Nvidia Becomes First Company With $5 Trillion Market Capitalization

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00:00You're definitely happy if you own NVIDIA. You know, a question we ask all the time is,

00:04okay, you own NVIDIA, but would you buy it now, considering the run-up it's had? Well,

00:10it just continues to go higher. It is opening at a $5 trillion market cap. The share's trading for

00:18$207.88, up another 3.4%. This after President Trump said he'll discuss Blackwell chips,

00:25which he called super-duper, with Chinese leader Xi Jinping. The CEO, Jensen Wang,

00:30expects sales now to top half a trillion dollars in 2026. And as Ed Ludlow told us,

00:36that's without factoring in any Chinese sales at all. A big donut for China. So if those talks go

00:44well, you know, the sky's the limit here. Wang also told Bloomberg he doesn't see artificial

00:49intelligence in a bubble. I don't believe we're in an AI bubble. And the reason for that is,

00:54we're going through a natural transition from an old computing model based on general purpose

01:00computing to accelerated computing. We also know that AI has now become good enough because of

01:06reasoning capability, research capabilities, its ability to think. It's now generating tokens and

01:11now generating intelligence that's worth paying for. Bloomberg Tech co-host Carolyn Hyde joins us now,

01:18and that's really not news. I mean, that's NSS, right? Jensen Wang, obviously...

01:23I have to explain NSS on your LinkedIn or on your X profiles later.

01:27I mean, just check out NINSS in the Bloomberg terminal and you'll understand.

01:33It would be news if he said they were in a bubble, but clearly Jensen Wang isn't going to say that.

01:38I think others have been saying maybe we're in a bubble. Look, Sam Altman himself has said he thinks

01:42we're in some sort of AI bubble. Bill Gates added to that chorus yesterday on other networks saying

01:46he thinks we're in an AI bubble. Some will be winners. Some will not be paying off for the

01:52amount that they're currently spending. But what we're seeing at the moment is that a few key

01:55companies are deemed the winners of this entire super cycle. NVIDIA, the main one, $5 trillion.

02:00It's up 50% year to date. It is therefore, thank you, S&P 500 run, because it's making up a fifth

02:07of the entire gains of this year. $5 trillion is extraordinary, considering it was only four months

02:12ago, it hit $4 trillion. But now we see the other players coming out, and the CapEx story is going

02:17to be so important. After the bell, you're going to hear from Alphabet. We know they raised last

02:21quarter to $85 billion per year in terms of capital expenditures. But that's going on things like

02:26NVIDIA chips. You're going to be hearing from Meta, which in its wealth is becoming a hyperscaler of

02:30choice in many ways. It's about compute. Where is their capital expenditure going? And then you've got

02:34Microsoft, the juggernaut that Bloomberg Intelligence thinks is going to raise it all the way

02:37to $130 billion for their next fiscal year for capital expenditure. That's about the entire value

02:42of their OpenAI stake as well. We're seeing just the amount of money flow in, because for now,

02:47the revenues are also rising. The money is being generated for these particular companies.

02:52I mean, just looking at SPLC on NVIDIA, Microsoft alone...

02:56Supply chain folks, SPLC, for those who are not lucky enough to have a terminal.

03:00Okay, if you look at the supply chain for NVIDIA, a much better way to say it,

03:03Microsoft has 19% of NVIDIA's revenue. I mean, doesn't today also just underscores,

03:10yes, NVIDIA has all this promise, but it's concentrated. It's a few bets on just the hyperscalers

03:16that they'll keep spending. And I think that is why what Jensen

03:19Wang on stage was really trying to show. The point is he's doing deals everywhere. He's going into Europe.

03:25They're getting all these other Neo clouds. Think of the Nebius deals that are being done. Well,

03:29Nebius gets its chips from NVIDIA, and they eventually then go to Microsoft, because

03:33Microsoft's buying extra cloud from other players, because it just can't build enough itself.

03:38You're seeing that with Nscale in Europe. But think about the deals that have just been done with

03:41NVIDIA trying to broaden its remit, showing that they're going to be in the world of 5G, 6G.

03:45They're going to be doing deals with Nokia. You've been hearing them do it with Deutsche Telecom in

03:48Germany for more data centers. He's really trying to show that, like, I am bigger than the sum of just

03:53these few hyperscalers. But you're right. At the moment, the revenue is super concentrated,

03:57but you can only build cloud with companies of certain scale and size, it feels like.

04:01All right. It's a fascinating story that we'll continue to tell, I'm sure, for years. And we'll

04:05watch your program for it as well.

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