Howard is a bona fide radio nerd, and his knowledge of the medium has helped shoot him to the top of the list of greatest radio performers of all time.
But longtime Stern Show producer Gary Dell'Abate is not such a radio nerd. He's a nerd, but not a radio nerd.
Howard laughingly told Robin about Gary trying to use radio terminology when he really doesn't know what he's talking about. According to Howard, Gary will use terms like "hard out," though Gary, and everybody in the Back Office pointed out that that term is actually abused by Howard TV's Mike Gange.
Gary didn't profess to be a radio geek like Howard, but Howard still grilled him, asking what AM stands for. Gary didn't know (Amplitude Modulation) though he did get FM (Frequency Modulation) correct.
As he and Howard were arguing, Howard thought he noticed that Gary had put on weight, which Gary said was untrue – he'd actually been losing weight recently. Didn't matter. Howard began noticing that Gary was starting to tug on his shirt - a sign Howard took as Gary being uncomfortable with his weight.
In any case, right or wrong, fat or thin, Gary decided to take a "hard out" on that conversation.