The REAL Reason Nvidia is Unstoppable

0:00 Let's do this, because I think this is going to be a learning lesson. We talked about NVIDIA all show. This or that, NVIDIA or Broadcom? It's more of a fight than people may think, but for sure, NVIDIA.

0:16 Like, one of the greatest.

0:18 Okay.

0:19 Since Tim Cook has stepped down, is NVIDIA the number one CEO in America?

0:26 He's always been my number one. So... Always.

0:29 Profit margin, ecosystem, the development, the drive is.

0:36 Second to none. So for sure, for me, it's NVIDIA. I think it's NVIDIA as well.

0:41 But I think people misunderstand and kind of don't give Broadcom its justice. I agree a thousand percent. It's a very important company, right? What NVIDIA does in GPUs. Broadcom has said, OK, if you can't afford that, what we can do for you, Meta, is we can make you an XPU, right? We can make you your own, right?

1:05 We can make it for you. You can put whatever you want and you can use it. You're seeing a lot of companies do that, right? Even Google, which is a partner of them now, Broadcom has fallen back because they're for guidance. And again, $ 100 billion is what they said they're going to do. Wall Street wanted to hear them say they were going to do $ 110 billion.

1:24 OK, understood.

1:26 But the demand has not changed. Google, the headline was that they were, you know, not going to be partners with them anymore. They actually just went to number two. This wasn't a big deal. I think what, and this is, this is the genius of Jensen. Their natural competitor and not by size yet or market cap is Marvell because both companies make custom silicone chips. If you listen to when Jensen spoke at, at, at, earnings at the summit.

1:57 He said the next trillion dollar company was going to be who?

2:01 Marvell. Was he putting some extra on that? Well, why is he saying it? He's saying, look, I know my competitor over there does that.

2:09 Yeah. I'm going to partner with the company that's doing what they're doing. I'm not going to say, hey, we're going to do exactly what you do. I'm going to find a company that does. I'm going to partner with them and I'm going to give them this cosign. Come on stage with me. We're already partnering. but you're going to be the next trillion dollar company. And tell us what that move is like to tie back into the book, getting rich from relationships. Since that's a competitor, why was that a great move to highlight them as opposed to demeaning them and tearing them down?

2:38 Because I think that's a valuable lesson.

2:39 Yeah. Well, if I know I have your backing from the number one company, the king of this AI story, if they have their backing and they have their partnership, potentially they have their resources. What does that say for my competitor? I got to go out and find more clients because they're Their demand's so high. They have 75% of the GPU market, right? How do I now get edge on them, right?

2:59 He's invested.

3:01 I'm talking about Hot 10. Hot 10. Shoddy.

3:04 Okay, now Shoddy, to your point.

3:06 Hot 10, I broke down.

3:08 Well, we talked about the NVIDIA ecosystem of the companies that he's actually invested in. And Marvell, that's a company that they've actually have equity stake in. So it's like, okay, at a certain point in time, The music business, what the model was in a rap standpoint is that the rapper gets hot, then the rapper gets a label, then the rapper does features on other artists, then makes them hot.

3:32 So that's what Lil Wayne did for Drake and Nicki Minaj. That's what Jay-Z did for Freeway and Beanie Siegel and Memphis Bleak, even Kanye to a degree. Everybody did the same thing. So, I mean, Jensen... saying that this is going to be the next trillion dollar company. We said it with that. I mean, he's in a position to move markets, whatever he says. It's like him, Elon Musk, there's.

3:59 A few people that can actually just move the market.

4:02 They've invested in over, what, 10,000 companies?

4:07 It's not just NVIDIA. It's the NVIDIA ecosystem that.

4:13 They benefit from if their companies do well, that they're invested in, and then They're going to do well because they invested in the company.

4:20 So then that's going to benefit the parent company.

4:22 And it helps the entire ecosystem if Marvell goes up to, let's say, 400. There's demand internationally that they can't take care of, but they've already set it up for Australia to then go to Marvell.

4:33 And it's brilliant because they're looking at the space and they're saying GPUs is what we're known for, hardware and software is what we do. We talked about the CUDA platform. We don't do custom ASIC. Our competitor does that. Let me find a company that does it. Invest in them. They're touching bases on all aspects of it. And we talked about this over and over, whether it was from photonics, whether it was from infrastructure, from energy. Now here you're talking about Custom Asics. That's our company. We're going with them.

5:00 Next trillion dollar company is right here. We watched that company shoot up to 390.

5:05 We were part of that.

5:07 And it goes back to your point about Peter Thiel saying competition is for losers. The real strategy is, like you said, to build an ecosystem where you can direct, you're almost like a toll road where you can direct the flow of traffic and send business out, you're still getting a VIG on the business that's not even coming to you. So it's a brilliant shot. That's when people are like, I'm short in video. I'm like, they have their hand in every company that matters now and the companies that are going to matter over the next 10 years.

5:31 Only losers want to compete.

5:33 And if you look at Mark Zuckerberg, another legend in our time, he never really competed with anybody. His strategy was just to try to destroy and buy, buy companies. So, or, or take the model. And just do it at a higher level and then squeeze them out. But it was never like a thing of like, I'm trying to really, you know, go toe to toe with Snapchat or Vine or, you know, any of these companies. Like, you know, it was like the idea of competition is for people that.

6:08 Want to compete. But why would you want to compete?

6:11 You know, that's the analogy is so good. And it makes you think of let's just take NVIDIA and we'll go to the next day. So that after, but when you hear a deep seek or you hear like a company, we don't think of it like that.

6:25 Right.

6:26 Right.

6:27 That's a small competitor. I don't have to compete with you. I can crush you. I have the capital. I have the bandwidth and I have the network. But when we, we hear, Hey, they're building their own GPO. It's like, Oh my gosh, we watched these companies pull back. Well, why people don't understand it. It's that same mentality. Like, The level of capital that these companies have, the Broadcoms of the world, the videos of the world, it's tough to compete.

6:52 You either win or you lose. There's no in between.

6:55 Maybe the closest thing that we have is Magic and Bird, but for the most part, Michael Jordan didn't compete with the Pistons. Michael Jordan didn't compete with anybody.

7:05 After he beat them. Exactly, but you look at totality. He won.

7:10 Muhammad Ali really didn't compete with, no disrespect, he didn't compete with Joe Frazier.

7:15 He beat him one time, but Mike, he won the series. Right. So he, he won.

7:20 So it's like, I think people have a false narrative about the, the honor and like, Oh, this is, this is great competition. Even in kids, youth, there's no competition. You got team. Somebody is going to be a winner. Somebody is going to be a loser. You compete as far as like you, but the idea of like, well, we gave it our all and we competed in this, this competition is going to be lost.

7:42 It's going to make us all better.

7:43 No, it's going to, Iron sharpens iron. No, iron destroys weaker iron. Somebody's going to lose and somebody's going to win.

7:53 That's it.

7:54 Really quick on NVIDIA. Gross margin, 74.7%. A multi-trillion dollar company. 65% operating margin, 63.7% net, 41.9% free cash flow margin. As great as Bill Gates was in a monopoly that he created. They didn't have these numbers by a third.

8:16 No.

8:17 It's not even fucking close.

8:19 I just got a call. I just got a text from the campaign, by the way.

8:24 Okay.

8:26 Speaking of competition.

8:30 Broadcom case. Broadcom case study this week, y'all.

8:34 You're a funny dude.

8:35 You're a funny dude. Yo, this is a good one. This is a good one. That was like, I felt like people, that was an obvious. Yeah, that was an easy one.