Help, I’m diluting myself
Welcome to Cautious Optimism, a newsletter on tech, business, and power. Modestly upbeat.
📈 Trending Up: Deep tech in Europe … AI transparency … startup discontent in India … Nigerian GDP … calm … corn sweat …
📉 Trending Down: JD.com’s float … UK retail sales … German GDP … France as a home for tech leaders? …
The California AI regulation dance: OpenAI supports watermarking synthetic content (AB 3211), and both Anthropic and Elon Musk (xAI) have come out in favor of SB 1047. Anthropic with a letter still arguing its case that the bill needs work; Musk in a tweet saying that his endorsement is a “tough call” that “will make some people upset.”
Instantly, fans and critics of Musk weighed in. One fan account in particular theorized that Musk was trying to detonate California’s AI industry so that he could run wild in, say, Texas. Musk responded that he’s “just being consistent” with his comments for decades and that as the “xAI team is primarily [located] in Palo Alto,” the bill would impact his company as well.
Aaron Levie (more below) argued that there is already enough “red tape” in deploying AI, and that AI regulation “should primarily be aimed at the applications of AI, less on the tech.” Agreed.
Help, I’m diluting myself
Let me paint you a picture:
Snap Q2 2024 revenue: $1.237 billion (+16%)
Snap Q2 2024 stock-based compensation: $258.95 million
Snap Q2 2024 net loss: $249 million ($128 million improvement)
Snap Q2 2024 adjusted EBITDA: $55 million ($93 million improvement)
Snap Q2 2024 free cash flow of -$73 million, +$15 million TTM
Snap Q2 2024 share repurchase spend: $76.0 million
Snap market cap this morning: $15.63 billion
Got it?
Let’s do one more. Box reports later today, so we are looking back one quarter in the below data, but observe all the same:
Box Q1 F2025 revenue: $264.7 million (+5%)
Box Q1 F2025 stock-based compensation: $51.16 million
Box Q1 F2025 net income: $17.22 million
Box Q1 F2025 free cash flow: $123 million (+14%)
Box Q1 F2025 share repurchase spend: $32.13 million
Box market cap this morning: $4.17 billion
What do these two companies have in common? Both were flagged in the below chart, shared on Twitter and his blog by Altimeter’s Thomas Reiner. Recall that we lean on Reiner’s colleague, Jamin Ball, frequently for interesting data. (Shoutout the Altimeter team for nerding out in public.)