Dan Ives, Senior Equity Analyst at Wedbush Securities, Talks Nvidia earnings, the NASDAQ, and Bull Case for Tech

You're gonna get right to this right now, Dan, I have shows us some Wedbush here all over the media. Of course, as we go into the mag eight Frenzy Warren't buffet. He's part of the mag eate right now, sixty five buys on Nvidio eight holds no sols like you don't follow in video. You got a thug at Webbush that follows it.

Right, Yeah, So our view and Nvidio, you know, we have one hundred and thirty eight hour probably start bult cases one seventy five.

Bernstein went to one fifty this morning, and.

I think this is just a star. I mean, look, I think this by the end of the day or even the next twenty four hours, this is a stock that should be in the green based on everything we saw from Godfather of Ai Jensen the video.

Pull get one more in here and I will so good at that.

So, Dan, give us a sense. What did you hear from nvidio last night? They beat numbers? Maybe the guidance wasn't where the street was expecting, But what did you really take away from Nvidia last night?

So three things? One demand, because the question is is they're double ordering. What is enterprise demands actually accelerating. And there's no better perch in terms of everything we're seeing from AI than what Jensen sees. To Blackwell, all the fears right, the worries is a gendle. They essentially put those fears to rest, and that was so important.

Okay, you know I'm the only one that does Matthews do not all this fancy dan eyes talk. You take the ten billion share bibic of Apple, they've been doing it for years, divided by free cash flow. You take a fifty billion statistic divided by invidious free cash flow. To me, it was a ginormous announcement. Everybody's saying it's not a big deal. Was a share buy back a big deal?

It's a monster deal. And also this also goes to a company. You go back six months ago, out year, by twenty five, twenty six, two dollars in earnings. Now it's gonna be five to six hours.

I'm extended time here this morning with Dani's were welcome you all around the world on YouTube and Android, Android auto Apple car play as well. Okay, I go to Apple, I go to the famed aggregation of Tom Secunda in the Bloomberg news, and I'm just gonna read these Paul quick mashable. Apple music playlists now transferable to YouTube music. University of Wisconsin deny new trial as that go after somebody.

I mean, this is the start of an AI driven super psych with iPhone sixteen. I think it's gonna be historical period. Look, we've talked about a lot on the show. Three hundred million of one point five billion iPhones, including Sweeney, haven't upgraded in four plus years AI. Twenty five percent of the world is going to access AI through an Apple device. The consumer revolution all starts.

Stop it a push against you, Tom Keen and Paul Sweeney. Don't give a damn about AI. Just want an iPhone to know where our kids are. What's a big deal about AI If Paul Sweeney's not gonna use it?

So that's today. If you look at the app There's gonna be hundreds of apps built on Apple Intelligence that are gonna be AI driven as well as this open AI. It's good. It's essentially gonna be a personal assistant that really from a data perspective, understands paul sway understands, can understand your habits. This is gonna change. This is how most consumers are now going to interact with AI.

China. What's the latest on China? My concern always in the back of my mind is that the average Chinese consumer is saying, I'm just not buying American. Is that an issue for Apple in terms of market share?

I mean, as someone that spends time in the region, the average Chinese consumer wants the best product in the world, which is an Apple device. So I'm not saying that there aren't some geopolitical headwinds. We're actually seeing more tail wins out of China, especially iPhone sixteen. You have one hundred million iPhones that are basically having upgrade four years, So I think any headwinds there starting now come down. That's why I cook ninety percent CEO ten percent politician.

Right, Yeah, it's smart. How about India? We were just I was just talking about this with somebody at the club last night. Tom at the bar, we were talking iPhones in India. How that came about? I have no idea you at the club last night. There's no club that would take or would I want to be in that club?

Or were you at the watch party for a video?

Yes, wisan Thal was that whatever?

I thought Sweeney was going to be at that watch But I.

At least day trading office couch at the cottage. I can only say my club last night, I was a club. Do the dishes club? India?

What's the opportunity there for Apple in India? Don't they have to have a lower price phone in that market?

But in India you've actually had a rising middle class, and I think if you that's always been a tough market for Apple. Three percent iPhones we think called by the next two years it's gonna be ten to twelve percent overall iPhones. India is actually gonna be robust for Apple, especially on different price points.

How many iPhones are purchased a wise one on a plan from a phone company and not where somebody spends eight hundred or one thousand dollars on the toy.

I mean, it's a huge number. I mean, it's a huge number. And if you look at the carrier discounts that's gonna come and this is the big thing.

Do you have information on them? You'd like to break on Bloomberg.

So everything we're seeing, we think it was gonna essentially be unprecedented types of promotion from especially US carriers at and just because this is the time in other words, when you think about five G when that came out, and now essentially AI, this is really gonna be the opportunity in terms of carrier discounts and what really starts

Do you have some of the parts on Apple you can update?

Yeah, so we have one point seven trillion is what what I view is the services value. And when you sort of some of the parts that that's something where you know, you got a one hundred billion a rev growing mid teens, free cash margins are double the hardware business. You combine it, it's over four trillion. I think bull cases ultimately you know over over three.

Hundred Microsoft, which I know you've been very bullish on Microsoft. What's the thought these days?

You look in a video's call last night, you also buy Microsoft because Nadella and Redmud are weeding. Then on the software side, you look at open Ai. They're really dominating in that amount rushmore. That's where Nadella is along with Jensen.

Does Blackwell compete with Azure or do they cohabitate They're complementary. Thing about I don't understand that exploits.

So essentially Blackwell is almost the architecture, the foundation of a house. Microsoft is the actual house. The actual rooms will be different software players, service now you know called salesforce and others. What protects the house, cybersecurity names like pale out though and others. Look, I continue to think in Vidia today it's Lebron in high school. That's essentially where they are. Lebron in high school, in Vidia, that's where they are.

So I guess so when we think about this AI spending here, the numbers are just almost numbing. That is so big. How much of the AI capital spending the is it incremental versus just taken away from other tech budgets like it or something.

So I'd say about eight hundred billion of the trillion is incremental. Wow, so there's two hundred billion that. Of course there's accounnibalization impact and there will be losers on that, but it really is incremental, and it just speaks to strong get stronger in tech. And then you can say about about regulatory. Regulatory is in a minivan going forty miles an hour in the right lane, and the technology is in a Ferrari key in the Ferrari left leane going one hundred miles an hour.

What is the free cash flow growth of the MAG seven when you aggregate them together. There's a secret Exel spreadsheet in the basement of the eyves.

Of free cash for growth of MAG seven is i'd say upper teams into potentially.

Really, you're gonna give me a two zero one.

I think it could start to now get that high till we go into next two three. And that's why, look, I get it. The bears continue to you know, they sit there with their spreadsheets DCF being negative. Ontack, I'm gonna stop there.

This is too important. You're going to DCF. I asked this with Paul yesterday. How do you do with terminal value on these juggernuts. This does not see FA one on one, but you.

Have to ultimately trajectory out what the capax looks like, what's the incremental dollars and what that ultimately means to the WARLD.

How far out does Dana ives go?

You basically have to go out six, eight, ten years to actually do a tradrest like when you look at Microsoft the way that you get four and a half five trillion, okay, just for you have to bas gonna say how much of percentage of cappacks they're gonna get, what demonization, what does the free cash will incrementally look like? And that's where all these stories change. But then there's other names like a pall and Teer, the Messi of AI.

Hey, Dan, one of the key action which of your research is that you travel the globe. You see people all over the place. What's your next trip?

So you'll be going to Asia on Monday, be there for two weeks and look to me, that's where we've got That's where we get edged. Because I think a lot of investors how they've missed AI Revolution. They try to find it on the Metro North Jersey transit on the tenth four of their office building in New York. Her Sam Frand you gotta travel to see it, And I think that, So what.

Do you see when you go to We see.

The suppliers, we see the component players. I also think by seeing global investors you get a very good sense in terms of where things are, and I think it just gives you a little more perspective.

Final, can you convince John Tucker to upgrade this time around?

No?

I think I think I think Tucker after going to the Inn video watch party last night, that he might now potentially upgrade to an iPhone.

O cursonally Blackwell Ship Where have I heard that name? Remember mister Blackwell, the guy who did the best and worst stress less? Oh yeah?

Where?

I think Kean would be at the top. Kean would be at the top, and I'd be and maybe like the like other category.

Mister travels qugely valuable well curse future, mister Rymes, mister Munster together today on Bloomberg Surveillance. That's the way that we roll