Transcript
0:01 ISSUING THIS STATEMENT TO CNBC IN JUST THE LAST HOUR. THE MEDIA REPORT IS FALSE. NVIDIA IS NOT ENGAGED IN DISCUSSIONS TO ACQUIRE ANY PC MAKER. LET'S BRING IN FAST MONEY FRIEND GENE MUNSTER FOR REACTION. HE IS, OF COURSE MANAGING DIRECTOR MANAGING PARTNER AT DEEPWATER ASSET MANAGEMENT. JEAN, GREAT TO HAVE YOU WITH US. HELLO. SEMIACCURATE WAS ACTUALLY INACCURATE ON THIS ONE. >> SEMI. >> WE DON'T KNOW. >> I'M WONDERING, JEAN, IF YOU THINK THAT THIS MAKES SENSE AT ALL, COULD DELL BE UP FOR SALE TO ANYONE?
0:31 >> SO MY SENSE IS NO. AND PART OF THE REASON IS THAT ULTIMATELY WHAT YOU LOOK AT, WHAT COULD THEY BE UP FOR SALE NOT BUY NVIDIA. I THINK NVIDIA STILL IS NAVIGATING THIS MARGIN OPPORTUNITY THAT THEY HAVE. THEY HAVE A 60% OPERATING MARGIN. DELL'S AT 7%. JUST TO PUT SOME PERSPECTIVE AROUND THAT. AND SO EVEN THOUGH IT IS INCREMENTAL TO ABSOLUTE DOLLARS, THAT IS A WRINKLE THAT THEY NEED TO NAVIGATE IN TERMS OF COMMUNICATING WITH THE STREET.
0:57 SO I DON'T THINK THAT THIS THAT DELL OR HP IS NECESSARILY GOING TO BE ACQUIRED BY NVIDIA ANYTIME SOON. I DO SEE A PATH WHERE THEY BECOME PART OF POTENTIALLY AMD, FOR EXAMPLE, OR INTEL, SOME COMPANY THAT'S TRYING TO MAKE A TURNAROUND. AND THE BASIC CONCEPT IS, YOU KNOW WHAT, THIS RUMOR, THE REASON WHY IT GOT A LITTLE BIT OF MOMENTUM WAS THE CONCEPT OF KIND OF BEING AN END TO END AI POWERHOUSE, VERY SIMILAR TO WHAT APPLE DOES DOING THE FULL STACK BETWEEN HARDWARE, SOFTWARE, SERVICES THAT STILL HASN'T NO ONE'S REALLY PUT ALL THAT TOGETHER. AND SO THERE IS WHEN WE THINK ABOUT HOW EARLY WE STILL ARE IN AI, THIS OPPORTUNITY TO VERTICALLY INTEGRATE THIS IS A BIG THEME.
1:40 THINK ABOUT WHAT SPACEX IS DOING VERTICALLY INTEGRATED AROUND AI. I THINK THAT THERE IS AN OPPORTUNITY THERE NOW. SO NOT NVIDIA, BUT I THINK THAT THIS RUMOR IS NOT OVER. IT'S NOT DEAD RIGHT NOW. I THINK WE'RE GOING TO KEEP SEEING A BIT ON THIS RUMOR IN THE YEARS TO COME. >> HEY JEAN, IT'S KAREN. THANKS FOR COMING ON. I MEAN THIS WOULD BE A VERY BIG DEAL. DELL, LET'S SAY FOR AMD. AND ALSO IT WOULD SEEM LIKE A KIND OF A BIG DISTRACTION. WHAT MAKES YOU THINK THEY NEED IT OR WOULD WANT IT THAT MUCH?
2:12 >> WHAT THEY NEED. THEY CAN'T JUST REPLICATE WHAT NVIDIA IS DOING, JUST TRYING TO SQUARE UP AGAINST THEM. TO HAVE THE MOST ADVANCED GPUS IS A REALLY DIFFICULT ROAD. WE'VE SEEN THAT. THEY'VE TALKED ABOUT HAVING THIS UPTAKE IN SOME OF THEIR MORE ADVANCED AMD'S, MORE ADVANCED GPUS. WE JUST SIMPLY HAVEN'T SEEN THE BID. AND MY THE REASON WHY I THINK THAT THERE IS POTENTIALLY SOMETHING THERE WITH SOME FORM OF A GPU MANUFACTURER IS THAT, AGAIN, IT'S JUST NOT THE SAME PLAYBOOK.
2:41 AND SO IF I'M AMD, I'M TRYING TO THINK WE'RE STILL EARLY AND HOW CAN WE SOMEHOW DIFFERENTIATE? THAT WOULD BE A VERY POWERFUL DIFFERENTIATION STILL IN THE CATEGORY OF MORE OF A LONG SHOT, LESS THAN A 50% PROBABILITY, BUT YOU COULD SEE HOW THE NARRATIVE LINES UP. >> HEY, JEAN, YOU KNOW, SO DELL, TO KAREN'S POINT, WOULD BE A VERY EXPENSIVE IN DOLLAR TERMS ACQUISITION. IT WOULD ALSO OBVIOUSLY WEIGH ON OPERATING MARGINS. LIKE YOU JUST MENTIONED. THE FLIP SIDE OF THAT IS LIKE HEWLETT, I MEAN, THE STOCK CAN'T GET OUT OF ITS OWN WAY. I MEAN, IF THEY WERE TO GO AND BUY ANYBODY TO GO AND BUY HEWLETT, IT WOULD NOT BE LOOKED UPON PROBABLY. YOU KNOW, I THINK THE STREET WOULDN'T LIKE THAT. I'M JUST CURIOUS, AS YOU THINK, ARE WE LIKELY TO SEE M&A? BECAUSE TO YOUR POINT, APPLE IS THE ONLY ONE WHO'S REALLY DONE THIS. WELL SPACE X THE JURY IS STILL OUT THERE.
3:28 >> SO FROM THE KIND OF THE THE THE THE HIGHEST LEVEL HERE. I'M I DON'T THINK WE'RE GOING TO SEE ANYTHING. I THINK THE PROBABILITY IS LESS THAN 50%. I UNDERSTAND WHY YOU KNOW, NVIDIA PUT THIS PRESS RELEASE OUT BECAUSE THEY JUST SIMPLY DIDN'T WANT TO ANSWER THIS. BUT YOU KNOW IS THERE GOING TO BE MORE M&A. THAT'S KIND OF THE CENTRAL QUESTION I'M TRYING TO ASK. I DON'T THINK THAT NVIDIA WOULD BE REWARDED. KEEP IN MIND NVIDIA HAS ALREADY SINCE LAST SEPTEMBER GIVEN THE THESE LIMITATIONS OR GIVEN SOME EXPECTATIONS THAT THEY'RE GOING TO BE INVESTING $80 BILLION INTO THEIR WHOLE DIFFERENT COMPANIES OVER THE NEXT SEVERAL YEARS. AND SO I THINK THAT, YOU KNOW, AN ADDITIONAL 30 OR ADDITIONAL 100 BILLION ON TOP OF WHAT'S BEEN ANNOUNCED, I DON'T THINK WILL BE RELATIVELY WELL RECEIVED. I THINK, AGAIN, BIG PICTURE IS THERE'S STILL AN OPEN AN OPENING IN TERMS OF FINDING WAYS TO DIFFERENTIATE AROUND BUILDING AND AI HARDWARE COMPANY. NO ONE'S KIND OF BROUGHT IT ALL TOGETHER. THE ONE COMPANY THAT HAS IS THAT'S BRINGING IT ALL TOGETHER IS SPACE X, WHICH SEEMS OFF TOPIC GIVEN ALL THE EXCITEMENT AROUND THEIR SPACE INITIATIVES, BUT ULTIMATELY, THEY'RE REALLY TRYING TO BE END TO END AI.
4:34 THEY'RE TRYING TO BRING EVERYTHING TOGETHER, REALLY REPLICATE WHAT APPLE HAS DONE. SO WE'RE GOING TO HEAR MORE,