replace all those
people uh they're going the the decision
makers who decided whether or not um
your insurance claim was valid is going
to be eliminated because all that is
going going to happen is some someone is
going to gather a little more data as to
what happened to to you and your uh as a
result of a tornado and the decision
then will be made through digital
analysis rather than human analysis
which will make it much more efficient
and which will make it much much less um
fraud and and whatever involved in it
and will make it work better
the reason Shar is such a key player is
he was with Google for 15 years and he
was in charge of Google AdWords and and
if you think about how Google AdWords
changed the advertising industry that we
don't have advertising agencies anymore
um the the Google knows more about
someone's customers than than the the
the the the manufactur ERS the sellers
whatever they know more about us than
our spouses know about us okay so they
have replaced the advertising industry
as as has Mark with with Facebook as has
Jeff with with Amazon they've replaced
the advertising industry and and shadar
is the guy who did it he took it from a
$1.5 billion industry to a00 billion
industry and then he woke up one day and
formed a company that said I can do this
in every aspect of of Comas and he
formed a company and eight months ago
that company was bought by by Snowflake
and they are now going to replace man
with digital okay so with that being
said then why did their price go down
20% this week well because Wall Street
got it wrong
understand they they they projected that
they were going to grow their revenues
um and and they they also said they were
going to add 1,000 employees
okay snowflake doesn't make any money
okay in fact they had revenues of 2.8
billion they had expenses of
2.99 billion so they had a loss of $20
million they then came Mountain said
that we are going to spend this next
year an extra $50 million on GPU chips
we're going to spend another $10 million
on uh cost of product and then we're
going to spend $30 million in increased
compensation for our Salesforce so
they're increasing their
expenses by $90 million but not
increasing a comp a a comparable amount
in sales okay then as I said they said
they're going to raise their employees
by a thousand currently they employ
5,884 people so that's an increase in
their sales force by
177% what's happening they're going to
war they're basically saying we're going
to restructure our company and we're
going to spend what we have to to take
us into the next generation of
artificial intelligence running
businesses so all the data I used to be
in the financial financial advisor
business we had armies of people behind
us making decisions based on the data
that we fed them many times they made
wrong decisions and thus um people
didn't have their their retirement funds
grow like they wanted to because
individuals were making human
decisions snowflake is going to take
that out of the equation they are going
to have those decisions made by the most
intelligent data available to Mankind
and made expediently you won't talk to a
person on the telephone you will get on
the phone and and they will ask you what
language you want to speak and they will
take on the conversation this will make
everything more efficient think about if
you put that into our government where
there's so much graft where there's so
much uh influence being pedal and take
all those decisions out of human being
hands and make them those decisions
based on what's best for our country our
citizens and therefore they make good
decision you know you I can remember one
time that some I read something that a
toilet seat on a a fighter on a on a a
cargo plane cost something like
$10,000 well that's because all the
graft that's involved in it all the
paperwork that goes If you eliminate all
those people touching that paper all the
influence that says hey uh you'll find a
new shotgun in your car if you buy the
toilet seat from me you'll you'll you'll
see that this is a major change in how
Commerce will take place in the world in
the future
and Wall Street didn't understand it all
Wall Street saw was we're going to incre
our increase our expenses by $90 million
we're not going to have we're going to
have a 6% increase in in our Revenue
which will not offset that and then
we're going to hire a thousand new
people well guess what's going to happen
and who who are those thousand people
they're Engineers they're the people who
are going to build the system to replace
the other five
884 people that they currently have on
staff that's what's happening in our
world in our world and and Wall Street
doesn't recogniz Wall Street does not
understand artificial intelligence if
they
did they would be
rewarding snowflake with a 20%
bump okay we saw today that the computer
infrastructure structure is driving the
economy right now uh we saw Dell go up
30% because they had some extraordinary
orders because Jensen sold them uh some
gpus to put into their computers so that
the the the shortage of computers from
Super Micro computer could be picked up
in part by Dell that's why Dell is up
once that's done that's done but what
comes behind it
is the change in our world and the the
the the movement away from man making
good bad indifferent biased decisions to
good decisions made by
compute and
snowflake had the insight and the
courage to go and hire the man who can
make it happen I can't pronounce his
name I won't try to you can read it
snowflake is up a little bit
today I'll buy
more because the world doesn't
understand that this may take a year but
that man is going to be standing next
to Bill Gates Steve Jobs Serj and Larry
Jeff basos and Mark he
is he is one of the
those who will be
recognized as
innovators for the future I'm Carrie
grink I'm a retired financial advisor
there's a lot of things I don't do well
uh but what I've learned I can do well
is connect the dots I can I can look at
something and say that doesn't make
quite sense to me so if it doesn't make
sense what what am I missing and I I
listen to this all the first time uh and
and I believe that that uh Frank slotman
got pushed to the side I don't think he
did after I listened to it a third and a
fourth time Frank recognized he did what
he could but he needed to pass the Paton
on and he he took the the data and
taught people how to interpret it and
now someone has to come in and teach
data how to replace the people how how
data can think like humans to make
decisions without bias without prejudice
and and make good sounds decisions that
create efficiency and economy that
reduce inflation rather in rather than
increasing
prices that brings Harmony in into a
very difficult world right now um I'm
really kind of scared of what is
is festering under the
surface uh this is a positive thing
we've got to look for positive
things you you dig in you learn
who
Shar ra renami is and what is PED agree
is and you see if you don't believe with
me Wall Street got it wrong I'm Carrie
grm I'm I'm the chief I guess of the
best of us investors
tribe uh later this afternoon this is
Friday I will have this discussion with
my tribe members we have a stock talk
every Friday a zoom call which if you
can't make the call you can access the
the recording of it um and we'll discuss
this in detail and they'll have an
understanding then they'll ask questions
and we'll hash it out how did I come
across this well when I saw the the drop
in the stock I went to the earnings call
and then Brian Brian is a young man from
um Nashville he's he's a a school
teacher High School school teacher and
and coach and he says Carrie do you
remember I sent you a a video of
Shamar sha sh shadar
shadar U being interviewed on CNBC a
year about a year ago when he made the
transition into Snowflake and I said
yeah I do remember it but I need to go
back and watch the video that's how I
learn that's how I stay ahead I have a
tribe I have a group of people who
subscribe who pay dues okay and we work
together to make better investment
decisions if you'd like some help get on
the bus we have a discount by the way uh
of uh 50% you'll find that in the
description
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