May 28, 2025 • 15 mins
Nvidia, the world’s most valuable chipmaker, gave an upbeat revenue forecast for the current period, even as a slowdown in China weighed on results. Sales will be about $45 billion in the second fiscal quarter, which runs through July, the company said on Wednesday. That included the loss of roughly $8 billion in revenue from China because of export controls. The forecast was in line with analysts’ estimates, according to data compiled by Bloomberg.
Nvidia shares rose about 4% in extended trading following the announcement. The outlook shows that Nvidia is ramping up production of Blackwell, its latest semiconductor design. The chipmaker — now the world’s largest by revenue — dominates the market for AI accelerators, the components that help develop and run artificial intelligence models. And an ever-broader lineup of hardware and software is letting Nvidia sell more products to customers.
For instant reaction and analysis, hosts Carol Massar and Tim Stenovec speak with:
- Bloomberg Intelligence Senior Tech Industry Analyst Mandeep Sing
- Joe Kaiser, Managing Director at Mercato Partners
See omnystudio.com/listener for privacy information.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:02):
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:09):
This is a breaking news update from Bloomberg, instant reaction
and analysis from our three thousand journalists and analysts around
the world and.
Speaker 3 (00:19):
Videos app folks, let's get to it right now. We've
got in studio our Mandi seeing Bloomberg Intelligence senior tech
industry analysts. Mande, tell us what you like what's interesting
in this report?
Speaker 4 (00:29):
I mean, had it not been for the China right down,
this company would have posted revenue which was five percent
higher than the forty four billion dollar number, and the
guide would have been almost fifteen to twenty percent higher.
So we're talking about eight billion in lost revenue. So clearly,
whatever they're doing, they are able to make up that
(00:50):
revenue lost in China with some other customers because it's
in line.
Speaker 1 (00:55):
With consensus where they making up for it.
Speaker 5 (00:57):
Well, I mean there are other customers.
Speaker 4 (00:58):
We saw the deals in I think there's demand from
other enterprise customers. And the one anecdote they provided was
token generation was up ten times.
Speaker 5 (01:09):
To explain what that is.
Speaker 4 (01:10):
Yeah, So the way these AI models work is if
you type in a query on chat GPT, it's going
to generate you know, hundreds of tokens from that it's
going to be passed with the model and the output
is also you know, hundreds of tokens. So Google said
at their io event their token generation was up almost
(01:31):
fifty x.
Speaker 5 (01:32):
Same thing from Microsoft.
Speaker 4 (01:34):
Yes, and so we are getting those type of numbers
from pretty much anyone who's exposed to demand for large
anngreage models, and in this case, Nvidia is exposed through
chat GPT because all the weekly active users that are
going on chat gpt and using the product for let's
say twenty minutes, that's what's resulting in the tenex increase
(01:58):
in tokens. And I'm not surprised that everyone needs additional
compute because if chatgpt needs to serve more users, they
need additional compute. The traditional CPU compute is just not
good enough. And that's where I think they are finding
that additional demand.
Speaker 3 (02:13):
Ian King our live blog says how many companies could
frontload their earnings released with details of what they're missing
out on and still get a positive reaction from investors.
So it's pretty impressive. Okay, you know, we just had
a guest on, Jay Goldberg over at Seaport.
Speaker 5 (02:27):
He's got the.
Speaker 3 (02:28):
Only sell on the company, and he's got some questions
about kind of like maybe all the good stuff is
already factored in, I think questions about the AI and
the build going to take longer. What do you say
to some of that.
Speaker 4 (02:42):
I mean, look, everyone acknowledges that, you know, semiconductors is cyclical.
Speaker 5 (02:48):
You will see.
Speaker 4 (02:48):
An air pocket or some sort of digestion and these
kind of these kind of growth growth rates are too
hard to sustain, you know, so you are not going
to see sixty seventy percent growth when your revenue base
is two hundred billion dollars run rate annually. I mean,
from that perspective, there will be a tapering of growth.
But look at all the hyperscalers. Nvidia is still growing
(03:13):
top line way above everyone else, including Microsoft and you
know Meta that are growing at a very healthy high
teen strate. So from that perspective, there is still a
lot of runway when it comes to Nvidia's growth.
Speaker 1 (03:25):
China and the China specific story here the age twenty,
the restrictions, what do you see as the long term
effect of what the Trump administration has recently said, but
also export restrictions on some of Nvidia's products, specifically with
regard to China, I.
Speaker 4 (03:40):
Mean, that is the most plausible bare case against Nvidia
because look, right now, China used to be about twenty
percent of Invidio's revenue. It's very hard to fill that
hole with all the additional demand. Even though Chat, GPT
and other llms need more compute and they can take
whatever Nvidia is making. But in the long term, if
(04:02):
you're looking five years out without China, I mean, that's
where all the secondary LLLM companies are besides you know, Chat, GPT,
Anthropic and Google, and so you are missing out on
a lot of potential customers that would have used your chips.
Speaker 3 (04:16):
What did we say about DeepC before that they had
an update and like we're trying to understand, So if
this is all real with what they upgraded.
Speaker 1 (04:25):
The R one AI model that helped propel it to
global prominence earlier this year, now we don't.
Speaker 3 (04:30):
Still know exactly how they're doing all of this, but
if they are doing it with less advanced chips, I mean,
does that make the Nvidia story not as exciting?
Speaker 4 (04:40):
No, because in videos to get this is all speculations. Yeah, yeah,
and look there could be some pull forward in China.
You know with Deep Seek using in videos chips because
they anticipated these kind of restrictions, right, But in other
regions everyone realizes and Vidia has the best ship. The
only reason why you are going to look for an
(05:01):
alternative is a hyperscaler looking to really kind of reduce
their dependency. So Google doesn't use in video chips because
they have their in house chip and they serve traffic
that's pretty much the seven most frequently used apps on
the Internet.
Speaker 5 (05:18):
So if they were to rely.
Speaker 4 (05:19):
On in video, I mean, in Video's revenue could actually
grow fifty percent just by serving Google.
Speaker 1 (05:26):
But does Google then create those send those chips. Would
Google sell those chips outside?
Speaker 4 (05:31):
They don't, so they don't use the chips outside of
their family of apps. They just use it for Google Search, YouTube,
and their family of apps.
Speaker 1 (05:40):
Why wouldn't they sell it because.
Speaker 4 (05:42):
It's not a chip that is generic in nature that
it can serve everyone else's traffic. It's customized for their data.
Speaker 1 (05:50):
Do we see Amazon then doing that too?
Speaker 4 (05:52):
I think that's the bare case that everyone is thinking,
But so far it hasn't happened, and everyone is trying.
Speaker 1 (05:58):
Would you disagree with j Goldberg who just told us
that he thinks that Broadcom is the closest competitor right now,
or not necessarily closest competitor. Excuse me, And I know
you can't make calls Andy, but he's the only one
who has a cell rating on Nvidia, and he argues
right now that investors should be putting their money toward Broadcom.
Speaker 4 (06:17):
I mean, look, we are in an AI infrastructure super cycle,
and this is a tie that will lift all the boats.
Broadcom Wild benefit other chip makers for benefits. So it's
very hard to say only Broadcom wild benefit with AI
infrastructure demand. And I think that's where you're too early
to put a cell rating on a stock like Nvidia.
Speaker 3 (06:39):
All right, so stock is at four percent and certainly
investors buying in the aftermarket. There is a you know,
a headline that crossed about ten minutes ago that in
video saying maybe unable to create a competitive product for China,
would have to foreclose from competing in China market. China
market foreclosure would materially hit the business. Export controls Apple
(07:00):
to China are complex. Help me make some sense out
of these headlines.
Speaker 4 (07:03):
I mean, look, if you want to see multiple expansion
in a stock like Nvidia, you got to convince the
investors that you can keep growing twenty twenty five percent.
And the way you do that is by showing pockets
of demand, you know, geographic diversification. If you lose out
China revenue, suddenly everything is like, okay, you're two dependent
(07:24):
on hyperscalers. What if Amazon actually develops a chip and
reduces their dependency altogether on in media and so that
is the big bear case, the concentration of customers, and
that's at losing China revenue is a rep.
Speaker 3 (07:38):
So Mandy Business is saying, here, we're laying it out
for you just to understand.
Speaker 5 (07:41):
Yeah, in terms of the China, is.
Speaker 3 (07:43):
That pressure on the Trump administration?
Speaker 4 (07:46):
Not really because they keep eating their numbers like this,
I mean really administration. You see the numbers and you're like,
that's these guys get managed without China revenue.
Speaker 5 (07:55):
But if they're.
Speaker 3 (07:55):
Warning of that impact in terms of China, is that
kind of a little bit of a subtle considering he
just traveled with him to the Middle East, you know
a little bit of a like settle message reminder.
Speaker 5 (08:04):
That's a fair characterization. I would agree with that.
Speaker 1 (08:06):
Okay, I want to bring in Joe Kaiser CEO and
managing director at Mercado Partners. It's a grow stage investment firm.
It's got over a billion dollars in assets under management
Mercado Partners. He joins us from Salt Lake City. Joe,
You've had a chance to sit back and look at
some of these results over the last thirty minutes or so.
First quarter data, revenue coming in close to estimates, second
quarter forecast solid despite an eight billion dollar eight billion
(08:28):
dollars in expected lost China sales. The company stock up
about four percent in the after hours. What's your view.
Speaker 6 (08:36):
I think this growth and the profitable growth that we're
seeing is really unprecedented in the venture community. We still
use the term called rule of forty, so it's combining
the top line growth rate coupled with EBITDAM margin. And
I haven't seen the EBITDN number, but if we use
the prior quarters EBITDN number, like they're approaching two hundred
(08:57):
from a rule of forty standpoint. And to give you
some historic precedent, when Micro sorry, when Microsoft and Apple
were at the same stages from a revenue size standpoint,
those companies were at ninety and sixty, respect respect respectively.
So This is truly unprecedented performance and at the end
(09:18):
of the day, like what we're seeing is probably the
greatest invention in the history of mankind and the company
that singularly powers that and that's the performance that we're
seeing before us.
Speaker 1 (09:31):
Now, are you bullish that there is more upside, Joe
to this company? Jake Goldberg is not.
Speaker 5 (09:38):
Well.
Speaker 6 (09:39):
I think it pays to be provocative at some occasions,
but yes, I think there is a lot of upside.
I think, you know, when we think about the deployment
of AI, particularly in enterprise applications, both in the United
States and abroad, we are very early innings and that
and that and that deployment. You know, they've talked about
(09:59):
the data iner deployment around the world across the GCC
countries as well as domestically. Lots and lots of runway
in that regard. So there is a long road ahead
for Nvidia.
Speaker 3 (10:12):
Joe, I know you're well versed on the power side
of AI, but I want to bring man deep in
on that. Man Deep, is there a point you know,
I think about you know, doing like basic charts anywhere,
like the ramp up and AI and the power demands
we talk about it all the time. Is there a
point where AI deployment and usage might be limited because
we just don't have the power?
Speaker 4 (10:30):
Yeah, and that's where actually in Vidia's architecture excels because
they give you performance per power what that your likes
of AMD and Intel aren't able to give. It's not
as if AMD doesn't have an offering GPU that can
compete with Nvidia, But in Vidio's GPUs just give you
better performance per power what And that is the constraint
(10:53):
right now, everyone acknowledges yea the power constraints.
Speaker 5 (10:56):
So from that perspective, also in Vidia does have an advantage.
Speaker 1 (11:00):
See you nodding. This is certainly your wheelhouse given the
history of what you've done and at the firm and
outside of the firm too, How is in Vidia doing
this and how solid and how big is their mode well?
Speaker 6 (11:10):
That is one of the big developments with the Blackwell
chip is the reduction and power consumption from black from
Hopper to Blackwell, and and that that is one of
the key breakthroughs. You know, I A lot of people,
including in Vidia, including the hyperscalers, talk about the lack
of power as the headwind here. The reality is we
(11:33):
as a nation. We have the resources, we have the technologies.
You know, I invested in a company called Taurus, which
has solved the storage challenge we have from a long
term standpoint, I think a guest earlier today talked about
small modular reactors and the technology of foot a small
footprint nuclear. That technology exists, right.
Speaker 3 (11:55):
But SMRs are taken a while. Yeah, we're still talking
quite everybody talks about it and SMRs are the way
to go, but it's going to be several years before
we really see that build up.
Speaker 6 (12:07):
Very true, Carol, But I think the challenges we have
plenty of natural gas as a country as well. And
the talk is, well, it takes a decade to build
a power plant, but the reality is the long pole
in the tent from building a power plant is the
permitting process and the process of getting the right to
turn on and use the power out of that power plant.
(12:28):
So if we streamline that process, and I know both
the federal government as well as states like Utah are
in the early inning right streamlining, but that is the
long pole in the tent.
Speaker 4 (12:38):
All right.
Speaker 3 (12:39):
We're talking with two guests. We've got Joe Keiser, he's
CEO of managing director at Mercado Partners out there in Utah.
Mandy Singh, Senior Tech Industry Alice Bloomberg Intelligence right here
in our Bloomberg Interactive Broker studio and Vidia out tim
stock is now up about four and a half percent
here in the aftermark.
Speaker 1 (12:56):
Yeah, first quarter data center revenue coming in close to estimate.
Second quarter forecast solid despite that eight billion dollars an
expected loss to China sales. In Vidia shares rising and
extended trading. It's providing a boost to other chip stocks
as well. We're seeing shares of Micron also higher in
the after hours by about one point four percent. Mandy,
you've been glued to the terminal looking through these numbers.
(13:16):
You got to go in a minute, what's the last
thought you want to leave us with ahead of this call?
Speaker 4 (13:20):
I mean, sovereign AI is a big opportunity. Sovereign Sovereign AI,
which is where you would put you know, revenue from
the likes of UAE, Saudi Arabia, the deals they just signed.
I just want to get a sense of how big
this could get, because so far this was like low
double digit revenue in terms of the revenue exposure that
(13:40):
Nvidia had and look they are losing China revenue. So
what makes up how many types of entity? Sovereign entities
want to build their own large anguid model infrastructure like
the UAE and the Saudi Arabia, And that would determine,
you know, the pace of growth when it comes to
the non hyper scale piece of and Video's growth.
Speaker 3 (14:02):
The Middle East trip like makes so much more sense, right.
Speaker 5 (14:05):
Maybe they should be doing more trips the administration?
Speaker 4 (14:07):
Well where else can they go?
Speaker 3 (14:08):
Anywhere?
Speaker 4 (14:09):
Right?
Speaker 5 (14:09):
Anywhere?
Speaker 4 (14:10):
I mean, look, you you've got so many pockets where
there's so much sensitivity around AI in terms of you know,
developing your own AI, serving it with your own infrastructure.
Speaker 5 (14:21):
That that's the real bull case when it comes to
sovereign AI. What can I ask one last question?
Speaker 3 (14:26):
Cash, cash equivalents, marketable securities fifty three point seven billion,
up from thirty one point four billion a year ago
and forty three point two billion a quarter ago. What
do they need to do? They tried to buy armed,
couldn't do it right? Do they need to do bigger dividends?
Do they need to do buybacks or what do you think?
Speaker 5 (14:45):
I mean stock buybacks?
Speaker 4 (14:46):
This company is generating as much free cash flow as Apple.
Now you're close to one hundred billion dollars in free
cash flow. So Apple does have a playbook when it
comes to returning cash to shareholders. I think N Video
should probably follow them. H
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:09):
This is a breaking news update from Bloomberg, instant reaction
and analysis from our three thousand journalists and analysts around
the world and.
Speaker 3 (00:19):
Videos app folks, let's get to it right now. We've
got in studio our Mandi seeing Bloomberg Intelligence senior tech
industry analysts. Mande, tell us what you like what's interesting
in this report?
Speaker 4 (00:29):
I mean, had it not been for the China right down,
this company would have posted revenue which was five percent
higher than the forty four billion dollar number, and the
guide would have been almost fifteen to twenty percent higher.
So we're talking about eight billion in lost revenue. So clearly,
whatever they're doing, they are able to make up that
(00:50):
revenue lost in China with some other customers because it's
in line.
Speaker 1 (00:55):
With consensus where they making up for it.
Speaker 5 (00:57):
Well, I mean there are other customers.
Speaker 4 (00:58):
We saw the deals in I think there's demand from
other enterprise customers. And the one anecdote they provided was
token generation was up ten times.
Speaker 5 (01:09):
To explain what that is.
Speaker 4 (01:10):
Yeah, So the way these AI models work is if
you type in a query on chat GPT, it's going
to generate you know, hundreds of tokens from that it's
going to be passed with the model and the output
is also you know, hundreds of tokens. So Google said
at their io event their token generation was up almost
(01:31):
fifty x.
Speaker 5 (01:32):
Same thing from Microsoft.
Speaker 4 (01:34):
Yes, and so we are getting those type of numbers
from pretty much anyone who's exposed to demand for large
anngreage models, and in this case, Nvidia is exposed through
chat GPT because all the weekly active users that are
going on chat gpt and using the product for let's
say twenty minutes, that's what's resulting in the tenex increase
(01:58):
in tokens. And I'm not surprised that everyone needs additional
compute because if chatgpt needs to serve more users, they
need additional compute. The traditional CPU compute is just not
good enough. And that's where I think they are finding
that additional demand.
Speaker 3 (02:13):
Ian King our live blog says how many companies could
frontload their earnings released with details of what they're missing
out on and still get a positive reaction from investors.
So it's pretty impressive. Okay, you know, we just had
a guest on, Jay Goldberg over at Seaport.
Speaker 5 (02:27):
He's got the.
Speaker 3 (02:28):
Only sell on the company, and he's got some questions
about kind of like maybe all the good stuff is
already factored in, I think questions about the AI and
the build going to take longer. What do you say
to some of that.
Speaker 4 (02:42):
I mean, look, everyone acknowledges that, you know, semiconductors is cyclical.
Speaker 5 (02:48):
You will see.
Speaker 4 (02:48):
An air pocket or some sort of digestion and these
kind of these kind of growth growth rates are too
hard to sustain, you know, so you are not going
to see sixty seventy percent growth when your revenue base
is two hundred billion dollars run rate annually. I mean,
from that perspective, there will be a tapering of growth.
But look at all the hyperscalers. Nvidia is still growing
(03:13):
top line way above everyone else, including Microsoft and you
know Meta that are growing at a very healthy high
teen strate. So from that perspective, there is still a
lot of runway when it comes to Nvidia's growth.
Speaker 1 (03:25):
China and the China specific story here the age twenty,
the restrictions, what do you see as the long term
effect of what the Trump administration has recently said, but
also export restrictions on some of Nvidia's products, specifically with
regard to China, I.
Speaker 4 (03:40):
Mean, that is the most plausible bare case against Nvidia
because look, right now, China used to be about twenty
percent of Invidio's revenue. It's very hard to fill that
hole with all the additional demand. Even though Chat, GPT
and other llms need more compute and they can take
whatever Nvidia is making. But in the long term, if
(04:02):
you're looking five years out without China, I mean, that's
where all the secondary LLLM companies are besides you know, Chat, GPT,
Anthropic and Google, and so you are missing out on
a lot of potential customers that would have used your chips.
Speaker 3 (04:16):
What did we say about DeepC before that they had
an update and like we're trying to understand, So if
this is all real with what they upgraded.
Speaker 1 (04:25):
The R one AI model that helped propel it to
global prominence earlier this year, now we don't.
Speaker 3 (04:30):
Still know exactly how they're doing all of this, but
if they are doing it with less advanced chips, I mean,
does that make the Nvidia story not as exciting?
Speaker 4 (04:40):
No, because in videos to get this is all speculations. Yeah, yeah,
and look there could be some pull forward in China.
You know with Deep Seek using in videos chips because
they anticipated these kind of restrictions, right, But in other
regions everyone realizes and Vidia has the best ship. The
only reason why you are going to look for an
(05:01):
alternative is a hyperscaler looking to really kind of reduce
their dependency. So Google doesn't use in video chips because
they have their in house chip and they serve traffic
that's pretty much the seven most frequently used apps on
the Internet.
Speaker 5 (05:18):
So if they were to rely.
Speaker 4 (05:19):
On in video, I mean, in Video's revenue could actually
grow fifty percent just by serving Google.
Speaker 1 (05:26):
But does Google then create those send those chips. Would
Google sell those chips outside?
Speaker 4 (05:31):
They don't, so they don't use the chips outside of
their family of apps. They just use it for Google Search, YouTube,
and their family of apps.
Speaker 1 (05:40):
Why wouldn't they sell it because.
Speaker 4 (05:42):
It's not a chip that is generic in nature that
it can serve everyone else's traffic. It's customized for their data.
Speaker 1 (05:50):
Do we see Amazon then doing that too?
Speaker 4 (05:52):
I think that's the bare case that everyone is thinking,
But so far it hasn't happened, and everyone is trying.
Speaker 1 (05:58):
Would you disagree with j Goldberg who just told us
that he thinks that Broadcom is the closest competitor right now,
or not necessarily closest competitor. Excuse me, And I know
you can't make calls Andy, but he's the only one
who has a cell rating on Nvidia, and he argues
right now that investors should be putting their money toward Broadcom.
Speaker 4 (06:17):
I mean, look, we are in an AI infrastructure super cycle,
and this is a tie that will lift all the boats.
Broadcom Wild benefit other chip makers for benefits. So it's
very hard to say only Broadcom wild benefit with AI
infrastructure demand. And I think that's where you're too early
to put a cell rating on a stock like Nvidia.
Speaker 3 (06:39):
All right, so stock is at four percent and certainly
investors buying in the aftermarket. There is a you know,
a headline that crossed about ten minutes ago that in
video saying maybe unable to create a competitive product for China,
would have to foreclose from competing in China market. China
market foreclosure would materially hit the business. Export controls Apple
(07:00):
to China are complex. Help me make some sense out
of these headlines.
Speaker 4 (07:03):
I mean, look, if you want to see multiple expansion
in a stock like Nvidia, you got to convince the
investors that you can keep growing twenty twenty five percent.
And the way you do that is by showing pockets
of demand, you know, geographic diversification. If you lose out
China revenue, suddenly everything is like, okay, you're two dependent
(07:24):
on hyperscalers. What if Amazon actually develops a chip and
reduces their dependency altogether on in media and so that
is the big bear case, the concentration of customers, and
that's at losing China revenue is a rep.
Speaker 3 (07:38):
So Mandy Business is saying, here, we're laying it out
for you just to understand.
Speaker 5 (07:41):
Yeah, in terms of the China, is.
Speaker 3 (07:43):
That pressure on the Trump administration?
Speaker 4 (07:46):
Not really because they keep eating their numbers like this,
I mean really administration. You see the numbers and you're like,
that's these guys get managed without China revenue.
Speaker 5 (07:55):
But if they're.
Speaker 3 (07:55):
Warning of that impact in terms of China, is that
kind of a little bit of a subtle considering he
just traveled with him to the Middle East, you know
a little bit of a like settle message reminder.
Speaker 5 (08:04):
That's a fair characterization. I would agree with that.
Speaker 1 (08:06):
Okay, I want to bring in Joe Kaiser CEO and
managing director at Mercado Partners. It's a grow stage investment firm.
It's got over a billion dollars in assets under management
Mercado Partners. He joins us from Salt Lake City. Joe,
You've had a chance to sit back and look at
some of these results over the last thirty minutes or so.
First quarter data, revenue coming in close to estimates, second
quarter forecast solid despite an eight billion dollar eight billion
(08:28):
dollars in expected lost China sales. The company stock up
about four percent in the after hours. What's your view.
Speaker 6 (08:36):
I think this growth and the profitable growth that we're
seeing is really unprecedented in the venture community. We still
use the term called rule of forty, so it's combining
the top line growth rate coupled with EBITDAM margin. And
I haven't seen the EBITDN number, but if we use
the prior quarters EBITDN number, like they're approaching two hundred
(08:57):
from a rule of forty standpoint. And to give you
some historic precedent, when Micro sorry, when Microsoft and Apple
were at the same stages from a revenue size standpoint,
those companies were at ninety and sixty, respect respect respectively.
So This is truly unprecedented performance and at the end
(09:18):
of the day, like what we're seeing is probably the
greatest invention in the history of mankind and the company
that singularly powers that and that's the performance that we're
seeing before us.
Speaker 1 (09:31):
Now, are you bullish that there is more upside, Joe
to this company? Jake Goldberg is not.
Speaker 5 (09:38):
Well.
Speaker 6 (09:39):
I think it pays to be provocative at some occasions,
but yes, I think there is a lot of upside.
I think, you know, when we think about the deployment
of AI, particularly in enterprise applications, both in the United
States and abroad, we are very early innings and that
and that and that deployment. You know, they've talked about
(09:59):
the data iner deployment around the world across the GCC
countries as well as domestically. Lots and lots of runway
in that regard. So there is a long road ahead
for Nvidia.
Speaker 3 (10:12):
Joe, I know you're well versed on the power side
of AI, but I want to bring man deep in
on that. Man Deep, is there a point you know,
I think about you know, doing like basic charts anywhere,
like the ramp up and AI and the power demands
we talk about it all the time. Is there a
point where AI deployment and usage might be limited because
we just don't have the power?
Speaker 4 (10:30):
Yeah, and that's where actually in Vidia's architecture excels because
they give you performance per power what that your likes
of AMD and Intel aren't able to give. It's not
as if AMD doesn't have an offering GPU that can
compete with Nvidia, But in Vidio's GPUs just give you
better performance per power what And that is the constraint
(10:53):
right now, everyone acknowledges yea the power constraints.
Speaker 5 (10:56):
So from that perspective, also in Vidia does have an advantage.
Speaker 1 (11:00):
See you nodding. This is certainly your wheelhouse given the
history of what you've done and at the firm and
outside of the firm too, How is in Vidia doing
this and how solid and how big is their mode well?
Speaker 6 (11:10):
That is one of the big developments with the Blackwell
chip is the reduction and power consumption from black from
Hopper to Blackwell, and and that that is one of
the key breakthroughs. You know, I A lot of people,
including in Vidia, including the hyperscalers, talk about the lack
of power as the headwind here. The reality is we
(11:33):
as a nation. We have the resources, we have the technologies.
You know, I invested in a company called Taurus, which
has solved the storage challenge we have from a long
term standpoint, I think a guest earlier today talked about
small modular reactors and the technology of foot a small
footprint nuclear. That technology exists, right.
Speaker 3 (11:55):
But SMRs are taken a while. Yeah, we're still talking
quite everybody talks about it and SMRs are the way
to go, but it's going to be several years before
we really see that build up.
Speaker 6 (12:07):
Very true, Carol, But I think the challenges we have
plenty of natural gas as a country as well. And
the talk is, well, it takes a decade to build
a power plant, but the reality is the long pole
in the tent from building a power plant is the
permitting process and the process of getting the right to
turn on and use the power out of that power plant.
(12:28):
So if we streamline that process, and I know both
the federal government as well as states like Utah are
in the early inning right streamlining, but that is the
long pole in the tent.
Speaker 4 (12:38):
All right.
Speaker 3 (12:39):
We're talking with two guests. We've got Joe Keiser, he's
CEO of managing director at Mercado Partners out there in Utah.
Mandy Singh, Senior Tech Industry Alice Bloomberg Intelligence right here
in our Bloomberg Interactive Broker studio and Vidia out tim
stock is now up about four and a half percent
here in the aftermark.
Speaker 1 (12:56):
Yeah, first quarter data center revenue coming in close to estimate.
Second quarter forecast solid despite that eight billion dollars an
expected loss to China sales. In Vidia shares rising and
extended trading. It's providing a boost to other chip stocks
as well. We're seeing shares of Micron also higher in
the after hours by about one point four percent. Mandy,
you've been glued to the terminal looking through these numbers.
(13:16):
You got to go in a minute, what's the last
thought you want to leave us with ahead of this call?
Speaker 4 (13:20):
I mean, sovereign AI is a big opportunity. Sovereign Sovereign AI,
which is where you would put you know, revenue from
the likes of UAE, Saudi Arabia, the deals they just signed.
I just want to get a sense of how big
this could get, because so far this was like low
double digit revenue in terms of the revenue exposure that
(13:40):
Nvidia had and look they are losing China revenue. So
what makes up how many types of entity? Sovereign entities
want to build their own large anguid model infrastructure like
the UAE and the Saudi Arabia, And that would determine,
you know, the pace of growth when it comes to
the non hyper scale piece of and Video's growth.
Speaker 3 (14:02):
The Middle East trip like makes so much more sense, right.
Speaker 5 (14:05):
Maybe they should be doing more trips the administration?
Speaker 4 (14:07):
Well where else can they go?
Speaker 3 (14:08):
Anywhere?
Speaker 4 (14:09):
Right?
Speaker 5 (14:09):
Anywhere?
Speaker 4 (14:10):
I mean, look, you you've got so many pockets where
there's so much sensitivity around AI in terms of you know,
developing your own AI, serving it with your own infrastructure.
Speaker 5 (14:21):
That that's the real bull case when it comes to
sovereign AI. What can I ask one last question?
Speaker 3 (14:26):
Cash, cash equivalents, marketable securities fifty three point seven billion,
up from thirty one point four billion a year ago
and forty three point two billion a quarter ago. What
do they need to do? They tried to buy armed,
couldn't do it right? Do they need to do bigger dividends?
Do they need to do buybacks or what do you think?
Speaker 5 (14:45):
I mean stock buybacks?
Speaker 4 (14:46):
This company is generating as much free cash flow as Apple.
Now you're close to one hundred billion dollars in free
cash flow. So Apple does have a playbook when it
comes to returning cash to shareholders. I think N Video
should probably follow them. H
Hosts And Creators
Tim Stenovec
Carol Massar
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