Episode 201: Cochlea Crashes, Firmus IPO Drama, Self Driving vs Flying, Batteries Step Up, Uber x Expedia, Ghost Buses and the Experience Economy
The guys discuss Cochlea's horrific profit downgrade, Firmus IPO hopes in smoke, self driving to challenge air travel, battery technology goes large and Uber and Expedia get close.
The Contrarians catchup
Adir gatecrashed the sold-out Blackbird Sunrise side event in Sydney by texting Rain Anderson for help. When he arrived and gave his name at the door: “She just looks at me thinking like, what’s an Adir. So all of my self-confidence just dissipated instantly.” Gen Z at the free bar: “They don’t drink alcohol unless there’s a free bar tab, but they sucked down that bar tab in 10 seconds flat.”
Adam reminisced about being a nightclub promoter at Redheads in the late ‘90s: “I could stand out the front of Redheads and there’d be a queue like a hundred people clamouring to get in. I’d stand next to Teddy who was the bouncer and point to like these three people and they’d wade through the crowd and get in. Like that was the best moment of my life.”
Atlassian surprised the market by announcing it would finally be profitable. Adam: “The share price should be double what it is if it was run properly. So this is a start. It jumped 20% after dropping and it’s still 75% down in the last year.”
The Victorian government is running buses through Fisherman’s Bend every 8-10 minutes - two routes, multiple buses, and nobody on them. Adam: “The effectively bankrupt Victorian government, that can’t afford to do anything, can’t afford to pay teachers, can’t afford to pay nurses, is running buses to this place where no one lives and no one works at nighttime, with no one on them, and spending millions of dollars. It’s just such a symbolism of the unbelievable waste and fraud that exists in this government.”
Australia’s east coast electricity costs fell 12% in the first quarter as renewables hit 47% of generation. Adir: “The main problem I’ve always had in Australia and globally is that it moved from a science- and technology-based discussion to a religion. And like you had two opposed religions. And all of a sudden, once you have religion and you have the ultimate truth, and you know the truth, and there’s only one truth, the other side is all heresy.”
Firmus IPO: the bank robbers who stayed too long
The most hyped float of 2026 (Firmus, the AI data centre business backed by Oliver Curtis and Tim Rosenfield) has deferred its planned June/July listing to “later in the year.” The company last raised at a $6B AUD valuation and is seeking $8B at IPO. Nick Curtis, Oliver’s father, has already sold $100M of shares, to James Packer.
Adam: “It’s peak AI, peak bubble, peak everything - stock markets at record highs, AI bubble still fermenting, NVIDIA still flying. If it can’t get away now, I can’t see this ever getting away.”
Adir: “Does anyone look at this thing and say, yeah, this is a long-term viable generational business? Who’s saying that? No one’s saying that. People are basically saying, we can make money. It’s like salivating, right? And so then the greed kicks in. There’s a balance in booms, bubbles, about how greedy you can be. And I think Firmus is maybe pushing that a bit past the line of greed.”
Adir: “There is literally no price at which you would buy stock in this business if you were forced to hold the stock and run the business for the next three years.”
Adam: “It reminds me of bank robbers in a bank and they take all the cash out of the vault. And then instead of taking the million dollars in cash and just leaving, they start, oh let’s get the safety deposit boxes as well. And the cops are coming. So they gotta get out of that vault ASAP. These guys have hung around, they’re hitting the safety boxes now, they want that $8-12B. It’s too late. Like people are onto this now.”
The data centre backlash is coming
Twenty-nine US municipalities have already passed ordinances banning data centres in their jurisdictions. One US state is now looking at passing that legislation. Adam argued Australia is not far behind.
Adir: “The country has got to make this tricky decision, which is do you wanna do the continued pathway to renewables or do you wanna host data centres? And I don’t think it can do both, basically.”
Adam: “What the right side of policy historically does is do that for their corporate donors. So in this case it could be data centres, could be hyperscalers, whoever it is. Eventually you push it too far and you get too greedy and people will start realising, oh actually hold on, this doesn’t actually work for me. Why am I paying double for power so someone else can make money?”
Adir: “I wouldn’t want to, if I’m a Tasmanian resident, be underwriting Firmus’ data centre in Launceston. Firmus runs a sales pitch that says we’re a data centre provider that runs on one hundred percent renewable energy. That will be true. But the bit that’s problematic, in the fine print, is that we didn’t go and generate any new renewable energy for our data centre. We just sucked the hell out of Tasmania’s renewable energy.”
Self-driving cars v. the Sydney-Melbourne flight
A viral post on X described a man driving his Tesla on full self-driving from Miami to Nashville (900 miles) taking calls, replying to emails and FaceTiming family, at a fraction of the cost of flying. Adam used it to launch a debate about whether autonomous vehicles could eventually kill domestic air routes.
Adam: “The only person who claims you need a pilot are the pilots’ union because pilots get paid $500K a year to be effectively a reassurance to passengers. They absolutely don’t need pilots to fly these planes.”
Adir: “You have to have self-driving in a car that’s equivalent to the level of safety of having no driver today. And so today, are we at level five? I think Waymo’s four and Tesla’s three. And this guy in his Tesla, the fact that he was writing emails, this is really not an activity that people should be encouraged to do right now in a self-driving Tesla at its current level of tech.”
Adir: “If you say to me, do I think the probability of what you just described happening in a decade, what do I think that probability is? I think it feels to me, unless something dramatic happens, it’s close to 100%. Like that feels like an almost certainty in the next decade that that sort of thing will be happening. And then the question is, how do you feel about airline stocks?”
Deep dive: Cochlear, a blue chip in free fall
Cochlear shocked investors by slashing FY26 underlying net profit guidance from a midpoint of ~$450M to ~$320M - a ~30% downgrade, sending shares down 74% from their 2024 peak of $338 to around $92. The company cited a “small reduction” in US implant surgeries, a strengthening Australian dollar (costing ~$25M), and higher expenses. The business was founded in 1981, listed in 1995, holds 60% global market share and spends $300M a year on R&D.
Adir: “There are more than a million people in the US that could have this surgery and would benefit from it. And like 10% of them have been implanted of qualifying patients. So you’d say the TAM looks amazing for this business. But one of the reasons Cochlear says, and they’ve flagged this themselves, is there’s actually very low awareness amongst patients and doctors that this is an option. And I think awareness amongst doctors and patients has always been problematic.”
Adir: “This is in no way a cigar butt. But on the flip side, a business that is growing top line 6 to 8%, trading on mid to high teens enterprise value multiple, that’s not a bargain. You can’t call that a bargain. But I think a business of this quality trading on these multiples with this much of a competitive moat - I think this might be, you might look at this and say, if ever you wanted to buy a really high quality med tech business, this feels like a time to buy it to me.”
Adam: “This is why I love share market crashes. You can buy Cochlear shares for 75% less than you could three months ago. That’s an amazing thing. Like whether you do it, you don’t buy it, who knows, who cares? But at six billion, like that’s really interesting to me. I’m highly bullish on this business long term.”
Five other stories worth following:
Colossal Biosciences is targeting the bluebuck antelope, extinct since the 1700s, after its mammoth, dodo and dire wolf projects. It says reviving the species could support broader African antelope conservation efforts across future work.
Light Phone will open LightOS to outside developers in May, with vetted tools launching in its Tool Library this fall, letting users add narrow functions like transit, wallets, document scanning or QR codes themselves.
GameStop CEO Ryan Cohen has made an unsolicited $56B offer for eBay, arguing a merger could challenge Amazon. He says eBay is undervalued and could become worth hundreds of billions under his plan.
Greg Abel impressed investors at Berkshire Hathaway’s annual meeting, while Warren Buffett warned against AI hype and likened markets to “a church with a casino attached,” calling one-day options trading outright gambling.
Ask.com has shut down after IAC exited search operations on May 1. The former Ask Jeeves had long since retired its butler branding, but IAC said “Jeeves’ spirit endures.”