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Speaker 1: You're gonna get right to this right now, Dan, I

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Speaker 1: have shows us some Wedbush here all over the media.

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Speaker 1: Of course, as we go into the mag eight Frenzy

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Speaker 1: Warren't buffet. He's part of the mag eate right now,

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Speaker 1: sixty five buys on Nvidio eight holds no sols like

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Speaker 1: you don't follow in video. You got a thug at

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Speaker 1: Webbush that follows it.

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Speaker 2: Right, Yeah, So our view and Nvidio, you know, we

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Speaker 2: have one hundred and thirty eight hour probably start bult

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Speaker 2: cases one seventy five.

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Speaker 1: Bernstein went to one fifty this morning, and.

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Speaker 2: I think this is just a star. I mean, look,

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Speaker 2: I think this by the end of the day or

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Speaker 2: even the next twenty four hours, this is a stock

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Speaker 2: that should be in the green based on everything we

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Speaker 2: saw from Godfather of Ai Jensen the video.

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Speaker 1: Pull get one more in here and I will so

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Speaker 1: good at that.

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Speaker 3: So, Dan, give us a sense. What did you hear

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Speaker 3: from nvidio last night? They beat numbers? Maybe the guidance

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Speaker 3: wasn't where the street was expecting, But what did you

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Speaker 3: really take away from Nvidia last night?

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Speaker 2: So three things? One demand, because the question is is

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Speaker 2: they're double ordering. What is enterprise demands actually accelerating. And

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Speaker 2: there's no better perch in terms of everything we're seeing

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Speaker 2: from AI than what Jensen sees. To Blackwell, all the

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Speaker 2: fears right, the worries is a gendle. They essentially put

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Speaker 2: those fears to rest, and that was so important.

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Speaker 1: Okay, you know I'm the only one that does Matthews

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Speaker 1: do not all this fancy dan eyes talk. You take

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Speaker 1: the ten billion share bibic of Apple, they've been doing

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Speaker 1: it for years, divided by free cash flow. You take

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Speaker 1: a fifty billion statistic divided by invidious free cash flow.

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Speaker 1: To me, it was a ginormous announcement. Everybody's saying it's

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Speaker 1: not a big deal. Was a share buy back a

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Speaker 1: big deal?

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Speaker 2: It's a monster deal. And also this also goes to

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Speaker 2: a company. You go back six months ago, out year,

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Speaker 2: by twenty five, twenty six, two dollars in earnings. Now

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Speaker 2: it's gonna be five to six hours.

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Speaker 1: I'm extended time here this morning with Dani's were welcome

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Speaker 1: you all around the world on YouTube and Android, Android

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Speaker 1: auto Apple car play as well. Okay, I go to Apple,

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Speaker 1: I go to the famed aggregation of Tom Secunda in

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Speaker 1: the Bloomberg news, and I'm just gonna read these Paul

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Speaker 1: quick mashable. Apple music playlists now transferable to YouTube music.

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Speaker 1: University of Wisconsin deny new trial as that go after somebody.

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Speaker 1: Apple orders ten percent more iPhones than last year. Apple

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Speaker 1: iPhone seventeen rumored to arrive at the Sweeney House before

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Speaker 1: September fifteenth. And on the last headline, Dan Ives on

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Speaker 1: Bloomberg Right now, I mean, here's the news out of

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Speaker 1: Tokyo shock. There's more iPhone orders. How do you translate that?

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Speaker 2: I mean, this is the start of an AI driven

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Speaker 2: super psych with iPhone sixteen. I think it's gonna be

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Speaker 2: historical period. Look, we've talked about a lot on the show.

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Speaker 2: Three hundred million of one point five billion iPhones, including Sweeney,

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Speaker 2: haven't upgraded in four plus years AI. Twenty five percent

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Speaker 2: of the world is going to access AI through an

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Speaker 2: Apple device. The consumer revolution all starts.

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Speaker 1: Stop it a push against you, Tom Keen and Paul Sweeney.

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Speaker 1: Don't give a damn about AI. Just want an iPhone

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Speaker 1: to know where our kids are. What's a big deal

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Speaker 1: about AI If Paul Sweeney's not gonna use it?

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Speaker 2: So that's today. If you look at the app There's

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Speaker 2: gonna be hundreds of apps built on Apple Intelligence that

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Speaker 2: are gonna be AI driven as well as this open AI.

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Speaker 2: It's good. It's essentially gonna be a personal assistant that

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Speaker 2: really from a data perspective, understands paul sway understands, can

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Speaker 2: understand your habits. This is gonna change. This is how

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Speaker 2: most consumers are now going to interact with AI.

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Speaker 3: China. What's the latest on China? My concern always in

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Speaker 3: the back of my mind is that the average Chinese

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Speaker 3: consumer is saying, I'm just not buying American. Is that

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Speaker 3: an issue for Apple in terms of market share?

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Speaker 2: I mean, as someone that spends time in the region,

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Speaker 2: the average Chinese consumer wants the best product in the world,

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Speaker 2: which is an Apple device. So I'm not saying that

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Speaker 2: there aren't some geopolitical headwinds. We're actually seeing more tail

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Speaker 2: wins out of China, especially iPhone sixteen. You have one

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Speaker 2: hundred million iPhones that are basically having upgrade four years,

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Speaker 2: So I think any headwinds there starting now come down.

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Speaker 2: That's why I cook ninety percent CEO ten percent politician.

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Speaker 3: Right, Yeah, it's smart. How about India? We were just

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Speaker 3: I was just talking about this with somebody at the

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Speaker 3: club last night. Tom at the bar, we were talking

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Speaker 3: iPhones in India. How that came about? I have no

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Speaker 3: idea you at the club last night. There's no club

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Speaker 3: that would take or would I want to be in

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Speaker 3: that club?

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Speaker 2: Or were you at the watch party for a video?

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Speaker 1: Yes, wisan Thal was that whatever?

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Speaker 2: I thought Sweeney was going to be at that watch

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Speaker 2: But I.

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Speaker 1: At least day trading office couch at the cottage. I

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Speaker 1: can only say my club last night, I was a club.

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Speaker 1: Do the dishes club? India?

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Speaker 3: What's the opportunity there for Apple in India? Don't they

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Speaker 3: have to have a lower price phone in that market?

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Speaker 2: But in India you've actually had a rising middle class,

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Speaker 2: and I think if you that's always been a tough

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Speaker 2: market for Apple. Three percent iPhones we think called by

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Speaker 2: the next two years it's gonna be ten to twelve

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Speaker 2: percent overall iPhones. India is actually gonna be robust for Apple,

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Speaker 2: especially on different price points.

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Speaker 1: How many iPhones are purchased a wise one on a

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Speaker 1: plan from a phone company and not where somebody spends

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Speaker 1: eight hundred or one thousand dollars on the toy.

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Speaker 2: I mean, it's a huge number. I mean, it's a

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Speaker 2: huge number. And if you look at the carrier discounts

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Speaker 2: that's gonna come and this is the big thing.

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Speaker 1: Do you have information on them? You'd like to break

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Speaker 1: on Bloomberg.

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Speaker 2: So everything we're seeing, we think it was gonna essentially

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Speaker 2: be unprecedented types of promotion from especially US carriers at

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Speaker 2: and just because this is the time in other words,

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Speaker 2: when you think about five G when that came out,

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Speaker 2: and now essentially AI, this is really gonna be the

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Speaker 2: opportunity in terms of carrier discounts and what really starts

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Speaker 2: to about maturity on a smartphone cycle. This is now

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Speaker 2: that consumer AI revolution that actually will go through Cooper

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Speaker 2: Tino and we think that's how we have a four

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Speaker 2: trillion dollar mark cap as you know going to early

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Speaker 2: next year.

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Speaker 1: Do you have some of the parts on Apple you

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Speaker 1: can update?

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Speaker 2: Yeah, so we have one point seven trillion is what

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Speaker 2: what I view is the services value. And when you

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Speaker 2: sort of some of the parts that that's something where

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Speaker 2: you know, you got a one hundred billion a rev

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Speaker 2: growing mid teens, free cash margins are double the hardware business.

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Speaker 2: You combine it, it's over four trillion. I think bull

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Speaker 2: cases ultimately you know over over three.

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Speaker 3: Hundred Microsoft, which I know you've been very bullish on Microsoft.

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Speaker 3: What's the thought these days?

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Speaker 2: You look in a video's call last night, you also

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Speaker 2: buy Microsoft because Nadella and Redmud are weeding. Then on

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Speaker 2: the software side, you look at open Ai. They're really

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Speaker 2: dominating in that amount rushmore. That's where Nadella is along

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Speaker 2: with Jensen.

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Speaker 1: Does Blackwell compete with Azure or do they cohabitate They're complementary.

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Speaker 1: Thing about I don't understand that exploits.

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Speaker 2: So essentially Blackwell is almost the architecture, the foundation of

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Speaker 2: a house. Microsoft is the actual house. The actual rooms

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Speaker 2: will be different software players, service now you know called

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Speaker 2: salesforce and others. What protects the house, cybersecurity names like

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Speaker 2: pale out though and others. Look, I continue to think

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Speaker 2: in Vidia today it's Lebron in high school. That's essentially

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Speaker 2: where they are. Lebron in high school, in Vidia, that's

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Speaker 2: where they are.

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Speaker 3: So I guess so when we think about this AI

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Speaker 3: spending here, the numbers are just almost numbing. That is

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Speaker 3: so big. How much of the AI capital spending the

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Speaker 3: is it incremental versus just taken away from other tech

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Speaker 3: budgets like it or something.

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Speaker 2: So I'd say about eight hundred billion of the trillion

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Speaker 2: is incremental. Wow, so there's two hundred billion that. Of

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Speaker 2: course there's accounnibalization impact and there will be losers on that,

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Speaker 2: but it really is incremental, and it just speaks to

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Speaker 2: strong get stronger in tech. And then you can say

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Speaker 2: about about regulatory. Regulatory is in a minivan going forty

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Speaker 2: miles an hour in the right lane, and the technology

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Speaker 2: is in a Ferrari key in the Ferrari left leane

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Speaker 2: going one hundred miles an hour.

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Speaker 1: What is the free cash flow growth of the MAG

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Speaker 1: seven when you aggregate them together. There's a secret Exel

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Speaker 1: spreadsheet in the basement of the eyves.

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Speaker 2: Of free cash for growth of MAG seven is i'd

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Speaker 2: say upper teams into potentially.

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Speaker 1: Really, you're gonna give me a two zero one.

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Speaker 2: I think it could start to now get that high

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Speaker 2: till we go into next two three. And that's why, look,

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Speaker 2: I get it. The bears continue to you know, they

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Speaker 2: sit there with their spreadsheets DCF being negative. Ontack, I'm

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Speaker 2: gonna stop there.

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Speaker 1: This is too important. You're going to DCF. I asked

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Speaker 1: this with Paul yesterday. How do you do with terminal

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Speaker 1: value on these juggernuts. This does not see FA one

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Speaker 1: on one, but you.

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Speaker 2: Have to ultimately trajectory out what the capax looks like,

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Speaker 2: what's the incremental dollars and what that ultimately means to

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Speaker 2: the WARLD.

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Speaker 1: How far out does Dana ives go?

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Speaker 2: You basically have to go out six, eight, ten years

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Speaker 2: to actually do a tradrest like when you look at

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Speaker 2: Microsoft the way that you get four and a half

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Speaker 2: five trillion, okay, just for you have to bas gonna

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Speaker 2: say how much of percentage of cappacks they're gonna get,

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Speaker 2: what demonization, what does the free cash will incrementally look like?

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Speaker 2: And that's where all these stories change. But then there's

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Speaker 2: other names like a pall and Teer, the Messi of AI.

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Speaker 2: It wasn't even on the radar. Now they're Lebron and

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Speaker 2: their core AI play.

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Speaker 3: Hey, Dan, one of the key action which of your

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Speaker 3: research is that you travel the globe. You see people

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Speaker 3: all over the place. What's your next trip?

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Speaker 2: So you'll be going to Asia on Monday, be there

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Speaker 2: for two weeks and look to me, that's where we've

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Speaker 2: got That's where we get edged. Because I think a

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Speaker 2: lot of investors how they've missed AI Revolution. They try

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Speaker 2: to find it on the Metro North Jersey transit on

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Speaker 2: the tenth four of their office building in New York.

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Speaker 2: Her Sam Frand you gotta travel to see it, And

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Speaker 2: I think that, So what.

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Speaker 1: Do you see when you go to We see.

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Speaker 2: The suppliers, we see the component players. I also think

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Speaker 2: by seeing global investors you get a very good sense

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Speaker 2: in terms of where things are, and I think it

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Speaker 2: just gives you a little more perspective.

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Speaker 1: Final, can you convince John Tucker to upgrade this time around?

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Speaker 2: No?

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Speaker 4: I think I think I think Tucker after going to

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Speaker 4: the Inn video watch party last night, that he might

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Speaker 4: now potentially upgrade to an iPhone.

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Speaker 1: O cursonally Blackwell Ship Where have I heard that name?

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Speaker 1: Remember mister Blackwell, the guy who did the best and

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Speaker 1: worst stress less? Oh yeah?

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Speaker 3: Where?

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Speaker 2: I think Kean would be at the top. Kean would

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Speaker 2: be at the top, and I'd be and maybe like

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Speaker 2: the like other category.

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Speaker 1: Mister travels qugely valuable well curse future, mister Rymes, mister

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Speaker 1: Munster together today on Bloomberg Surveillance. That's the way that

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Speaker 1: we roll