00:00But as we head into this earnings tomorrow tonight, you know, I was taking a look not only at the expectations for, you know, the next quarter,
00:06but also listening to some of the things that Jensen Wong has said at conferences just over the last couple of months alone,
00:12pretty much about fiscal 2027 for his company, which is basically next calendar year and beyond.
00:18And it's hard to really see that growth engine downshifting materially.
00:23Right. Nice to be with you virtually, Romain. I mean, I totally agree.
00:27I think what you're alluding to is what Jensen Wong talked about last month at a trade show when he talked about a five hundred billion dollar order book for Blackwell and Rubin that spans through the end of calendar 26.
00:41That is a massive number. I think that makes it pretty clear to me that for NVIDIA specifically, the demand environment is pretty solid, at least through next year.
00:51Obviously, the market in this current environment is asking questions beyond next year.
00:57But I think for that reason, maybe the numbers tonight, obviously, they have to be good.
01:01They have to be they have to guide above. But the numbers near term may be a little bit less important just because there's such a high degree of confidence in the demand environment currently.
01:12One big issue that will certainly come up, if not in the press release, certainly on the conference call, is what is, if at all, the state of their business in China?
01:20Right. Yeah. I mean, I think most investors, I think, have really tamped down expectations for the China business for now.
01:31I think there's just too much uncertainty or really underwrite much in China.
01:34We'll see. You know, we know that they've been working on a compliant Blackwell product for China.
01:42China, obviously, the government there has as much different incentives and I think is looking at a bunch of different things.
01:49Maybe NVIDIA is part of a bigger U.S.-China deal.
01:52I'm not that focused on China this quarter. I think that's kind of been taken out of expectations.
01:59And if anything, it seems to be, you know, gravy on top if it does come into the numbers.
02:05And, you know, when it comes to NVIDIA, the phrase that, OK, demand is outstripping supply is used often to explain why the fundamentals for NVIDIA still look good.
02:17But, John, when does that really start to become a concern, especially if you have some issues in the supply chain when it comes to data centers actually standing up the facilities that will be able to outfit that supply?
02:28Yeah, there seems to be quite a few bottlenecks out there right now of access to power being one of them, access to data centers, shells being another.
02:37But, you know, I think for NVIDIA, it is, to your point, very clear that demand outstrips supply.
02:43That's why you've seen their revenues have grown in such a linear fashion sequentially over the last several quarters,
02:49because revenue is really a function of how fast can the supply chain stand up product.
02:53It's not a function of how robust is the demand environment.
02:57I think that situation is going to continue.
03:00We're coming off an earnings cycle where hyperscalers really significantly, again, increase their capex expectations into next year.
03:08So, you know, I think the question for NVIDIA, for the AI trade, as people say, as a whole, is, you know, when does the cycle peak and how high is the peak?
03:17Katie, I was listening to the segment before.
03:19The fact that you have not tried any AI service is pretty amazing.
03:24Maybe when you try an AI service, let me know, because that might mark the top.
03:29There you go.
03:30I'm sure unwittingly I've used it.
03:32But, again, I try not to seek these things out.
03:35But let's talk a little bit about the deal frenzy that has been going on in the AI space.
03:40Of course, NVIDIA, no stranger, has signed onto plenty of these things.
03:44But so, too, have their competitors.
03:45You highlight, for example, AMD signing deals with OpenAI, a couple more hyperscalers.
03:51How much of that is a threat potentially to NVIDIA longer term?
03:55Because they've built this fantastic moat.
03:57They have this clear first mover advantage.
04:00Eventually, a pessimist would say that has to erode.
04:03Well, I'd start by saying definitionally NVIDIA is going to lose market share going forward.
04:08They've got close to, say, 95% of the AI accelerator market today.
04:14So, competition is inevitable.
04:16It's coming.
04:17I think a lot of these recent deals, again, speak more than anything to what a robust demand environment we're in.
04:25I think the fact that you've seen AMD be able to strike a couple of really large deals with the likes of OpenAI, Oracle, I think it just speaks to the fact that, you know, the model companies, the cloud companies, they are looking for as much compute infrastructure as they can get their hands on right now because the end user demand is so robust.
04:46I do think, you know, for NVIDIA, the competitive environment, you have AMD.
04:50You also have Broadcom.
04:51I think what Broadcom is doing is very interesting in their custom accelerator program, basically designing custom chips for some of the largest users of the chips.
05:02And I think, you know, that to me, it's always going to be a niche offering.
05:04It doesn't really compete head on with NVIDIA, but I think there's a place for that in the market.
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