Colin Sebastian

Colin Sebastian from Baird asked for details on the Instacart Platform, wanting to know which enterprise solutions are gaining the most traction, the extent of cross-sell opportunities, and the strength of the sales pipeline, including for non-grocery retailers.

Answer

CEO & Chair Fidji Simo identified Storefront as the key initial product for retailers, which then opens up cross-sell opportunities for solutions like Carrot Ads, now used by over 240 partners. She also highlighted growing interest in in-store technologies like CaperCarts and CarrotTags, which create omnichannel solutions and improve fulfillment efficiency. Simo described the enterprise offering as a critical and underappreciated competitive advantage that competitors cannot easily replicate.

Colin Sebastian inquired about the performance drivers within Instacart's advertising business, specifically the contributions from core CPG versus emerging brands, and asked for the company's long-term vision for agentic commerce.

Answer

CEO Fidji Simo explained that the strong Q1 advertising performance was driven by both large and emerging brands, with over 7,000 brands now on the platform. She attributed the success to high-performance metrics (ROAS, CTR) and the expansion of Carrot Ads. Regarding agentic commerce, she stated that while it's early, Instacart is embracing new technologies to accelerate online grocery adoption and extend its category leadership, citing its work with OpenAI as an example.

Colin Sebastian asked about the long-term balance between the consumer marketplace and enterprise offerings, and whether establishing better standards in retail media could significantly boost ad spending.

Answer

CEO Fidji Simo stated that while they don't break out the segments, both are strong and address the full market. She noted the enterprise business, including Caper carts, has massive potential as 87% of grocery is still offline. Regarding advertising, Simo confirmed Instacart is pioneering standardization with MRC accreditation, which she believes is a lever for growth as it helps prove the superior performance of their ads compared to other platforms.

Colin Sebastian asked about the impact of Airbnb's new testing paradigm on the timeframe for other initiatives like loyalty programs and advertising, inquiring if they remain on track.

Answer

Airbnb CEO Brian Chesky stated loyalty and advertising can proceed in parallel with new business testing, as they are platform-based and can scale faster. He confirmed exploring a unique loyalty program and delaying advertising integration until AI search is "nailed" to align with the new search paradigm.

Colin Sebastian asked about the impact of Airbnb's new testing paradigm on the timeframe for other initiatives like loyalty programs or advertising.

Answer

Brian Chesky, CEO of Airbnb, stated that new supply-based businesses can be tested city by city, allowing for parallel development with platform-wide initiatives like loyalty and advertising, which could scale more quickly. He confirmed that a unique, community-focused loyalty program is being explored, and advertising is being re-evaluated to integrate with the new AI search paradigm, rather than old search models.

Colin Sebastian asked about the impact of the recent app redesign on booking behavior for homes and sought confirmation that booking lead times had returned to normal levels.

Answer

CEO Brian Chesky described a major behavioral shift, with more users booking from the redesigned homepage, moving from search to browse/discovery mode, which helps direct traffic to available supply. CFO Ellie Mertz confirmed that booking lead times, which were compressed in April, have normalized and even lengthened slightly into Q3, signaling strong guest demand.

Colin Sebastian asked if the stronger competitive tone in the shareholder letter was due to past performance or future initiatives. He also inquired about the progress in repopulating the marketplace with high-quality Experiences ahead of the relaunch.

Answer

CFO Ellie Mertz responded that Q4 and full-year 2024 results support continued market share gains against the industry, particularly from hotels, driven by product improvements and brand consideration. She also noted strong performance in non-urban U.S. markets against competitors like Vrbo and leadership in exclusive supply growth. The transcript did not include a response to the Experiences question.

Colin Sebastian asked about common denominators driving the strong recurrent consumer spending (RCS) performance across NBA 2K and mobile titles, and how the GTA VI release date change might affect content updates and marketing for GTA Online to maintain engagement.

Answer

Strauss Zelnick, Chairman and CEO, stated that no change is expected for GTA Online support, noting its continued strong performance, 20% YoY growth in GTA Plus, and GTA V's 220 million units sold. He attributed RCS strength to modest industry tailwinds and, more significantly, to creative teams delivering high-quality, engaging experiences that naturally lead to monetization.

Colin Sebastian asked about the common denominators driving the strong recurrent consumer spending (RCS) performance across NBA 2K and mobile titles, and how the GTA VI release date change might affect content updates and marketing for GTA Online to maintain engagement.

Answer

Strauss Zelnick, Chairman and CEO, stated that Rockstar Games' support for GTA Online would not change, noting its continued strong performance and 20% year-over-year growth in GTA Plus membership. He attributed the overall RCS strength to the creative teams delivering high-quality, captivating experiences, suggesting a positive correlation between quality and monetization, alongside modest industry tailwinds.

Colin Sebastian inquired about the drivers behind the mobile segment's strong performance relative to the broader market and asked for the reasoning behind the forecast that the segment would not grow in the upcoming fiscal year.

Answer

CEO Strauss Zelnick attributed the success to talented creative and publishing teams at Zynga, Peak, and Rollic, who are consistently creating new hits like 'Match Factory!' and 'Color Block Jam'. CFO Lainie Goldstein explained that the fiscal 2026 forecast anticipates some moderation for mature, top-performing titles after their outstanding results in fiscal 2025.

Colin Sebastian asked for perspective on the industry trend of market share consolidation and whether rising development costs will favor optimizing existing franchises over creating new IP. He also asked about the drivers of recent GTA performance.

Answer

CEO Strauss Zelnick explained that industry maturation naturally leads to the 'big and good getting bigger' and emphasized Take-Two's focus on creativity, innovation, and its strong portfolio of owned IP. CFO Lainie Goldstein added that the improved GTA performance was broad-based and driven by strong engagement.

Colin Sebastian asked about the initial observations and expected incremental contribution from the OpenAI integration, and general expectations for transaction volumes originating through AI platforms.

Answer

Harley Finkelstein, Shopify's President, noted a 7x increase in AI-driven traffic and an 11x increase in AI-attributed orders to Shopify stores since January. He highlighted that 64% of shoppers are likely to use AI for buying and emphasized Shopify's strategy to lay the groundwork for agentic commerce through partnerships with leaders like OpenAI and Perplexity, aligning Shopify's growth with merchant success via GMV and payments.

Colin Sebastian inquired about the initial observations and expected incremental contribution from Shopify's integration with OpenAI and other AI platforms, seeking insights into how volumes might originate through these new AI channels.

Answer

Harley Finkelstein, President of Shopify, highlighted a significant increase in AI-driven traffic (7x) and orders (11x) to Shopify stores since January, noting that 64% of shoppers are likely to use AI for buying. He emphasized Shopify's role in laying the rails for agentic commerce through partnerships with leaders like OpenAI, Microsoft, and Perplexity, aligning Shopify's business model with merchant success through GMV and payments.

Colin Sebastian asked about the ultimate vision for Shopify's buyer-facing platform, including Shop App and Shop Pay, and inquired about capital allocation plans for the upcoming year given the company's strong cash generation.

Answer

President Harley Finkelstein stated the goal is for Shopify to be the 'gold standard for commerce,' with the Shop platform driving trust and providing an owned channel for merchants. CFO Jeff Hoffmeister addressed capital allocation, noting the company will maintain a healthy cash cushion, has a convert maturing this year, and will continue to make small, strategic 'acqui-hires,' particularly for AI talent. He stated there are no plans for big acquisitions or an immediate return of capital.

Colin Sebastian of Baird asked for Shopify's perspective on e-commerce platform consolidation and how this trend influences its product strategy for offerings like the Shop App.

Answer

President Harley Finkelstein explained that larger brands are seeking unified commerce systems to consolidate their tech stack, and Shopify's platform meets this need. He highlighted that Shopify's flexible offerings (Plus, enterprise, commerce components), optimized checkout, and transparent total cost of ownership are key drivers attracting these brands, reinforcing Shopify's strategy to be the central retail operating system.

Colin Sebastian asked about the drivers of AWS acceleration, distinguishing between core infrastructure and AI workload monetization, and the importance of services like AgentCore. He also requested a disaggregation of advertising acceleration, specifically regarding core advertising versus DSP and Prime Video.

Answer

CEO Andy Jassy attributed AWS's 20.2% year-over-year growth to momentum in both AI (inference, training, Trainium, Bedrock, SageMaker) and core services, noting the significant interest in AgentCore for building secure, scalable agents. He also highlighted the continued earning of enterprise transformations from on-premises to cloud. For advertising, Jassy stated that all offerings grew meaningfully, driven by Amazon's 'unusual full funnel offering' (Prime Video, live sports, sponsored products), audience curation, and advantageous measurement. He specifically mentioned the rapid growth of Amazon DSP due to feature enhancements and partnerships with Roku, Netflix, Spotify, and SiriusXM, and the significant opportunity in the stores business and video advertising.

Colin Sebastian asked for clarification on the drivers of AWS's acceleration, specifically the split between core infrastructure and AI workload monetization, and the importance of services like AgentCore. He also requested a disaggregation of advertising acceleration between core advertising, DSP, and Prime Video.

Answer

CEO Andy Jassy attributed AWS's strong momentum to growth in both AI (inference, training, Trainium custom silicon, Bedrock, SageMaker) and core services, noting significant enterprise transformations to the cloud. He highlighted AgentCore's role in enabling secure, scalable agent deployment for enterprises. For advertising, Jassy stated that all offerings grew meaningfully, driven by Amazon's robust full-funnel approach, audience curation, and advantageous measurement. He identified significant growth opportunities in the stores business, video advertising (Prime Video Live Sports), and the rapidly growing Amazon DSP, which has expanded its features and partnerships with platforms like Roku, Netflix, Spotify, and SiriusXM.

Colin Sebastian of Robert W. Baird & Co. inquired about the drivers behind the International segment's improved revenue and margins and asked for an update on Project Kuiper's launch status and long-term ambitions.

Answer

CFO Brian Olsavsky attributed the International segment's margin strength to established countries like the UK and Germany achieving US-like profitability through operational efficiencies, alongside progress in emerging markets. CEO Andy Jassy positioned Project Kuiper as a key future player in LEO satellite internet, highlighting its performance, pricing, and AWS integration as differentiators, with a commercial beta targeted for late 2025 or early 2026.

Colin Sebastian asked for color on the drivers behind the International segment's revenue and margin improvements and requested an update on Project Kuiper's launch timeline and long-term ambitions.

Answer

SVP & CFO Brian Olsavsky attributed the International segment's strength to margin profiles in established countries like the UK and Germany now resembling the US, alongside progress in emerging markets. CEO Andy Jassy discussed Project Kuiper, highlighting its large market opportunity, performance differentiation, and strong enterprise interest, targeting a commercial beta later in the year or early 2026.

Colin Sebastian questioned the drivers behind the slight decline in the third-party seller unit mix and asked for perspective on the capabilities and revenue opportunities for a next-generation, AI-powered Alexa.

Answer

CEO Andy Jassy explained the third-party unit mix shift was due to strong growth in 'everyday essentials,' which tend to be first-party (1P) items. Regarding Alexa, he shared the vision of it becoming the world's best personal assistant by rearchitecting its 'brains' with generative AI, enabling it to not just answer questions but also take actions for customers.

Colin Sebastian of Robert W. Baird & Co. asked how the new visual search tool will contribute to engagement and monetization, how it positions Pinterest against other visual AI apps, and about MAU seasonality.

Answer

CEO Bill Ready highlighted that Pinterest's proprietary AI model for visual search outperforms off-the-shelf models by 30 percentage points in relevancy, a key differentiator driven by its unique curation data. CFO Julia Donnelly noted that while some seasonality exists, MAU growth accelerated year-over-year across all regions in Q2, driven by improved relevance and user re-engagement.

Colin Sebastian from Baird asked how the new visual search tool will contribute to user engagement and monetization, and inquired about Q2 MAU seasonality trends in North America and Europe.

Answer

CEO Bill Ready explained that the visual search tool, powered by a proprietary model that outperforms off-the-shelf alternatives by 30 percentage points, drives deeper engagement and retention. CFO Julia Donnelly noted that while some seasonality exists, year-over-year MAU growth accelerated across all regions in Q2, driven by improved relevance and actionability.

Colin Sebastian asked for a breakdown of growth contributions from new versus existing advertisers and inquired about any potential geographic headwinds in Europe that might affect the Q4 outlook.

Answer

CEO Bill Ready did not break out new versus existing advertisers but confirmed growth in the total number of active advertisers and strong share-of-wallet gains with large and mid-tier retailers. CFO Julia Donnelly addressed the Europe question, stating that Q3's 20% growth was strong despite a much tougher year-over-year comparison. She expressed confidence in the region, citing broad-based strength in retail.

Colin Sebastian from Baird asked for details on the economics of the newly launched Disney Solitaire, including licensing costs and margin profile, and followed up by asking if Playtika's strategy for its legacy portfolio is changing due to structural shifts in gamer preferences.

Answer

President & CFO Craig Abrahams explained that while specific deal terms with Disney are confidential, the title has a license fee and is scaling much faster than previous Super Play titles. He also noted their investment strategy focuses on category-leading games. CEO Robert Antokol added that the success of Disney Solitaire demonstrated that launching a new game can grow an entire category they already dominate, which is influencing their future strategy for new game launches.

Colin Sebastian from Baird sought clarification on the 2025 outlook, asking if new game revenue contribution is immaterial, if any future M&A is included in guidance, and whether the recent performance improvements in Slotomania are sustainable.

Answer

Craig Abrahams, President and CFO, confirmed that new game revenue is considered immaterial for 2025 guidance and that no future M&A is embedded in the outlook. Regarding Slotomania, he noted that game economy adjustments led to near-term improvements and that the company is strategically investing in a new slots title to regain market share.

Colin Sebastian from Baird inquired about the importance of the active and enthusiast buyer base in sustaining GMV growth and whether the strong year-to-date performance alters the company's medium to long-term growth outlook.

Answer

President & CEO Jamie Iannone affirmed the critical role of both active buyers (which grew 1% to 134 million) and enthusiast buyers (who drive 70% of GMV). He stated that the current performance validates their existing strategy of focusing on focus categories, geo-specific investments, and horizontal initiatives like AI, and that the company will continue to execute this successful playbook.

Colin Sebastian of Baird inquired about eBay's perspective on 'agented commerce' and how AI-driven agents might ultimately change consumer shopping behavior on the platform.

Answer

CEO Jamie Iannone highlighted eBay's significant progress in AI, citing the 'Magical Listing' tool used by over 10 million sellers to generate billions in GMV. He mentioned that AI is being broadly integrated across marketing, customer support, and product discovery, such as the new AI-powered fashion experience. Iannone also noted early tests with partners like OpenAI, indicating that AI is a core part of the company's strategy.

Colin Sebastian inquired about the drivers behind the uptick in advertising penetration and the long-term take rate opportunity. He also asked if 'magical listing' tools had a material impact on trading card volumes and if that could be replicated in other categories.

Answer

CEO Jamie Iannone attributed the 16% first-party ad growth primarily to the strength of the core Promoted Listings General (CPA) product, driven by ongoing optimizations. For trading cards, he explained that success was due to a combination of innovations, including 'magical listing' and deeper integrations with partners like PSA. He expressed bullishness that making listing easier across all categories will unlock significant inventory from households.

Colin Sebastian asked if platform initiatives are expected to attract new enthusiast buyers or primarily increase spending from the existing base. He also requested quantification of the one-off headwinds factored into the Q4 guidance.

Answer

CEO Jamie Iannone stated that the initiatives are converting new buyers, evidenced by a 1% growth in active buyers to 133 million. He highlighted that C2C sellers bring unique inventory and become twice as valuable as buyers, creating a positive flywheel. CFO Steve Priest confirmed the Q4 guidance accounts for headwinds like the U.S. elections, a shorter holiday season, and Hurricane Milton, but did not quantify their individual impacts, stating the forecast balances strong execution with these factors.

Colin Sebastian of Baird asked for the live services growth rate excluding Apex Legends and whether expectations for upcoming titles like Battlefield and Skate are changing due to positive early feedback.

Answer

CFO Stuart Canfield reported that live services, excluding Apex Legends, grew in the low single digits. He also noted that the negative impact from Apex was less than expected and that momentum is improving, positioning the title well for the rest of the year.

Colin Sebastian asked about Electronic Arts' long-term strategy to sustain the impressive growth momentum in its American football franchise and inquired about the rollout cadence and partnership strategy for the upcoming EA Sports app.

Answer

CEO Andrew Wilson detailed a strategy to transform American football into a 365-day fan platform by creating a symbiotic relationship between Madden and College Football, which has already doubled the player base. For the EA Sports app, he described a phased, learning-based rollout starting in Spain with La Liga, aiming to merge real-world and virtual sports content by leveraging EA's extensive global partnerships.

Colin Sebastian of Baird requested an update on the Fastlane product, specifically regarding its rollout, merchant adoption, and any measurable uplift in transaction volumes.

Answer

President, CEO & Director Alex Chriss reported that the Fastlane rollout is progressing with large merchants, and the previously cited 50% conversion uplift is holding strong. He noted that 75% of Fastlane users are new or dormant PayPal customers. The next major inflection point will be the rollout of multi-processor support, which is expected in the coming quarters.

Colin Sebastian asked about the use of AI for operating efficiency, whether it requires near-term investment, and how spending on customer acquisition and rewards might impact 2025 operating margins.

Answer

CEO Alex Chriss detailed that AI is being used for customer support efficiency, personalizing the commerce journey, and automating back-office risk decisions. CFO Jamie Miller added that marketing spend will increase slightly in 2025, weighted towards Q2, and that while customer acquisition costs are budgeted, they have not been significantly deployed yet.

Colin Sebastian asked for management's perspective on the sustainable long-term growth rate for the Services segment and inquired about the competitive landscape in the restaurant and retail category, particularly concerning food delivery platforms.

Answer

CFO David Schwarzbach expressed confidence in sustaining strong performance in Services, citing 15 consecutive quarters of double-digit growth and opportunities to expand into more categories. COO Jed Nachman attributed the headwinds in the RR&O segment primarily to macro factors, rather than competitive pressure, and stated Yelp is well-positioned for when the market turns.

Colin Sebastian asked about broader e-commerce technology trends like digital assistants and personalization, how important these initiatives are for Wayfair, and whether they are seeing any positive impact on engagement metrics even if sales conversions are not yet apparent.

Answer

Co-Chairman Steven Conine and CEO Niraj Shah confirmed that Wayfair is aggressively adopting new technologies like GenAI for internal efficiencies, such as catalog management and developer productivity. They believe that for a non-commodity category like home goods, AI presents a significant opportunity to enhance the customer's discovery and shopping experience. Niraj Shah mentioned they are actively piloting new tools that are already showing 'really amazing customer engagement,' though it is still early.

Asked for an update on the company's progress in selling through its aged inventory and what the inventory situation is expected to look like heading into 2024.

Answer

The company is nearly finished with its aged inventory, with only a few hundred cars remaining. For the fourth quarter, the mix of aged units sold is expected to be less than 20% and will decrease sequentially each month. Management does not anticipate any material amount of aged inventory carrying over into 2024.