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All eyes on Nvidia earnings after the closing bell, Investors expecting to learn more about where those billions of dollars on AI spending are actually going.
Plus in Video CEO Jensen Wang and Tesla CEO Elil Musk are speaking right now at the US Saudi Investment Forum.
We'll bring you the latest, and.
Brookfield Asset Management targets ten billion dollars of fund commitments for a global AI infrastructure program.
In partnership with you guessed it in Video and.
In Vidia dictates trade.
Right now, we are seeing signs of stability in the Nasdaq one hundred. More broadly, I remind you that almost two trillion dollars have been wiped off of this benchmarks. It's the end of October in large part because in Video has been down, but all the key mag seven
names have been under pressure. But today's some reprieve and video in the point's perspective helping within as that one hundred crypto though still in the EI of the storm or by two point eight percent, that anxiety driving it below ninety thousand dollars, so still some risk A version.
Ed okay, in Vidia is up more than two and a half percent, but off its session high. It is a stock that's up almost forty percent year to date, outperforming double the performance of what we've seen of the NAZAQ one hundred in S and P five hundred. The expectation is revenue growth above fifty percent, net income growth above fifty percent. But all that matters is what CEO Jensmong tells us about the future. Let's get with Bloomberg'ssey
and King, who leads our semiconductive coverage. I mean, that's what it comes down to. Either they will beat consensus or they won't. But expectations are really high for this quarter, as is the skepticism of what's happening bigger picture with data center instructure. Give us the things we need to look out for, and what's in your preview of this company's earnings?
Yeah, I mean the numbers speak for themselves, right. We're looking for a prediction in the sixty billion range for revenue, and just to give that context, that's ten x where we were three years ago, ten x Okay on profit for this year, we're going to be looking at one hundred billion dollars of net income. That's more than Intel and AMD get in revenue combined. So the numbers have come off the charts. The key here is we all
know the numbers are going to be good. We know the forecast is going to be But the key is, well, do we really believe the basis for those numbers? And that's going to be the key question he's going to face.
So in what can his response be that's more than what are you already signals in GtC that he has line of sight on half a trillion dollars worth of orders not you black Bell, but Roobin into twenty twenty six? How much more can he signal that they will remain integral to inference as well as training.
Absolutely right, he's essentially played all his cards in that respect. What's going to happen will be that the investment community are getting their first chance to sort of pull that apart, to ask him about the details, to ask him about the new products, to ask about the margins, to ask about when exactly these sales will kick in and we haven't. They haven't really had that chance. So that's what they'll dig into today. And his response is how precise he is will condition how they feel.
There are some real concerns and there are some real questions from videos. Some of those will get to pose this evening to gentlemen self. There is the idea of depreciation on older chips and circular financing that's just not going.
Away, absolutely not. I mean, we saw a deal announced with Anthropic yesterday, big commitment to use a lot more of in Video's chips. But guess what Invidea is putting ten billion dollars to work in that company over time. So yes, that concern is absolutely not going away. And if anything is going to accelerate, who we get a clear outcome.
Bloomg's inking, who will be across all those earnings after the bell alongside ed We so appreciate it. Meanwhile, look, we know Wall Street is eagerly awaiting in Vidia's results for a clearer picture on AI spending because it impacts the whole rest of the market. Bloomberg's US Equities report a common rhyining keys here to just bring us the context.
We know the question is gonna be asked of Nvidia, But what does it signal about the commitment of the Magnificent seven of the key hyperscalers and more broadly the rest of the AI trade.
Yeah, so this is a huge moment for the AI trade. I think a lot of people are really looking to Invidia and the stocks reaction to sort of decide the next direction of where the market, the entire market is going to go. You know, in Nvidia is the largest waiting in the S and P five hundred and the biggest.
Name in AI.
And what we also know about in Vidia is that its biggest four clients are some of the other MAGS seven members. So we're going to see where they're spending is flowing if it's still flowing to.
Nvidia how much.
When I was reading your your piece which you co wrote with Rhyan Vla Seleca, the data is really interesting. It's gonna be a big part of the Bluma tech audience that don't know some of that. So you just talked about waiting right in video is about eight percent of the S and P five hundred. That's a factor you also looked at in Nvidia's multiples relative to the
index level the Nasdaq one hundred, for example. What are the other key data points that have us on such edge ahead of the earnings report later this evening.
Well, you know, as Ian said, I think a lot of people are really looking at the forward guidance. You know, in video is expected to continue to grow revenue, even though that growth is expected to slow in the coming years. I think the other thing that people are really looking for is what Jensen's going to say about what they're seeing in the future. Right Also, is Ian pointed out the guidance is very important here, and that's I mean, probably even more important than the numbers that in Vidia
actually reports. We want to see the line of sight into revenue growth going forward. There are also still some questions about China, how much revenue can be expected there or not, And so I think the sentiment here, what investors take away about their confidence from the report, is going to be maybe even more important than the actual numbers.
Pretty most common Rhino Keey, it's a great story. Thank you very much indeed for bringing us the data as well. And now we bring you the investment perspective. Martin Norton's here with us chief investment strategistic and Power, which administers more than one point six trillion dollars in assets, and that's about the same amount that's been wiped off on nude like one hundred since the end of October.
Yes, is there room to the.
Downside here or are you thinking there's some sort of relief rally from any data we get from Jensen later?
Well, I don't think you can ever count out a relief rally. But what I come back to when we look at the price action that we've seen over the past few weeks is that we have taken some froth off the top, but we're not looking at really attractive valuations at this point. We're still at elevated valuations for
a lot of these names. And what's interesting, and it alluded to this, you know, the questions that people are raising the current environment, I don't think they're necessarily going to be conclusively answered within Video's report, right, the depreciation question, the demand question, you know, extending to the rest of the economy. I think those doubts are are with us, which would mean potentially more volatility.
Well, if Jensen can't tell us how long his GPUs are going to last and what the depreciation of them are. I'm not sure anyone have, but you're so right that that has been again an argument about why perhaps.
Evaluations are flush.
If you look at a video trenting about thirty times future earnings, that's not that elevated. So is it the rest of the trade, the palenteers, or perhaps some of the energy stocks that have risen to extraordinary degrees.
Well, I think you raise a good point. It's not that elevated, especially if you're focused on that right side of the probability distribution, if you're looking at a full probability distribution, and you come to the conclusion that I don't know if I share, but some folks are raising, hey, this isn't as transformative as people have suggested it is. We're not going to see every application take off the way people suggest it would. Then I think there's room
for some of these stacks to come down. Now, I'm not sure I share that view. I tend to believe that the AI supercycle is real, that it is going to have a pretty profound impact on the economy, but we have to make room for the full range of outcomes when we price these things.
Marta, it's great to have you back on Bloomberg Tech. As is quoted in that well read story on the Bloomberg term on Bloomberg dot com from one investor, this is a quote, so goes Nvidia, so goes the market kind of report from your desk, and your perspective is that the situation here.
Well, I think there's no question that this is a Capstone report. It's a macro indicator, and I think has the potential and you see that in pricing around it, right this idea that you could have swings up to seven percent either way. I think this is the kind of thing that people are really going to key off of. My question is whether this is going to answer all the AI doubts that are out there or whether it's
just going to arrest them for now. But we're still going to be wrestling with some of these questions going forward.
Depreciation is the most common concern or question that I've received for Gensen so far. You know, get out to people and said what would you ask? There are people that look at the depreciation issue and say, how can I model for that impact on the balance sheet of those key customers of Nvidia, But others on social media are talking about a different data set which is utilization. If those older generation GPUs are running at one hundred percent,
that's a really good problem to have, right. This is kind of very specific, but are those soft data sets that your team are looking at to work out what neof's going on?
Well, you know, I think the thing that we're focused most on as we turn our gaze to twenty twenty six is this question in particular about the capacity bill that we expect in twenty twenty six and frankly in
twenty twenty seven. So our view is that, you know, we're going to have these questions to your point about utilization, about appreciation, but our view is that those questions are going to linger as we build out the capacity for AI in twenty twenty six, in twenty twenty seven, because there is so much that you have to put in place to be able to see the demand come through. And so for us, as we go through twenty twenty six, we're going to be watching, of course, like everybody else.
Are we seeing that capex is the conviction still there to build out the massive infrastructure that you need for AI, And I think that's the key question that we're wrestling with.
It was interesting that you said you don't align yourself with the negativity and actually applications of AI, right, you do think the supercycle's real?
What data set are you looking for that? Because we do.
Have the MIT pilots aren't working, there's always a counter example for every time there's a negative, but Intelligent just have some great analysis out showing that actually only ten percent of companies at the moment or people surveyed are saying that they're using generator of AI for revenue or for new product.
Right, I think there's still an I mean, first of all, if you take a look at kind of adoption rates for the AI cycle relative to the Internet and things like that, people are pointing out the Federal Reserve and others that you've seen much faster acceleration of adoption. But to your point, we're still very much early days, and so I think one of the things that we look at is just at the earnings season themselves and looking
at what companies are saying. And a lot of the commentary around AI at this point is still very generic.
It's not very.
Specific in terms of how AI is actually transforming those businesses. And I think also watching to see how earnings in the broader economy are responding, Are you starting to see those cost savings come through, which I think is of course the first leg, and then ultimately you'd also want to see the revenue which we're seeing from the hyperscalers. But I think those, you know, that real world application is really what we're going to be keying off of it,
and I think it's going to take time. I think you still need to build that capacity to see the earnings impact.
Broadly speaking, Macha, so it's great to have you in good thank you for coming to this year. Mantulton close side of empower. Meanwhile, in Vidia CEO and Hung it's already on stage ahead of his earnings publication.
Of course, I mean while test to.
Alongside in DC as part of the US Saudi Investment Forum in Washington, d C.
Take a listen to his.
Royal Highness announced the AI strategic Framework and partnership. Today we're going big with Elon and Jensen.
So thank you for those opportunities.
Now they told me I have time for two last questions. So last night at the dinner, I got a number of questions because it seems that the schedule leaked and everybody was giving me hints about the last two questions I'm going to do. So the first one was for you Elon, and there's a big one for you Jensen, So prepare for that one.
AI in space Is that possible?
Yes, if civilization continues, which it probably will, then AI in space is inevitable. You know, I always have to like preface that, you know, we shouldn't take civilization for granted. We need to make sure to take care to ensure that civilization hasn't an upward arc. I mean, any student of history knows that civilization does not always have an upward arc, and in fact, civilizations have life life cycles.
So hopefully we are in a strong upward arc. I think we are for now, but we don't want to
take that for granted or becomplacent. But in order to the way to think of AI in space is that in order to achieve any meaningful percentage of a Kotdashev two scale civilization where you're using even a millionth of a millionth of the Sun's energy, you must have solar powered AI satellites in deep space, so that once you realize, like once you think in terms of a Cottashev two scale civilization, which is what percentage of the Sun's energy
are you turning into useful work? Then you then it becomes obvious that space is overwhelmingly what matters.
Overwhelmingly.
So the Sun only receives one roughly one two billionth of the Earth only receives roughly one two billionth of the Sun's energy. So if you want to have something that is, say a million times more energy than Earth could possibly produce, you must.
Go into space. It's and so.
This is where it's kind of handy to have a space company, I guess.
Sell the books cold chips in space too, Yes, easier to cool chips in space.
Yes, there's definitely no water in space, so you're gonna have to do something that doesn't involve water.
Well, it's just got to radiate, that's right.
So my estimate is that actually that that that the cost of electricity, like the cost effectiveness of AI in space will be overwhelmingly better than AI on the ground, so far, long before you exhaust potential energy sources on Earth, long before.
Meaning like I think even PEFs in.
The four or five year timeframe, the lowest cost way to do AI compute will be with solar powered AI satellites.
So I'd say not more than five years from now.
Wow, And just look at the supercomputers we're building together. Let's say each one of the racks is two tons. Out of that two tons, one point nine to five of it is probably for cooling.
Right.
Just imagine how tiny that little supercomputer is, right, each one of these GB three hundred racks and.
Mull just be a little tiny thing.
And just electricity generation is already becoming a challenge. So if you start doing any kind of scaling for both electricity generation and cooling, you realize, okay, space is incredibly compelling. So like, let's say you wanted to do I don't know, two or three hundred gigawats per year of AI computed, It's very difficult to do that on Earth. So the US average electricity usage last time I checked it was around four hundred and sixty gigawats per year average usage.
So so something like say you know three hundred, If you're doing three.
Hundred giga what's a year, that would be like two thirds of US electricity production per year. There's no way you're building power plants at that level. And then if you take it up to say a taro wat per year impossible, Like you have to do that in space there they're just is there just is.
No way to do a tarow per year on Earth.
And in space you've got tenuous solar you've got you don't You actually don't need batteries because it's always sunny in space, right exactly, And and the solar panels actually become cheaper because you don't need glass or framing.
And the cooling is just radiative. So that's that's why I think.
That's the dream. Yes, that's the dream.
So Jensen, everybody last night was asking me, and I'm mindful it's Earning's call for you today. So I'm gonna say this delicately. Everybody has been asking me to ask you. Are we going to have an AI bubble?
That's the last question?
All right, let's not.
All right, let me see well, let me just tell you what we see, okay. So, so I think it's really important when you look at what's happening around the world and go back to the first principles of what's happening in computer science and computing. There are three things
that's happening. The first thing is that we all know that Moore's laws run its course, and the ability the amount of demand for computing, since the amount of computation we can get out of general purpose computing is really challenging, and so the world's been moving to accelerated computing for some time. We've been pushing this now for some over twenty years. Let me give you one statistic. I was just at supercomputing six years ago. CPUs were ninety percent
of the world supercomputers top five hundred supercomputers. Six years ago. This year less than fifteen percent. Went from ninety percent to ten percent. And meanwhile accelerated computing went from the other way ten percent to now ninety percent. Okay, so you're seeing that inflection point, the transition in high performance
computing from general purpose of computing to accelerated computing. Well of the one of the most data intensive, one of the most intensive computation things that the world does in cloud is data processing. Several hundred billion dollars of computation is done on just raw data. Process has nothing to do with AI, just CFL processing data frames. You know everybody's names, address, their sex, their age, where do they live,
you know how much money they make. All of that sits into a data frame, and that data frame drives the world today, whether it's in banking or you know, whether it's in credit cards or of course e commerce and everything from ad recommendation and everything is driven off of that data frame. That data frame costs hundreds of billions are always to go compute. And so that's the number one thing end of More's lows. The second thing is generative AI. The most important application of the last
fifteen years is called rexis recommended systems. How do we know what information to recommend to us in a social feed? How do you know what ad to recommend to somebody, what book to recommend, what movie to recommend? The world is the Internet is so gigantic without a recommended system that the little tiny phone of us will have no chance. I've ever seen the right information that REXUS is the
engine of the Internet today. That's going generative AI. It used to be running on CPUs, now it runs on GPS, which then says the third thing. When if you just look at those two applications, many of the Internet companies can build an enormous number of GPUs supercomputers. Just doing that, of course, then it creates this the third opportunity on.
Top of it, which is agentic AI.
This is Grock and this is open AI, this is anthropic you know, this is Gemini.
Agentic AI sits on top of that.
But don't you know, don't forget to think about what is happening above, underneath what everybody sees as AI today, there's a whole movement of computing from jenniferpose computing to accelerated computing, and that if you just if you take that into consideration, you'll come to the conclusion that in fact, what is left over to fuel that revolutionary agentic AI is not only substantially less than your thought and all of it justified.
Well, I was just informed by the team that my boss and your bosses is going to talk next the Honorable President and his Royal Highness to the com Prince, and hence we ran out of time.
But in essence, this is ah.
Such so much love for you Elon and Jensen. But this, in essence is a ninety two alliance that shifted from energy to digital to the intelligence age, powered by pioneers such as Elon and Jensen to serve humanity and create on a net new basis, new economies, new jobs and a better future for humanity powered by the Kingdom of aud Arabia and the United States. Thank you for our lifetime partnership and friendship. Thank you, Elon, thank you, Jensen.
Thank you.
That was Elon Musk speaking alongside and Vidio CEO Jensen Huang at the US Saudi Investment Forum in Washington, d C. Probably, Caroline, the biggest piece of music came out of it was Elon Musk confirming that Xai is going to do a five hundred megawat data center in the Kingo of Saudi Arabia in partnership with Humane. That's a story that we broke actually back in July, so we've had a sense that it was coming for its confirmation.
Confirmation of course, all eyes on really the access that Saudi Arabia has to the latest greatest chips and what they're able to continue to export out in the United States to Saudi Arabia, too Humane to be able to use on the ground when it comes to Blackwell, and of course we're going to hear so much with your interview later today ed on details of an AI bubble, the vindication there that we're starting to hear from jensens to.
Already the CPU, the GPU.
Necessities when it comes to just our social media desires, let alone what's happening with the genta AI.
Yeah, we should probably point out the obvious to our audience that in video reports earnings after the closing bell.
Jensen Wang is an experienced executive to say the least, and he probably thinks to himself, Ah, what can I or can I not say during the course of this conversation, But a lot of his final answer there was repetition about the idea that as we move from the balance of workloads being inference having previously been training, that is his evidence base for this big build out INAI infrastructure to continue.
And I think more broadly as well, there were going into the realms of imagination, a realm of imagination that I've heard time and time again. We've heard it from Sooner pitch I, We've heard it from Jeff Bezos. Now we're hearing it from Elon Musk about the idea that actually the energy limitations are far less in space.
And this is why.
Suddenly you're hearing a lot of these executives talking about how we might be building data centers not on this Earth, but outside of the world at the moment. This is an interesting way diversion perhaps of talking about the cost of energy that seems to be going up into the right here in the United States.
Yeah, in space, you can put solar panels on satellites and you can use radiation to do calling. That seemed to be the point that Jensen Wong and Elon Musk were making, as if by magic. In the time that we've been speaking, Bloomberg Senior Tech Executive editor Tom Giles has appeared on set. I mean, it's a big moment, right if you have the world's richest man sat alongside, let's be honest, probably the most important person in global technology, you're kind of bracing for news. The news that I
saw was confirmation is something we reported. That's SAI doing something in Saudi Arabia.
That's right.
It's yet again evidence of this huge need for data centers and computing capacity, which is what they were talking about from beginning to end. And this is how XAI is going.
To take part in it.
This is how Elon Musk and his empire are going to take part in ensuring that we have the capacity that we need to fuel all of these services, especially the ones that Xai is providing with GROC.
All of this Tom Hinges on access to compute and to GPU, how we unfolding that story as a newsroom at the moment of Humane's access to the latest in video, Blackwell architecture, and more broadly, how we see the relationship for the demand dainty centers to be built out in Saudi Arabia rather than here in the United States.
Yeah, Caroline, I was just in Saudi a couple of weeks ago, and the thing that one of the things that I took away from that was this urgency to find sovereign AI first of all, ensure that each region of the world.
Has the computing that it needs.
I also saw the urgency of these relationships between US based companies and sovereign wealth funds in partnership with the Saudi government and other governments throughout that region. And the idea is that there's going to be a lot more partnerships. You're going to see a lot more collaboration. Humane is this company that just came out of nowhere a few months ago and really does seem to be wanting to take play a big role in this data center build out.
Before we let you go there. There is also this issue of reciprocity. So for example, there's all these projects announced in Saudi and other Gulf states, but the United States government, i think, is very hopeful that those titans of Middle East finance will also put the equivalent number of dollars into the United States itself.
That's right.
They want to see they want to jointly invest in the region. They want to see countries from around the world, particularly this region, the oil rich region, also making investments and showing that the US is a place to invest.
You know, this.
Administration wants to send the message that we're open for business and that we're here to build jobs, and we're here to bring some sort of manufacturing and technology dominance back to the United States.
Being both.
Senior Executive Editor, Tom Giles, thank you very much. Don't forget to tune in. This afternoon, we have an exclusive interview with Video CEO Jensen Wong following the company's earnings. Print that conversation around six thirty pm Eastern time.
Okay, coming up.
Pooja Goyle from Carlisle joins us to talk about AI infrastructure spending from a very different side of the table very much looking forward to this one. This halftime, We'll be right back. This is Bloomberg Tech. Welcome back to Bloomberg Tech. Nvidia is the super Bowl moment today earnings after the bell, the stock up more than two percent
off its session high. It is a stock that's up almost forty percent year to date, and there are very high expectations, but there is also very high skepticism about what is happening in this AI infrastructure build out. I will continue to track it throughout the hour. It is the big one. But one big big move to the upside is Alphabet, parent company of Google. Shares trading at a record high, on track for their biggest jump since
about mid September. Yesterday, Gemini three was released, an executive saying that this is a big jump in the model's abilities for reasoning and coding. This seems to have been some kind of delayed response in the stock. You know, you did see others like am Outman of Open Ai, even Elon Musk on social media congratulate Google what they've achieved with Gemini free.
Now that's playing out in the shares character it is.
And well cool.
One hundred folty billion being added in terms of honey capitalization, we're up at more than three and a half trillion for Google. Now let's break down though, what this so called Gemini means man deep singers with us being the intelligent senior tech analyst joining us.
Is it a big leap?
It is?
And when you look at some of the benchmarks they showed in the paper around visual reasoning, I mean everyone has been focused on multimodality. This was the true kind of model where you could see multimodality in action in terms of okay, we can do code, the model can also do image generation and visual reasoning, which is what you see in Weymel. I mean when I think about
you know why they're so successful with Weamel. Yes, they've been doing it for the longest, but also some of it is AI that's coming from their models, and I think that was reflected in the paper. And look at how far they've come in the past two years from that botch Bard launch to now Gemini three model being a frontier model, so really well executed. And I think
it was all on TPUs. That's the other thing, right, n ro N video GPUs used for training, which everyone still relies on Nvidio for training.
So that's a big.
Le Mandy, this is interesting. We were reading your research this morning. I think we're going to bring it up on the screen. So you're basically saying that if this is evidence of the success of the TPU, Google's custom chip, that might free up Google Cloud or GCP to take their n video allocation and then put it to work for customers, which is a good thing for their cloud business when it comes to external facing customers.
That's right.
And so look, Google is still buying in video chips. In fact, they are one of the top three customers
for Nvidia. And so when I look at you know how everyone is using their Nvidia allocation, some of the workloads are in fact for Meta everything is being consumed inside you know Meta with the family of apps for training and for inferencing and recommendation systems in the case of alphabet, I mean, given everything internal is running on TPUs, Google Cloud is where they deploy a lot of the Nvidia allocation, whether it's the latest Black veil or the
prior versions. And that's where you can rent it. You can generate revenues same way as new clouds are doing it. And so from that perspective, I do think that cloud revenue could get a lift just because they are more availability of in video GPUs over there.
I really recommend you go read that research if you're a terminal client. If you're not, maybe I'll post it on the social media's later. You just heard Man deep Seeing of Bloomberg Intelligence break it down. Thank you very much. AI infrastructure spending news keeps rolling in Brickfield Asset Management is teaming up with in Video but also creates wealth fund targeting ten billion dollars of commitments for a program
to build global AI infrastructure. The big plan is to acquire up to one hundred billion dollars of data center, energy and other assets. I want to discuss with Pooja Goyle, she's the partner and chief investment officer for Carlisle's Infrastructure Group. That's just a piece of news, but the structure of it is a really interesting case study for what's happening
right now in AI infrastructure. A financing arm getting commitments for a fund, partnering with some of the players in video in the technology case, and then saying over course of time, we're going to go out and buy these assets.
How do you make a response to that. How do you react to that.
Well, first of all, Ed, thank you for having me on your show. And look, from our perspective as infrastructure investors, we have a pieces driven approach to investing in infrastructure assets and a longer term time horizon, and we do believe that AI infrastructure is a significant investment opportunity for us. Now you're at Carla, we're developing over twenty gigawatts of data center capacity, primarily scale data center capacity. But we
aren't just developing these assets in isolation. We have taken a much more comprehensive view where we are looking across the value chain for AI infrastructure and we are making sure that we're developing these assets with that comprehensive lens. So that means absolutely developing data centers, but also addressing one of the most significant bottlenecks when it comes to
data center development, which is access to power. Look, you had a little bit of a snapshot where you were watching Elon talk about AI and he was talking about access to energy being the one most significant bottleneck. The way we are developing AI infrastructure is that we are building these large scale energy campuses where we have power generation capacity. That's co located next to this data center capacity.
That's Copier power. Am I right? This is actually something that you formed.
I was reading about the release back in twenty twenty one, a new portfolio company that's just building out in terms of a platform nature these campuses.
The scale is extraordinary.
What was interesting was back in twenty twenty one, it was all about sustainable infrastructure.
It was all about renewable power sources.
Is that realistic now when we think about the energy necessity?
Yeah, I mean, Caroline, You're absolutely right. From an energy perspective, you need to take in all of the above approach. So absolutely you need solar and storage, but gas is a very important part of.
The solution as well.
Look at Copia for example.
We think of data center development as building large campuses, and a campus is basically like a mini city that has multiple gigawads of power generation capacity. This includes gas, solar as well as storage. That capacity is connected onto the grid and located right next to that power generation capacity. A hyperscale data centers that are also connected to the grid.
So I'm not talking about building islands.
I'm talking about building a fully integrated city or a campus, which is a better term for it, and by doing that, you're making sure that data centers are getting access to power in a more timely manner. Remember, timing is very important here, and that power is actually cost effective. Cost an economics matter a lot here, but more importantly, it's also more reliable power. Everyone's talking about five nine reliability,
which is ninety nine point nine nine nine percent. In order to do that and build long lived infrastructure assets, that reliability is just a very important point. So at Kopia, for example, we have a site that we're building in Arizona. It is about three times the size of Manhattan. Once that site is fully built out, you're talking about thirty billion dollars in capital investment between the power generation assets as well as the data center assets. And then Coopia
has another five campuses in the web behind that. So you want to make sure these campuses are located close to where there will be demand for compute power, but you also want to make sure it's going to be cost effective, delivered on time, and also reliable.
I wish we had more time, absolutely fascinating the size and the scale. Pooja Goil, come back soon. Tell us how these campuses are evolving. Chief Investment officer for Carlile's Infrastructure group. We thank you. Let's just turn attention to Nokia now, which is also streamlining its business to focus on the networking infrastructure that can connect all of these data centers.
Now, Ka CEO Justin Hotel spoke with us earlier.
With AI, the market is going to change dramatically. It's already changing in the data center, which is a part of our business. You know, we're building AI factories. Obviously Jensen talks a lot about this, I know in video has earnings later today. But we're connecting data centers to each other and building massive AI factories. That's using our optical technology, it's using our IP routing technology. And where's
the future headed. The futures headed to physical AI, robotics, autonomous vehicles, delivery drones, ARVR, you glasses, more and more devices. And fundamentally, that means our networks need to change to handle that, and that's what we're planning for and anticipating to seize that opportunity.
Can you briefly describe the growth opportunity here and how the profile, the growth profile of your company will change as you make the shift.
Yeah.
Look, I mean today you see the pockets of growth that we have in the fixed infrastructure, and as we see this build for AI native networks going into mobile, we're going to see tremendous growth there. It's just not coming in the next few years, or we believe it will come over the longer term as the market invests and builds, but it's not going to be in the
next couple of years. So really think of our business in a couple of ways, capturing growth and fixed infrastructure today, and then in mobile infrastructure, positioning the business for technology innovation and longer term growth as that market picks up.
What industries do you expect to be most dominant in.
Are there particular industries that you think will.
Be fastest to adopt the AI connectivity that you're hoping to provide.
Yeah, I think there's a few things. First of all, you know, there's no question that the core tech industry that we're in today is the engine of growth, right AI and cloud customers, hyperscalers, cloud providers, and that's of course serving the technologies we have today l l ms, you know, AI agents. But when we look ahead, I see it being in areas like transport and logistics and manufacturing, physical AI also an area that we already serve that
we call mission critical enterprises. Think of public safety, uh, you know, rail transport. These are these are places where AI can add better reliability, better security, better outcomes for people. If you think about public safety, for example, emergency services, and those are areas where I think we'll see fast you know, we'll see faster AI adoption. But I don't think we can. You know, we can predict the future perfectly. We need to just anticipate what are the use cases
and the needs. It may be that, you know, delivery drones, other retail applications also accelerate and those are early users. So for us, it's about building the plumbing and the core capability.
That we need.
There was Nokia CEO Justin Hozard Okay coming up in earnings reports, investor presentations, and company memos. His egitors have been touting efficiency gains from AI and pointing to the tech for shrinking or flat workforce as we are more in that next carac.
Meanwhile, we're watching a deal that has sent sem Rush holding shares skyrocketing seventy four percent, Adobe agreeing to buy the marketing platform first take over announcement of course this has failed acquisition of Figma. It's all cash deal, twelve dollars for share.
This is a blue bag tech.
Looking ahead, however, layoffs and reduction and hiring plans due to AI use are expected to increase.
You see a significant number of companies either announcing that they are are not going to be doing much hiring. We're actually doing layoffs and meant much of the time they were talking about AI and what it can.
Do, the supporting cast of the soul crushing work is now being done by agents. They work hard twenty four x seven. You don't have to pay them, and they don't need any lunch, and they don't have any healthcare benefits, so they're very affordable and that really complements our workforce.
Just a few who have been hearing about AI's impact on the workforce. Increasingly executives have been laying the blame for job cuts at technology's feet. Nelu Meg's editor for AIU Seth Figeman joins us now and Seth, I'm hearing the term AI washing. Is it actually that AI is to blame for these job cuts or it's a nice excuse, but actually they overhearede in COVID and this is a good way of announcing job cuts.
Yeah.
I think it's a little bit of both. I mean, first off, the step back. We're seeing a real shifting how we talk about this. Even six months ago, a year ago, companies were pretty sheepish about saying AI had anything whatsoever to do with cost cugging headcount reduction, because I think no one wanted to be the poster child for massive job displaced unemployment. Nobody wanted that back headline.
Something has shifted in the last six months, And I think it comes down to one, we are in a bit more of a difficult macroeconomic environment where companies one have more reason to be cugging costs, and potentially AI improving against that backdrop is going to be a perfect storm for those cost cuts. But two, it's a little bit easier probably for investors to say it's AI than to say we over hired, we're a bloated workforce, we're dealing with outdating technologies.
Let's just say AI.
So in terms of a post a child or maybe a better phrase of case study, you have Amazon. Right, So in June Andy Jesse signaled or said, you know that this would happen long term because of AI, but then more recently when Amazon actually did job cuts, that was not the messaging that's right.
I think he came out there and said, well, you know, not yet you know. And I think that the Amazon cuts maybe speak to a different phenomenon that's very TEXTPASI, which is that we're seeing a lot of tech companies
do significant content. Some of that is because of overhiring during the pandemic, to be sure, but also these same tech companies are reallocating substantial resources to compete in the larger AI race, and as a result of that, they're trying to trim and be more efficient in other parts of their businesses. So AI is a part of it, but it may not just be because chatbots are taking people's jobs.
There is data we can reflect on.
I think the New York State is the first state that said when you make big layoffs, you've got to say whether it's AI automation related. We're seeing in the Challenge of Gray and Christmas numbers, thirty one thousand jobs was sort of AI sacrificed in just October elone.
That's right, but again the challenger stuff is also based on how people how companies are representing that publicly. To your point, though, I think other states are trying to emulate the New York legislation. We would love nothing more than greater transparency on this rund because I think there's a lot of fear, there's a lot of misinformation, and that would help us really set back from fiction.
Beg Seth Figman, Thank you very much. Let's get to another top story. Meta has secured a key legal victory against the Federal Trade Commission. The FTC alleged the company's purchases of Instagram and WhatsApp violated antitrust law.
A judge didn't agree.
Bloomberg's Riley Griffin joins us with the details. I think let's start with the basic legal reasoning that the judge gave what was the decision based on what happens.
Well, and you have to remember that when the FDC first launched this lawsuit, that was five years ago, that was Trump one point zero. The social media landscape has changed drastically since then, and that was really the reasoning behind his ruling. The FDC had argued that me Wei and Snap where it's only competitors, and you and I have spoken plenty of times about what TikTok is doing to Meta's market share. That's what Judge Boseberg said as.
Well, and then Meta gets up and says, see, we have got so much competition, it's fierce out there, and continued to tackle it. It's an interesting sort of argument to have to make to your investor base employees that you are under threat in some way.
It's such an important point, Caroline, because really this win is also a warning. Looking forward, Meta is going to have to grapple with Judge Boseberg's comments, which are that it is not differentiated from its competitors and that TikTok is eroding its market share.
This is probably the most difficult question.
But what happens next is that just it now, it's all done, or there are some changes that Meta has to make, or there will be more legal challenges down the road.
So we've been speaking with analysts. Nobody expects the appeal process to proceed, but we're going to wait and see. Really this means that Meta doesn't have to spin off Instagram or WhatsApp. That was the overhanging threat, but a big win one that was really priced in. Analysts had expected Meta to take the w here.
Bru Mags, Ridy Griffin has been alled across the story, thank you so much. I mean, while coming up, we're going to get back to the Nvidia earning So course we are. Will Street is awaiting AI signals. We await an exclusive conversation with Jensen Wang.
The ed will conduct is blut that tech.
Turning back to Nvidio ins investors awaiteds results after the closing bell Conjensavanni Bloomberg Intelligence ci Alis wrote at the end of October that in Video's partnerships could broaden its revenue and quote. With China constrained expansion into quantum robotics and networking reinforces a long term growth trajectory. Conjensavaranni joins us now here in San Francisco. Whatever happens in the quarter happens, It's all about this kind of long term story.
You wrote that note after GtC and DC, and you seem to have seen enough to think that long term story is intact.
Definitely.
I mean, it's not going to be able the numbers, as you said this QUAD, but I think given the macro and sentiment backdrop that have been rising concerns or question regarding sustainability of these deals be double our customers double ordering or double securing supply and see the final can supply keep up even if the demand is true and can sustain whether it's from the supply chip side, from TSMC and packaging, or whether supply from the end of data center build up that the customers are trying
to build.
Can they execute that fast?
Qinjin. When we heard a GtC from Jensen.
About the five hundred billion dollar half a trillion line of sight, how real and tangible are those orders?
I mean when you look peel into the onion, the timing of that was sort of over six quarters and it did some analysis and that just suggests basically five to ten percent above consensus. So a very very achievable and very executable target that he laid out.
That's one reason why expectations is so high going in since Aday that single slide behind him on stage, five hundred billion dollars. If there are some questions to pose to Jensen, Wang and Nvidia, not just today but on an ongoing basis, what are the it's your minds conngent.
I think we need more clarity around these deals. Right, there's deals when it comes to sort of media securing revenue by these investments and sloan. There are questions around depreciation schedule of their GPUs and again, finally there seems to be or at least implies some sort of securing scarcity of GPU securing from multiple different provider, whether it's other merchant silicon providers or acy providers.
Can I ask.
About the depreciation of GPUs? Is Jensen the key person to ask about this? He's obviously understanding exactly how they're using and how they're appreciating within other those data centers.
Can he give a signal as to whether.
Companies on their own forward looking basis estimating right whether it's three four years, four years, five years.
Well, definitely from a technology perspective, he can definitely give that answer. But there are two input factors here. One is realistically, how long can you use this chips, which we believe of three to five year period seems fine, But there's also business decisions that the customers are making when they're evaluating lifetime of these chips, whether will they upgrade to newer chips, will these chips be still valid to use their models which are increasing at unprecedented rate.
There were people out there that say the kind of micro barriers of this world are wrong because those older generation chips are one hundred percent utilization. Is there a Bloombag Intelligence house view on that.
Well, again, from a technology perspective, we think that useful life. We're seeing most of the cases are correct and the chips can be used that long. Whether from a business perspective, whether from a GPU rental pricing perspective, that's valued or not depends on the customer use cases.
Con Jin, you've got a busy day. We so appreciate that you've come on to front Ron.
What is our super bowl? Kunjin, Sivanni and Bluembag Intelligence, We thank you. Do not forget to tune in later. You've got to tune in for an exclusive inefit with Invidia CEO Jensen Wang following his earning.
Six thirty pm is going to be thirty pm Pacific. Who's doing it?
You're doing it in Yeah, it's going to be an interesting conversation. There are difficult questions for him, the depreciation factor, circular financing, which they've already pushed at back up before.
But let's see what's in the print.
Yeah, that does it? From this edition of Bloomberg Tech.
Yeah, don't forget to check out the podcast. A new way to find it online on all the Bloomberg platforms. This is Bloomberg Tech.