John on why antitrust shouldn't stand in the way if Apple or Amazon were to acquire Instinct: "They should 100% be allowed. It's the most competitive industry." "It's a knife fight for the personal agents." "You're up against the monopoly guy, Mark Zuckerberg. Go to town."

Q: Does Apple have the balls to buy Instinct? @markgurman believes famously M&A-shy Apple could be more trigger-happy with acquisitions under John Ternus. The biggest signal is new M&A leadership at the company. Mark broke the story a few weeks ago that Adrian Perica, the former head of M&A, was moved to a new position under Eddy Cue on the services side of the business. Steve Smith, Perica's former deputy, is now Apple's head of M&A. Mark believes this shakeup happened for two reasons: 1. Eddy Cue will eventually need a successor, and Perica is being positioned as a candidate. 2. John Ternus and the hardware team have had a decades-long gripe that Apple buys no one, and now they're finally in charge. "The joke with Apple M&A is they do nothing. It's the easiest job in the world. This is how the hardware guys think of it." "Ternus wants someone who will get cracking."

Apple makes more money from casino games than it does from selling Macs, according to @markgurman. "If you think about how much money the App Store makes, and what percentage of the App Store are these casino games, it's billions."

Re:Build CEO Miles Arnone (@ReBuildMFG) argues manufacturers are putting too much faith in robotics to improve efficiency. "The problem with robots is that they're attacking a pretty small part of the total production cost. It's largely the elimination of direct labor." "Bringing robots in might take a few percentage points off your total cost at a very high capital expense." "You're much better off trying to implement something like Toyota's lean production system to eliminate all the steps along the way that are wasteful, that don't add value to the product." "In the U.S., we're very techno-centric and we like big step-change improvements. We want robots instead of grinding it out and every week just pulling a quarter or a half percent of the cost basis out by getting a little more efficient." "The 'I'm going to put robots here, get rid of all my labor, and all of a sudden I've solved my problems' approach won't happen."

.@GavinSBaker explains how most people don't understand how hard it is to stand up energized compute, and that a lot of 'amateurs' will get cleaned out by 2027. "Standing up a big GPU cluster is like running an F1 team." "A bunch of people who have no relevant experience have acquired some land and power, then they get a zero down payment offtake agreement from someone, and a lot of that is being cleaned up." "This is a forcing function to allocate GPUs to people who can actually bring on a cluster, energize the GPUs, and run it well." "Companies like CoreWeave, Crusoe, Nebius, SpaceX, etc." "It takes most people 3-6 months to get the GPUs energized. If we can, through Jensen's new DSX product, get that time down, I think that that's also healthy because that effectively takes a lot of working capital out of the market."

.@GavinSBaker on neolabs pivoting into neoclouds: "If you signed a long-term compute contract at any point prior to May of 2026, you are way in the money. You're buying compute for $10 or $15 a watt. And you could sell it at a massive premium to that price today." "And it's not just that the spot market is tight today. You have to pay vast amounts to bring on a cluster in mid- to late-2027." "I think that's something that public markets are not appreciating... All [this information] is out there, but for whatever reason, I think it's not legible to the public markets."

Gavin and John diagnose $CRWV's current challenges and contrast them with $SPCX's approach to pricing compute: @GavinSBaker: "CoreWeave is great. They run GPUs very well. They just sadly locked in a vast amount of compute in long-term contracts that are now way, way under market." @johncoogan: "They sold their GPUs for fixed prices, and that's why they're getting hammered right now. It's not that they don't have compute... they just sold for too cheap." Gavin: "The conclusion Elon came to was, 'Prices are going up. If we are willing to sell into the spot market, we can have paybacks of well under a year and get big prepayments.' I think that's probably a better financing model for the market we're in." "And by the way, I think CoreWeave is very aware of this. They're trying to get more spot exposure and do less of these big, long-term offtake agreements."

Gavin Baker says his portfolio companies are having a hard time getting access to GPUs even well into 2027, and are shocked by the prices they're being asked to pay for compute so far out. "So for all the commodity experts focused on backwardation and what that implies, I've got news for you — we're not in backwardation anymore." "It's not just that the spot market is tight. If you want a cluster a year from now, you have to pay a lot of money." "Just the number of companies we have in our portfolio [at Atreides] who are like, 'Ok, we have a cluster of 4,000 Blackwells that we got in May or June of '26, and we want to bring on another cluster of 4,000 in September of 2027' — they're shocked by how much more they have to pay in the future." "Everybody's aware of the supply that's coming on, but even with all that supply coming on, it is hard for the companies in our portfolio to find compute. Even well into 2027." @GavinSBaker

Atreides' @gavinsbaker says more of the AI buildout in 2027 will be financed by operating cash flow than people expect, and that we're getting close to peak external financing: "All these clouds signed contracts at well below current market values. As those contracts reprice higher, as they bring on more compute with more spot — the same thing that CoreWeave is trying to do — I do think you're going to see a pretty continuous acceleration in the sum of the big hyperscaler cloud revenue growth. For the neoclouds, that number is just going to continue to accelerate." "And then it's dropping down at very high margins. So operating cash flow is following. And then you're going to be able to finance more of the 2027 buildout than people think from cash flow." "I don't know if we've seen the peak of external financing, but I think we're getting close."