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Not sure why you'd short Google. Their business was doing great pre-AI, and will likely do great regardless of what happens to AI. The rumors of their demise when AI hit the scene were clearly greatly exaggerated.
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Excluding all the capex from AI this last quarter has been one of their best.
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> Excluding

But you don´t get to to that. Would be like "Excluding my business costs, my company profits are the same as my revenue".

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I think the point is more: as soon as they stop with the AI silliness they'll return to being a quite strong business.
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The implication is if AI implodes, the AI-related expenses go away and what remains is a great business.
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> But you don´t get to to that.

You can, and for tax purposes you must. The bean counters hate that you can’t deduct capex.

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The return on capital is also phenomenal. To be a bear, you have to assume that will crater.
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EBITDAI
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There is quite a bit of information out there as to how Google is achieving short term growth in their core search business. And boy, it is ugly. It does not signal long term continued growth.
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Please explain more. I haven't seen anything of quality. Best I can observe is they've increased ads on videos and pages.
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They search used to be good and became rather bad.
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[dead]
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from your list, I think only Google has moat and something I would short least.

Google has hardware, software ecosystem, mobile ecosystem, controls browser, has access to 2B+ users, has talent to come up with ideas - perfect spot for AI

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Now Microsoft, them I'd short. In a way I have by starting my own company to undermine their various competitive advantages comprehensively
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The number of companies that default to using Teams shows why MSFT isn't going anywhere.
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Microsoft bundles enough things at a low enough price that it seems silly not to use Microsoft if you are a corporation, because the alternative is to buy a number of different SAAS products (which are generally superior) at a higher price and have to deal with half a dozen to a dozen vendors.
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I will be very concerned for MSFT if small companies start outperforming larger companies. That's when Microsoft's advantage disappears. If AI truly encourages smaller, flatter organizations. IMO large enterprise adoption is their moat.
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Installed by default is their moat. Trying to arrange a video conference on other platforms means making sure that everyone has the client installed, which can be a real headache. Teams is the common denominator.
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Google Meet doesn't require a client
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The only strategy that can work against Microsoft is a full broadside. You can't try beat them in just one niche, you have to go after the whole tech stack they offer. That's what I'm willing to try doing.
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Yes, exactly, would I bet that Microsoft’s products are inferior in quality to others. Yes.

Would I bet that other humans would believe that? Nope.

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Microsoft has many of the same advantages but is incapable of judging the quality of the products it makes.
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Time will tell but that feels foolish. MSFT is a terrible product company (look at copilot) but what they sell is a safe decision which is one of the most important factors for enterprise software. Nobody is close to replacing that.
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I'm content for that be the narrative. Nobody is close, and what's more it's not even possible, and even if it was possible nobody would want it, and even if anyone did want it would only be a few people. ; )
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You missed the plot. ; )
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Concur; I am shorting them as well. Your approach is more clever!
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Microsoft is in the same situation as IBM decades ago. „ nobody ever got fired for buying IBM“ used to be a common saying. If at all you’ll see a slow decline.
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Wow why has nobody thought of this /s
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Microsoft is in a better position (as their b2b ecosystem can realistically be made LLM-agnostic), but Google will be fine.
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Maybe you’re right but, man, there’s easier money to be made than betting against those two companies.
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Have you seen Microsoft’s price over the last year. If AI doesn’t pan out they’re going to be the next IBM.
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Agreed, and in my opinion he's 100% right. But I'm still invested in both.

The market hasn't been working on fundamentals for a long time. I have a fair amount of value stocks and a bunch of cash lying around, so I'll be ok.

I really feel for anybody trying to invest to grow right now; there's no obvious safer play.

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Like?
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> Like?

Vanguard’s total market fund (VTSAX). Just setup a monthly purchase and forget about it. Turn wealth building into a time problem instead of a skill/luck/cash problem. (Assuming time is on your side)

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All of the quantum computing companies (Especially QUBT, which is outright fraud), although the window may have passed on that.
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Google makes money hand over fist and they don’t have enough things to spend it on. AI is a natural fit for them to burn all their profits into. Gemini’s integration is, I think, absolutely awesome - it’s completely changing the way I interact with the concept of googling and finding answers, and is free of sign ups or purposeful interactions with the likes of ChatGPT or Claude where you know you’re AI-ing. So your short could work, but it’s not going to work for google’s involvement in an AI-bubble, it’s predicated on the entire market tanking, which should have been occurring for the past two years already if fundamentals and capex translating into profit were what the market cared about. But it seems like the market isn’t caring right now so you could be holding that short for quite a while before it turns into a major return.

SpaceX I actually bought at the IPO price because I think the company will be around in 30 years time, so as fraudulent and mispriced as it is, having a small holding over that kind of horizon I believe will be profitable. And I want to be that kind of old-timer who can chuckle at buying it at the IPO and holding through the crash and still holding when they are on Mars and beyond and SPCX is worth multiples of what it is today.

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> Gemini’s integration is, I think, absolutely awesome - it’s completely changing the way I interact with the concept of googling and finding answers,

Oh, me too. The way it writes things that look like they address my question, and then links references that totally don't makes me dread Googling in a way I hadn't yet. For probably five years, I've been doing DDG first and Google when I DDG doesn't work well and usually Google doesn't either, so I already have dread for Google, but this makes it worse.

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Nailed it. I didn't state this explicitly, but:

> So your short could work, but it’s not going to work for google’s involvement in an AI-bubble, it’s predicated on the entire market tanking

Is indeed a required assumption. Major return is not going to happen with this, Not losing a big chunk of my money is the goal!

> SpaceX I actually bought at the IPO price because I think the company will be around in 30 years time, so as fraudulent and mispriced as it is, having a small holding over that kind of horizon I believe will be profitable. And I want to be that kind of old-timer who can chuckle at buying it at the IPO and holding through the crash and still holding when they are on Mars and beyond and SPCX is worth multiples of what it is today.

I think that's a fine play as well. The short is more of an "This IPO price doesn't make sense; sell within a year after it settle"

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Short Google? Early is wrong you know?
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That’s a pretty weird take considering they’re down 21% in the last 2 months. How, exactly, is this early?
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Early in terms of there being no sign of actual signs of decay of their business. It's less than a week since Google reported literally the highest quarterly profits by any public company ever[0]. This is while growing at 25% YoY, which is just insanely fast for a company that size.

[0] By net income. By operating income, still like top 5 to top 10 depending on how you interpret the numbers.

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Zoom out. Look at 5 yr chart then look at April 2025 could say the same thing.

Also when shorting you are betting against the machine of capitalism. It's like very rare and abnormal for today to be a GFC or Enron sort of day rather than a business as usual. You need a lot of skill to short a top 50 comompany. Anyway good luck.

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That’s brave, and I don’t mean that shittily, but more cautiously. Like, I’m thinking of the Simpsons shirt-tugging meme when I read this.

I’ve always been hesitant to short stocks because of the old adage “the market can stay irrational longer than you can stay solvent” and the market has a REAL vested interest in seeing these companies not explode.

Good luck on this one, genuinely, because you may need it.

(That said, if you DO win big on this one, I think we’re all fucked, so maybe I shouldn’t be wishing you TOO much luck. =) )

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Sage advice!. In shorts like these, there's no outcome that "wins big" unfortunately, unless you do it with large amounts of money. (Unlike a long position on an individual stock that 10xs, or options which are much riskier). But... it will ideally make the landing softer after the Fall.
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SpaceX near $100/share is a great long position now, IMO.
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Why $100? Why not $80 or $5 or $134?
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Google is not a good short. They are actually one of the companies that will likely come out on top when the AI-bubble has popped.

Anthropic and OpenAI though will likely be dead, killed by cheap open weight LLMs and local LLMs.

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Most sane comment.

Even in the last Elon Musk interview by The Economist, he admited that it's likely China will win at the end.

The gap is so close now. Opinions matter not, the Chinese will have their own GPUs, RAM and everything they need.

Giants like google and spacex are the few that can handle it because their business is not only about shipping the best models.

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It isn't currently —for google— only about shipping the best models, but in the future however...
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I expect China to eventually develop or sidestep EUV lithography. When that happens it’s over.

It will also crash the price of chips globally. These high prices are kind of artificially buoyed by the fact that China can’t obtain ASML machines. This keeps China’s vast proven ability to scale manufacturing off the playing field.

This is so clearly the Chinese century. Doesn’t mean the US, EU, etc become backwaters. England was a huge influence on the 20th century. It does mean that China will drive tech and the global economy forward.

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