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Let's go to actually the outlook first quarter revenue forecast beating estimates, the company saying for the first quarter seas revenue of seventy six point forty four billion to seventy nine point fifty six billion, that is easily above the street estimate of seventy two point seventy eight million. Let's go back to the fourth quarter data center revenue that coming in better than expected sixty two point three billion versus the street estimate of sixty point thirty six billion,
and Vidia saying computing demand is growing exponentially. Fourth quarter adjusted gross margin we expected seventy five percent, We got seventy five point two percent. Fourth quarter revenue coming in overall sixty eight point one billion, better than the street estimate of sixty five point ninety one billion. Tim we're seeing that stock up now about two point two percent in the aftermarket.
Yeah, just to remind everybody where we are with these numbers. The first the company ce's first quarter revenue coming in six seventy six point four four billion dollars to seventy nine point five six billion dollars. That beat estimates handedly handily of seventy two point seven eight billion dollars. As Carol mentioned in video, CEO Jensen Wong saying in a statement,
computing demand is growing exponentially. We are also fourth quarter data center revenue worth repeating a beat there sixty two point three billion dollars the estimers for sixty point three six billion, and that gross margin coming in above estimates at seventy five point two percent.
Our Sarah Friar on our live blog saying that chairs are growing up on that data center revenue beat. Hey, Ed Ludlow, come on in. I know you're looking at these numbers. What jumps out for you?
Yeah, I mean, straight's the outlook. And by the way, I would have done the same thing. Go right there. You know, revenue in the fiscal first quarter seventy eight billion dollars plus le minus two percent, and you know, a consensus was really high. But like going into this,
it's a very simple equation. There were many names from across sell side and buyside that said they wanted to see in Nvidia beat revenues overall in the current period in by the multiple billions of dollars, you know, against consensus, and so one thing I would say to confirm something is that the fiscal first quarter, which is the the April quarter, does not assume any compute revenue from China. In the outlook does not factor in any compute revenue
of China. That I guess is something to check off the list. It was one of the questions we had.
I want to bring in Jake Goldberg from Seaport Research partnering senior analysts your semiconductors and electronics. He joins us also from San Francisco. Anything in here that confirms your thesis or does it sort of go against the celerating that you have on in Vidia?
Yeah, I mean it goes. I mean it's a good quarter. It's a good quarter on a good guide. It's above consensus above My expectations were good for them. Were still waiting to see a lot more detail.
What do you want to see?
I want to see, I want to hear more. I have to talk about gross margin for next quarter. I think that's going to be in the CFO commentary.
Yeah, Ed jump in, Yeah.
No, I don't have it yet, but it will be in the CFO commentary.
Versus seventy five percent expectations, I mean, can can ed Can you use that as sort of a guide for for how the company could see first.
Yeah, I mean on a basis point basis, Yeah, it looked like margins are impacted by a number of things. It has been a sell side question on prior calls the percentage of a server that Nvidia contributes to. And again what's changed in the period is in Nvidia starting to sell, for example, CPUs as standalone product, and that was a part of the meta deal that was included. They talked about core Weave being an early user of CPU as a standalone product. You know, how does that
impact the margin profile going forward? But yeah, I mean what they do is they own more of the server and that has been one of the ways in which that they've got margins to where they are. And clearly being zero point two percent above you know, where where the hopes were is not a bad thing.
Yeah, I'm looking at that CFO commentary. As we know, revenue expected to be seventy eight billion plus or minus two percent, and as you correctly pointed, out not assuming any data center compute revenue from China. In their outlook, gap and non gap gross margins expected to be seventy four point nine percent and seventy five percent, respectively, plus or minus fifty bases point inclusive of a one tenth
of one percent impact from stock based compensation expense. Just looking at what else we have here, Operating expensive gap and non gap operating expenses to be approximately seven point seven billion seven and a half billion, respectively, including that's inclusive of one point nine billion of stock based compensation expense.
A headline getting my attention is in Vidia says that hyper scalers were just over fifty percent of four Q data center revenue. Jake Goldberg, I want to repeat that headline for you, hyper scalers, We're just over fifty percent of fourth quarter data center revenue. Is that a sign that in Vidia is diversifying revenue? Who who made up the other half of data center revenue? Is it automakers? Like who's buying well?
I think that's one of the most interesting things that's taking place with in videos is they're not just reshaping the semiconductor industry, They're trying to reshape the cloud computing industry as well. And that's why you see we see all these neoclouds getting investment from or support from in video. In Vidia would much rather have one hundred neocloud customers.
Than three HYPERD scale customers, of.
Course, and they're doing a really good job of creating that, willing that into existence.
So those other customers had come on in here. Those other customers are like the core weaves and the other neoclouds.
Yeah, I mean, what is still important in his fact is that obviously the vast majority has been the hyperscalers plus meta, right, and so they've wanted to kind of switch between a story what they used to call an AI factory. At first, an AI factory was an on prem data center that enterprises and maybe some of the
neoclouds would operate themselves. Now an AI factory is what they you define any data center that's running AI workloads in so they have chopped and change between that story, but its origin was that they wanted to go beyond the hyperscalers to have people own their own infrastructure for AI workloads if they were say a software company or an enterprise of a slightly different size.
You know, it's interesting.
I'm looking for supply constraints and they seem to say in the CFO commentary, I'm seeing it in terms of gaming. They say, we expect supply constraints to be a headwind to gaming in the first quarter fiscal twenty twenty seven and beyond, but not so important, right ed. I mean, we want to really just see if that's a problem in the data center area.
Sadly, you know my history within video, you know, before coming Silicon Valley and covering the data center thing was gaming and you know it's now such a small piece of revenue. It's I mean, Jay, you can jump in,
but really it's not where anyone's looking right now. There is some discussion later on as it relates to the balance sheet and cash flow on things to do with supply, but you're right that what they're basically saying is that that was the gaming was the segment that was impacted, and I don't know that that is having any effects really. And how we see the stock trading in after hours, well.
And Video shares up three point four percent right now, and in fact we're seeing Broadcom TSMC and Micron shares follow in video higher. Jake Goldberg come on in here and talk a little bit about the broader repercussions of a print like this outside of in video. What's the signal that it sends not just to hardware makers but to the entire market.
I think there are always concerns about how long the spend is going to keep going, and we had certainly had some positive data points about that. Two weeks ago when the hyperscale is reported, Facebook reported they have very strong CAPEX numbers. This just continues that trend. And I don't want to say it's a rising tide that lifts all boats, but it's it is six seven hundred billion dollars in CAPEX this year, and that's going to spread across the entire ecosystem.
No, and I want to go back to it, and I totally get like gaming non important, but I was like looking to see if there's any supply constraints in the rest of their universe, and I just thought it was kind of interesting that I haven't seen anything along those lines.
It was just in regards to gaming.
So is that a good sign that we haven't seen anything that the company has said so far in terms of supply constraints.
Yeah, for the rest of the business, or I don't know, is it not that important?
Well, you know, I leave it to the analyst to model money left on the table if there were any, so to speak. But given the outlook in terms of sales and where it came in relative to consensus, you know, Nvidia, it's an enviable position to be in right where demand
exceeds your ability to supply anyway. But going back to that five year handbag analogy of a few moments ago, you know, the other argument that Jensen Wong and Video have made quite consistently is that if you tell your suppliers what you plan to do five years in advance, then the rest of the supply chain can help prepare with you and keep up. And you know recently that that's been most difficult in memory. But memory shows up
in pricing, you know. And if you're Jensen Wong, I'm sure you can make a phone call and make sure that the corresponding high bandwidth memory that you need is there or thereabouts.
Quick check on now ZAK one hundred many futures here in the aftermarket, and they're up about one point eight percent. So we're certainly seeing a lift to the overall market. Jay Gilbert, come on back in what's top of mind when we get to this conference call in terms of what you want to hear. I know we talked a lot about margins earlier, but what is it?
Yeah, I mean, I think this margin stuff is important because what I'm sort of reading between the lines is they had to negotiate pricing with the memory memory makers, and the memory makers have the most leverage they've had in a decade, and we don't see any impact on in videous numbers. Compare that to pretty much any other electronics company out there today which is warning about memory.
I'm sure they're in video is feelings some of that, but the fact that their gross margins are guiding to at least in line tells me that they're just going to price on those memory increases to their customers, which is a testament to their pricing power, to their power their market position.
Jake Goldberg, Jay, we're gonna have to leave it there. We're going to give you time to get ready to jump on that call. Jake Goldberger, Senior Analyst, Semiconductors and Allow Electronics for Seaport Research Partners. Once again, Jay, the only analyst tracked by the Bloomberg terminal who has a celerating on in video and want to give you the last word. You've spoken to Jensen Wong many many times. What's a question that you would have for him on the earnings call tonight?
Yeah, Like, ultimately, it just always comes down to a projection of confidence that all of the stories we've been over in more than the last year is still intact. You know that the great buildout of AI infrastructure is early, that they have long horizon visibility into what's going on. All in video can control, I suppose, is the roadmap to go from one generation of compute to the next. And so they talk about in the CFO document margins being supported by the ramp up in blackwell and mix
of new products. Well, when does that mixed change? When does Vera Rubin really kick in and then go beyond that? That's kind of how the street would look at it.
I think, all right, we're going to live with there.
Ed.
We know you're busy as well. Ed Lovelo, thank you so much as we awaited those numbers then helping us break them down. Co host of Bloomberg Tech of course on Bloomberg Television, Catch It at eleven am Wall Street time Monday through Friday. In the meantime, we've got chairs of Nvidia up about three point two percent. We're seeing broad come up about three quarters of one percentage point.
Here in the aftermarket, TSM, Taiwan Semi up about one in a third percent, and you're seeing Micron also hire off its best levels.
In the aftermarket. It's still up Tim about eight tenths of a percentage point.
All right, we're keeping an eye on this. We know Charlie Pellett is keeping an eye on all this and more. He's standing by in the Bloomberg Interactive brokers to studios with a business flash.
Hey Charlie, all right, I thank you very much. Tim and Carol keeping an eye as we recap and reset on in video. The stock hire after ours up by three percent right now. It did give another bullish quarterly revenue forecast, signaling that the massive buildout of AI computing does remain on track. Chip maker said fiscal first quarter sale is going to be around seventy eight billion. That compares with an estimate of seventy two point eight billion
in Nvidia is the world's most valuable company. Closely watched shares up now by three percent, salesforce heading in the other direction after ours, stock down roughly five percent, out with a lukewarm outlook for sales growth in the new fiscal year, fueling while Street's worries that the software giant will lose out to new competitors in the age of AI.
Other companies reporting earnings, Zoom Communications forecast adjusted EPs for two twenty twenty seven that guidance missing the average analyst estimate, shares down one point seven percent. Also reporting snowflake after Ours, the stock down two and a half percent. It gave an outlook for quarterly sales that was in line with estimates. The Dow, the SMP, and Neztak all advanced today, s and P up fifty six, wrapping up the Wednesday session at sixty nine forty six, a gain of eight tents
of one percent. Dow Industrial is up three oh seven ups six tens, Nez Stack today up by one point three percent, the Nestak one hundred index up today by one point four percent, the Vics just falling below eighteen with a ten year four point zero five percent spot Gold up twenty six dollars, the ounce up by five tens of one percent, fifty one seventy major move in bitcoin today surging eight point one percent sixty nine thousand, two hundred and forty five on bitcoin and finally beyond
Wall Street, Cuban forces killed four people today who opened fire from a speedboat with Florida tags, an incident with the potential to escalate an already ten standoff with the US. Carolyn tim that is a Bloomberg business flash.
All right, folks, we're watching in Vidia, Charlie, thank you so much for that breakdown on all of that. In Vidia shares continuing to trade higher. A couple of headlines also crossing that we want to bring to you, and Vidia says it's secured supply to.
Meet demand for several quarters.
So we talk about supply constraints often when we're talking about Nvidia and the AI demand. Also in Vida saying, the United States granted a license to ship H two hundred chips to China based clients, so they've granted a license for specific China based customers. The US licenses to ship small amounts of the H two hundred to China, So we were looking for some clarification on its business in China. Something that they've certainly been looking for.
We've got a great Bloomberg Intelligence roundtable, Mandeep's saying. His global head of Technology Research for Bloomberg Intelligence. He joins us here in the Bloomberg Interactive broker's studio. He covers in Vidia, he covers Snowflake and more. Also, anurag Rana is senior technology analyst for Bloomberg Intelligence. He joins us from Chicago, and he covers a salesforce. So we're going
to talk software, We're going to talk hardware. Man, Deep, I want to start with your reaction to in Video. It was a beat it, I mean, a very good quarter. Your reaction to margin and what is actually holding up margins here because seventy five point two percent.
Yeah, no mention of any impact related to memory costs, which is surprising.
And why is that surprising? I know memory costs have gone up, but in Video is such a big company. Don't they have pricing power? They do, but purchasing power.
They clearly did a great job in terms of securing that supply, and they don't have the premium. They don't have to pay the premium that everyone else has to pay on the hardware. Signe.
They said, secured supply to meet the man for several quarters. What's several well, I mean in this case at least like the FED. This is like the FED.
But they're saying that they've got it. That's a good thing.
They have got it, and they're guiding to you know, mid seventy percent rose margin for next quarter as well. So clearly memory not you know, an impact at all in terms of the margins. The thing that is clear is they are selling you know, to existing customers, not just GPUs, but systems. And that's the big difference between and in Vidia and AMD. AMD wants Meta to use
their chips and integrate it right. Nvidia is actually selling their custom to their customers entire systems that have higher asps. They are helping them reduce the token costs and that's where the customers don't mind paying that extra you know, premium that in Vidia is charging because overall the total cost of ownership is lower than if you were to standardize on any other chips. And that's what's reflected in their print is look, their customers see.
The so well done in video right by doing the whole.
Thing and the Blackwell architecture that's really taken off. I mean, all the concerns around the migration from Harper to Blackwell. I mean, they just prove that Blackwell will be probably a bigger, you know product in terms of their chip architectures.
Does this in your mind?
I mean I always feel like you're like the calmvoice of saying, the airspend is still happening, like everybody relaxed.
It's accelerating that.
But it's accelerate. That's what you're getting from this.
I mean, look at Nvidia's growth in the last fiscal quarter. It was around mid sixty percent. They're pointing to seventy seven percent growth in their fiscal one Q So that goes to show and the proof point you can see in the hyperscalar capex. The hyperscalar capex seems to be going up as well. So it's underpinned by healthy fundamentals.
We know why. And Vidius top line is accelerating, right because the kapex seems to be accelerating, and all these points towards more inferencing, more for AI compute, and we are hitting that phase where it's not just you know about training or whether it will happen or not. It's happening.
So the ROI the usage right, We're seeing it.
The usage is happening, and companies are consuming the compute. It's going to get reflected in the cloud revenue next quarter. It's going to get reflected in all the possible forms of where inferencing will show up.
We're gon we're going to bring on aurag In in a second and talk Salesforce because I think that's a good transition to talk about what companies are doing with AI and the message at least that Salesforce trying to make with agentic AI. But before we get there, maybe if I do want you to weigh in on what Carol mentioned earlier about the China business. H two hundred shipped under a new program subject to a twenty five percent tariff.
Nvidia discloses US government in a ten K filing, granted license by the US and February of twenty twenty six, the US licenseship small amounts of H two hundred to China for specific China based customers. What what is our investing ADI? You need to understand about what it can sell to China and the impact on that financially.
I mean it used to be China used to be mid single digit percentage of in Vidio's overall data center revenue, and Jensen has said China is about a fifty billion dollars addressable market when it comes to you know, chips, and so the fact that they're allowed to sell something now to China doesn't mean it's going to grow at the same rate as their overall top line, which is you know, seventy seven percent, and that excludes the China number.
But it's all incremental revenue. And this print shows there is just insatiable demand for Invidia's chips and whoever can get it well buy it. So it's just a question of whether in Vidio is willing to sell it to them or not.
All right, so let's go to salesforce.
We do want to bring in our anarag Rana, senior technology analyst a Bloomberg Intelligence.
He's in Chicago.
Shares of Salesforce anaragar Dad about four and a half percent in the aftermarket. Some of the red headline that we crossed on the Bloomberg Company in terms of the outlook sees first quote a revenue.
Of eleven point zero three to eleven point zero eight billion.
That's above the street estimate of ten point ninety nine billion, also increasing its share buyback authorization. Did fifty billion dollars walk us through? Because this company has certainly been under a lot of pressure. It's down about fifty percent since late twenty twenty four.
So there are two things that are happening right now. The first is, given so much spend going into AI, the NONAI spending is the one that's under pressure, and that is hurting companies like Salesforce, workday accenture, and so forth, because companies have or the clients don't have that much money to spend in terms of how they're allocating AI
spending versus NONAI. The second big piece right now is the market's extremely worried about software companies getting disrupted by all the model providers and all the AI native companies. So Salesforce are getting hit by two different ways. But the results, frankly, I mean I wouldn't say they were disappointing. I would say they were stayble to inline in terms of what they were saying they're going to do. So from our side, you know, it is just going to take some time to sort out.
So ANNI rog.
The question.
I think a lot of people have excuse me about a company like Salesforce, and you know, we could go through any other software company, not any other, but many other software companies and ask you the same question is about the threat from artificial intelligence. And Mark Benioff was was very clear in the press release to say that this is a company that has like relaunched, I don't have the exact wording in front of me, but relaunched as an AI and agentic AI company. Is is it
really under threat? And specifically like what is the threat from Claude, from anthropic or from open AI that investors are so worried about and is it warranted?
So the question is the answer to the if is it warranted? I mean, I think we're going to take some time to play out because if the models get really smart, then why do you need a manufactured software like this. That software can do a lot of what you need to do in terms of managing your salesforce
or customer service. Now, the question is in our view, when a company like Salesforce is there there are a handful of their products that they have they have that they sell into the enterprise, whether it's customer service, cloud or sales automation cloud. Those are the ones I think they have a little bit better position of not being disrupted. But they have other visualization tools or some other smaller products that you know, may not be the ones where
anybody would pay for it. So I think there is a lot that needs to be done from Salesforce in terms of adding more AI capabilities to its core product and not be you know, change the narrative around it.
You know, the narratives have been so interesting on AI as you really well know, looking at names like Snowflake down about one point three percent here in the aftermarket, we're talking about Salesforce and that stock just a real quick rehash here on the Bloomberg seeing that stock still down about four and a half percent here in the aftermarket, and then of course you've got Nvidia up about two point three percent.
You put out some great research.
This week, Anaog, you and the team about the haves and have nots and AI disruption. What do we need to know at this point, especially when everyone says, folks, we're still early in on this.
We don't really know how it all plays out.
You know.
I think that's the most important thing is we are very early in the inning. But at the same time, you know, when people are worded daily entirely sell the entire sector. We have seen that numerous times. So when we looked at this thing, I mean the entire team worked on creating a framework of you know, when we see a company, does it have high market share? Does it sell to very large companies versus smaller companies? Is
it a platform, is it a system of record? All those things takes into account, you know, kind of the history of a company. So let's say a company like I SAIP that's been around for fifty years, you you know, use it for your code, accounting, reason, supply chain. I think something like that is better entrenched than a very small company that's probably doing one particular function or selling only to the small and medium customers.
Hey, final question here on Salesforce. Just going back as we watch this stock down four point six percent, top of mine. I know I always ask you guys this, but when the call starts with the company and the C suite and analyst and investors, what must be asked?
I think the biggest thing is going to be like, how what are you doing to change the narrative around them being disrupted by AI? And how are they adding more AI capabilities across the entire suite?
All right, love it, Anirog, thank you so much, Anirog.
Grana his research certainly on the AI world and also on salesforce.
We'll be looking for that later on today.
Anirag Grana, senior technology analyst at Bloomberg Intelligence out there in Chicago,