>> WELCOME TO "BLOOMBERG ETF IQ." KATIE: THERE IS A LOT TO KEEP PUSLE OF. SCARLET: AFTER WE CARE OF THE JOBS REPORT AND EARNINGS. KATIE: THAT IS A BIG ONE.LET'S GET TO THE BIGGEST WORRIES RIGHT NOW. $17 TRILLION GLOBAL ETF INDUSTRY. WE START WITH STOCKS REBOUNDING AFTER THE SELLOFF ON FRIDAY FUELED BY WEAK JOBS DATA.SCARLET: IN A FEW MINUTES WE WILL SPEAK WITH TRAVIS SPENCE. ON THE RECORD FLOW. KATIE: WE WILL DISCUSS WHY THE FUNDS ARE HAVING A HUGE BOOST EMERGING FROM BITCOIN.ALL OF THAT AND MORE. ERIC IS W ...

Core Insights - Amazon has a significant market capitalization of $2.45 trillion and generates approximately $650 billion in annual revenue, with a net profit margin of around 10% [8][9] - The company employs about 1,556,000 full-time and part-time employees, making it the world's second-largest employer [7] - Amazon's brand value is estimated at $356 billion, ranking it as the fourth-most valuable brand globally [11] Company Background - Amazon was originally named Cadabra before being rebranded to its current name, which reflects its wide range of products from A to Z [4] - The company has evolved from a simple online retailer to a major player in various sectors, including cloud computing with Amazon Web Services (AWS) [12][13] Financial Performance - Since its IPO in May 1997, Amazon has experienced an average annual growth rate of 32%, turning an initial investment of $10,000 into nearly $26 million [9] - The company derives 59% of its revenue from services, indicating a strong presence in the cloud computing market [12] Business Diversification - Amazon operates multiple businesses and brands, including Whole Foods Market, Zappos.com, and Twitch, and offers various services under the Amazon Prime umbrella [12][13] - The company has also ventured into healthcare and robotics, indicating a strategy of diversification and innovation [13]

Market Overview - The "Magnificent Seven" started 2025 strongly, but performance has since varied [1]

Group 1 - The article discusses the evolution of the "Magnificent Seven" lineup, which has transitioned from FANG to FAANG, and now includes a broader set of influential tech companies [1] - The author, Rick, has extensive experience in trading stocks and options, and his work is recognized by major publications [1] - Rick's personal journey to financial independence at age 35 is highlighted, emphasizing the importance of financial literacy [1] Group 2 - There is a disclosure of a beneficial long position in shares of major tech companies such as Amazon (AMZN), Google (GOOGL), Microsoft (MSFT), Apple (AAPL), and Meta [2] - The article expresses the author's personal opinions and indicates that no compensation is received from the companies mentioned [2] - Seeking Alpha clarifies that past performance does not guarantee future results and that the views expressed may not reflect the platform's overall stance [3]

Group 1: Tesla's Performance and Challenges - Tesla has experienced significant success over the past decade, disrupting the global auto industry with its electric vehicles, but is now facing challenges [1] - The stock trades 32% below its peak as of June 10, yet has gained 1,810% over the past 10 years, making it one of the largest tech companies [2] - In Q1, Tesla's automotive revenue declined by 20% year over year, and it reported its first-ever year-over-year drop in deliveries in 2024 [4] - The company's profitability is under pressure due to higher interest rates and increased competition, impacting demand for its vehicles [4] - Elon Musk's political engagements have distracted from Tesla's brand, leading to negative perceptions among investors [5] - Tesla is currently struggling to regain its previous momentum in the market [6] Group 2: Netflix's Growth and Market Position - Netflix has shown remarkable growth, with its stock up 1,200% in the last decade and adding 41 million net new customers in 2024, totaling nearly 302 million subscribers [8] - Despite concerns of market saturation, Netflix's co-CEO believes there are still "hundreds of millions" of potential customers to sign up [9] - The company is projected to see revenue growth at a compound annual rate of 12.3% from 2024 to 2027 [9] - Netflix commands 7.5% of video viewing time in the U.S., trailing only YouTube, indicating its strong market position [11] - With a trailing 12-month revenue of $40 billion, Netflix has the financial capacity to invest heavily in content and marketing while generating significant free cash flow [12] - Netflix is argued to deserve a place among the tech giants, potentially replacing Tesla in the "Magnificent Seven" group due to its ongoing success [13]

Core Viewpoint - Billionaire investor Bill Ackman, through Pershing Square Capital Management, is actively managing a $12 billion stock portfolio and aims to emulate Berkshire Hathaway's success [1] Group 1: Recent Investment Moves - Pershing Square recently sold its stake in Canadian Pacific Kansas City, a decision made "with regret," to invest in Amazon at what they consider a "uniquely attractive time" [2][7] - The sale of Canadian Pacific was influenced by its sensitivity to economic conditions and tariffs, as noted by Pershing's Chief Investment Officer Ryan Israel [6] Group 2: Canadian Pacific Kansas City Overview - Canadian Pacific Kansas City, formed after a $31 billion acquisition of Kansas City Southern, is the only railroad company with a single-line railway connecting Canada, the U.S., and Mexico [5] - The stock has appreciated nearly 67% over the past five years, indicating strong performance [6] Group 3: Amazon Investment Rationale - Pershing Square already holds shares in Alphabet and views Amazon favorably due to its dual strong business segments: retail e-commerce and Amazon Web Services (AWS) [7][8] - AWS has shown significant growth, with a 17% year-over-year revenue increase in the first quarter, and is expected to capture a larger share of IT workloads moving to the cloud [9] Group 4: Market Position and Valuation - Amazon's current valuation is less than 34 times forward earnings, which is lower than its five-year average of 39, making it an attractive investment opportunity [10] - Despite potential consumer spending slowdowns in a recession, Amazon's diversified revenue streams and strong market position in cloud services are seen as mitigating factors [10]

Core Viewpoint - The significant rise in the U.S. stock market on Tuesday, with the Dow Jones increasing by 741 points, is attributed to the "TACO phenomenon," which reflects market reactions to Trump's trade policies [1] Group 1 - The term "TACO trading" stands for "Trump Always Chickens Out," describing Trump's tendency to announce high tariffs on foreign goods but later retract or reduce them after market sell-offs [1] - The impact and longevity of the TACO trading phenomenon are yet to be determined, and it remains to be seen if it will reach the prominence of terms like FANG, FAANG, or Magnificent Seven [1]

Core Viewpoint - The "Magnificent Seven" refers to seven dominant American technology companies that significantly influence the U.S. stock market and have outperformed overall market gains [1] Group 1: Market Dominance - As of May 2025, the Magnificent Seven companies account for over one-third of the S&P 500 index's combined market capitalization, nearly tripling from around 12% in 2015 [2] - Amazon, as part of this group, has delivered a 145% return since the beginning of 2023, significantly outperforming the S&P 500's 55% increase during the same period [4] Group 2: E-commerce Growth - Amazon generated $94 billion in revenue in Q1 from its online stores and third-party seller services, representing 60% of its total revenue [6] - The global e-commerce market is projected to grow at an annual rate of 19% through the end of the decade, potentially reaching $73.5 trillion [7] - The adoption of AI in e-commerce is expected to grow at an annual rate of 24% through 2033 [8] Group 3: AI Integration - Amazon is integrating AI tools to enhance customer experience and seller capabilities, such as Project Amelia, which provides insights to sellers [9] - New features like Interests help customers find relevant products, potentially boosting e-commerce revenue [10] Group 4: Cloud Computing Growth - Amazon Web Services (AWS) reported a 17% year-over-year revenue increase in Q1, reaching $29 billion, with an annual revenue run rate exceeding $100 billion [11][12] - The demand for cloud-based AI services could create a revenue opportunity of nearly $650 billion for Amazon by 2030 [13] - AWS holds a 30% share in the global cloud infrastructure services market, positioning it well to capitalize on AI-related opportunities [14] Group 5: Future Outlook - Amazon plans to increase its capital expenditures to $100 billion in 2025, a 20% increase from the previous year, primarily to enhance its cloud-based AI services [15] - Analysts forecast a 12% increase in Amazon's earnings per share to $6.20 this year, with stronger growth expected in 2026 and 2027 [16] - The significant market opportunities in e-commerce and cloud computing could lead to sustained earnings growth for Amazon, making it an attractive investment at 32 times forward earnings [18]

Core Insights - Alphabet Inc. is considered one of the cheaper stocks among the Magnificent Seven, but it is still not deemed cheap enough for investment [1] Group 1: Company Analysis - The analysis focuses on high-quality companies that can outperform the market over the long run due to competitive advantages and high levels of defensibility [1] - The focus is primarily on European and North American companies, without constraints regarding market capitalization, covering both large cap and small cap companies [1] Group 2: Analyst Background - The analyst has an academic background in sociology, holding a Master's Degree in Sociology with an emphasis on organizational and economic sociology, as well as a Bachelor's Degree in Sociology and History [1]