It's earnings season, and in this week's Industry Focus: Tech, host Dylan Lewis and Motley Fool contributor Evan Niu look at updates from two of the giants, Facebook (META 2.79%) and Apple (AAPL 0.79%). Whether investors like it or not, Apple stopped reporting iPhone unit sales. How significant is this whole Services thing they keep emphasizing, and what does this all mean for Apple's long-term picture from here?
Meanwhile, investors who were expecting Facebook's scandal-fest to concretely hurt their business were probably surprised by this most recent report. Tune in to learn more about the changing business models for both businesses, the most important trends from this quarter, and what to watch in the future.
A full transcript follows the video.
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This video was recorded on Feb. 1, 2019.
Dylan Lewis: Welcome to Industry Focus, the podcast that dives into a different sector of the stock market every day. It's Friday, February 1st. We've got fresh earnings releases from Apple and Facebook. I'm your host, Dylan Lewis, and I've got fool.com tech specialist Evan Niu on Skype. Evan, what is going on?
Evan Niu: Tired, man! It's busy week. Like I said last week, earnings season.
Lewis: There's no sleep for you during earnings season. [laughs] You have to keep up to date on what's going on with all these companies. Someone's got to do it. It's a tough job. We appreciate that you do it for us, Evan!
Niu: We had a lot of big companies this week. We can only cover so much, though.
Lewis: We can only cover so much. We're going to spend today's show talking about Apple and Facebook, two businesses that we frankly spend a lot of time on. I'm wary of overcovering them because they're very popular, they're very widely reported on. I look at both of the earnings that we're going to discuss today, though, and say these are companies that are at critical crossroads. For Apple, it's a change in how they're actually doing some of their reporting. This is the first time we're getting a glimpse of that. For Facebook, it's a business that has some serious risks to address. For those reasons, even though we talk about them quite a bit, it's worth diving into these releases, Evan.
Niu: I think both companies are definitely facing their own respective challenges in different ways. It's not often you hear about Apple facing these [...] iPhone, but that's exactly what's happening. Total revenue fell 5% to $84.3 billion. Net income was about flat at $20 billion. But earnings per share hit a new record of $4.18 just because Apple keeps buying back so much thought that the profit gets spread out across a fewer number of shares, highly accretive to earnings per share. iPhone revenue, of course, is a big one there, and that fell 15% to $52 billion.
Lewis: But outside of the iPhone segment, everything looked awesome. If you just cover up that one part of the earnings release, everything else looks great.
Niu: Yeah, everything else was really good. But that's always the irony, Apple's a victim of its own success in that the iPhone was so successful, it became so big and such a huge business, over 60% of revenue total. Any weakness there is going to really hit the overall results pretty heavily. But outside iPhone, like you mentioned, iPad revenue put up its strongest growth in nearly six years. It was up 17% to $6.7 billion. Pricing is probably a big key there, as we've seen the company to do in the past year or two. They've been pulling this pricing lever. The iPad Pros that they launched last year saw some nice little price bumps along with the new design. Mac revenue increase to $7.4 billion. The new segment that they established, it used to be called Other Products, is now Wearables, Home, and Accessories. That business saw sales jump 33% to about $7.3 billion. Most of that's being driven by Apple Watch and AirPods. Services, Apple has talked a lot about Services, as we know, the past two years. New record of $10.9 billion. For 2018, they did about $41 billion in revenue for services. That's a pretty new record. We talked about before, their goal is to hit $50 billion by 2020. They're well on their way.
Lewis: We knew that a lot of these numbers were going to be coming because we got that note from Tim Cook earlier in the month detailing that they would be below guidance and that they were revising their outlook for the quarter, and that Wall Street should be ready for some lower numbers. So, we knew generally what the numbers were going to be. I think when we're looking at this report, it's much more about the story and the commentary that we're getting from management. This was the first time that we weren't getting the nuts-and-bolts inputs of iPhone ASPs and units sold. It's a little tough to lose it, especially when the iPhone segment isn't doing particularly well.
Niu: Right. And you're right, they did give investors a pretty comprehensive idea of what to expect with that guidance letter. A lot of the main headline figures were more or less already known in advance. The big new thing here is that they've changed their financial reporting structure. As you mentioned, they're no longer giving out unit sales or ASP data. Kind of leaving people in the dark there, which is not a great thing. On the flip side, now what they're doing is even more aggressively pointing to the Services business to say, "Hey, look how profitable this is." Now, they're breaking out cost of sales in products as well as cost of sales of services. You can get a good sense of how profitable is the Hardware business vs. the Services business. This was the first time they've ever given this data. Services had a 63% gross margin. That was up like 5% from a year ago. That's super profitable compared to the 34% hardware margin that they enjoy on the product side of the business.
Lewis: Yeah, so basically $1 in Services revenue is worth about $2 in actual product revenue because that margin is so much larger. We got a little bit more color on some of the inputs within the Services segment as well. This is part of management trying to shift the focus and shift the narrative with this business. I appreciate the detail since we're going to be losing a lot of the detail on the iPhone side.
Niu: Right. A lot of these Services are really growing and scaling quite well, which is letting them have some operating leverage, which is why we see the gross margin expanding. Breaking it down a little bit further, Apple Music now has 50 million paid subscribers. The last update they'd given investors was 40 million back in April 2018. At some point in 2018, they also said, "We have 50 million total including free trials," but that's not really a comparable number because you want to focus on the paid side of it. So, they're at 50 million now in Apple Music. They have 360 million paid subscriptions going across all their platforms. That's the same pace that they've been adding. Every quarter, they add about 30 million. More of the same there, in terms of the trajectory. They do now expect to hit 500 million paid subscriptions at some point in 2020.
Lewis: One of the numbers that I loved in this release was the breakout of how important any of these individual Service segment customers are to the overall services revenue. This is the breakout that you'd expect to see from a maybe software-as-a-service company going public and trying to explain, "We're pretty well diversified among our customer base. We're not too reliant on one." In the case of Apple, the largest customer when it comes to Services is a fraction of a percent of revenue.
Niu: Right. They were trying to distance themselves from this problem they've had over the past few years, which we've just touched on. So much the overall business is concentrated on the iPhone, and that's a blessing and a curse. It becomes this concentration risk. Luca Maestri, the CFO, was trying to highlight how the Services business is much more diversified. Largest subcategory within the Services business is about 30% of revenue. Over 30,000 different subscription apps available. The biggest of them is 0.3%. I think it's pretty obvious that that's Netflix. There's some interesting implications there, too. But overall, they're not relying too heavily on any one third-party app or subscription to grow this business.
Lewis: It's funny, because we look at Services and we say, well, it's not the biggest piece of the pie in terms of revenue for Apple. In the scale of Apple, sometimes you forget that this business is on the scale of most multinational companies, this Services segment they have. The level of detail we're getting now reminds me of the kind of reporting you would get for almost any other Services company. For them, it just happens to be nested within this larger hardware empire.
Niu: Right, exactly. So now, they're going to start giving more information about the installed base. They also disclosed for the first time ever what the iPhone installed base is. People have been trying to come up with third-party estimates always, but Apple now says, "Hey, we have 900 million iPhones. That's our installed base right now. That's up 75 million over the past year." And to your point, that's how a company like Microsoft might talk about its Office business, in terms of how many commercial seats they have or how many consumer seats they have. It's all about the seats that you have that are generating that recurring revenue.
The installed base is really the driver behind the Services business. Apple's challenge is, they're trying to get more people to be subscribing and paying for these things. They are making progress on that front.
Lewis: Evan, I want to spend a little time talking about some of the major challenges that led to this revised guidance that we saw. Tim Cook spent some time on this during the conference call. I think it's worth looking at these because when I take a big-picture look at this business, a lot of this doesn't seem like simply one-quarter issues. This seems like stuff that might plague the business for a while. One of the things that he focuses on is the fact that the strength of the U.S. dollar is making Apple products more expensive in other parts of the world. In the conference call, he specifically talks about Turkey and the fact that the lira has depreciated 33% over the past year. When you think about that type of relative currency depreciation, that makes Apple products so much more expensive in these other markets.
Niu: Right. That's been a real challenge for them. Here in the U.S., we're not subject to that kind of volatility. Obviously, Apple prices their products in U.S. dollars and we're in the U.S. You don't have this volatility associated with exchange rates. In international markets, particularly emerging markets, when the U.S. dollar is strengthening against the local currency, Apple has to adjust its prices, and effectively increase its prices, just to bring the same amount of money home in U.S. dollar terms. But from a local consumer's perspective, this iPhone has just gone up in price over the past year.
For example, the Tim Cook mentioned that the iPhone XS starts at $1,000. Last year's iPhone X, also $1,000. But if you're a local consumer in one of those international markets, XS might start 20% higher than X did last year. That's not something that's good for sales. That's hard to justify to consumers. They don't care about the foreign exchange implications to Apple, they just want to get a good product.
Lewis: Yeah. For a while, it's something that they haven't been as concerned about. They've done hedging on foreign exchange, but they haven't really worked that as much into their pricing strategy. It seems like that might be shifting a little bit.
Niu: Right. Now, they're going to basically say, "We're going to try to eat these costs, absorb the impacts, if these foreign currencies are moving against us." They're going to try their best not to raise prices and just absorb it within their organization, which could hurt profitability. Like you mentioned, they do have this hedging program in place. They're going to try to use the hedging program in as many markets as they can to predict and offset these movements. But, of course, currency markets are very volatile. If they're more volatile than Apple expects, that's where it can start to eat into their profits a little bit, depending on how these things play out.
Lewis: One of the other major points that Tim Cook emphasized in the conference call was the disappearing subsidies in the wireless market. This is something that a lot of U.S. consumers are probably pretty comfortable with and understand conceptually at this point. We're several years out from a lot of the major providers like Verizon, AT&T, etc., giving you that, "Hey, you can get the newest iPhone for $200, $250. We're going to eat the cost above that because we want you on our network." That's not the case in other markets. There are other markets where subsidies in the wireless space are much more common, or were. They're getting rolled back a little bit, as well.
Niu: Right. In the U.S., it's been two to four years since the subside model started to go away, mostly thanks to T-Mobile shifting toward this more transparent installment plan model and leasing model where you know exactly what you're paying and you spread it out over time. A subsidy hid that cost from you. All U.S. consumers, when we started to come around to the new model, there was the sticker shock of like, "Oh, wow, smartphones actually cost $500 to $800," now $1,000.
In other markets like Japan, they're still predominantly on the subsidy model. Those markets still have to make the transition that the U.S. did a couple of years ago.
Lewis: And that's going to sting the ability for them to charge high prices on top of some of the other forex issues that they might be running into. One of the other things they emphasized is the battery replacement program. We've talked about this in the past, but I think it's worth repeating here. That's something that undeniably extended the useful life of models that people already had, which made them far less likely to upgrade to the new stuff that Apple has made available.
Niu: Right. They replaced an estimated 11 million batteries under the program throughout all of 2018. On a normal year, they'd only replace one or two million. That's 9 or 10 million devices that have batteries replaced that could have turned into sales. I don't remember the number off the top my head, but I ran the numbers a while ago. It's billions of dollars' worth of potentially lost sales of people that might have upgraded their phones that year, but instead just got a new a battery for $30.
Lewis: Yeah. A lot of big issues. I think the biggest, though, and anyone that's been following the Apple story so far, is China. They said that basically, the miss is almost single-handedly attributable to China and them not anticipating what would be happening in that market and the way that it would play out over the last couple of months. I don't really think that that's going to change anytime soon, Evan.
Niu: Yeah. Greater China was by far the big weakness here. Sales fell almost 30% to like $13 billion. iPad, Mac, and iPhone all declined. That weakness is really only partially offset by the strength in other areas. There's ongoing trade tensions with the U.S. There's also a sense of economic nationalism, a lot of Chinese consumers are kind of trying to stay away from foreign brands and buying these local bands like Xiaomi or Huawei, who are also making really good phones at very affordable prices nowadays. It's this culmination of all these different factors, some of which are macroeconomic and beyond Apple's control, but some of them are very much within Apple's control.
Lewis: Thinking about how all this might play into the business for the quarter that we're currently in, and that they'll be reporting when they give results in May, they're forecasting revenue between $55 billion and $59 billion. If they were to get the upper end of that guidance range, they'd be coming in where Wall Street is expecting them to. It seems like it's possible that we could be looking at another somewhat disappointing quarter from this company when they report again.
Niu: Yeah, that's why I was surprised. The market likes the report overall. Apple shares went up. But their guidance wasn't that great. It could be that people thought they were going to issue way worse, and it wasn't as bad as they'd thought it would be.
Yeah, they're going to have to stretch just to hit basic consensus estimates on revenue. At the same time, they've talked a lot about all these challenges they're facing. They're working hard to tackle them and address them. We'll have to see over the next couple of months what kind of progress they make on these important fronts.
Lewis: Apple feels to me a lot like a company that is trying to find a new identity. They know that the growth lever that they've had for a really long time -- the iPhone segment -- isn't what it has been historically, and that the game is changing a little bit. They seem to have understood that well, and started to build out and emphasize the Services segment; but I don't know that from a share price perspective or from a growth perspective, we're at a point where that's going to be immediately realized anytime soon.
Niu: This transition to emphasize the Services business has been going on for about two years now. It's very obvious to me that most investors are still very focused on the iPhone business, unit sales, hardware sales, because the reality is, that's still the bulk of the business. I think it's going to take more time still before investors shift their perception and appreciate that this hardware sales piece is really important, but the Services business is growing really well. It's much more profitable, as they're now showing. They're making progress in getting people where they want, in terms of perception, but I do think it's going to take a little more time.
Lewis: All right. Evan, we want to talk Facebook today, too. It's kind of funny that we're talking about Apple and Facebook in the same show. These are two companies that maybe aren't particularly thrilled with each other right now.
Niu: [laughs] Yeah, they had this little dispute this week. To try to sum it up quickly, Facebook's been using an enterprise developer certificate to distribute this research app that was basically spying on people. Apple revoked their certificate, and that broke all of their internal development apps. [laughs] At this point, they've given it back, so I think everything's OK now. But it's a pretty big conflict between the two because Apple is so pro-privacy, and Facebook has had so many privacy scandals.
Lewis: And this is the latest in a series of public jabs between Zuckerberg and Apple CEO Tim Cook. I think they like to get in their shots when they can. The episode recently came out about them taking advantage of some of this access to get some more consumer data, and paying for it, but still being a little shady in that. It reminds me of this thought that I had a little while ago. I think that Facebook is the Wells Fargo of tech at this point. You look at this company, and you're like, OK, I think we've gotten through it, I think we've weathered all of the bad news that could possibly come up. And just when you get there, there's another headline, Evan.
Niu: It's just back to back to back. [laughs] It's really crazy how the media is able to just keep digging up all these stories. Every story that comes out, it's Facebook doing more shady stuff. The recent episode also highlights how much power Apple has over Facebook, if they can flip a switch and break all of Facebook's stuff. And Apple's right. Facebook was very clearly violating its policy with how these certificates were supposed to be used. But it's interesting because one of the biggest risk factors to Facebook has always been that it relies almost entirely on these third-party mobile platforms for its business. 93% of advertising revenue is mobile ads. And Apple totally controls that business. Theoretically -- not that this would happen -- if Apple were to take Facebook's app off the Store, Facebook is just toast. [laughs]
Lewis: It would take something pretty ridiculous for them to do that. We mentioned all the trouble they've had and all the bad news that's come out. And yet, the business just keeps churning along. You'd think that at some point, it would be the straw that broke the camel's back. We look at the user numbers, we look at the revenue that we've gotten in this most recent report that came out this week, everything's coming up aces for them.
Niu: And that's the same way it's been all year. All 2018, it's scandal, scandal, scandal, and almost every quarter, they put up strong numbers. In the summer, they reported earnings and had a huge drop because of the guidance. But the user numbers have been resilient this entire time. Fourth quarter alone, revenue was up 30% to $16.9 billion. They also hit a record profit of $6.9 billion. These numbers are just astounding.
Lewis: On the user side, DAUs reached 1.5 billion, which is up 9%. They have a denominator that is at a billion-plus, and they're still able to grow DAUs 9%. MAUs also up 9%, reaching 2.32 billion.
Most of that growth is coming from developing parts of the world. All of the markets that they were in early, like United States, North America, Europe, those are pretty saturated at this point. A lot of the user growth is coming from the Philippines and countries like that.
Niu: Right. Even beyond the user numbers, in terms of monetization, I was also really impressed with their advertising average revenue per user in North America. It hit a new record of $34, which is just insane. I thought it was good at $24 a few quarters ago, but now they're all the way up to $34. They're continuing to really ramp this monetization. Of course, there's a lot going on there with the dynamics of the ad business, but the overall number is incredibly strong, still.
Lewis: One number that does speak to that, and where the additions are coming from on the user side, and how that impacts the business, is we saw that ad prices went down. They were down about 2% year over year. That's because the ability to monetize some of the people that are coming on in developing markets just isn't there in the same way that American users or Canadian users or European users would. There's a different value in terms of ad reach to those different regions. That's probably going to continue to happen a little bit as we see more and more of the growth come from developing parts of the world.
Another thing to keep in mind as you're looking at that ad price number is that a lot of the ad load in the feeds for Facebook and for Instagram is fairly saturated, as well. A lot of the new impressions that we're going to be seeing on these platforms are going to be in the Stories product, which is new testing ground for a lot of these ad companies.
Niu: Right. They said ad impressions were up 34%. That's primarily being driven by Instagram. Some of the slippage in the pricing, they also mentioned, some of the usage of their services is shifting toward these features that are less monetized currently, like Stories. But, they have started to monetize Stories now. They have two million advertisers that are already promoting inside of Stories. They basically have to navigate that shift, but they've been able to navigate these types of shifts in the past, so I would be pretty confident that they'd be able to do that again. But, that's part of what the challenge is right now, being able to transition there.
Lewis: All told, the company said that they have 2.7 billion people using one of their properties in the month of December, which is just incredible. Managements emphasis of that number speaks to a larger organizational philosophy of, "OK, let's look at everything holistically. Let's look at all of this as a portfolio of properties rather than just one, another one over here, and a third and fourth."
Niu: Right. They first introduced that metric last summer, this familywide audience metric. Back then, it was 2.5 billion. Now, it's at 2.7 billion. That number is still growing. But yeah, I agree. A lot of what's happening is that the core Facebook platform has always been very important, but most of the growth these days is coming from other platforms like Instagram. The more significant financially that these other platforms become, it calls to question, when are you going to start breaking out more detailed results and metrics and give investors this transparency around these other businesses that are super important? I think, basically, what this familywide audience number does is acknowledging that, yes, this is really becoming more important outside of Facebook. But instead of giving us broken-down numbers here and there and on each individual platform, they're just going to combine it all. I think it makes a lot more sense that way because if you look at it, they also advertise across all platforms. When you're buying ads on Facebook, you can have them automatically place it for you, on any of their platforms. So in a sense, they already treat them all like one platform. This is just reinforcing that approach.
Lewis: It also ties into this major news item we saw a little while back about the company deciding to merge some of the messaging apps, looking at what they're doing WhatsApp and the end-to-end encryption, and possibly rolling that into some of the properties that people are maybe a little bit more familiar with with Messenger.
Niu: Right. That report came out a few days before the release. But then, Mark Zuckerberg basically confirmed the plans, saying, "Yes, we're looking at integrating these messaging services a little bit more." Think about, you're a user looking at a classified ad on Marketplace, and then you want to message the listing, you're interested in buying it; but then, you have to go to Messenger. What if you're in an emerging market where WhatsApp is the big popular service there? You have to go to WhatsApp. You know what I mean? There's all these different ways, and that can be jarring. The idea is to unify these apps, allow you to message across the services better for the sake of user experience.
Lewis: Looking forward, Facebook is trying to wave the flag a little bit and say more revenue deceleration is coming. This is something that they've been trying to get the Street to understand for quite some time. We talked a little bit about the reasons for that, in that the ad loads are pretty saturated on the news feeds for Facebook and Instagram, most of the growth is going to be coming from Stories, which have lower CPMs. So much of the opportunity still remains very untapped. If you look over at WhatsApp and Messenger in particular, they've done a little bit of testing there, but by and large, there isn't a lot there in terms of activity that's monetized, and it doesn't really seem like they're in any rush to do it.
Niu: Right. Instagram is really up and running, charging forward with monetization. But the messenger services have always been a little bit trickier to get a good model on how to monetize the usage. They're very up front that it's basically immaterial at this point. They have ads in these products. They're also connecting businesses to consumers. But these aren't really bringing in a lot of money. They're still not really meaningful in terms of financials right now. I think that they can focus on that later.
The real key is going to be to be able to grow revenue, even if it's decelerating. They have big plans in store in terms of their costs and investments in the business. Total costs are expected to go up by 40% or 50% next year. That's $43 billion to $46 billion in total cost for next year. Capex will be $18 billion to $20 billion. They're investing heavily in the business, particularly on the safety and security side. Mark Zuckerberg said they tripled their workforce from 10,000 to 30,000. They're going to have to grow that top line to pay for all that stuff.
Lewis: And that's hopefully addressing a lot of the criticisms that the company has very rightly had to field over the last couple of years.
Something that was curious to me in this report, Evan, a little buried in there, wasn't in the PR part of the release, but if you look over the 10-K, we see in Facebook's release the mention of Amazon.
Niu: Yeah, they actually mentioned Amazon as a competitor in advertising for the first time ever. We've talked about before, Amazon is really expanding aggressively into advertising because, of course, advertising and commerce go hand in hand. They're such a huge player in commerce that they have a huge opportunity with having merchants advertise on Amazon directly, as opposed to Google or Facebook.
Lewis: Yeah. So, you see both of these companies treading into the other one's space a little bit. With Facebook deciding to focus a little bit more on commerce and seeing what the opportunities might be there on Instagram in particular, because it lends itself so well with product featuring; and Amazon deciding, "We're going to check out ads and see what we can do there." It's funny to see them dipping their toes in each other's ponds, so to speak.
Niu: Yeah. It really speaks to, 2018 for Facebook was all about beefing up safety and security after all of these scandals. I think that now that they've made some progress on that front -- obviously, there's still new scandals coming every week, apparently. [laughs] But, I think 2019, they're going to try to refocus back on core product development. Zuckerberg was saying that they want to be introducing new social experiences, new ways for people to interact and connect on their platform. Commerce is certainly a part of that.
Lewis: I think a big part of that is the acknowledgment that the way that they've made money over the past couple of years, especially on the namesake platform, isn't necessarily how they're going to make money in perpetuity. They need to add functionality to these platforms, and they need to build out new ways to monetize their users because there are ad dynamics that are going to impact their ability to continue to make solid revenue on those experiences.
Niu: Right. Their other segment, payments and other fees, actually went up about 40%. That was actually driven mostly by their hardware side, which is a new business for Facebook. Oculus Go, which isn't exactly new, Oculus Go's new product, they're ramping that. Portal is definitely a new product, Facebook-branded hardware. Zuckerberg said that beat his expectations. I don't know how many people actually bought that thing, [laughs] or are willing to put a Facebook camera in their home after all these privacy concerns, so I wonder how low his expectations were. But, there are other parts of the business, to your point. They're diversifying outside of ads. They're finding new ways to build this business.
Lewis: I would like to put a call out to our listeners here. I have not seen a Facebook Portal in person. Evan, it doesn't sound like you own one in your home, either.
Niu: [laughs] Nope!
Lewis: [laughs] So, if anyone does have experience with one, I would love to hear about that and what you use it for. That was something that was a head-scratcher for me in terms of hardware, especially given a lot of the news that came out about that company when they decided to make that release. So, I'd love to get the consumer perspective on that. Feel free to write in if that is your experience.
Evan, anything else you want to hit with Facebook or Apple before we wrap up today's show?
Niu: No, I think we're good!
Lewis: All right. Listeners, that's going to do it for this episode of Industry Focus. A little housekeeping note here. This is going to be our last episode, for a little while, with our dear producer Austin Morgan. He's going to be out of commission for a bit.
Austin Morgan: Yep. Getting my labrum and my rotator cuff put back together on Tuesday. If any of you have any Netflix recommendations, I would gladly take them.
Lewis: [laughs] Do you have any bits of wisdom for our listeners, having gone through the experience of hurting yourself? [laughs]
Morgan: It's just not worth it!
Lewis: It's just not worth it! Maybe the story behind how you hurt yourself is worth telling?
Morgan: We were playing a softball tournament. Last game of the day, we were about to lose because we lost a girl, so we were down a person. We were losing anyway. Ball hit up the line. I was playing right field. At a full sprint, took a full-speed dive and landed a little heavy, the ground was a little wet, and I stuck and just blew up my shoulder. And here we are!
Lewis: And here we are. So, in a couple of weeks, we'll have a new-and-improved Austin Morgan. But listeners, if you have any suggestions for things for him to do, things for him to watch while he is hanging out in a hospital bed or hanging out at home, please send them along, or any wishes for him. I'm sure he'd appreciate that!
Morgan: Very much!
Lewis: [laughs] Otherwise, that'll do it for the show. Of course, if you want any more of our stuff, listeners, you can subscribe on iTunes or check out all of our videos from the podcast on YouTube. Necessary disclosure here that people on the program may own companies discussed on the show, and The Motley Fool may have formal recommendations for or against stocks mentioned, so don't buy or sell anything based solely on what you hear. Thanks again to Austin Morgan for all his work behind the glass! We'll be having Dan Boyd sub in for the next couple of weeks. For Evan Niu, I'm Dylan Lewis. Thanks for listening, and Fool on!