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Nvidia has unveiled new chips aimed at extending the company's dominance in artificial intelligence computing. And Vidia says its new processor design, named Blackwell, is multiple times faster at handling the computer models behind AI. That includes the process of developing AI technology known as training and running the process AI. And Vidia says it's Blackwell chips will be the basis of new computers and other products being deployed by the
world's largest data center operators. That roster includes Amazon, Microsoft, Alphabet and Oracle. Jensen Hoong and Video CEO and co founders said AI is the driving force in a fundamental change in the economy.
The industry is being transformed, not just ours because the computer industry. The computer is the single most important instrument of society today. Fundamental transformations and computing affects every industry.
Jensen Hoong there and Vidia CEO and co founder and Vidia shriffes we're down about one point seven percent in late trading. Joining us now for some discussion on this is Nick Turner, Bloomberg, Senior editor for the Technology Team. Nick, thank you for joining us. So Jensen Wong, we heard him saying that the Blackwell processor is multiple times faster than previous chips. That sounds impressive, of course, but with a company like Nvidia, you know, there's all kinds of superlatives.
And we see that the stock price in after hours was a little bit underwhelming. How is the response in the room?
Well, I mean, this is their first in person event for this GtC conference in four years, essentially since the pandemic started, and you know, I wasn't there myself, but just seeing the photos of my colleagues end and just the vibe of people who are there, it just really seemed like kind of a really pumped up crowd. And yeah, I mean this company is now one of the biggest stars in the tech world, up there with Apple and Microsoft, and in some ways more exciting to people just because
of what it's doing. In terms of changing the way computing works.
And the company seems so far ahead of the competition when it comes to this, and I think it goes back to its roots in developing the graphics processors that were used for the gaming industry, where you had to kind of create a chip that was able to handle complex calculations so quickly but dynamically as well, because you had inputs coming from two sides, from the game itself and then from the gamer who was interacting with the control surface. I'm wondering, though, when it comes to this
idea of encryption. We played a cut earlier where mister Wong was talking about encryption. How do we understand what Nvidia is doing as it moves toward AI to develop a secure environment.
Well, I mean, I think, first of all, this is a company really that has its hands in so many areas in terms of just designing software services, the simulations. Obviously the chips are kind of its biggest source of revenue, but I think that it really wants to sort of create an ecosystem around what it's selling, and obviously that includes security and encryption. And I think that it, I mean, in broader terms, a lot of these areas that it's
been in. It's sort of had to make sure people feel like they're safe and they're you know, secure, and I think that that, you know, that's part of the pitch.
It is interesting. It's I think we're learning here as time goes on that there's not just one winner in this AI space, It'll be multiple winners. So in addition to in video, a lot of the people in that room probably you know, working we said, Amazon, Microsoft, Alphabet in Oracle are in a sense even competitors with in video. And then you have a MD and Broadcommon a whole slew of others, you know, in your estimation here is is this rolling out in that way where a lot
of people win? And that's not even to mention all the downstream recipients of the AI technology. Are we going to see a lot of winners here?
What demand is so much higher than supply at the moment that I think in the short term release, it does seem like you're gonna have a lot of winners. I mean, I think am D is going to be successful with it's you know, the same sort of styles chip that in video sells that's coming out this year. It's already increased its forecast for how much that's going to generate. Intel has its own version too, which is
maybe not being received quite as warmly. But then, as you mentioned, the cloud companies themselves, they're designing some of their own chips that are going to handle these functions, so ultimately they become customers but also competitors. But part of the reason for that is they really want to sort of have control over the process and maybe make it a little bit easier to ensure that they get as much of whatever chip it is that they need.
Are we reaching an inflection point in the near future where this investment in the technology is going to have to be justified. There's going to have to be a return on investment seen, so the use case, I mean, I understand the technology and the amazing things that it's capable of doing, but for a company to actually derive a benefit from that as it's invested in this technology. Are we always away from seeing that?
Well, it's funny to hear him speak today. He did kind of He kept coming back to this theme of sort of the the AI factory, that these data centers are sort of AI factories, and I think he sort of said he talked about how they were money makers, improfitable, and I don't know if that's the case right now for these companies, but I think that it's it's It did seem like he was hitting the theme that these things were going to be a profitable enterprise, at least
in the near term. But I think you're right. If suddenly tomorrow AI services were held to you know, sort of a make or break you have to be profitable or sort of cutting you off, then that wouldn't be a I don't think any many are already at that point, even the big companies that are investing in this. So it's the big debate I think is is this closer to the dot com bubble of two thousand year two thousand or is it farther back like nineteen ninety five
or something like that. I mean, you hear that a lot, and.
One is that in the stock price. And the reason I asked you about are there multiple winners is so that people don't necessarily feel so, you know, beholden by Nvidia, that there are other places to turn. So I wanted to ask you about this process. I mean, he said multiple times faster, so that's difficult to actually you know, deal with quantitatively, how does that compare with the last chip that they rolled out? How much did they say
it was faster than previous iterations. So in order to get a feel for you know, how far is.
Nvidia, I had yeah, I mean it, you know, not to get into sort of the two nitty gritty of the numbers, but I mean, you looked at some of these charts he threw up. Then it's really a dramatic gain from even the you know, the current ship that obviously is so far ahead of the competition already that
it's you know, in this incredible demand. So I think that that it is going to be you know both I think, more powerful but also hopefully more power efficient, which has been another issue that the AI industry in general and video has hit up against. It just that these things, you know, the electricity required of these things, the fact that data centers are outstripping the amount of
energy available in their communities in some cases. I mean, that's another He's got to hit a lot of points to sort of make sure people are not growing concerned about some of these issues.
So when in video is talking about the application for AI, the focus seems to be the cloud. And I want to see if we can kind of shoehorn in the Apple story today, because it seems like what Apple is trying to do is to give a lot more of that computing power to the phone where the user is actually interfacing with the phone and maybe not so reliant on what's happening in the cloud. Is that a fair statement?
Yes, I mean, I think Apple in general handling things on the device, it's better for security, privacy. That's a huge issue in terms of the marketing Apple, and I think that the problem they're finding themselves in is that they're just a little bit too far behind on some of the cloud based services that people have gotten excited about, a chat, GPT and you know that ILK, obviously Gemini, which is the one they're in talks with from Google
to potentially use in the iPhone. So I think they find that that they've been concentrated on this on device stuff for good reason perhaps, but they're they're not quite cut up on the cloud based AI services.
All right, Nick, thanks very much for joining us. A very interesting material there, Nick Turner Bloomberg, Senior editor for the Tech Team. So let's see, we've got Amazon Anthropic, We've got Microsoft, Open Ai and now Alphabet Apple. At least those three big camps, Nvidia and a MD seemingly in their two camps on the chip side, it's setting up as a fascinating story. Chinese regulators say the developer Evergrand falsely inflated revenue by more than seventy eight billion
dollars in the two years leading to its failure. Joining US now is Carrie Sue Lindberg Bloomberg Private Credit and Loans reporter. So we won't have any trading in Evergrand stocks bend suspended since it went into liquidation. It's a good I guess it's a good time today to talk a little bit about the overarching story about Evergrand. In terms of these finds, a hefty fine for the founder and the former CEO as well as for the hung Da unit in China.
Right, that's right, So thanks Brian. So essentially Huy who was kind of the kind of the found the founder of the founder and chairman of Evergrand, was fined forty seven million yun as well as Hung Da was fined seven four point one eight billion un which is kind of quite sizable fins And so really what this means is in some ways. This is the latest blow for Huay, who was once among Asia's richest tycoons and saw kind
of the sprawling empire. So, I mean, it really strikes at the heart of Evergrand, especially when they were once kind of the one of the leading growth engine of the world's second largest economy. And this is really just you know, more details and kind of a flaming the fires.
In that sense, I'm wondering whether it's unique to Evergrand, which is not to say that other companies were, you know, engaged in similar practices and maybe not as extreme as this where you inflate revenue by more than seventy eight billion dollars over two years. But are there questions being asked more broadly about the accounting standards that some of these property developers have used in the past, or ways that they are accounting for property sales.
Yeah, I mean, that's a good point. I mean, And just to put a little bit into perspective, the numbers you brought, so for twenty nineteen they inflated their Hangdah inflated their tour revenue by sixty three percent, and for twenty twenty, they inflated their numbers by eighty seven percent, which is massive. Well, I don't think this is in
some ways unique to Evergrand. I think what it really shows you is why the government was trying to kind of overhaul the whole regulatory system quite strongly and kind of tighten the lending. So if we'll remember and kind of just going back a little bit onto kind of the three plus year saga of this company, it was really you know, it was expanding tremendously by kind of taking on massive amounts of debt. But once the regulator started tightening their ability to borrow money, that's when it's
that's when the trouble really started. And so I think that's really what we're seeing, right, We're seeing, you know, once you tighten those practices, if you're you're not one hundred percent sound in some ways that this is what could await you. And I think that's really a signal to other companies.
Yeah, and Andhay himself is still under police control as far as we know, and his subject to whatever mandatory measures means. But it is you know, is there much progress in terms of selling assets of Evergrand to pay off the you know, the creditors that because that's an ongoing story that I think investors would be quite interested in.
You're right, it is an ongoing story because you know, just in January, right they were the group received a liquidation order, and so I think that's still kind of the ongoing story. I've no news on that front, but I could say that the mansion of Hong Kong Mansion that's tied to Howay, who was the founder of Evergrand,
has been put up for sale. It's a luxury block that and the tender ends on April twenty second, So I mean that's also kind of a good barometer who wants to buy that and where does the proceeds for that his personal asset go. I think that could provide some a bell weather for where everything else goes as well. Well.
That was the question that I was going to ask next about the government's ability to claw back any of this inflated this overstatement. Are there means for the government to be able to try to do that, to seize assets to make up for this?
There are, But I think a large part of the issue is that not all of Evergrend's buildings and real estate infrastructure that they were responsible for were completed. So I mean you could seize an acid. But what's the point of seizing an acid that's not completed?
Right?
So I think that's also the really tricky issue that's not facing not just evergrand i'd say, but kind of the slew of Chinese real estate companies that are under severe distress or have already defaulted.
So carry see. One of the stories we did was that, you know, we did see investment pick up and industrial production pick up, and we just mentioned a few moments ago that it has led some analysts and vesters to think that maybe we'll get a little bit less stimulus. It brings us to the property sector. That's the biggest overhang. What are we seeing in terms of sales now, transactions and prices? Is it getting better or is it still getting worse?
I think it's not great, to be honest, and that's really the key barometer what a lot of people are looking out for. We'll wait that news as well and see where that happens.
So what recourse do you think will the government take here? I mean, if we're talking about the property market really being or the weakness of the property market being the nerve center for this lack of positive centerment, this lack of confidence in China. Is there anything the government can can do to kind of fortify the weakness that we have seen among these property developers or have they just or are they allowing the markets to kind of have their way right now?
I think that's a tough question, and I think that's one that we continue to watch because last year the government did put in kind of small amount inject small amounts of liquidity into the market, right and this was seen as marginally helping the property sector kind of show up the very worst of it. But on the other hand, the debt and kind of the magnitude is so great that actually it's not enough. And the real question is to what extent will the government continue to help the
property sector. And that's kind of the question that's kind of been hanging over everyone for the past three years.
All Right, Kerrie, thanks very much for joining us. Kerry Sue Lindberg, their private credit and loans reporter for Bloomberg. We should mention that these finds huge fines that were
leveled against Huai Khayan are civil in nature. No criminal charges have been filed against him, but as you mentioned, he's being held under police control and seems to suggest that there will be illegal crimes coming because when he was put under this control, it was mandatory measures due to quote suspicion illegal crime something to watch out for.
This has been the Bloomberg Daybreak Asia podcast, bringing you the stories making news and moving markets in the Asia Pacific. Visit the Bloomberg Podcast channel on YouTube to get more episodes of this and other shows from Bloomberg. Subscribe to the podcast on Apple, Spotify, or anywhere else you listen, and always on Bloomberg Radio, the Bloomberg Terminal, and the Bloomberg Business app.