Wedbush Dan Ives Talks Tesla

Bloomberg Audio Studios, podcasts, radio news.

Right now, Daniel Ives joins us, and he's the greatest thing about Ives is when he's right, he doesn't do the rhyme right, I'm right and right thing. He just moves on to the next analysis. So I'm gonna go CFA on you, Dan Ies joining from Webbush. The thing I don't get is the terminal value of revenue growth for these juggernauts. The media is out one quarter, if we're lucky, three quarters a year, the streets out two years. I was trained to go out five or even seven years.

I look, I think, for really the first time maybe ever, big tech, because of this AI revolution, the visibility and the demand that they're seeing gives them what I believe is almost hypergrowth into the next call it, you know, five.

Six, seven years.

And I think that's that's essentially what we're seeing play out here, whether it's on digital media, whether it's on cloud, across the board, even in the tariff uncertainty, Big Tech, Rocker Gibraltar, I mean, it's it's playing through as we see it.

Hey, Dan, I'm looking at a Microsoft. I mean, here's a three trillion dollar market cap company, stocks up pre market. I mean, it's just amazing. Here. Talk to us about what's got the street enthus tier about Microsoft this morning?

Well, first off, I mean think about all the rumors abandoned data centers here and there that, well, how about them apples? Right, you don't see I don't think those a banded datas and that story is gonna gonna disappear, right.

Because the reality is like Azure two.

Hundred bits above street accelerating into the next quarter or two.

I mean to put some numbers in, I basically think like you.

Could be looking at for a typical Microsoft customer, you could be looking at thirty to forty dollars of every hundred hours that they've already spent, thirty to forty incremental just on AI spent. You put that together and you can essentially be looking at cloud numbers are essentially double every two years.

Dan.

Prior to the beginning of this year, all we talked about was AI for the past couple of years, and for the last you know, four months, we've talked about nothing but tariffs. How is the AI story unfolding. Now, can you give us an update?

Yeah, look, i'd say, and we talk about it.

You know that that Tom reference. In the last few weeks, like all of our checks, I mean, we've seen some eccent almost and acceleration and a.

Lot of the AI spend because I think companies are basically saying like this is you cannot touch this, because this is really what's driving the strategic shit a view of a lot of these comings over the coming years.

And I think we're talking two two and a half trillion that's gonna be spent with AI, with really a small amount.

Of companies that are going to benefit. D I think when it comes to taps is not impound.

I got a return on invested capital folks, that one of the best screens in the Bloomberg terminal is wacc way to the average cost of capital study. It's what's called a stern Stewart study from a million years ago. And I got a persistent twenty five percent return on invested capital for Sachin company Dan ives. I got revenue pre pandemic of one hundred and twenty six gazillion. They've done a double to where we are. Now, do they get out to I can't believe I've never said this number.

I mean, I think four fifty to five hundred. I mean, it's it's hitable because just given I don't see what's going to stop it, just given where companies are going, and just to I mean you put in perspective today like you only have two percent of US enterprises that have gone down the true AI path. It just shows that's just US. None in Europe, none really, I mean outside of China, it's minimum in terms of agent. It just shows where this is going, despite obviously tireff uncertainty.

Hey Dan, we're going to get our good friends from Coopertino. Apple's gonna report after the close here today. What are you looking for?

I feel like they're not going to give guidance, right, I mean, I'd be shocked, And I think I think the big question for them is the quarter itself actually was pretty strong and even something that could be pulled forward.

The big question for them is like, how do you navigate coming out with iPhone seventeen in a typical cycle with these tariffs, what are you waiting for from the administration?

Is there a? And I think that's the question. There's the timing.

Get the way we've talked about for Apple obviously being bullish, you know, for for a ducade, this is you don't look at it over the next three months. You gotta look as you know, as tom Owi's reverence, you got to look over the next twelve to eighteen months. I'll give free cash flow, I'll get the install base, and even if things move around and then I then negotiations ultimately come through, and I think they will be much more unscathed relative to.

You know where we see things stay when it comes to tiers.

Tom Apple's gonna have over one hundred billion dollars for free cash flow. Yeah, I mean, well, Dan, what do they do here with this free cash flow here?

I mean, look, M and A has obviously been minimal to that. The way that they view it in Cooper Tino, it's it's basically from an R O I C.

It's about to buy back and it's about ultimately how they how.

They're going to continue to return that to Cheryl.

Right.

You can notice you don't see this on Bluebrig radio, but you see it on YouTube. What I've does is he's at some golf courses. He in Arizona, I don't know he airport, he drops in the webbush backdrop of some class hotel room. He's like at a Motel five or a Motel Force somewhere instead of some two thousand dollars a night golf course in Scottsdaleer you know one of the places sweet he's been.

Dan.

I look at the belief here and what I see more than anything is mag seven is under owned by disbelieving institutions. Retail America loves Apple. Okay, that's a generalization of my part. But what happens when we wake up this morning with thirty three percent as your growth rate, what we get from Amazon tomorrow, whatever? I just count the boxes at the bottom of the scots d and I where is the institutional wall street? The belief in these companies?

I think what I ken nailed it Retails, stuck with it, institutional They've hit the exit, and I think they got and they've got scared out a lot of the mags Haven, a lot of attack and now I guess what's gonna happen over the coming weeks.

They're they're gonna have to double down.

And I think that's why I think the run here that we can see intact over the next three four weeks, especially as we go through this, I think could be massive because it's under own institutionally.

Christ well Is Paul talked about stock being up nine. There was a view that they were gonna miss ager.

They absolutely, I mean, this is an Aaron Judge like performance.

Hey, yes, it is Aaron Judge. Happened even a better year this year than last year, if that's eaves impossible exactly. Hey, Dan, talk to us about Tesla and I think a lot of people are probably most interested in Elon Musk. We haven't heard from him much over the past month or two on the Doge front. Where do you and I know you've been very very public and very outspoken about suggestion that he really needs to get back to his day job at Tesla. What do we know about Elon Musk and Tesla these days?

Yeah? And then obviously you know the Journal article which obviously a board denied then that I came out last night about you know, looking for.

A CEO potentially, Look, the reality is a must. That was a Code RED situation and it was the most important comments.

Call he ever had to do, and he handled it. I think the best I've ever seen him. Pick Tesla. He's going to lead them into this next chapter when it comes to autonomous robotics, and ultimately I think that more and more a growth rebound that we see in China and his days at the White House are done. However you want to call it one to two days that we I mean, I think this is the being and the end. The board was not gonna take it.

And your community across the nation this morning and of course on YouTube, Dan Eyes with Us with White Bush