Instant Reaction: Nvidia Delivers Solid Earnings
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Fourth quarter revenue has beat estimates. Fourth quarter data center revenue coming in at $35.6 billion, $34.09 billion. Fourth quarter revenue, that top line, $39.3 billion, exceeding estimates of $38.25 billion. Now coming to that revenue estimate for the first quarter, NVIDIA sees first quarter revenue plus or minus 2%.

The estimate was for $42.26 billion. Fourth quarter data center revenue coming in at 35.6%. The company saying that it ramped up massive scale production of Blackwell AI in the after hours shares higher right now by about 3.4%. Yeah, actually, NVIDIA saying demand for Blackwell is amazing.

So that's what we talked about in terms of that transition. But again, the key metrics, as Tim said, stock is up almost 4% here in the aftermarket. The first quarter revenue. So looking ahead, outlook, $43 billion plus or minus 2%. The estimate was for 42.3 billion. And again, fourth quarter data center. So looking at the

A quarter that they just wrapped up, data center revenue, that's the bulk of their business. That's those hyperscalers and more. $35.6 billion, that is a beat. $34.09 billion was what the street was expecting. First quarter adjusted gross margin. Again, looking forward, 70.5% to 71.5%. Street was looking for a little bit more. This is a measure of profitability. And the estimate on the street was 72.1%. Again, the stock now not up as much. In fact, it's down just a hair.

Yeah, shares climbed as much as 4% after this first quarter revenue forecast topped estimates. We're getting some more commentary too. NVIDIA saying that Blackwell is achieving billions of dollars in sales in the first quarter. The company also saying that it successfully ramped up Blackwell massive production. NVIDIA also coming out and saying, as Carol mentioned, demand for Blackwell

is amazing. We're continuing to get more numbers here too. Fourth quarter compute revenue coming in above estimates at $32.56 billion. Fourth quarter networking revenue coming in just shy of estimates at $3.02 billion. Yeah, now the stock is down about 1% here. It's bouncing around a lot, not surprising. A lot of investors in this name. So you're going to see a lot of movement as we get tick by tick, headline by headline. But again, the key ones right now, it has to do with the fourth

quarter data center revenue, excuse me, $35.6 billion. Again, that's above what the street was expecting. Street was looking for $34.09 billion. And again, key is the revenue outlook, $43.0 billion plus or minus 2%. Street was at $42.3 billion. And again, we got some context.

context, if you will, in terms of demand for Blackwell being amazing, uh, successfully ramping up the Blackwell massive production, Blackwell achieving billions of dollars in sales in the first quarter and ramping up the massive scale production of Blackwell AI. The company also saying it delivered $11 billion of Blackwell architecture revenue in a fourth, the fourth quarter. Uh, joining us right now, red Brown is here in our New York studio, Bloomberg news earnings reporter, Caroline Hyde, co-host of Bloomberg technology. Also here in studio. Um,

And, you know, Red, I want to bring you into this conversation. You keep a watch on earnings. Just, you know, your initial thoughts on what we're seeing in the trade, because the stock is bouncing around a lot. Yeah, I mean, I do feel like we got to kind of take a sigh of relief here because they did check off all of the boxes, kind of what Kunjan, or ask for the question marks, as Kunjan has kind of touched on there. The outlook is solid.

fourth quarter was solid and there seems to be real kind of optimism around the progress with Blackwell. So, um, yeah, I think overall this kind of was in line with what analysts were expecting. I know the market's maybe been a little bit down going into this court, into this report. Um, but yeah, kind of a sigh of relief, I think for everybody. The company did give an upbeat forecast. It is a sign that the AI build out is strong. Caroline Hyde, I want to bring you in co-host of Bloomberg technology on Bloomberg TV. Uh,

weekdays at 11:00 AM Wall Street time. I do want to ask about, is the sigh of relief sort of coming too early? Did we get any answers about the impact of deep seek here? Well, I think there's flies in the ointment. I don't know how much you've talked about them, but I think the gross margin

is clearly a sign that we're having perhaps a slight air pocket that many had talked about is where you flip from Hopper to Blackwell and indeed how much expense is spent on making sure that Blackwell is easy to use and get up and running as quickly as possible. That could be an issue. And you have also got this potential guide of slightly weaker on the revenue for the fiscal first quarter, plus or minus 43 billion. If they come in at the low end, that does indeed just slightly...

But I think we are trying to hear ultimately whether that insane demand is now an amazing amount of demand. And does that basically put off any concerns that we had about whether or not more can be done with less in the future? And I think we'll hear on the call, particularly from Jensen, as to ultimately whether inference demand is really there for his very expensive chips. Carol, it is like reading a statement from the Federal Reserve. Insane versus amazing. This is what I was thinking.

- So that's what I was gonna ask you is that, you follow this company so closely and it's how do you read the tea leaves because he does tend to be very enthusiastic and maybe changes the word and maybe there's a nuance to that change but how do you kind of read through what he says 'cause we know he's gonna be upbeat.

I think he's going to be saying, look, trust us with this R&D. Trust us on a slightly lower margin because we have got, quote, the fastest product ramp in our company's history. This is a company that's suddenly become like Apple and giving us a new chip every year. That never used to happen before. There's an extraordinary...

pace at which they're trying to innovate, that costs money. And indeed, of course, you have to be patient that sometimes there's going to be a slight friction when you come to actually putting these Blackwell supercomputers into the mix. Shares were as high as 4% higher in the after hours, now down about four tenths of 1%. Not much. Yeah, not much. It seems like, though, investors are really trying to make sense of these numbers. Yeah. It's not going and it's not moving in a clear direction.

I think the clear direction is still always growth, isn't it? And the idea that, sure, an 100% increase in revenue for their fiscal 2025, which is the one that's just gone, and the one prior to that, for two straight years, we've had a doubling of revenue. We're going to have to start to get used to a 50% increase in revenue, and then a 23% growth in revenue. The key question I think there is still going to be

What about the cheaper alternatives? What about Tranium 2 that Amazon has that is much cheaper? What about some of these startups that you're seeing? Does Tranium 2, does that compare with Hopper? Does it compare with Blackwell? It's about inference much more as well. And so this is when they're trying to say, hey, you've got your beautiful large language model. Come and now use it with us and we will save you so much more money, about 30%. So after you've used NVIDIA to train it, we will process those requests for you.

Exactly. And I think that's where you're going to start to get the edge. And in fact, there was an interesting interview done with a rival with the ARM CEO, of course, knows data centers and mobiles deeply. And his own design work, of course, helping a lot of those out there, including NVIDIA. But he's himself saying, look, this is where the opening is for competitors. It's the inference stage. No one can really compete with the GPU power that NVIDIA has when it comes to training these models. But the next layer, when we actually get it in and use these incredibly powerful things, that's where the edge can come.

I mean, I don't know. In terms of market expectations, not bad. Yeah. Signaling right. Kind of everyone was on the money. Analysts did their job well. Jensen's done his job well in terms of guiding. But had we got used to beaten raises? But look, look back to when we were sat here together with Meta and Meta's numbers were A, really late. B, they missed the forecast. And then Zup got on and just talked really optimistically and we all bought it.

Yeah, that's a good point. Yeah. Wait till see what happens in the cash session. Wait to hear from Jensen a little later. We can only take the moves as soon as the numbers come out with a grain of salt. Red Brown. I put deep seek in the search. Nothing. Nothing's coming. Let's just say it'll likely be asked about by at least one analyst tonight. Red Brown, I want to bring you in here on sort of the broader market reaction to this. There was this idea that given the sentiment we've seen in the last five, six days,

in the broader market, the sell-off that we've seen in the mega cap tech companies this year and in the last few days, this would sort of change the tone, does it? I mean, it doesn't really seem like the tone has changed at all. If we're looking at the numbers, it's flat, right? Kind of across the board with everybody not really reacting. I think a lot of

the narrative kind of has been said, you know, the spending is still there. I think if we read all the analyst reports heading into this, that was the one data point that everyone was hanging on to, that there hasn't been anyone coming out and saying, you know, we're going to be adjusting our AI spending. They've stuck to, you know, those massive CapEx numbers that we saw throughout the quarter. So I think, yeah, maybe a little bit of a wait and see still, unfortunately, you know.

for the time being. Well, and they did note, I'm looking at our live blog, noted margins are being squeezed by the cost of bringing new, more complicated products to market. And it sounds like, what? Well, Caroline, explain what that means. Because, you know, Kunjan also mentioned this idea of an air pocket, of the transition from Hopper to Blackwell. What exactly happens behind the scenes here? And why is it so expensive? Well, I think you've just ultimately got to make sure that it works hardware seamlessly with the software that you've got going. And ultimately, that becomes a more...

a powerful piece of equipment that is able to use your data and do what you want with it. I think when it came to Hopper, there was...

That was working beautifully for many, but everyone got deeply excited about the fact that there was a latest, greatest innovation suddenly coming out and sort of decided to go long on Blackwell instead. We actually saw a repositioning of that by many customers when they realized, oh, actually, this is going to take work for everyone to ensure, to plug this in, to get this into my data centers and to ultimately make sure that it's doing what it wants to with the most efficiency. Heating problems, for example, just some of the technicalities that they hadn't been able to stress test at this rapid rate of innovation.

All right, just to rehash, NVIDIA giving a bullish revenue forecast for the current quarter, reassuring investors that spending on AI computing remains strong. Just reading some of the reporting out by our Oney and King, who follows this sector, sales will be about $43 billion in the fiscal first quarter, which runs through April. Analysts had estimated about $42.3 billion on average, with some projections ranging as high as $48 billion. So there were some outliers and some very high expectations there.

Caroline, how are you thinking about this story? Obviously, we want to see what more commentary we get on the call, the follow through in terms of the trade. Like I'm looking at NASDAQ 100 E-mini futures. They're relatively little change, maybe up about one tenth of one percent.

S&P 500, E-mini futures, they are just a hair lower, pretty flat. So it's really very calm, it feels like here in the aftermarket. - And maybe we just sort of braced ourselves 'cause the volatility that we experienced yesterday and then today. - Exactly. - And we got used to the fact that the market is trying to find its direction when it comes to what is the question of capacity? I think we've got to go back to what happened in the beginning of the week. We're all asking questions about TD Cowen's note over the weekend about Microsoft.

I'm sure there will be questions put to Jensen about ultimately, is there a capacity over stretch or under reach at the moment? And what about these so-called scaling laws that he's trying to combat at every feat? Whether or not it's about the scaling laws of how much better LLMs can become with the amount of data and compute you throw at it, but ultimately also the scaling laws of China or whether that becomes something that you can still scale into in any way with an H20.

I'm glad you brought that up because one of the questions that Kunjian mentioned was getting more detail on views of more U.S. restrictions, specifically with regard to China. Red, I know you've been doing some searching within the press release. Are you seeing anything in there about China sales, about commentary about China? No mention about China. So I think Kunjian is correct that we that's definitely going to be a top of mind topic for analysts on the call.

You know, right now there's a lot of question marks looming around what they can do there. They get around 12% of their sales over the past few years, most of that coming across from gaming, automotive, and data centers. So I think there will be questions about, you know, what sort of contingencies maybe they have in place if any sort of restrictions do come down. Well, and Caroline, I mean, Jensen Wong has made his way to the White House, right? He's had conversations with President Trump about these issues and his concerns. Yeah, certainly. And that had been pre-election.

He'd been going to go and see President Trump. We know that he'd wanted to when our own Ed Ludlow sat down with him previously and said, I'm ready, willing and able to go and meet President Trump. And certainly they want to be negotiating. Because remember, it's the end of the administration, the Biden administration, that suddenly added all these curtailments to how much...

they can place chips in other geographies, not just China, 'cause there's this worry that you sell into a different nation, to Singapore, and actually that's suddenly how it's getting dispersed into China as well. So he's got a lot to be debating. I do know in, I mean, I hate to be a cynic when you're looking at these press releases, but he really only mentions US companies at the beginning of how much that they're working with the AWSs, the Ciscos, the Verizons,

I mean, it really is a focus in on US. It was just this week they announced increasing a partnership with Cisco. Exactly, to get the networking better. Again, to just get these things into people's hands more efficiently. We've talked about Hopper. We've talked a lot about Blackwell. Is it too early for us to be talking about Rubin?

I mean, what, as in the next innovation? Yeah, the next innovation. Never, this is the next year. This is the next. I don't think Richardson is ever too early to talk about what he's got up next to sleep. So that's the question. I mean, our investors looking for, you know, this is what happens with compute, right? You build something and then you build something better and you build something better. That just happens over and over again. And it costs money.

It costs money. So how important is, you know, the next generation? What comes after Blackwell, apparently codenamed Rubin. How important is that to where we are in the timeline of NVIDIA? I think it's important to show that they are continuing to just innovate

ahead of any of the competition. For more, it's more Lisa Su who pays attention to Ruben and thinks, oh boy. Over at AMD. Like, yeah, how am I managing to get any sort of in here in terms of owning the data center space when it comes to just the ability that Jensen has had to see around corners when it comes to the use and application of his GPUs for gaming, for crypto, and then for generative AI. But,

But maybe Lisa Su starts to play the tack of, okay, but it's me with cheaper price points. And I wonder whether the margin starts to creep into that narrative as well as maybe, yes, it's a deeply expensive piece of kit, but with everyone offering cheaper alternatives, what do you do? How do you respond?

As crypto has gone mainstream in the U.S., regulators have struggled to adapt. But that's changing. It's been a complete 180. That's Coinbase's Cara Calvert. In our latest episode, Cara breaks down why it's been so hard to achieve regulatory clarity and why she's optimistic that it's now just around the corner. You've got the most pro-crypto Congress. You have Republicans and Democrats all saying, we understand what the future might hold and why it's important. Listen to Evolving Money from Coinbase and Bloomberg Media Studios in your podcast app.

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For all types of jobs and a variety of reasons, choosing Express Employment Professionals is the move to make this year. With more than 860 locations in the U.S., find the one near you at expresspros.com. All right, folks, we're talking with Caroline Hyde, co-host of Bloomberg Technology on Bloomberg TV at 11 a.m. Wall Street time. Let's bring into the conversation Mandeep Singh walking into our studio, Bloomberg Intelligence Senior Tech Industry Analyst. He walked in because we asked him to and we...

Hoping you would. Hey, NVIDIA shares have been bouncing around. Should any of us who are thinking about the AI industry, is this a dose of optimism?

It is, but when it comes to NVIDIA specifically, I would say the fact that networking revenue declined sequentially for the second quarter in a row. Again, NVIDIA has very high bar and given their beat-in raises, everyone expects them to do well on every line. So networking going down, to me, that's a sticking point along with

gross margins going down and just the sequential increases that we have seen in the past quarters. It looks like it's tapering. Again, it's double digit, but when it comes to the overall growth rate, it feels like it's decelerating. And the last data point I would offer is the

cloud exposure, the hyperscale cloud exposure. It was 45% before, now it's 50%. Now what it tells you is they clearly are exposed. - Concentration, yeah. - And so the fact that networking is going down, it's a sign that training versus inferencing component, that seems to be really in question here because networking does well if training is growing.

If networking is going down, that's a sign that they may be facing some sort of challenges or starting to get more questions around the scale of training. And I think that's a big question. So go deeper on that with training versus inference. We were talking a little bit about it with Caroline in the context of Amazon and what Amazon has when it comes to inference. But what did we learn with NVIDIA today?

Look, if you're setting up a giant cluster like XAI has with 100,000, 200,000 GPUs, you need a lot of networking there. But if you are setting up a data center with, let's say, 1,000, 2,000 GPUs, you don't need as much of NVIDIA's networking. And that's where training versus inferencing really matters because companies are leaning towards setting up more

data centers with fewer chips, I mean, when I say fewer, it's still thousands of chips, but not to the scale of 100,000, then networking won't do as well. And that's the whole debate about training versus inferencing. So to my mind, you know, DeepSeq and all the recent developments from hyperscalers,

suggest that you may not need giant clusters. And that is, I think, going to affect NVIDIA going forward. So when I look at their guide, when I look at the fact that networking declined sequentially, again, it's a great print, but to me, the

path seems to be that it will slow down on the networking side. And then you have to ask yourself, where will the upside come from? Maybe on the call they expand on Starlink and, you know, the sovereigns. That is a big pocket. If that pans out in terms of training, like setting up

big clusters that Sam Altman has talked about, you know, with Project Stargate, then you will start to see networking bounce. But for me, there is a clear connection between networking and size of cluster and also software. There was nothing in the print around software, even though it's, you know, $2 billion in revenue. When you look at a data center, you know, line, which with over $115 billion, $2 billion is very...

small but they didn't mention anything around software so they're still a chip company that depends on you know companies buying their uh their chips in bulk and uh also layering and networking so to me that and the networking part is critical here you know uh one of our um on our live blog our carmen reineke

you know, bringing kind of Salesforce into the mix, noting that shares of Salesforce are down more than 5% in post-market trading after it reported weak growth outlook, stoking worry about its new AI product. Like, you know, you do think about kind of the whole infrastructure, the whole community. Caroline, come on in the conversation, following off Mandy, but if you've got a question, go for it. Well, I do think that that's interesting about agentic AI and this is where Salesforce and

agent force has been front and center. And look, Jensen pays lip service to it in the statement saying, AI is advancing at light speed as agentic AI and physical AI set the stage for the next wave. But he's got to keep talking about scaling laws when it comes to training that is going back to a reasoning AI. He's trying to find new ways to galvanize us all to be excited. But if the agent's

aren't selling that well as fast as we thought about. - Is reasoning really that good for Nvidia? - Yeah. - To my mind, if the pivot has happened towards more reasoning, that's not a positive for Nvidia because when you're doing reasoning, you are doing more inference compute. And I mean, based on Jensen's past comments, Nvidia has a 40% share in inferencing.

60% is training. So how can it be better if you're doing more training using that reasoning approach? So those are like very small nuggets, but I think in the grand scheme of things, they matter. You mentioned agentic AI. You got to explain what that is for people, especially in the context of what you talked about with Panos Panay earlier and what Amazon released today. And I think this is how ultimately reasoning starts.

starts being more helpful that not only will your chat bot basically go away and take longer thoughts about things, thoughts quote unquote, you know, trying to order personify these pits of traffic. - Caroline, it is real. - Yeah, it is real and there's a real person I'd fall in love with on it. - It gets realer by the minute. - But she, if it's Alexa Plus, then is going to go off and start actioning stuff for you.

Not only are they gonna tell you the best restaurant, they're gonna book it for you. They're gonna potentially start booking flights, paying for them. Agents can take ultimately still relatively basic needs, but run with them and complete the task. And that's ultimately where Salesforce and these enterprise software companies

has started to really see their in. The question for Mandeep, which is always being asked, is how they price for it. And Salesforce sort of stuck themselves on a limb and started saying, well, this is how much you're going to pay per user or indeed per amount that you actually use. But all of this is the return on AI that we keep questioning in so many ways.

I mean, you have to ask yourself, why is Nvidia's gross margins going down? Right. You know, obviously they released a new product that should command premium pricing. And look, they guided to that. So they are saying in the second half, you will see gross margins rebound. But they're going down for a reason. Either...

they're paying up more for foundry costs to TSMC, or they're just incentivizing their customers to buy more. And, you know, given Blackwell did so well in the quarter, there could be some, you know, pricing aspect to it in terms of just driving demand and, you know, shipping more Blackwell. And is that because we're getting more competition as well in the future? I mean, look, CSPs, the four CSPs make 50% of their revenue.

- All these CSPs are competitors. - We're talking about the hyperscalers, right? - The hyperscalers, so all of them-- - So you're talking about your Alphabet, you're talking about your-- - Microsoft. - Microsoft, right, all of these guys. - Microsoft, Meta, and Amazon.

And it was 45% last quarter. So that exposure grew. - Right. - I mean, and they're shipping more Blackwell. So when you connect the two, clearly there is, and these are customers that are buying chips in bulk. So they need some pricing, you know, to-- - Does that play to the margin? That they're getting a break?

- I would assume so, right? - Yeah. - If you are a customer that is paying, you know, $20 billion a year to Nvidia, you want some pricing break compared to the other customers. - Not just a fruit basket. - It was a question that I couldn't answer fully, 'cause I don't have the depth of knowledge that you do, Vandeep, and ultimately,

The issue of getting to Blackwell and the heating issues that we've seen and the ultimate rollout, has that cost them any margin? Does it cost them to have to keep going back and fixing things or is it on someone else to keep upgrading and ensuring it's working? So there were concerns around Blackwell and look, if you're a customer, you're

you would want to wait until they resolve all these issues. But NVIDIA moved at a pretty fast pace in terms of fixing those issues and actually getting $11 billion of revenue in the quarter. So the fact that they were able to do it so quickly shows good execution, but they're shipping a lot of these chips to the hyperscalers.

who again, I feel have to be incentivized to take those bulk shipments. And that could have played in terms of the lower margins. Were the concerns about overbilled answered? Were they put to rest? I mean, they look at

all of their suppliers, TSMC, Micron on the HBM side, all of them are still supply constraints. So I can't imagine there is any chance of an overbuild here. There's clearly more demand than supply and all the suppliers are continuing to expand capacity. So that is the least of my concern here. It's more the competition and the lower gross margins. And the training versus inferencing is the

key point that I hope he addresses on the call in relation to deep seek. I'm just again going to people who maybe are not so in it like you guys are the training versus inferencing. Like what what do they need to kind of understand? I want to go back there because I do feel like that's the big factor here. Are we building one million GPU clusters?

Right now, the largest size cluster is a 200K cluster that XAI has built and I think Meta is also building. And that's for training or for inference? For training. I mean, you build a 1 million or 100,000 chip cluster, you're using it for training. You're not doing inferencing because inferencing patterns are very volatile.

And inferencing is more tied to usage. If I am using ChatGPT during the day, the traffic will be more. At night, it'll be less. So I'm not going to keep the chips underutilized. I want the 100,000 chips to be utilized at maximum capacity. That's why training is what is used for the large GPU clusters.

But to that point, even into the inference point, we learned, I think today that DeepSeek is sort of doing surge pricing when it comes to when you're using the app because they want people to use it, not during peak times, because that is expensive. Yeah. I mean, look, and that goes to the under supply aspect, right? So the market is still under supplied and that's where wherever you can find capacity, you use it. We know you guys both have to go. Caroline, so you're sitting down with Jensen. What do you want to know?

I wanna know about, for me, I wanna know about China. And I also wanna know about this capacity issue that we keep talking about and how ultimately at ease he is with the amount that demand he's still going.

All right. And same thing for you, Mandeep. You're sitting down with Jensen. Hey, what? Training. Just tell me your training share right now. Is it still 60-40? Has it changed? And what's the outlook? All right, guys, you rock. Thank you so much. Mandeep Singh, Bloomberg Intelligence Senior Tech Industry Analyst here in studio, along with Caroline Hyde, co-host of Bloomberg Technology and Bloomberg TV. Check out Mandeep's research. It'll be on the Bloomberg tomorrow. Caroline will be all over it on Bloomberg Technology. That comes your way at 11 a.m. Wall Street time on Bloomberg TV.

As crypto has gone mainstream in the U.S., regulators have struggled to adapt. But that's changing. It's been a complete 180. That's Coinbase's Cara Calvert. In our latest episode, Cara breaks down why it's been so hard to achieve regulatory clarity and why she's optimistic that it's now just around the corner. You've got the most pro-crypto Congress. You have Republicans and Democrats all saying we understand what the future might hold and why it's important. Listen to Evolving Money from Coinbase and Bloomberg Media Studios in your podcast app.

From providing extra support during busy seasons to replacing vacant roles, you need Express employment professionals on your team. Express can handle everything from contract placements to finding the right full-time team member. Solve your workforce challenges when you let Express to deal with workers' compensation, payroll, benefits, and more, so you can concentrate on what really matters, growing your business.

Go to expresspros.com. If you've never used a staffing company, here's how Express has helped business like yours. 80% of businesses turn to staffing companies to fill temporary vacancies. 72% use staffing for extra support during busy times and 68% to staff special short-term projects.

For all types of jobs and a variety of reasons, choosing Express Employment Professionals is the move to make this year. With more than 860 locations in the U.S., find the one near you at ExpressPros.com. All right. Well, you heard Caroline mention China just now, and that's kind of what we want to talk about with Michael Shepard. He's Bloomberg News Senior Editor for Technology and Strategic Industries. He joins us from our Washington, D.C. bureau. As Red Brown pointed out to us earlier,

Michael, just a few moments ago, no mention of China in the press release. We are waiting for Jensen to take questions from analysts about that. What are the concerns around potential? I don't want to use the term sanctions, but restrictions on what Nvidia can sell to China. Well, that's a better way of putting it, Tim, because really what Nvidia has confronted is not so much sanctions or penalties, but limits on the technology

types and quantities of chips that it can sell to Chinese entities. And of course, this is in response to the challenge that the world's second largest economy poses to the US in advanced technology, but especially in this emerging area of artificial intelligence. And Donald Trump, upon taking office, he made it

a national priority to preserve dominance in artificial intelligence. But that was also a theme during the Biden administration. And some of these restrictions that have really bedeviled NVIDIA at times date to the Biden era. And President Joe Biden, a week before leaving office and handing over the reins of power to Donald Trump,

imposed a three-tiered system of limits on countries' access to sensitive chips for AI, of the likes of which that NVIDIA produces. And so we are waiting to see what Jensen Huang will have to say about this. What sort of challenges it posed to the business and what sorts of steps has he taken to maybe try to talk Donald Trump out of it? So has he been to the White House yet?

He was one of the last of the big tech executives to pay a visit to the White House and see Donald Trump. There was no visit by Jensen Wang to Mar-a-Lago during the transition. And it wasn't until January 31st, that week when Deep Seek really shook the markets and especially NVIDIA. It was a Friday that he went in to go meet with the president and he

Talk generally about artificial intelligence, of course, but you had to imagine that export controls came up. NVIDIA certainly has railed against them. We saw statements coming from their spokespeople as we heard the Biden folks talk more about them. And then as the Trump team came in and saw DeepSeek's breakthrough and thought, hey, we have to do something ourselves. We may need to further tighten these restrictions.

Well, they weighed in again. But Jensen Wong has been quiet about it. So this will be a moment for him to say something. You know, I think it was Caroline. I can't remember exactly who it was on our air, Carol, who mentioned that in the press release, the names that are mentioned, cloud service providers, AWS, CoreWeave, Google Cloud Platform, Microsoft Azure, Oracle Cloud Infrastructure, AWS, Cisco, Verizon. All U.S. companies. All U.S. companies. And I don't know if it's,

If it's a political statement or if it's just a statement of the fact that these most prominent companies are based in the U.S., is there a read into this, Michael, that that this is a company that's making sure it's touting its American connections? So many companies, Tim and Carol, are trying to get on the right side of Trump in that sense. And in this case, the facts may be conveniently aligned here.

to whatever Trump and the new administration may want to hear about American companies buying from an American provider, namely NVIDIA. But of course, so many of NVIDIA's chips are made in Taiwan by TSMC. So that has to be another area of concern for Jensen Wang as he hears Donald Trump talk about

potential tariffs on semiconductor imports. He hasn't imposed them yet. He hasn't really announced them yet. But it is something that we are watching for in the coming weeks. And of course, the president will be delivering this address to Congress next Tuesday evening. And that could be a moment where we hear him talk in somewhat

more detail about this. Remember, the semiconductor supply chain is so interconnected globally. You have foundries in Taiwan making chips that are designed here in the US. And so all the production and design are happening in a lot of different places. So when you see tariffs and export controls imposed, the trade flows and the impacts really ricochet through the supply chain. And

all the way through. You know, when you get to end use products like

and light cars, you know, where we're going beyond the data centers that we think of with NVIDIA, but speaking more broadly on the semiconductor sector, the ripple effect through the supply chain will be really strong. Michael, and, you know, it's certainly something you guys and you are, you know, on top of on a regular basis in terms of things coming out of the White House. But I do wonder about when it comes to AI and what President Trump wants to see. Obviously, he wants to protect people

the U.S. industry, the U.S. chip industry, but so many of these big tech companies here in the United States are global players. It's a fine dance, right, in terms of their top line, their revenue, their growth. Yes, the U.S. market, obviously important, but global markets are important as well.

That's a great point, Carol, because when you think about one of the best-known U.S. chip companies, it also happens to be one that is struggling existentially right now, and that is Intel. And it has sales overseas, but including in China. So any export restrictions, anything.

Any move that could affect its ability to do business in China could be bad for Intel and Nvidia as well. It's not like Nvidia has no business in China, but the most sophisticated chips are off limits now. The administration is weighing whether to lower the threshold on those limits, making even less advanced chips made by Nvidia and other makers too.

off limits for Chinese buyers barring a license, a permission from the U.S. Commerce Department. So they are thinking about this. And we're looking at a series of restrictions, too. And these include getting Japan and the Netherlands to

get companies like Tokio Electron and ASML. These are the businesses that make the semiconductor manufacturing equipment, these huge photolithography machines that are really finicky and expensive. What they want is they want Japan and the Netherlands to limit maintenance of these machines that have already been sold to China. They're looking at every which way to contain China in this area.

Michael, hang on for a second. I just want to recap because we are seeing shares of Nvidia up about 2.2% now in the post-market trade, after-market trade. They've been bouncing around a lot, gains and losses, but it does look like they're kind of holding at this level, again, a 2.2% gain. Keep in mind, I'm looking at our Ian King, his reporting, Nvidia giving solid quarterly results and a bullish revenue forecast for the current period.

even if the numbers didn't reach the blowout level that some investors were banking on. And of course, we're waiting for some headlines, Tim, here as the call will get underway soon with the C-suite and Jensen Wang of NVIDIA. So I think the big question that I have is how much insight we'll get, and we don't know this yet, Michael, but how much insight we'll get on the call into NVIDIA's relationship with

with China and to what extent restrictions are set to affect the company? And that is a key question for investors going into this because

when DeepSeek emerged onto the scene. And remember, DeepSeek was a trigger for the Trump administration to think about tougher restrictions on NVIDIA's chips. And it was also an existential moment for NVIDIA itself. You know, DeepSeek was able to produce its chatbot on the cheap, undermining this whole idea that, hey, we need Manhattan Project level CapEx to be able to

produce these breakthroughs in AI. And of course, to do that, you need tons and tons of NVIDIA accelerators. DeepSeq raised questions about, well, maybe we don't need quite so many or quite so much. Nonetheless, we've seen the hyperscalers all

you know, reinforce their commitment to heavy CapEx tens and tens of billions of dollars in plans for data centers and chip purchases. All right. So appreciate being able to get this perspective and roll it in. It's such a big part of the NVIDIA story. Michael Shepard, thank you as always, Senior Editor for Technology and Strategic Industries out there in our Bloomberg News Bureau in D.C.

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