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Speaker 1: Yeah, let's move to the semiconductor chip space, if you will,

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Speaker 1: and more pain here for some of the corporates involved

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Speaker 1: with video, the latest one to give a week forecast

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Speaker 1: for the current period. It does suggest to demand maybe

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Speaker 1: even worse than fear. Let's get over and discuss all

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Speaker 1: this with Ian King, Bloomberg News US semiconductor reporter. We

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Speaker 1: got to the moment after ours four and a half

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Speaker 1: pers sent down video that they missed their forecast by

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Speaker 1: a billion dollars. Now, surely these corporate companies that normally

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Speaker 1: try and under promise and over deliver, this is not

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Speaker 1: the case here. Yeah. I mean what in video is

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Speaker 1: basically saying is, look, we have got this mountain of

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Speaker 1: inventory that essentially the massive dip that we're seeing contumer

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Speaker 1: spending driven by inflation quarter that we just couldn't respond

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Speaker 1: in time. We have all of these chips. Suppliers have

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Speaker 1: all of these chips that you know, we just don't

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Speaker 1: have the absolute demand for. So we're just going to

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Speaker 1: undership what's going after shelves for the next couple of

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Speaker 1: quarters and make sure that all of this works its

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Speaker 1: way through the system and that we get back to

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Speaker 1: a more healthy position. Is this a darling that's kind

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Speaker 1: of gone off the rails, or is this all understandable

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Speaker 1: given you know, this sort of progression of the pandemic

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Speaker 1: and and bottlenecks and the like, a mixture of both.

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Speaker 1: I would say, I think what has been underestimated by

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Speaker 1: investors is the amount of these GPU chips and video

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Speaker 1: makes that we're actually in the hands of the crypto minors.

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Speaker 1: And that's obviously a very volatile situation. And there's new

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Speaker 1: technology under way that will basically mean that video's chip

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Speaker 1: won't be used for this market anymore. So there's been

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Speaker 1: a lot of a lot of lack of clarity there.

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Speaker 1: But on the flip side, look, this is what the

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Speaker 1: chip industry does. It always gets ahead of itself, it

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Speaker 1: always gets caught out, and it always then has to

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Speaker 1: do this called inventory correction. The question is always how

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Speaker 1: long so, And I mean, we have a situation right

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Speaker 1: now also that other PC makers are feeling it. And

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Speaker 1: to me about gaming revenue, how that really held up

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Speaker 1: if it did hold up at a tour, which sure

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Speaker 1: it didn't. And on top of that, one of the

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Speaker 1: main drivers of growth that we've seen is the data centers.

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Speaker 1: Now you know how are they doing, and what's the

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Speaker 1: sort of forecast for them looking ahead, because that's going

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Speaker 1: to really also be something that we're going to be

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Speaker 1: perhaps looking at again in the next quarter. Yeah. No,

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Speaker 1: I mean you've you've nailed at These are the two

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Speaker 1: things that people are worried about. You know, just spoke

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Speaker 1: with the CEO about half an hour ago and he said, look,

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Speaker 1: you know, fundamentally the gaming market is in, you know,

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Speaker 1: in a good place. You know, lots of games out there,

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Speaker 1: lots of two technology, and there lots of exignment. But

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Speaker 1: you know, consumer spending is what it is. We'll just

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Speaker 1: have to work our way through this. So obviously that's

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Speaker 1: a you know, a rather sort of how can I

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Speaker 1: put this less bullish approach, and we've heard from him

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Speaker 1: about that market. Data center is a very different situation though,

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Speaker 1: he's saying, look, we just literally can't meet demand. We

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Speaker 1: can't get enough of the support chips we need for

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Speaker 1: the cards we need for the systems, otherwise would be

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Speaker 1: even better than this record level that we're at. So

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Speaker 1: two very different situations. You know that the chip industry

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Speaker 1: is kind of two faces if you like that. We're

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Speaker 1: still not out of the chip shortages. But we're already

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Speaker 1: into oversupply of other types of chips. So consumer electronics

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Speaker 1: and smartphones suffering I guess a lot here, and part

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Speaker 1: of that can be explained, I suppose by inflation. But

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Speaker 1: since data center is more on the enterprise side, that

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Speaker 1: looks pretty solid and maybe enough to wretch things back. Yeah,

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Speaker 1: I mean the balance of these two businesses. For in videos,

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Speaker 1: it's it's very much at that point right where if

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Speaker 1: data center has a really really good quarter and gaming

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Speaker 1: stays at kind of this level, then data center will

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Speaker 1: be more important. But overall, the problem, Brian and is

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Speaker 1: that there is concerned amongst the analysts based upon what

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Speaker 1: other chipmakers have said that guess what, we're consumer leads

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Speaker 1: than enterprise will follow because we'll see an overall week

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Speaker 1: in the economy and that'll cause large companies to cut

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Speaker 1: their budgets and that will just work. It's right, screw

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Speaker 1: into things like in videos data center business. So that's

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Speaker 1: the abiding concern untils sorry in vidious CEO. So don't

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Speaker 1: worry about that. We're not seeing that. The technology reasons

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Speaker 1: for all of this data center spending is still strong.

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Speaker 1: Don't planic kind of thing. But that's that's definitely in

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Speaker 1: underligning concern and I think that's you know, you're asking

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Speaker 1: the right questions in let's have also look at how

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Speaker 1: in videos stacks up next to its rivals, and you

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Speaker 1: know they've said similar things. Does this perhaps lead that

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Speaker 1: would be because of the number of them cause regulatory

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Speaker 1: concerns some consolidation. The problem, I think is that there's

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Speaker 1: been so much over the last four or five years

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Speaker 1: that we're down to a very few players, and as

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Speaker 1: we saw within Video and their attempt to get hold

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Speaker 1: of UM that there's just so much opposition amongst the

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Speaker 1: customer base, you know, those willing to whisper to regulators

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Speaker 1: around the world. But you know, consolidation is just is

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Speaker 1: just very, very difficult to go through as a process

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Speaker 1: because there's so many ways to undermine any deal that

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Speaker 1: gets proposed that it just doesn't seem to be a

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Speaker 1: huge amount of appetite for that right now, anything that's

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Speaker 1: not small and just roughly an add on that nobody

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Speaker 1: cares about kind of thing. Just in ten seconds, margins

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Speaker 1: margin held them well. Margin's held up well because we're

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Speaker 1: moving to the sort of speaks speaks to management, I suppose,

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Speaker 1: And yeah, anyway out of time this time, but Jensen

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Speaker 1: Wong is a good operator. Interesting to see how long

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Speaker 1: it takes for the company to bounce back. Ian King

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Speaker 1: with US as usual, providing some insightful commentary.