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Speaker 1: Good morning.

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Speaker 2: I'm Brian Curtis and I'm Doug Krisner. Here are the

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Speaker 2: stories we're following today.

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Speaker 1: Israeli Prime Minister Benjamin Nathan Yahoo has convened a cabinet meeting.

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Speaker 1: It's a signal that a hostage deal with Hamas may

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Speaker 1: be getting ever closer. At Baxter has that story and

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Speaker 1: more from the nine to sixty news room in San Francisco.

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Speaker 3: That Yahoo going in says progress has already been made.

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Speaker 3: He says he's hoping for his words good news soon.

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Speaker 3: The US President Joe Biden says things are moving now.

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Speaker 4: We're now very close, very close. We could bring on

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Speaker 4: some of these sauces as home very soon.

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Speaker 5: But I don't want to.

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Speaker 4: Get into in the details of things because nobody is

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Speaker 4: done and tell us done now.

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Speaker 3: Bloomberg's Andrey Hordurn says it is limited, but this.

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Speaker 6: Would be for potentially as many as fifty two one

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Speaker 6: hundred hostages that were taken by Hamas. We know that's

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Speaker 6: around a number of two hundred and forty, so this

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Speaker 6: would be fifty to one hundred only women and children.

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Speaker 6: It would come with a number of days of a pause,

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Speaker 6: potentially four days of pausing of what is going on

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Speaker 6: in Gaza with these Israeli bombardments.

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Speaker 7: On top of.

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Speaker 6: That, it would also mean Palestinian women and children would

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Speaker 6: also be released from Israeli jails.

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Speaker 3: Meanwhile, Israel says will not mean that Israel will stop

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Speaker 3: rooting out Hamas and trying to eliminate it. Bloomberg's Dan Flatley.

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Speaker 8: Certainly, I think the Prime Minister is trying to get

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Speaker 8: across there the idea that the fighting will continue, that

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Speaker 8: this is not a cease fire per se, This is

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Speaker 8: a pause, and I think that that is probably important

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Speaker 8: from the Israeli government's perspective, because they don't want to

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Speaker 8: give Hamas the indication that they are losing some resolve.

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Speaker 3: So cabinet meeting now, hopefully some good news soon. Pentagon

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Speaker 3: is confirming it conducted an air strike against Iranian back

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Speaker 3: militants operating out of a rock. Pentagon spoke from Whence

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Speaker 3: Sabrina sungsas response to several short range missile attacks.

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Speaker 9: Immediately following the attack, a US military AC one thirty

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Speaker 9: aircraft in the area conducted a self defense strike against

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Speaker 9: an Iranian backed militia vehicle and the number of Iranian

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Speaker 9: backed militia personnel involved in this attack. This self defense

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Speaker 9: strike resulted in some hostile fatalities.

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Speaker 3: Sing says some US service members were injured in the attack.

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Speaker 3: Also conducted three attacks in Syria. North Korea says it

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Speaker 3: has successfully launched a rocket carrying a spy satellite. Two

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Speaker 3: attempts earlier in the year failed. South Korea's Joint chiefs

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Speaker 3: of Staff say about two hours after launch, there'd been

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Speaker 3: no indications it had broken apart. Japan's Defense Ministry has

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Speaker 3: yet to confirm whether a satellite was actually deployed. US

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Speaker 3: President Joe Biden meeting the day with senior administration members

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Speaker 3: to follow up on the gains that he says he

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Speaker 3: was able to accomplish with China and Mexico at APEC

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Speaker 3: regarding fentanyl, but he says much is left to be done.

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Speaker 4: Start by passing my supplemental budget requests for a national

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Speaker 4: security priority, including significant resources help stop the flow of

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Speaker 4: fenlon in our country, as well as funds of sense

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Speaker 4: and support services for people struggling with fent hall impacts.

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Speaker 3: And this also comes on the heels of the DOJ

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Speaker 3: announcement that has broken up a large smuggling operation out

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Speaker 3: of Mexico. Global news twenty four hours a day and

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Speaker 3: whenever you want it with Bloomberg News Now in San Francisco.

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Speaker 3: I'm at Baxter. This is Bloomberg.

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Speaker 1: Let's take a look at some of the top business

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Speaker 1: stories of the hour. After the closing bill, in Vidia

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Speaker 1: said that sales for the current quarter will be about

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Speaker 1: twenty billion dollars. That top analyst estimates of seventeen point

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Speaker 1: nine billion, but some projections had run as high as

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Speaker 1: twenty one billion. Investors are really expecting more as they

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Speaker 1: bet on artificial intelligence. We heard from Dan Morgan, senior

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Speaker 1: portfolio manager at Sonovis. He says in Vidia's business in

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Speaker 1: China will be important going forward.

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Speaker 5: We know that in Vidia generates about twenty to twenty

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Speaker 5: five percent of their sales from China. There are two

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Speaker 5: core ships that they sell an AI, which is the

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Speaker 5: H one hundred and the A one hundred have Chinese

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Speaker 5: equivalent H eight hundred and A eight hundred. We also

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Speaker 5: know they have a slew of new chips coming out

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Speaker 5: that are going to be focused just on the Chinese

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Speaker 5: market that are supposed to meet all these new restrictions.

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Speaker 1: Nvidia said, US curbs on exports to China could have

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Speaker 1: an impact down the road. The company expects sales to

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Speaker 1: China to decline significantly in the fourth quarter, but overall,

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Speaker 1: it says it doesn't matter all that much, Doug, because

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Speaker 1: they still have too much demand for what they can

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Speaker 1: actually supply at the moment.

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Speaker 2: Anyway, Now, the latest on open Ai, the startup says

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Speaker 2: it's in intense discussions to unify the company. This comes

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Speaker 2: after most employees threatened to quit if Sam Altman doesn't

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Speaker 2: return as chief executive officer. Now we are hearing discussions

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Speaker 2: are happening between Altman and at least one board member,

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Speaker 2: Adam DiAngelo. Here is Bloomberg's at Ludlow.

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Speaker 10: The fact that Sam is even speaking to Adam Dangelo

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Speaker 10: is news. It is complete change from the weekend. We

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Speaker 10: sat there all day Sunday saying, Okay, well, Sam's definitely

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Speaker 10: coming back and the board's going to go. That wasn't

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Speaker 10: the case at all. The board was digging in and

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Speaker 10: there was very little communication.

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Speaker 2: At all, that is Bloomberg said Ludlow. By the way,

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Speaker 2: we hear no imminent leadership decisions are expected as negotiations continue.

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Speaker 1: Right, boy, you go off for a cup of coffee

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Speaker 1: and the whole world has changed in this story.

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Speaker 7: Well.

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Speaker 1: Binance and its CEO, Jao Chung pung, pleaded guilty that

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Speaker 1: that CEO pleaded guilty to criminal charges for anti anti

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Speaker 1: money laundering and US sanctions violations. It included allowing transactions

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Speaker 1: with Hamas and with other terrorist groups. The charges came

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Speaker 1: under a sweeping deal with the US Justice Department. It

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Speaker 1: was designed to keep Binance operating. Here's US Attorney General

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Speaker 1: Merrick Garland on the charges.

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Speaker 11: Binance has agreed to plead guilty to wilfully violating the

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Speaker 11: Bank Secrecy Act, knowingly failing to register as a money

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Speaker 11: transmitting business, and wilfully violating the International Emergency Economic Powers Act.

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Speaker 11: These laws ensure that our financial institutions are not available

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Speaker 11: to designated terrorist organizations, drug traffickers, and sanctioned nation states

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Speaker 11: that threaten public safety and our national security.

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Speaker 1: Merret Garland there Finance will pay four point three billion

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Speaker 1: dollars in fines. The CEO, Chung Pung Joo, also agreed

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Speaker 1: to step down from his post and pay a fifty

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Speaker 1: million dollar fine as part of the settlement. Jowface is

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Speaker 1: a maximum sentence of ten years in prison, and his

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Speaker 1: lawyer said in court that sentencing will be delayed by

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Speaker 1: six months.

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Speaker 2: We got minutes from the last FED meeting today and

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Speaker 2: they show policymakers united around a strategy to proceed carefully

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Speaker 2: on future rate moves. The minutes also show officials agreeing

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Speaker 2: to base any further tightening on progress toward their inflation goal.

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Speaker 2: Here is Bloomberg's Michael McKee.

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Speaker 12: They did emphasize the need to keep rates higher for longer.

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Speaker 12: They took into consideration where rates had gone and the

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Speaker 12: possible tightening of financial conditions from that, but made it

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Speaker 12: clear they weren't sure that that would continue, and of

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Speaker 12: course it did not, so it doesn't seem to be

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Speaker 12: a major factor in their continuing ongoing outlook.

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Speaker 2: That is Bloomberg's Michael McKay. By the way, the market

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Speaker 2: has now marked down the chance of any additional rate

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Speaker 2: hikes to nearly zero, and the market is betting the

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Speaker 2: Fed will begin to cut rates as soon as May.

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Speaker 2: By the way, the next FED meeting is December the twelfth.

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Speaker 1: Well Bay Dude delivered third quarter revenue gains that were

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Speaker 1: stronger than estimated. Bloombriggs, David and Glace has the story

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Speaker 1: from Hong Kong.

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Speaker 13: The Chinese tech company said revenue was four point eight

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Speaker 13: billion dollars. That was better than expected, but only slightly

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Speaker 13: higher than the previous three months. Spending on the e

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Speaker 13: commerce platforms during the Singles the shopping extravaganza showed lackluster results,

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Speaker 13: and that adds to investors' worries that the Chinese economy

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Speaker 13: is in danger of deflating. But one Bright's bought, the

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Speaker 13: company expects it's chat GPT style Ernie bought to boost

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Speaker 13: ad revenue in the next quarter. Those numbers could lift

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Speaker 13: the top line by hundreds of million of y on

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Speaker 13: in Hong Kong. I'm David Ingless Bloomberg Radio.

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Speaker 1: Well, we talked a little bit about Nvidia. Let's bring

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Speaker 1: in Ian King, Bloomberg News US semiconductor reporter. So, Ian,

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Speaker 1: help me understand whether I should be happy or slightly disappointed.

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Speaker 5: Here.

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Speaker 1: We had sales, which I think is an astonishing number

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Speaker 1: of sales tripled from the third quarter last year. However,

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Speaker 1: that was a year ago. And if we think about

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Speaker 1: the eighteen billion that they that they had in sales

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Speaker 1: for the last quarter and they're only estimating twenty billion

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Speaker 1: for the next quarter, is that still rapid growth or

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Speaker 1: is it slowing down.

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Speaker 7: I mean, there's no way you can describe this as

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Speaker 7: as slowing down, particularly relative to even bullish estimates, like

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Speaker 7: ninety five percent of analysts recommend buying the stocks. You've

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Speaker 7: got target prices over a thousand dollars, and yet a

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Speaker 7: company is still saying, hey, look, we're going to be

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Speaker 7: a billion two billion dollars better than even you think

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Speaker 7: we are in each quarter. So you know, direction really that.

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Speaker 7: I don't think there's anything wrong here. I mean, you've

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Speaker 7: just got a stock that's gone up two hundred and

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Speaker 7: forty two percent over the course of the year, and

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Speaker 7: it's giving back, you know, one point two seven percent

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Speaker 7: of that and after US trading. So I think we

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Speaker 7: should be a little bit balanced in how we're viewing this.

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Speaker 7: But that said, clearly investors are on a head trigger.

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Speaker 7: Clearly they want better than perfect, and we've seen other

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Speaker 7: tech companies that haven't delivered the goods been beaten up very,

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Speaker 7: very heavily in the market. So this is kind of

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Speaker 7: symptomatic in a way of that, I believe.

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Speaker 2: So if there's a threat to the business, I think

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Speaker 2: it comes in the form of those US curves on

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Speaker 2: exports to China and in Video saying that it is

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Speaker 2: now expecting sales to China to decline significantly in Q four.

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Speaker 2: I thought there was a word around here. I thought

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Speaker 2: they had a special chip for the China market.

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Speaker 7: They did, but that's you'll remember. We had October twenty

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Speaker 7: twenty two, we had the big rules that shut down

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Speaker 7: in Video. Then we've had October twenty twenty three where

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Speaker 7: we've had some more rules that have shut down the workaround,

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Speaker 7: and now what we've had today is confirmation that in

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Speaker 7: Video is working on another workaround. And the questioning was, well,

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Speaker 7: hold on a minute, or when's this coming, How's this

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Speaker 7: going to help? And the answer was, we're working with

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Speaker 7: companies to try and get licenses, we're working on new

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Speaker 7: solutions that won't trigger these regulations. We can't tell you.

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Speaker 7: What we can tell you is it won't help in

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Speaker 7: the current quarter. And they did admit that the forecast

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Speaker 7: would have been slightly higher if we weren't burdened by

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Speaker 7: the China restriction. So clearly there is an impact, clearly

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Speaker 7: at a quarter of their sales. This is something that

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Speaker 7: you have to be concerned about, but it's nothing new.

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Speaker 7: It's nothing that if you haven't been following this, you

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Speaker 7: would be surprised by you.

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Speaker 1: Know, I covered China every day. But to me, it's

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Speaker 1: not that big of a deal because there are a

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Speaker 1: lot of big US tech companies that don't do any

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Speaker 1: business in China. They can't, particularly internet companies. And additionally,

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Speaker 1: the other angle to this is they already can't meet

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Speaker 1: the existing demand. So it's kind of hard to say

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Speaker 1: that they need more demand from China because there currently

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Speaker 1: are so many constraints on producing what people are asking

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Speaker 1: for that so be it.

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Speaker 7: Yeah, no, that's exactly it. You know, again, the conversation

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Speaker 7: was like, look, we are working to get more supply.

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Speaker 7: That means that's great news if you TSMC right, which

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Speaker 7: makes their main product sometng as a secondary sort of supplier.

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Speaker 7: So if you're worried about getting more supply, you're not

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Speaker 7: worried about demand right now. And Jens Applying, the CEO,

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Speaker 7: said look, we will continue to grow in data centers

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Speaker 7: into twenty twenty five. Right. He made it very clear

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Speaker 7: that were all of these poking and putting questions about

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Speaker 7: how confident are you? Where does this go? Where's demand

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Speaker 7: coming from? He sort of figuratively banged his fist on

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Speaker 7: the table and said we're very confident about this keeping

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Speaker 7: going until twenty twenty five.

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Speaker 2: Ian, I'm going to bring an open AI into this

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Speaker 2: conversation only because Bloomberg reporting indicated that Sam Altman was

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Speaker 2: at the time he was fired, actively working to raise

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Speaker 2: money from some of the world's big investors for a

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Speaker 2: new chip venture. And as we understand that the aim

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Speaker 2: here was to create a company to go head to

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Speaker 2: head with Nvidia in the market for these AI chips,

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Speaker 2: how easy or difficult would that be?

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Speaker 7: Well, I mean, Sam, if that's what he's working on,

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Speaker 7: and let's say that you should be working on other

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Speaker 7: things as a priority right now. Giving the newsflow, he

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Speaker 7: needs to take a place in the queue because there

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Speaker 7: are others with a lot more money, a lot more expertise,

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Speaker 7: and a lot further down the line we were ahead

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Speaker 7: of in there. This is absolutely a threat to Nvidia

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Speaker 7: over time and something we need to keep a focus on.

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Speaker 7: But right now, nobody's even close. Even companies with the

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Speaker 7: resources the expertise of Intel, of Microsoft, of Amazon, you know,

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Speaker 7: all the money in the world you could want. They

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Speaker 7: can buy all the expertise they can, and yet they're

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Speaker 7: still lining up to pay in video as much as

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Speaker 7: in video wants to charge them right now, forget about it.

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Speaker 7: Three years time when Inferior, a new startup would have

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Speaker 7: a chip in the market that might be competitive, who knows,

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Speaker 7: but that would be a very long and expensive bet

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Speaker 7: and a very long process.

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Speaker 1: Ian I heard a number of Nvidia analysts saying that

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Speaker 1: the data center numbers would be the most important in

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Speaker 1: the actual print, and then there would be more that

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Speaker 1: we could learn in the call. Just clue us in

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Speaker 1: on the data center numbers. Did those come in as expected?

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Speaker 7: It came in as everything did, way ahead of what

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Speaker 7: the analysts had been projecting. You know, I mean, this

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Speaker 7: company is making more out of just its data center

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Speaker 7: division than it was as a whole company a couple

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Speaker 7: of years ago. So you know, it's hard, you know,

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Speaker 7: the sort of a fourteen billion dollar right You've got

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Speaker 7: to remember in twenty twenty one, total revenue was only

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Speaker 7: sixteen billion from as a whole company. The year before

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Speaker 7: that it was a ten eleven billion dollar company. So

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Speaker 7: clearly things are doing well in the beating expectations. And

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Speaker 7: you know, the question that they kept getting though was well,

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Speaker 7: where are you going to go next? You're basically accounting

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Speaker 7: for a massive portion of a WS and Microsoft and

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Speaker 7: everybody else's spend. How much how big can you get?

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Speaker 7: And Jensen Wang's answer to that was, well, yeah, great,

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Speaker 7: they're big customers, but we're going to be so you know,

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Speaker 7: in others as well.

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Speaker 1: Yeah, all right, Ian, thank you so much for joining US.

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Speaker 1: Ian King, Bloomberg News US Semiconductor reporter. This is Bloomberg

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