WEBVTT - Holiday Special: 2025 Tech Trends with Ives and Munster 0:00:02.520 --> 0:00:14.960 Bloomberg Audio Studios, Podcasts, radio News. Thank you so much 0:00:15.000 --> 0:00:18.120 for joining us for this special edition of Bloomberg Daybreak. 0:00:18.200 --> 0:00:21.400 I'm Nathan Hager. US markets are closed for the fourth 0:00:21.400 --> 0:00:24.079 of July holiday, coming up this hour. Well, what a 0:00:24.160 --> 0:00:27.640 difference three months makes. Back in April, tech stocks were 0:00:27.760 --> 0:00:30.960 hardest hit in the stock market selloff. Now after tumbling 0:00:30.960 --> 0:00:33.800 in some cases more than thirty percent from record highs, 0:00:34.000 --> 0:00:37.440 names you know like Nvidia, Microsoft, and Meta Platforms have 0:00:37.520 --> 0:00:39.720 helped power the Nasdaq and the S and P five 0:00:39.800 --> 0:00:43.240 hundred back into record territory. So what will the rest 0:00:43.240 --> 0:00:45.720 of the year bring. We hope to answer that question 0:00:45.760 --> 0:00:48.840 in this special one hour roundtable with two of Wall 0:00:48.880 --> 0:00:53.239 Street's most influential tech analysts, Gene Munster, managing partner at 0:00:53.280 --> 0:00:56.880 Deepwater Asset Management and Dan Ives, Global head of Tech 0:00:56.960 --> 0:01:00.600 research at Webbush Securities. Kind of becoming a tradition to 0:01:00.640 --> 0:01:02.960 have the three of us together. Thanks so much for 0:01:03.000 --> 0:01:05.040 being here, and I want to start with a look 0:01:05.080 --> 0:01:07.319 back at the last time we got together at the 0:01:07.360 --> 0:01:10.840 start of this year. Dan, you've talked about the time 0:01:11.040 --> 0:01:13.319 it's at in the AI party, so I want to 0:01:13.319 --> 0:01:15.800 remind you what you told us not too long ago. 0:01:15.959 --> 0:01:16.760 On New Year's Day. 0:01:16.880 --> 0:01:19.640 First of there's after parties at five and six am, 0:01:20.000 --> 0:01:23.560 and then even in news you'll have some that fall 0:01:23.640 --> 0:01:25.800 by the waisa. But if you focus on the winners 0:01:25.880 --> 0:01:29.080 and keep the thesis again, we're going to be talking 0:01:29.160 --> 0:01:33.840 about four trillion, five trillion dollar mark aps NASDAK twenty 0:01:34.280 --> 0:01:39.039 twenty two, twenty five k over the next three four 0:01:39.440 --> 0:01:40.880 five years in my opinion. 0:01:41.280 --> 0:01:44.360 So now here we are with talk of Nvidia maybe 0:01:44.400 --> 0:01:48.000 Microsoft becoming the first four trillion dollar company. The Nasdaq's 0:01:48.000 --> 0:01:51.480 already at twenty thousand. So what time is it now, Dan? 0:01:52.200 --> 0:01:54.880 Yeah, Look, I mean it was nine pm in the party. 0:01:55.040 --> 0:01:58.080 Now it's ten pm. But that party goes to four am. 0:01:58.160 --> 0:02:03.320 As we've said, because this SAI revolution, it's just starting 0:02:03.360 --> 0:02:05.080 to hit its next stage. Go ahead in terms of 0:02:05.120 --> 0:02:08.519 the use cases on enterprise, in terms on the consumer. 0:02:08.600 --> 0:02:11.639 You think about physical AI, which obviously Jen's talked a 0:02:11.639 --> 0:02:14.839 ton about, we'll and we'll hit on And that's my view. 0:02:14.880 --> 0:02:18.919 This is a fourth industrial revolution, This tack bull market. 0:02:19.360 --> 0:02:22.160 It's another three years ahead. And that's why I think 0:02:22.200 --> 0:02:25.400 it's get out the popcorn, get the champagne. I's handing 0:02:25.480 --> 0:02:26.399 slowing it down. 0:02:26.639 --> 0:02:30.480 So a slow moving clock at the start of the 0:02:30.480 --> 0:02:34.360 AI party. Potentially, Gene, let's remind everyone what you had 0:02:34.440 --> 0:02:35.919 to say about this at the start of the year 0:02:35.919 --> 0:02:36.239 as well. 0:02:36.280 --> 0:02:38.080 I like dance party analogy is much more of my 0:02:38.120 --> 0:02:42.120 baseball analogies. But I'm at the third inning of this, 0:02:42.240 --> 0:02:44.080 and we think we're in the early stages of a 0:02:44.080 --> 0:02:47.120 three to five year bull market, and I don't I wouldn't. 0:02:47.120 --> 0:02:49.520 Don't worry about the after don't worry about the hangover 0:02:49.600 --> 0:02:53.160 at this point, I think you just embrace that this 0:02:53.320 --> 0:02:57.200 is as the substance will exceed the hype and we've 0:02:57.240 --> 0:02:59.239 got some great years ahead of us from the market. 0:03:00.000 --> 0:03:03.720 This is the question, is the substance succeeding the hype now, Jane, 0:03:04.360 --> 0:03:05.119 I don't even. 0:03:04.880 --> 0:03:06.120 Think we're close to it. 0:03:06.160 --> 0:03:09.560 And I go back a couple months ago, we hosted 0:03:09.600 --> 0:03:12.200 an AI summits and we had all the leaders from 0:03:12.680 --> 0:03:15.880 the big private AI companies there. I mean, these companies 0:03:15.919 --> 0:03:20.200 are just geared towards evangelizing what's going on AI. And 0:03:20.240 --> 0:03:24.240 what surprised me most was they talked about the most 0:03:24.280 --> 0:03:29.040 compelling use cases of AI being coding and customer service. 0:03:29.120 --> 0:03:31.440 These are the same things that we talked about a 0:03:31.520 --> 0:03:34.400 year ago and the reason why that's so bullish. If 0:03:34.440 --> 0:03:36.800 I was going to refine what I said back in January, 0:03:36.840 --> 0:03:40.200 I'd actually say we're in the second inning, and this 0:03:40.360 --> 0:03:46.640 commentary around from these leading AI companies that the use 0:03:46.680 --> 0:03:49.640 cases really haven't taken off. I think to me speaks 0:03:49.680 --> 0:03:52.600 to just how early we are. And then you layer 0:03:52.720 --> 0:03:54.560 on top of that things that are going on with 0:03:54.760 --> 0:03:57.400 Zuck going out and putting these huge bounties. I mean, 0:03:57.680 --> 0:04:00.880 if you believe that he's competent and look at the 0:04:00.880 --> 0:04:03.560 money that's getting put behind this, I think we're still 0:04:03.640 --> 0:04:05.840 very early. So to answer your question, you know, is 0:04:05.880 --> 0:04:10.000 the substance there. It's just starting. But totally agree with 0:04:10.600 --> 0:04:14.680 where where Dan's at and how the trajectory this plays 0:04:14.720 --> 0:04:15.840 out over the next few years. 0:04:15.880 --> 0:04:19.479 Well, let's talk a little bit about where the use 0:04:19.560 --> 0:04:22.920 case is going right now. Over the last several months, 0:04:22.920 --> 0:04:25.880 maybe the last couple of years, we've talked about all 0:04:25.960 --> 0:04:29.560 the spending that's been going on, particularly by the hyperscalers 0:04:29.560 --> 0:04:32.120 in this space. Dan, how do you see the use 0:04:32.200 --> 0:04:33.600 cases developing right now? 0:04:34.600 --> 0:04:36.760 Yeah, and Gene hit on some of them, But I 0:04:36.760 --> 0:04:38.640 think the most important thing too is, like for every 0:04:38.720 --> 0:04:42.280 dollar spent on in video chip, we estimate there's an 0:04:42.320 --> 0:04:47.720 eight to ten dollars multiplier across software, infrastructure energy. That 0:04:47.880 --> 0:04:50.120 speaks the ripple effect. When you think about the use 0:04:50.200 --> 0:04:53.440 cases obviously front and center of the MESSI of AI 0:04:53.600 --> 0:04:56.680 pound tier. I mean we have upwards of eighty four 0:04:56.800 --> 0:05:00.160 use cases today. You go back a year ago mid 0:05:00.279 --> 0:05:06.240 less than five across retail, advertising, marketing, government. And what's 0:05:06.240 --> 0:05:09.880 starting to happen is companies seventy percent of the data 0:05:09.920 --> 0:05:14.000 they've never accessed before. That's why now for any of 0:05:14.080 --> 0:05:20.039 these install based Oracle, Microsoft Salesforce Service now it's a 0:05:20.080 --> 0:05:23.919 bonanza because of the cross SEU opportunities. You know, Gene 0:05:24.279 --> 0:05:27.039 sees so much of the innovative company is also on 0:05:27.080 --> 0:05:30.360 the private side. And I think what you're also seeing 0:05:30.400 --> 0:05:35.400 now is like the innovation that's happening. To me, it's 0:05:35.440 --> 0:05:38.240 the biggest thing that I've ever seen, and when I'm 0:05:38.279 --> 0:05:43.359 surprised every time in a factory floor, whether it's humanoids, robotics, autonomous, 0:05:43.560 --> 0:05:47.000 whether it's in the US, whether it's in Asia, it's 0:05:47.160 --> 0:05:50.840 just starting. It's a golden age for tech ahead. And 0:05:50.839 --> 0:05:54.400 that's why Wes say the Bears and their hibernation caves. 0:05:54.880 --> 0:05:57.960 They can see AI in the spreadsheets. 0:05:57.880 --> 0:06:02.360 Gene In terms of how these large language models are 0:06:02.480 --> 0:06:06.040 developing and the use cases that are being put out there, 0:06:06.520 --> 0:06:10.120 how do you see some of these companies like open AI, 0:06:10.480 --> 0:06:13.839 like Anthropic competing against each other? Is there going to 0:06:13.880 --> 0:06:16.640 be one winner? Are there going to be multiple winners? 0:06:17.440 --> 0:06:19.640 I mean from our perspective, I mean, again, keep the 0:06:20.000 --> 0:06:22.839 groundwork to framework that Dan's laid out, like this is 0:06:22.880 --> 0:06:26.680 going to be bigger than what people can imagine. And 0:06:26.720 --> 0:06:29.000 in that case, you know what is this at the 0:06:29.000 --> 0:06:31.240 core of it? It is that intelligence piece and answer 0:06:31.320 --> 0:06:33.440 question Nathan. I think there's going to be five kind 0:06:33.480 --> 0:06:37.600 of core models that essentially the Western world is going 0:06:37.640 --> 0:06:40.479 to be a run off of. And those are those 0:06:40.520 --> 0:06:44.320 companies that we just that we know so well. There 0:06:44.400 --> 0:06:46.960 is a debate about is this kind of a race 0:06:47.000 --> 0:06:49.960 to the bottom. Eventually, once we hit general intelligence, does 0:06:50.040 --> 0:06:53.440 this AI the powers of the INSIGHT's going to become 0:06:53.480 --> 0:06:56.960 a commodity? And I feel very strongly that that's not 0:06:57.040 --> 0:06:59.040 going to be the case. I think that as more 0:06:59.040 --> 0:07:02.600 and more of our world, basically the world becomes dependent 0:07:02.640 --> 0:07:04.719 on these, I think that there is pricing leverage and 0:07:04.800 --> 0:07:08.080 so to answer your question, I think there is going to. 0:07:07.880 --> 0:07:10.280 Kind of be five key companies. 0:07:10.320 --> 0:07:13.160 There's going to be thousands and thousands, tens of hundreds 0:07:13.160 --> 0:07:16.120 of thousands of models, many of those large language miles 0:07:16.160 --> 0:07:17.840 that are out there, but really five that are going 0:07:17.880 --> 0:07:19.760 to determine this. And you look at a company like 0:07:19.840 --> 0:07:23.480 open Ai, you get a company like Xai. I mean, 0:07:23.600 --> 0:07:26.360 these companies are going to be trillion dollar plus companies 0:07:26.400 --> 0:07:26.920 down the road. 0:07:27.080 --> 0:07:29.680 We're speaking with Gene Munster, managing partner in deep Water 0:07:29.800 --> 0:07:32.560 Asset Management and Dan Ives, global head of Tech research 0:07:32.960 --> 0:07:36.920 at web Bush Securities. Obviously, guys, it hasn't been a 0:07:36.960 --> 0:07:40.280 straight line. We mentioned the selloff at the start of 0:07:40.320 --> 0:07:43.400 the second quarter with some of the tariff rhetoric that 0:07:43.480 --> 0:07:46.560 came around there. Dan, were you concerned at all that 0:07:46.880 --> 0:07:50.120 when we heard some of these high teriff rates announced 0:07:50.120 --> 0:07:52.640 that the party was almost over free. 0:07:52.400 --> 0:07:56.520 I I thought Trump closed the party, the velvet ropes 0:07:56.520 --> 0:08:00.520 were gone. That was a dark few weeks. Look in 0:08:00.560 --> 0:08:03.600 twenty five years doing this, that was the darkest two 0:08:03.640 --> 0:08:06.240 weeks I've seen, even going back to the Financial crisis 0:08:06.320 --> 0:08:10.280 and every other event, Because that, to me was the risk, 0:08:10.400 --> 0:08:12.760 especially when it comes to China and tariffs and the 0:08:12.800 --> 0:08:17.160 supply chain that was gonna cut tech off at the knees. Thankfully, 0:08:18.120 --> 0:08:21.480 we've seen the administration step further and further back from 0:08:21.520 --> 0:08:24.480 the cliff. Cool heads prevailed, the adult in the room, 0:08:24.480 --> 0:08:28.080 investments taken over, and I think that it's a very 0:08:28.120 --> 0:08:31.840 important stage and that the markets kind of gleaned will 0:08:31.920 --> 0:08:37.240 have much more of a digestible tarerf ray and reciprocal tarifray, 0:08:37.320 --> 0:08:40.360 but nothing that was essentially at the time going to 0:08:40.440 --> 0:08:45.040 be an economic army. Gedton and glad and so happy 0:08:45.040 --> 0:08:47.000 that you know those days are a memory. 0:08:47.720 --> 0:08:50.839 Is it just a memory gene or could we see 0:08:51.320 --> 0:08:54.160 more hiccups down the road depending on how policy turns 0:08:54.160 --> 0:08:55.000 out in Washington. 0:08:55.600 --> 0:08:58.600 Unpredictability is kind of part of the strategy today and 0:08:58.640 --> 0:09:01.360 so we have to kind of go with that. I've 0:09:02.040 --> 0:09:05.760 over the past couple of months have had several conversations 0:09:05.920 --> 0:09:11.280 with former US Trade Group and they currently work with 0:09:11.440 --> 0:09:14.320 the Trump administration and help advise on that. And what's 0:09:14.360 --> 0:09:17.320 been very clear about this whole kind of back and 0:09:17.360 --> 0:09:20.040 forth on what's going on and the White House in particular, 0:09:20.320 --> 0:09:25.000 is the center of gravity is the economy. And we 0:09:25.040 --> 0:09:27.960 can look at all the different pieces around AI trade. 0:09:27.960 --> 0:09:30.040 We can look at what's going on in Tarras, but 0:09:30.360 --> 0:09:32.040 at the end of the day, the White House wants 0:09:32.080 --> 0:09:34.079 to maintain the economy. And so Nathan, when I think 0:09:34.080 --> 0:09:38.960 about this crazy pendulum that goes on, I expected to 0:09:39.000 --> 0:09:40.200 continue at some level. 0:09:40.520 --> 0:09:42.040 But as Dan just so. 0:09:42.040 --> 0:09:47.839 Accurately said, this, cool heads will prevail because ultimately the 0:09:47.880 --> 0:09:50.640 economy is what matters most when it comes to politics, 0:09:51.240 --> 0:09:53.319 because that is how you get reelected. 0:09:53.040 --> 0:09:56.280 And I think that I'm not going to be swayed 0:09:56.280 --> 0:09:56.480 by that. 0:09:56.520 --> 0:09:59.240 And just one other piece related to kind of some 0:09:59.280 --> 0:10:02.480 of these unpredicted what's happened in terms of policy is 0:10:03.120 --> 0:10:07.560 the general view historically is that if the market pulls back, 0:10:07.880 --> 0:10:10.960 it's really difficult for one sector to continue to do well. Like, 0:10:11.000 --> 0:10:14.280 for example, you know, if there's NASAK goes down, it's 0:10:14.320 --> 0:10:17.240 really hard for the AI companies to continue. 0:10:16.840 --> 0:10:19.280 To power forward. And whatever might cause that. 0:10:19.840 --> 0:10:22.040 Slow down in the Nasdaq, whether it's high interest rates 0:10:22.679 --> 0:10:26.000 or whatever it might be. But I actually am so 0:10:26.200 --> 0:10:29.360 bullish on AI. I think that it has the power 0:10:30.640 --> 0:10:33.679 for these companies to continue to move higher over the 0:10:33.760 --> 0:10:36.800 next three to five years, despite what is going to 0:10:36.840 --> 0:10:39.599 happen what could happen with the overall macro and I 0:10:39.679 --> 0:10:42.320 don't like being out on a limb that fart and 0:10:42.920 --> 0:10:46.600 the right approach is that AI is just much more impactful. 0:10:46.760 --> 0:10:48.959 Like Dan said, if it got cut off at the 0:10:49.040 --> 0:10:52.040 knees with trade, that's something that is that would have 0:10:52.080 --> 0:10:55.960 an impact. But assuming the trade piece stays intact, I 0:10:55.960 --> 0:10:57.959 think it's going to be really hard for policy to 0:10:58.559 --> 0:10:59.520 slow this AI train. 0:11:00.120 --> 0:11:01.800 Just to pick up on that point. So much of 0:11:01.840 --> 0:11:06.080 the policy decisions are driven by just the fact that 0:11:06.120 --> 0:11:09.080 this could be seen as an AI race between the 0:11:09.240 --> 0:11:11.760 US and China. I mean, how do you see that 0:11:11.840 --> 0:11:15.040 playing out? Dan, who takes the lead in AI? Is 0:11:15.080 --> 0:11:16.920 it gonna be the US? Is it going to be China? 0:11:17.040 --> 0:11:18.880 How big a deal is that? The deep seek news 0:11:18.920 --> 0:11:20.280 that we saw just a few months back. 0:11:21.000 --> 0:11:24.199 I think the Deep Seek that was a scary moment, 0:11:24.320 --> 0:11:27.120 But the reality is is more came out about that 0:11:27.240 --> 0:11:29.320 in terms of add a few comments to what they 0:11:29.320 --> 0:11:32.000 were spending and next Gen and video are hard where 0:11:32.000 --> 0:11:34.720 they were using. Everyone recognized there's only one chip in 0:11:34.720 --> 0:11:37.240 the world feeling this, and it's it's the godfather of 0:11:37.240 --> 0:11:40.400 a Jensen and video. You'll have other moments like that, 0:11:40.520 --> 0:11:43.120 and China is not just going to sit there on 0:11:43.160 --> 0:11:45.600 a treadmill. They're going to continue narrow the gap. But 0:11:45.640 --> 0:11:48.600 I actually think that's positive because it's a shot across 0:11:48.640 --> 0:11:52.440 about at US big tech, and I think you're seeing 0:11:52.480 --> 0:11:56.600 an acceleration since Deep Seek. But that's an important movement, 0:11:56.640 --> 0:11:59.880 and I think what Gene said is such a great 0:11:59.880 --> 0:12:02.080 one to sum it up in terms of what's happening. 0:12:03.400 --> 0:12:06.800 This is just an unrivaled period and you can go 0:12:07.280 --> 0:12:10.720 if you become myopically focused in some of the headlines, 0:12:11.400 --> 0:12:14.720 you miss what's really a fourth in dust revolution that 0:12:14.720 --> 0:12:15.400 we're living in. 0:12:15.760 --> 0:12:18.400 You know, if all of us investors can channel that 0:12:18.520 --> 0:12:21.839 superpower of just looking at the endgame here, which is 0:12:21.880 --> 0:12:25.840 effectively most parts of the world are going to be 0:12:25.960 --> 0:12:27.920 have a profound impact from AI. If you can stay 0:12:27.960 --> 0:12:30.880 focused on that, I think you can create some wealth 0:12:30.880 --> 0:12:32.120 over the next three to five years. 0:12:32.160 --> 0:12:34.040 And we're going to keep this focus going. Is This 0:12:34.240 --> 0:12:37.760 special one hour round table on the high tech industry 0:12:37.800 --> 0:12:42.120 continues here on Bloomberg Daybreak, with a focus particularly on 0:12:42.160 --> 0:12:44.439 some of the biggest names in the mag seven. So 0:12:44.760 --> 0:12:48.079 stay with us as this special edition of Bloomberg Daybreak 0:12:48.360 --> 0:12:51.760 continues it's twenty minutes past the hour. I'm Nathan Hager, 0:12:51.840 --> 0:13:04.400 and this is Bloomberg. Welcome back to the special edition 0:13:04.440 --> 0:13:07.839 of Bloomberg Daybreak. US markets are closed for the fourth 0:13:07.840 --> 0:13:10.160 of July holiday. I'm Nathan Hager getting you back to 0:13:10.200 --> 0:13:12.920 our high Tech Power Hour. Dan Ives is with US 0:13:13.000 --> 0:13:15.920 global head of Tech Research at web Bush Securities, as 0:13:15.920 --> 0:13:20.080 well as Deepwater Asset Management managing partner Gene Munster Gina. 0:13:20.080 --> 0:13:23.160 I want to focus a little bit on specific names 0:13:23.480 --> 0:13:25.760 in the mag seven we've been talking about in Nvidia, 0:13:25.840 --> 0:13:29.280 So let's talk a little bit more about this powerhouse 0:13:29.880 --> 0:13:32.920 in the AI chip space. There's been talk about it 0:13:32.960 --> 0:13:36.440 getting to a four trillion dollar valuation. We've seen some 0:13:36.600 --> 0:13:40.480 analysts calling for up to a six trillion dollar valuation. 0:13:40.880 --> 0:13:43.400 Where do you see Nvidia going into the second half? 0:13:43.920 --> 0:13:46.400 So at the end of the day, what in Nvidia 0:13:46.480 --> 0:13:48.760 comes down to is what's the growth going to be 0:13:48.800 --> 0:13:51.440 in calendar twenty six and so the street currently has 0:13:51.960 --> 0:13:54.640 estimates for about twenty five percent growth. That's a step 0:13:54.679 --> 0:13:58.200 down from about fifty five percent in calendar twenty five. 0:13:58.280 --> 0:14:02.280 And so I believe that this ultimately that Nvidia is 0:14:02.280 --> 0:14:05.760 going to grow probably somewhere between thirty thirty five percent 0:14:05.920 --> 0:14:09.960 much faster, and this narrative that you just can't rely 0:14:10.440 --> 0:14:14.120 on hardware when it comes to sleep well at night 0:14:14.160 --> 0:14:16.440 for investors. I think that narrative is going to each 0:14:16.559 --> 0:14:19.560 quarter be proved wrong. And the reason is that if 0:14:19.600 --> 0:14:22.360 we are as early as we believe in this whole 0:14:22.400 --> 0:14:27.480 AI transformation, and there is a cost and energy advantage 0:14:27.520 --> 0:14:30.440 of using these invidio chips even ahead of custom silicon 0:14:30.520 --> 0:14:33.320 from these hyperskillers with their building that the world is 0:14:33.320 --> 0:14:36.440 going to continue to depend on in video. So I'm 0:14:36.440 --> 0:14:39.800 a believer that ultimately the stock continues to move higher 0:14:40.160 --> 0:14:43.680 that this on evaluation basis is still despite the big 0:14:43.720 --> 0:14:45.880 move that we've had, one of the most attractive large 0:14:45.880 --> 0:14:46.800 cap tech companies. 0:14:47.040 --> 0:14:50.840 Yeah, it's been breathtaking, Dan, seeing the outperformance that in 0:14:50.960 --> 0:14:54.280 Vidia manages to put out their quarter after quarter. Do 0:14:54.320 --> 0:14:59.239 you see double digit percentage growth for this company continuing 0:14:59.320 --> 0:15:00.320 into quarters to come. 0:15:01.360 --> 0:15:03.800 Look, I think, and Gene hit on it a little. 0:15:04.640 --> 0:15:07.080 I think there's a better chance to me batting in 0:15:07.120 --> 0:15:10.560 front Aaron Judge than these numbers being real and there 0:15:10.800 --> 0:15:14.320 I think in video these are samdbag numbers that the 0:15:14.360 --> 0:15:17.200 street has they're probably gonna beat it anywhere from five 0:15:17.320 --> 0:15:20.680 hundred to eight hundred BIPs. And I think that's the reality, 0:15:20.840 --> 0:15:25.920 is that the street is underestimating growth because there's only 0:15:25.960 --> 0:15:28.359 one ship in the world fueling this, and the sovereigns 0:15:28.760 --> 0:15:30.680 and the rest of the world haven't even started down 0:15:30.680 --> 0:15:33.160 the path. That's why when I look at a video 0:15:33.400 --> 0:15:36.600 four trillion, they get into the first in that club, 0:15:36.640 --> 0:15:40.400 and then Microsoft gets in, then the path to five trillion, 0:15:40.600 --> 0:15:46.000 ultimately six trillion. Because this is just the start. Jane 0:15:46.040 --> 0:15:48.240 talks about second inning to about ten pm and a 0:15:48.280 --> 0:15:51.640 party that goes to four am. They'll be headlines, they'll 0:15:51.680 --> 0:15:54.200 be rich, stocks will sell off. But that's why we're 0:15:54.200 --> 0:15:58.760 gonna be throwing about NASDAK twenty two thousand, twenty five thousand, 0:15:59.320 --> 0:16:02.200 and when we're doing this again, at one point we're 0:16:02.200 --> 0:16:04.080 going to be twin in NAZAC thirty thousand over the 0:16:04.120 --> 0:16:06.120 coming year. That's where this market's going. 0:16:06.840 --> 0:16:11.520 Does it depend for Nvidia gene on the company diversifying 0:16:11.520 --> 0:16:15.360 its customer base, getting that sovereign business to get it there? 0:16:15.520 --> 0:16:17.360 Can it depend just on the hyperscalers? 0:16:18.640 --> 0:16:21.360 I mean, eventually no, but I think over the next 0:16:21.360 --> 0:16:24.560 couple of years. There's still much more to spend, much 0:16:24.560 --> 0:16:28.560 more spending than people anticipate from the hyperscalers. And yes 0:16:28.640 --> 0:16:31.240 we have those other chapters Dan mentioned the sovereign. That's 0:16:31.240 --> 0:16:33.000 a huge deal. I mean governments are going to be 0:16:33.040 --> 0:16:37.120 dependent upon AI companies, industries. But to answer your question, Nathan, 0:16:37.160 --> 0:16:39.760 eventually you do have to to kind of move beyond that. 0:16:40.360 --> 0:16:42.960 The move isn't just. The reason why there's still more 0:16:43.480 --> 0:16:48.440 room to go is that these hyperscalers recognize that the 0:16:48.520 --> 0:16:51.440 demand on this is growing exponentially. Just to quickly frame 0:16:51.480 --> 0:16:55.040 in one example of how demand is exponentially growing, if 0:16:55.040 --> 0:16:57.960 you look at GPT usage on they give it on 0:16:58.000 --> 0:17:02.440 a weekly basis, thea that it is accelerating, it's doubling 0:17:02.560 --> 0:17:06.080 in shorter amounts of time. So when you have this 0:17:06.160 --> 0:17:09.600 kind of hockey stick, they need to keep up with that. 0:17:09.600 --> 0:17:13.480 That means that the need is accelerating. They're not making 0:17:13.560 --> 0:17:17.040 progress towards the getting their arms around it. And so yes, 0:17:17.080 --> 0:17:19.919 we still have a few years left. Yes, eventually they 0:17:19.960 --> 0:17:21.800 need to go beyond the hyperscalers. But I don't think 0:17:21.800 --> 0:17:23.000 investors need to worry about that. 0:17:23.800 --> 0:17:27.880 Are there certain risks that investors do need to worry about, Dan, 0:17:28.000 --> 0:17:31.560 in terms of in Nvidia, I'm thinking about, you know, 0:17:31.680 --> 0:17:36.200 keeping up with the demand for those Blackwell chips, innovating 0:17:36.240 --> 0:17:40.399 even further on some of the highest tech AI chips 0:17:40.400 --> 0:17:42.320 that in Nvidia puts out there. Can it continue to 0:17:42.400 --> 0:17:43.560 keep up with that demand? 0:17:44.520 --> 0:17:46.720 Look, they're a risk, I mean China is a risk 0:17:46.840 --> 0:17:49.160 right in terms of the tree and negotiations to make 0:17:49.200 --> 0:17:52.240 sure because of the each twenty chip that got restricted, 0:17:52.320 --> 0:17:56.240 they're not handing Quai eight billion a quarter, so to 0:17:56.280 --> 0:17:58.800 make sure they're able to sell into China. That is 0:17:58.840 --> 0:18:01.800 a risk because the react these chins that just sitting 0:18:01.960 --> 0:18:05.880 still the supply demand right now, demand the supply still 0:18:05.960 --> 0:18:09.400 ten to one, so they have to continue to keep 0:18:09.480 --> 0:18:11.359 up with that and that is a risk as well. 0:18:11.680 --> 0:18:14.600 And competition is going to come, you know, from AMD 0:18:14.840 --> 0:18:18.800 and others and across chips. But the reality is there's 0:18:18.800 --> 0:18:22.840 only one Gensen. He along with the Dell and others, 0:18:23.000 --> 0:18:26.800 understand the AI revolution better than animals. And that's why 0:18:26.800 --> 0:18:29.720 there's only one godfather of AI. He's wearing a black 0:18:30.080 --> 0:18:31.680 weather jacket. His name of Gensen. 0:18:32.440 --> 0:18:34.800 We're speaking with Dan Ives, the Global head of Tech 0:18:34.840 --> 0:18:38.800 Research at Wedbush Securities. And Gene Munster, managing partner at 0:18:38.840 --> 0:18:43.000 Deepwater Asset Management. Let's move on from Nvidia to Microsoft, 0:18:43.000 --> 0:18:45.080 because it does seem like these are the companies that 0:18:45.119 --> 0:18:47.800 are that are in the race for the four trillion 0:18:47.880 --> 0:18:52.800 dollar valuation potentially. Microsoft has been really aggressive with the 0:18:52.840 --> 0:18:55.600 AI spend, cutting costs to do it as well. They've 0:18:55.600 --> 0:19:01.040 gone through thousands of job cuts over the last few months. Gene, 0:19:01.040 --> 0:19:03.800 what do you make of the strategy under Sacha Nadella 0:19:03.960 --> 0:19:04.800 over at Microsoft. 0:19:05.680 --> 0:19:07.840 I mean, they're doing a great job of being there early, 0:19:08.200 --> 0:19:12.040 of course, and also navigating a changing relationship with open AI. 0:19:12.840 --> 0:19:15.960 And the way this all kind of plays forward is 0:19:16.000 --> 0:19:17.600 that if you look at the growth rates that the 0:19:17.600 --> 0:19:20.720 streets expecting for this year, next year, last few quarters, 0:19:20.960 --> 0:19:24.359 it just hovers around this eleven, twelve, thirteen, fourteen percent. 0:19:24.400 --> 0:19:25.880 It's really a tight range. 0:19:26.240 --> 0:19:29.080 And so at the core, what they're doing right is 0:19:29.119 --> 0:19:32.080 recognizing that they can increase the value of their products 0:19:32.160 --> 0:19:33.720 by injecting AI into it. 0:19:33.760 --> 0:19:35.800 They're the first with Copilot. 0:19:35.280 --> 0:19:39.560 Around that, and it's something I think for the negative 0:19:39.680 --> 0:19:43.160 is you're not going to see an acceleration of Microsoft's 0:19:43.200 --> 0:19:45.320 business to grow in like twenty five percent. That's not 0:19:45.359 --> 0:19:48.760 going to happen. But what you will see is a 0:19:48.800 --> 0:19:52.160 company that's just going to continue to knock it out 0:19:52.320 --> 0:19:55.120 quarter on quarter on quarter on quarter of this kind 0:19:55.160 --> 0:19:58.720 of low double digit growth. And when you do that, 0:19:59.000 --> 0:20:01.640 investors sleep well at night. That's good for the multiple. 0:20:02.800 --> 0:20:07.720 How do you view dan the evolving relationship between Microsoft 0:20:07.760 --> 0:20:10.360 and open Ai. It has been interesting to watch over 0:20:10.359 --> 0:20:11.280 the last few months. 0:20:11.760 --> 0:20:15.240 Look neither I viewed it. It was a training wheel 0:20:15.320 --> 0:20:18.159 situation with the open Ai and the Della and Microsoft 0:20:18.200 --> 0:20:23.040 going back to early twenty three. Training wheels are off Della. 0:20:23.640 --> 0:20:28.720 He's taken Microsoft down the side of a mountain and 0:20:28.760 --> 0:20:32.159 not looking back. The point is that they're just in 0:20:32.280 --> 0:20:35.919 the next stage of the AI revolution and they are 0:20:36.040 --> 0:20:39.399 in the backyard of Microsoft. So I don't when I 0:20:39.440 --> 0:20:43.160 look at OpenAI that would be called competition, say partner, 0:20:43.600 --> 0:20:45.920 but I don't really concern myself with that, just given 0:20:45.960 --> 0:20:48.879 where Microsoft is and they're just gaining more and more momentum. 0:20:49.040 --> 0:20:51.119 I mean to give you example, we think based on 0:20:51.160 --> 0:20:53.600 all of our survey work, for every one hundred dollars 0:20:53.960 --> 0:20:58.119 A customers spent with Microsoft in their lifetime, there's now 0:20:58.600 --> 0:21:01.720 forty to upwards of fifty furs for every one hundred 0:21:01.840 --> 0:21:06.960 dollars they've spent from AI modization opportunity. That basically speaks 0:21:06.960 --> 0:21:12.600 to almost another Microsoft being built within Microsoft. And that's 0:21:12.600 --> 0:21:18.520 why the market is recognizing further and further that stockje. 0:21:18.520 --> 0:21:22.600 Of course, there's so much competition in the cloud, Microsoft, Azure, 0:21:22.880 --> 0:21:28.040 You've got Amazon Web Services, Google Cloud as well. How 0:21:28.040 --> 0:21:30.080 do you see that competition shaking out? 0:21:30.520 --> 0:21:33.879 You know, I think that the competitively, if you think 0:21:33.880 --> 0:21:37.400 it like market share, you're going to see AWS continue 0:21:37.440 --> 0:21:39.800 to lose share. I mean, this is just a math game. Essentially, 0:21:39.880 --> 0:21:43.000 Their AWS is growing high teens and if you look 0:21:43.040 --> 0:21:46.160 at Azure and Google Cloud, it's kind of high twenties, 0:21:46.200 --> 0:21:48.320 low thirties. And so there's just a math game going 0:21:48.400 --> 0:21:53.159