In this podcast, Motley Fool analyst Jason Moser and contributors Travis Hoium and Lou Whiteman discuss:
- Top earnings reports.
- Is artificial intelligence coming for trucking stocks?
- Stocks on their radar.
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A full transcript is below.
This podcast was recorded on Feb. 13, 2026.
Travis Hoium: Welcome to Motley Fool of Money. I'm Travis Hoium, joined today by Jason Moser and Lou Whiteman, and guys, this is really when earnings season kicks into high gear for a lot of the companies that we follow. We want to do a rapid-fire look at some of the popular companies, disruptive companies, and find out what we learned from the quarter. Jason, what did we learn from Cloudflare? Maybe first, what in the world does Cloudflare do?
Jason Moser: That's a good question. It's like, hey, what does Salesforce do? It's everywhere, but we don't necessarily see it. The proper answer, it does a little bit of a lot of stuff, but primarily, it's seen as a content delivery platform focuses on application development and, most importantly, I think, in today's day and age, cybersecurity. There is a big cybersecurity dynamic to Cloudflare, and it's one we even talk a lot about within our quantum leap service, thinking about beyond classical computing and into that post-quantum cryptography stage of life that we will ultimately hit Travis. Cloudflare is a company that is working to protect us on that front, as well, but that's the answer in a nutshell. I think this was another good quarter that showed that the language we have been talking, we've been using over the last couple of years with Cloudflare and with a number of enterprise software type companies. The elongated sales cycles, the trepidation of their customers to commit to spending, those days seemed to be well past us. It was another very solid report. They grew revenue, 34% for the quarter, well exceeding their own guidance, guiding for another tremendous year, 28% revenue growth. They tend to underpromise and overdeliver, which is certainly priced into the stock, but I think the story with Cloudflare really continues to be large customers. Those customers that pay over $100,000 per year, they really continue to drive results, revenue contribution in that segment for the quarter was up 42%, and now contributed 73% of revenue in total, and that's up from 69% from a year ago. Then, just to top it all off, that dollar based net expansion rate of 120%. That was up from 111% from a year ago. Very encouraging to see that not only do they sign on new customers, but they continue to really grow those relationships with customers, as we've seen from that large customer data.
Travis Hoium: Cloudflare is one of these companies that, if you go back to 2021, this is the first one of those high-flying stocks that I remember trading for 100 times sales. Then, suddenly crashing in 2022, we're back to the point where they're trading for 30 times sales, which is still a very high number, and five year growth rate is 38%. Is valuation ever a concern for Cloudflare? Is this just one of those, hey, this is a utility on the Internet, and so they're not going anywhere? That's why the market pays a premium for them.
Jason Moser: I think it's a little bit of both, to be fair. I always look at something like Cloudflare and think, one of the primary risks to a business like this, beyond some security breach, is the valuation itself. It has always really traded for a premium valuation. Save those couple of years, just a few years back, when we were talking about those elongated sales cycles and how committed their customers were. We really saw the stock take a huge hit back then, but it has recovered, I think, based on these growth rates that we're seeing. As long as we see that top line continue to grow at the pace that we're seeing today, I think the market, the premium is fairly well earned, but that is a big risk. If we see that tick down, we're going to absolutely see those shares pull back.
Travis Hoium: Lou, what did we learn from Airbnb?
Lou Whiteman: In a narrative-busting week for Airbnb because everything was down. Airbnb actually missed earnings, and the stock is up post. On this week, that seemed really weird. A few things going on, though. For one, stock was already down 15% for the year, and we're still just in mid February. There weren't a lot of expectations baked in here. Also, they see double-digit revenue growth in 2026, which I think is better than some had feared, especially with all the macro concerns, where things are going. This was a good report from a good company. I think the funny thing is, though, is what expectations? What should we expect from here? I don't know about you guys, but increasingly, when I look at Airbnb, I see Marriott. I see a mature lodging business, asset-light, that can outperform but is not going to be a high-growth stock. I've given up on experiences as a new rocket ship.
Travis Hoium: That was supposed to be their thing that they launched about a year ago.
Lou Whiteman: Yeah, they invented a concierge. I think it's tough to figure out how this is anything more than a Marriott from here. The good news is, is that Marriott has been a pretty good, solid company. I think it's all about expectations from here, but a good company doing well, they went public so late, so much of the growth was gone. I think now we're just waking up to this is more of a lodging company than it is a tech company, maybe.
Jason Moser: Well, correction, Lou. It was an AI-driven concierge there, revolutionary concept there. I'm just, that's tongue in cheek course. I'm with you there, I love Airbnb as a consumer. I like it as a company. It is difficult to see that tremendous growth going forward, just given how big the company is. Yeah, experience has just been underwhelming, to say the least.
Travis Hoium: The interesting thing for them is they did actually start to, like you said, accelerate in the quarter. It seems like some of those, hey, this is going to be a commodity. You're going to have booking.com come in. Maybe that isn't the huge fear, and I think they talked about that a little bit on the conference call. You've got this community of trust with Airbnb, and in a world of AI, and you don't know who you're going to be able to trust when you're doing something like planning a trip, maybe that's an OK place to be, we'll see. I was interested to hear Brian Chesky's digs at AI on the conference calls, too, because he always seems to have an interesting take or two. Jason, what do we learn from Shopify?
Jason Moser: Shopify. Well, this was another good one. Not surprised to see the growth rates they lobbed up. The report looked very good revenue up 30%, and they saw quarterly gross merchandise volume surpassing $100 billion for the first time. Of course, we saw the stock sell off. That's not a terrible surprise because just like we're talking about Cloudflare, for as strong as Shopify is, it's still one of those businesses that trades 150+ times earnings. There is a lot of optimism baked in. Now, I get it. They're taking a share. Again, that gross merchandise volume number, very impressive, and that is poised to continue. I think one of the question marks I have with Shopify it's not really specific to their business, but we just hear more and more talk about this agentic commerce, and exactly what that means. I think we're going to see how that opportunity in agentic commerce shapes up over the coming quarters and years. They certainly discussed their AI investments on the call. They're very excited with the opportunities, the efficiencies, helping their merchants run better businesses, become more effective with their advertising, and ultimately closing sales. Speaking of valuation, listen, I think Shopify has at least earned that leap of fate that the market is taking. It has grown revenue 32% annualized over the last five years, and I think the two billion dollar share repurchase is an interesting announcement. Maybe it's a vote of confidence.
Travis Hoium: That's a drop in the bucket, to be fair, 154 billion.
Jason Moser: It is a drop in the bucket. You're right, and ultimately, let's see that that authorization is actually having the desired effect.
Lou Whiteman: That's funny. Timing matters. Maybe I'm oversimplifying, but they grew by 31%, but margins were down because they were investing in AI. If that was the exact same headline last summer, the stock was probably up 15%. Part of it is just what you're doing. It feels, as a long-term holder, I didn't see any reason to go chicken little on this, but it's just a different environment, and I think we're adjusting to all that.
Travis Hoium: Lou, we had a Ferrari report, and I wanted to get your thoughts on Lewis Hamilton's season ahead, but we'll skip that for now. What did the numbers look like?
Lou Whiteman: Travis, I'd rather talk about the big Brentford Arsenal game from yesterday. It'll be good if you want to go into European sports, but I'll spare you that, and we won't get into Formula 1. Here's what I'd say. Ferrari, last time they reported back in October, shares fell 20%. This time, they beat lowered estimates, and the stock responded well. It's still down about 20% since October, though, so I don't think we should read too much into just the headline jump. What's going on? What's wrong? They're only guiding for minimal revenue growth in 2026, under 5%, no margin expansion. This, they say, is temporary. They're doing model changeovers, but look the Ferrari model, you've got a huge waiting list. Just sell the cars, just jack up prices. I don't get why it's working. I think I still like this company, but it's still trading at more than 30 times expected earnings. There's tariffs, there's macro, I get why the markets.
Travis Hoium: I want to get to two quickly here. A sentence or two, Jason, what do you think of Spotify's results?
Jason Moser: Well, Spotify is another one. I love it as a consumer and was very impressed with these results. We saw monthly active users up 11%. Importantly, premium subscribers up 10%, and we know that is the lion's share of the revenue picture for Spotify. Consequently, we saw that premium membership revenue up 8%, but I thought what was really impressive was how they're starting to bring this all down to the bottom line. Saw operating margin for the quarter 15.5%, that's versus 11.2% a year ago. I think we had some questions really early on in the Spotify story as to exactly how quickly they could get to profitability and how profitable the company could be, given the nature of the relationships with publishers and just the music business in general. I think we're hitting a situation here where the company they have so many users. It's starting to become one of those Facebook-like or even Netflix-like stories where even a mass exodus at these levels probably wouldn't have that grave an impact. Travis, I just realized they passed a two-dollar price increase on the family plan that we have here in the Moser Household.
Travis Hoium: I got it too.
Jason Moser: Happily paying it.
Travis Hoium: The kids' app is very sticky for us. Lou, Pinterest is down 22% today post earnings.
Lou Whiteman: They matched expectations on earnings. They grew revenue by 14%, but that was a little shy of expectations. Interesting thing, the forecast is very underwhelming here. They're blaming tariffs. They're basically saying that tariffs are depressing sales among their customers, and that's leading to fewer ad sales. Which guys might be true, but here's my question. Retail has been very mixed. I don't think we have gotten the sky is falling from the actual retailers. Just throwing this out here, I hate to be too negative, but does this indicate that Pinterest is low on the priority level for ads? If retailers are pulling back ad spending just a bit, it is affecting Pinterest more because those are the easiest ones to cut, and if so, is that a longer-term issue? There's a lot of ifs there. I don't want to say it, but I both get the tariff excuse, and I'm a little skeptical just based on everything else going around.
Travis Hoium: A lot going on with earnings, but Lou promises me there's something exciting going on in trucking.
Lou Whiteman: I'm only promising fun.
Travis Hoium: We'll get to that in a moment. You're listening to Motley Fool Money.
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Travis Hoium: Welcome back to Motley Fool Money. Lou. You are the old boring business guy. You like to talk about logistics and trucking, but you're promising that there's something exciting going on related to AI. What's the news for this week?
Lou Whiteman: First of all, it's not just logistics. We saw this with SaaS stocks, just crushed because of AI tools. Charles Schwab and other financials were crushed earlier in the week because of some AI tax planning tool that is supposedly the first step toward replacing financial planning. That happened on Thursday with logistics companies. A lot of truckers and logistics stocks down 20% or more. Why? A company that six months ago sold karaoke machines, announced an AI platform that it says will increase trucking efficiency by 300% and eliminate the need for truckers and brokerages, basically. Guys, I am willing to keep an open mind here. I believe technology can greatly add to efficiency in the shipping business. CH Robinson, RCO, some of these leaders have been spending millions on tech. The issue is most of their customers still use rotary phones and paper. Now we're supposed to think that they are suddenly going to adopt AI. I'm a little skeptical. We'll see. Maybe this company does have the answer. We'll see. It's also possible that this is the poster child for what we've seen the idea that maybe the market is overreacting. Sell first, ask questions later. One thing I know for sure here, and I'm curious because, this is, I think, a more extreme example than what's going on with the SaaS stocks and, we'll see. But this company that made the announcement, their market cap is $6 million. If this system is half a quarter of what they say it is? Why don't we get together, someone should buy them for 200 million today, subject to due diligence. I would like them to do due diligence first. You get to karaoke assets for free, I guess. But I think, and the reason I wanted to bring this up is, I don't know what's going on with logistics. Maybe they're all that, but we have seen just a bloodbath in sectors this week, just because companies we had never heard of have introduced AI tools that are going to disrupt. I believe in AI. I believe that we are going to see disruptions all over the place. I do think as investors, it's good to take a long term perspective and not just sell off on these press releases. Let's wait and see how it develops. Does that make sense?
Travis Hoium: One of the questions I have for you is it seems like a lot of these companies that are coming in and trying to disrupt established players, it's ultimately value destructive overall, and that's what's confusing about what's going on with the market is a company will introduce something. The bigger company will fall 20%, lose, let's say, $50 billion in market cap, but there's no made up market cap by the company that's doing the disruption. Obviously, they're just seeing this as potentially pure upside, but it does seem like the market overall is selling first and asking questions later, and yes, disruption may be coming, but also these companies have agency. That's the thing that I think we don't think about. These trucking companies do have the ability to if they can make an AI in six months that will improve efficiency, you would think that at least someone inside CH Robinson and all these companies would be thinking about doing the same.
Lou Whiteman: They're spending millions. This has been going on back from before we called it AI when it was machine learning. UPS famously in the '90s, put in software to basically root out their drivers to make mostly right, 'cause turns right turns are safer and they're quicker. Like this efficiency driving is pretty old. You can do more. But, CH Robinson is spending millions on Tech. Their issue is getting customers to adopt it. There's a lot that can happen from here. I do think that AI can be revolutionary. I am not sure it's going, I actually think there's a world where on a lot of these, especially touching the physical world, that this is going to lead to actually better companies and more efficient companies. The truckers selling off with the logistic companies. I don't get. The trucks are full already. The problem is that there's not enough distribution centers, and I don't know how AI solves that, but we'll see, I guess.
Travis Hoium: Is it possible that in trucking in particular, we sort of skip this interim phase of being more efficient and just go straight to autonomy, because it seems like, that is an area where, especially is long haul trucks, is it going to be safer and more efficient to just have an autonomous vehicle drive from point to point? We saw this in an area like India. They just went straight to cellphones in 5G. They didn't go through this development that went through in the US. Is that possible or am I overthinking it?
Lou Whiteman: If your timeline is long enough, maybe. I don't know. With cellphones, going straight to cellphones, you don't have to worry about it plowing into, a bunch of other drivers. We're heading all directions. How fast we get there, we'll see.
Travis Hoium: Uncertainty seems to be the name of the game. Like we've seen with the example I keep thinking about is electric vehicles. Five years ago, we thought that everyone was going to be buying an electric vehicle today, but that is not where we ended up. Sometimes these disruptions take a lot longer than you think. If you go back to the dot-com bubble, it took until the early to mid 2010 for a lot of those things to materialize. When we come back, we're going to see what stocks are a falling knives and which ones aren't. You're listening to Motley Fool Money.
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Travis Hoium: Welcome back to Motley Fool Money. This segment, we like to have a little fun and just get a feel of what's going on in the market. I want to ask Jason and Lou, whether these stocks are falling knives. A cautionary tale you don't want to be buying before it hits the bottom, or are these stocks worth a fresh look? We talked a little bit earlier about Shopify. Shares of Shopify are down 38% from their peak. Jason, is this a falling knife or worth a fresh look?
Jason Moser: I would say worth a fresh look now, going back to what we were talking about earlier in the show. I do also believe that valuation is going to be just a risk that investors have to consider with this stock. That said, it has always maintained a premium valuation, and I think that's for a lot of the reasons we discussed. The growth rates of the company continues to lob up there. I think just that overall opportunity in commerce, the nature of the business, there's some big question marks as to entirely what agentic commerce means.
Travis Hoium: Everyone is trying to define that? It's funny to see the AI companies explaining what agentic commerce means. I'm just as a normal user of this stuff, I'm going, "Really?" I'm just going to let it go plan a trip for me without [OVERLAPPING]
Jason Moser: It's not a mind reader. I think that's where we have to figure, where's that happy middle there? Are we talking about just auto filling delivery addresses and payment information? Because, you know what? That's been happening for a while now. I've read a lot of thoughtful pieces about agentic commerce. A lot of them talk about why that may be a little bit overblown. Perhaps what we see with agentic commerce ultimately is it serves more on the back end for these companies and is less consumer facing. I think that's a little bit of an easier leap to make there, when we see these investments the businesses make in helping their merchants run more efficiently and making their actual businesses more efficient. Overall, I mean, I think we still look at Shopify. I'm a longtime shareholder, very happy shareholder, and I'm happy to hang on to those shares. I think when we see the company pull back like this, historically, these have represented interesting times. I don't think that Shopify is the type of business that is going to be disrupted by AI, as many of these companies we're discussing. That's the big question.
Travis Hoium: They seem to be necessary because they're serving the long tail companies. If you're going to build a business, an online business that's going to plug into these AIs, you would think that Shopify would be the place you would do it.
Jason Moser: It's going to be building, I think, on top of that layer of AI technology, and ultimately helping reshape the commerce industry. I think obviously a very tech-forward company in Toby Lütke, I think, just clearly very dedicated to the business, and I don't want to imagine that changing anytime soon.
Travis Hoium: Lou, my question here is, when does this company get interesting? I'll give you some valuation metrics. Enterprise value to sales is about 13 still. Even on a price earnings ratio is 126 on a trailing basis and on a forward basis, still 65. Not a good value argument here, but, where do you get to the point where you go, Man, this is just too cheap to pass up.
Lou Whiteman: I would echo almost everything you guys said about, I'm not worried I'm a shareholder. I'm not worried here, but valuation does keep me from buying. I think they're a long term winner. At the end of day, valuation is your ability to grow over what time frame. I do think there's an argument to be made that if you're a long term holder, you can do OK here, I would probably not add to it unless it falls from here just because I do think nobody knows what's going on. We just talked about it. It's shoot first, ask questions later. I don't think, like, I don't think you can say, "Buy in now", and it goes straight up from here. I don't know if I necessarily want to catch this right now, but I also don't I lose sleep about a lot of things, guys. I'm not losing sleep over my Shopify shares.
Travis Hoium: Let's go to another company that's taking it on the chin. This has been on my watch list for a long time, but I've never been a shareholder. That is Workday. Shares are down 53% from their all time high. That actually goes back to 2024. But the valuation getting a little bit more compelling than we get at Shopify. Enterprise value to sales is 3.8. Forward priced earnings multiple is just 13. One of the reasons this caught my eye this week was one of the big AI labs said that they were adopting workday. Even the big AI labs aren't building a workday to replace Workday. Lou, is that saying something to you?
Lou Whiteman: It's certainly is interesting, isn't it? It certainly worth noting. Even before the AI drama, there was a lot of competition in this sector. It was already an uphill battle to their credit. They have done very well beating back the competition and establishing themselves. I don't worry about this one, but I guess I'm less confident than I am with Shopify. I do think that, you have all this competition plus AI at least on the back end, automating some of the things that go on here, I think I see maybe a bit of a crack in the foundation, but I don't see rubble. If you make me say one or the other, I would say worth a fresh look, but I'm content to watch this play out and see how it develops.
Jason Moser: I think it's interesting to see the language that we're hearing from a lot of folks in the tech space these days. I feel like they've got a pretty good in there and maybe know a little bit more than some of us do about what's going on. We saw Amazon Web Services Chief Matt Garman, talking about this recently saying that much of the fear is overblown. I went back to a tweet that Aaron Levyie at Box had sent out a little while back, talking about, this is going to be transformative technology, but what it's going to result in it's going to result in more software than ever before, more productivity, more options, more companies, more ideas that we just aren't even thinking of today. I don't think it's going to be destructive as much as it's going to be constructive. When I look at something like a workday, yeah, it's one thing if you can go in there and vibe code some of the stuff that they do. But don't discount the difficulty in building an actual company. This is a $38 billion market cap company right now.
Travis Hoium: By the way, what they're doing is, you can't make mistakes.
Jason Moser: It's not easy. It takes a lot of thought. It takes a lot of work. It takes a lot of redundancy. It takes a lot of bug squashing. Then after all of that is said and done, it takes a ton of maintenance, and it takes a lot of work to build that customer base and build that trust. I don't think that's something that just disappears overnight. When you look at the economics of the company itself, it's a strong business. I get why shares have pulled back. I mean, we've seen the software and services sector. Essentially, earnings valuation for this sector has just been cut in half, and that's more or less overnight. I'm not saying it's not warranted because I think we're seeing a lot of these companies were rerating the growth prospects going forward and trying to understand exactly how they might be disrupted. But let's also remember to think about what we don't know here, know what you don't know. We're still asking a lot of these questions as to how this is ultimately going to shake out. We just really don't know yet. We're watching it play out in real time.
Travis Hoium: One of the companies that I'm intrigued by and may actually fall in the value stock category at this price is Adobe. Shares are down 62% from their high. Then the valuation numbers are just getting crazy. Enterprise value of sales is four, but they're actually a really high margin business. Price earnings multiple on a trading basis is 15. That's cheaper than the market overall. But on a forward basis, that PE multiple is just 11. Jason, is this a falling knife, hey, this is a disruption happening, and we're going to watch this stock grind lower for the next decade as the business deteriorates? Or are we getting this all wrong, and professionals are going to continue using Adobe a decade or two from now?
Jason Moser: Well, it is a not loved business today, Travis. That's for sure. I've seen investors vote with their feet there. I own a handful of shares of Adobe for a while, and it's been a recommendation in a number of our services, generally speaking, it's because of just the historical success it's had. I think a lot of that being brought into question now with the capabilities of a lot of these large language models. You see some of the things that Notebook LM is capable of, for example. You can build some pretty fascinating graphics with just not very much expertise at all. Then the question for me becomes really, what does Adobe do to utilize AI to make their business better? It's not like they can't respond to this and say, well, we can offer these same types of tools and we can do it better. Actual businesses here that can support your needs and grow the relationship. It's not a high conviction name right now. I would not say. I don't think it is a falling knife. I think that the company has the wherewithal to respond competitively and utilize AI to make their business better and respond to the competitive threats. But it is a bigger question mark out there right now than probably some others, I would say.
Travis Hoium: Their operating margins have not really felt a pinch since 2018. The operating margin is up from 31.5% to 36.6%. If there's pricing pressure, which are just one of the areas you would feel at first, they're not feeling it yet.
Jason Moser: You would figure. If you look at what they've done to their share count outstanding, man, they're buying shares back hand over fist. I applaud them for their conviction there.
Lou Whiteman: Yeah. This is one I'm watching close. I get the concerns. I just think professional users, it's going to be a long time before they go to free tools or lesser tools, especially with Adobe investing and making like Incorporating AI. I'll admit it's not a slam dunk, but Travis, look, it's down, I think. It's lost a quarter of its value this year. Again, we're in early February.
Travis Hoium: It was arguably a value stock at the beginning of the year.
Lou Whiteman: Yeah, I don't think this is a slam dunk by any means. I think the threat is real, but yeah, this is one that I'm getting closer and closer to leaning into.
Travis Hoium: Let's talk about another one that is potentially under threat that is Intuit. This is a company that's making TurboTax, the thing that they're known for the most. But the drawdown with their stock is 60%, and that's in just a matter of months. Is this one of these cases where disruption is coming for them. We're not going to see it until maybe tax season 2027, or are we getting to value territory with shares trading for 16 times forward earnings estimates, Lou?
Lou Whiteman: I'm not a big fan of this company. I feel like that there should be better ways.
Travis Hoium: You know what we're seeing for Intuit once a year [inaudible] taxes. Come on.
Lou Whiteman: Well, no, look, the IRS gets all the information. I do feel that in most civilized countries, they should be able to just [inaudible].
Travis Hoium: I understood that. Why is it that once a year, it seems like I get a $50 bill from the IRS for something that I forgot to put into TurboTax? Why didn't you just tell me that in the first place?
Lou Whiteman: Lobbying, baby. I don't want to be a conspiracy theorist. Look, if anything, we've gone the other way with the consumer product. I do think the lesson is that they do have a powerful market position, however they got there. I think it'll probably be OK. As much as we talk about the TurboTax side, a lot of what's driving this business is on the non-consumer side, and that's a whole lot more complicated. I'd be surprised if this business goes away. I've heard multiple predictions about why it was doomed over the years. So far, none of them have come true.
Jason Moser: Yeah, it feels like it's a bit more of a, I don't want to say protected, but just the barriers to entry and finance and all the regulatory red tape that comes with it, whether it's helping someone run their business or someone do their taxes or manage their payroll. That's difficult to replicate reliably and then actually push out to a large consumer base. It seems like the easier disruptor for this company would have been if our politicians could have simplified the tax code and made it easier just to file taxes. But as I think we all probably know, as we get older, that process just becomes inherently more difficult because we've accumulated more wealth. It goes on and on. We use TurboTax every year, and frankly, I find it to be a breath of fresh air knowing that I can log in, speak with a tax representative, have them do this stuff for me. I know that it's being done correctly to the extent that they're doing it. I just think most people hate the idea of having to deal with doing their taxes. Furthermore, it's un-understandable, in many cases. Unless you're just filing the simplest of returns.
Travis Hoium: I felt the same way as I've gotten older, where, you know what, paying 100 bucks, even 200 bucks to get your taxes done it's way more efficient than spending a whole bunch of time. My grandpa used to do these by hand and that was his hobby as he got older. But they also seem like a company that could potentially leverage tools like artificial intelligence.
Jason Moser: Correct.
Travis Hoium: To be much more efficient as a company, hey, Travis, here's your folder of documents. Just dump them in. We'll put them in the right place, and we'll figure it out for you. Now instead of having to go through 50 pages of yes, no, answering questions, you can answer all that stuff for you. Is that a reasonable way to think about it?
Jason Moser: I personally think so. I think the more likely scenario is essentially that application, that service being built on top of the AI foundation to make that business ultimately better and more intuitive. See what I did there, guys. But in all honesty, that does feel like it's going to be the more likely scenario. I could be wrong, but again, you talk about well-established businesses that are very difficult to replicate at that scale, this is one of those.
Travis Hoium: All right, when we come back, we are going to get to the stocks on our radar. You're listening to Motley Fool Man.
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Travis Hoium: As always, people on the program may have interest in the stocks they talk about, then the Motley Fool may have formal recommendations for or against, so don't buy or sell stocks based solely on what you hear. While personal finance content follows the Motley Fool's editorial standards. It is not approved by advertisers. Advertisements are sponsored content and provided for informational purposes only. To see our full advertising disclosure, please check out our show notes. We'd like to end the show with the stocks on our radar. Jason, you're up first. What are you looking at this week?
Jason Moser: Yes, well, Travis, as you know, companies need to communicate with their customers, and that's what Twilio does. Ticker is TWLO. They just reported another strong quarter on Thursday, flew past their own internal guidance with revenue up 14%, and another quarter of Gap operating profitability was up better than 300% from a year ago. With active customers up 402,000 now, that's versus 325,000 from a year ago. Dollar based net expansion rate, 109% for the quarter. That was versus 106% from a quarter ago. This is a business that really turned the tides a little bit. I think a lot of that boils down to what CEO Khozema Shipchandler has done. We talk about that often. How do you assess leadership? It's a squishy topic. Oftentimes, I'm just looking to see that they do what they say they're going to do, and Shipchandler really has done just that. I'll just conclude with this. If you guys saw over the week here, JP Morgan put out a list of their AI resilient software companies. Very interesting list there with Tech and Enterprise software, cybersecurity, data, and industry software. But Twilio was one of those companies, and just going back to the discussions about AI, I think Twilio is doing a good job of building on top of that AI layer to ultimately make their business better and their customers' lives easier. One I'm keeping an eye on.
Travis Hoium: Dan, does Twilio have a good AI argument because its name sounds like AI?
Dan Boyd: I don't know, Travis, but I have a question for Jason. Twilio, they talk about it's making, receiving phone calls, text messages, Cloud communications. Is this the Spam text company?
Jason Moser: I was told there would be no questions. No, that's a good point. Some of that service is very well received, but not all. That's a good point.
Travis Hoium: Lou, what's on your radar this week?
Lou Whiteman: Dan, I got to talk about logistics earlier, and now I'm going to double down, press my luck and talk about building supplies. Company is QXO Ticker, QXO easy to remember, formed by serial entrepreneur Brad Jacobs to roll up the building products industry. This week, they did their second deal. They bought something called Kodiak for 2.25 billion. I really like this. Kodiak diversifies the product line, adds more than 100 locations, mostly in high growth states. QXOs getting the business at less than one time sales, just ten times EBITA factor in expected cost cuts, and it's closer to seven times EBITA. This is textbook Jacobs. He built United Waste, United Rentals and XBO some of the best performing, all top 10 performing Fortune 500 companies over the past decade. QXOs stock was up 15% plus on the announcement, which you'd never see for an acquirer. I expect more deals to come. This is a formula that's worked really well for Jacobs and shareholders. The machine is up and running. I'm really excited to latch it.
Travis Hoium: Dan, what do you need to know about QXO?
Dan Boyd: I just don't like the name 'because it's too much like XBO. Get a new name, Brad.
Lou Whiteman: That's his Cryptant. He can't name companies, unfortunately.
Travis Hoium: All right, what's going on your watch list, Dean?
Dan Boyd: Let's go with Twilio. That's all our time for today. Thanks for listening to Motley Fool Money. We'll see you here tomorrow.
