1 00:00:00,120 --> 00:00:02,560 Speaker 1: The AI bubble may not be popping anytime soon. If 2 00:00:02,560 --> 00:00:04,080 Speaker 1: you have a look at what's just happened to Nvidia. 3 00:00:04,160 --> 00:00:07,320 Speaker 1: The latest quarterly results smashed expectations off the back of 4 00:00:07,320 --> 00:00:10,240 Speaker 1: fears demand for its chips to power the AI. It 5 00:00:10,320 --> 00:00:13,400 Speaker 1: recorded revenue of a tick over fifty seven billion US dollars. 6 00:00:13,400 --> 00:00:15,360 Speaker 1: It's a twenty two percent jump from the previous quarter. 7 00:00:15,440 --> 00:00:18,280 Speaker 1: And Sam Dickey from Fisher Funds is with us. Hello Sam, 8 00:00:19,000 --> 00:00:21,280 Speaker 1: Hello Heather. Now what did you make of this result 9 00:00:21,360 --> 00:00:23,319 Speaker 1: and what did we learn about the broad health of 10 00:00:23,360 --> 00:00:24,560 Speaker 1: AI as a result of it? 11 00:00:25,960 --> 00:00:28,640 Speaker 2: Yeah, I mean you said it was another stonking result 12 00:00:28,720 --> 00:00:32,840 Speaker 2: from the biggest company on Earth. So revenue and earnings, 13 00:00:33,280 --> 00:00:36,400 Speaker 2: we already saw pretty lofty or inflated expectations, but they 14 00:00:36,479 --> 00:00:39,800 Speaker 2: beat expectations by about three percent for the quarter, and critically, 15 00:00:40,440 --> 00:00:43,800 Speaker 2: they guided forecast revenue and profit to beat the expectations 16 00:00:43,840 --> 00:00:46,320 Speaker 2: by even more, about four to five percent. So, as 17 00:00:46,320 --> 00:00:48,640 Speaker 2: you said, there was fairly palpable fear for the last 18 00:00:48,640 --> 00:00:51,000 Speaker 2: I'd say probably ten trading sessions in the market that 19 00:00:51,040 --> 00:00:53,880 Speaker 2: the AI bubble was bursting. And this has at the 20 00:00:53,960 --> 00:00:57,160 Speaker 2: very least temporarily calmed the market. So we saw that 21 00:00:57,200 --> 00:00:59,800 Speaker 2: play out after market in video shares jump five percent, 22 00:01:00,560 --> 00:01:03,240 Speaker 2: and any stock it even smells like it is exposed 23 00:01:03,240 --> 00:01:08,600 Speaker 2: to AI, they rarely pretty hard. So Applied micro Devices, Oracle, Broadcom, Google, Amazon, Meta, 24 00:01:08,640 --> 00:01:11,640 Speaker 2: Microsoft all up two to four percent after ours. 25 00:01:12,080 --> 00:01:15,080 Speaker 1: Did it calm fears of the bursting of the AI bubble? 26 00:01:15,760 --> 00:01:19,360 Speaker 2: Yeah? I think it has, at least temporarily. So you know, 27 00:01:20,400 --> 00:01:22,479 Speaker 2: every time he reports, Jensen is getting more and more 28 00:01:22,480 --> 00:01:25,360 Speaker 2: granular with his guidance and his forecasts. He's now sort 29 00:01:25,400 --> 00:01:29,240 Speaker 2: of forecasting half a trillion dollars of revenue to be 30 00:01:29,319 --> 00:01:31,360 Speaker 2: shipped over the next sort of fourteen months, and that's 31 00:01:31,360 --> 00:01:33,200 Speaker 2: getting quite specific, and he has good a line of 32 00:01:33,240 --> 00:01:35,319 Speaker 2: sight on that. So I do think this was a 33 00:01:35,319 --> 00:01:37,800 Speaker 2: critical result, and for now fears are calmed. 34 00:01:38,400 --> 00:01:40,600 Speaker 1: Okay, Now I want to talk about something else as well, 35 00:01:40,600 --> 00:01:43,959 Speaker 1: which is the US consumer. Tell me what you make 36 00:01:43,959 --> 00:01:45,759 Speaker 1: of the health of the US consumer. If you look 37 00:01:45,800 --> 00:01:47,920 Speaker 1: through the eyes of Home Depot, Target, you know, that 38 00:01:48,000 --> 00:01:48,559 Speaker 1: kind of thing. 39 00:01:50,760 --> 00:01:54,680 Speaker 2: Definitely a vastly different story for the all important US consumer. 40 00:01:54,800 --> 00:01:58,160 Speaker 2: So those companies were generally incrementally more cautious. So Home 41 00:01:58,200 --> 00:02:01,960 Speaker 2: Depot think of min ten or Bunnings on steroids and 42 00:02:02,000 --> 00:02:05,040 Speaker 2: one of the biggest retailers in the US said consumer 43 00:02:05,120 --> 00:02:09,240 Speaker 2: uncertainty and continued pressure and housing are disproportionately impacting home 44 00:02:09,280 --> 00:02:13,960 Speaker 2: improvement demand. And importantly, while it had been primarily the 45 00:02:14,040 --> 00:02:16,280 Speaker 2: lowering consumer that was hurting hither you and I have 46 00:02:16,280 --> 00:02:18,720 Speaker 2: talked about that, that is now spreading to the middle 47 00:02:18,720 --> 00:02:22,480 Speaker 2: income consumer target the massive general merchandise I said, consumers 48 00:02:22,480 --> 00:02:27,919 Speaker 2: are continuing to trade down and he cheekily equipped about Christmas. 49 00:02:27,919 --> 00:02:30,760 Speaker 2: He said people will prioritize what goes under the tree 50 00:02:31,360 --> 00:02:33,960 Speaker 2: rather than spinning unnecessarily on what goes on the tree, 51 00:02:34,400 --> 00:02:37,000 Speaker 2: and Lowe's competes with Home Depot, while feeling it a 52 00:02:37,000 --> 00:02:39,880 Speaker 2: little less said visibility remains poor. 53 00:02:40,600 --> 00:02:42,720 Speaker 1: What does this all mean for investors? Do you think? 54 00:02:43,800 --> 00:02:47,920 Speaker 2: I think it really shines a clear spotlight on the 55 00:02:47,960 --> 00:02:51,400 Speaker 2: extraordinary two speed economy in the US, AI and all 56 00:02:51,440 --> 00:02:54,440 Speaker 2: spinning related to AI and everything else. So it's a 57 00:02:54,440 --> 00:02:58,040 Speaker 2: reminded that a couple of handfuls of AI winners in 58 00:02:58,040 --> 00:02:59,880 Speaker 2: the S and P five hundred since chat GPT was 59 00:03:00,080 --> 00:03:02,440 Speaker 2: launched in November twenty twenty two, like the start of 60 00:03:02,440 --> 00:03:06,560 Speaker 2: the modern AI bonanza, those stocks have driven seventy five 61 00:03:06,560 --> 00:03:08,000 Speaker 2: percent of the gains in the S and P five 62 00:03:08,080 --> 00:03:10,200 Speaker 2: hundred eighty percent of the growth and earnings and ninety 63 00:03:10,240 --> 00:03:12,919 Speaker 2: percent of the growth and capital expenditure. And outside of that, 64 00:03:13,000 --> 00:03:17,200 Speaker 2: the economy remains or visibility on the economy remains very 65 00:03:17,280 --> 00:03:17,760 Speaker 2: very poor. 66 00:03:18,600 --> 00:03:20,440 Speaker 1: Hey, thank you very much. Sam has always appreciated and 67 00:03:20,480 --> 00:03:23,280 Speaker 1: we'll talk to you again soon. That Sam Dickey Official. 68 00:03:22,880 --> 00:03:26,120 Speaker 2: Funds For more from Heather Duplessy Allen Drive. 69 00:03:26,280 --> 00:03:27,720 Speaker 1: Listen live to news talks. 70 00:03:27,720 --> 00:03:30,920 Speaker 2: It'd be from four pm weekdays, or follow the podcast 71 00:03:31,000 --> 00:03:31,959 Speaker 2: on iHeartRadio.