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And I've got to tell you something, David. People like to speculate about what he's going to say. Get out of that game. He won't let you know until it starts. It's all a secret. That's how he does it. Is he a dramatic guy? When New Yorker piece I told you to read about it, he does not regard himself as a classically great speaker, but today he delivers. And I think that we will be surprised because he does not let himself be gamed. I think people have to start recognizing that. OK, so that being said, and secretive, though, he may be, you've got to tell us at least what some of your expectations may be. Certainly there are at least questions that many people who think are going to be addressed, Jim. And I'm curious as to what you think they are. OK, so I think that what will be addressed is not necessarily the total stressful market in terms of what number it'll be, but it'll be about biology. It'll be about health care. It will be about finance. It will be about auto. It will be about manufacturing. And yes, it'll also be about accelerated computing and generative AI. So what I'm saying is it's going to go vertical. And if you look at all the different-- you've got some cues. There's just these tremendous breakout sessions. You see where he's going. He's going toward health care. He's going toward figuring out things that can do best with accelerated computing. And then second early, he's going toward Microsoft AI pilot and going toward what we're going to talk about with Google, going toward what anthropics doing. So I don't think he's going to rule out, obviously, he has to talk about what traditional AI is. But I think he's going to talk about what accelerated computing can do to make the world a better place. Because he's a bigger thinker than we are. He's just bigger. I call him DaVinci. DaVinci knew about the helicopter. I know, you've been talking about the digital twins before anybody had any idea what in the world you were talking about. We were never considered digital twins, you and me. I know we're like Danny DeVito and Arnold Twitsen again. The accelerated computing market, and or at least sort of the data center market. You know, I'm looking-- listen to a podcast this weekend. Bill Gurley, Brad Gerstner, do this podcast. Gerstner talking about how he believes, or Jensen Wong now believes, the data center market will be as much as $2 trillion, just over the next four to five years. That's the addition of capacity that's needed to power the large language models. Where are you on that? And you know, again, if NVIDIA maintains any semblance of its current market share, let alone, you discount it, it's still a very big number. Well, look, I like to go back to when Bob Noyce and Gordon Moore and Andy Grove were at the former stage of Intel, where they talked about how they had a computer that was this size. And it's going to power far more than what a mainframe does. And one of the people in the audience said, well, wait a second, you're never going to be able to charge $2 million for that. No, we're going to charge $200 bucks for it. This is where Jensen is. He has formula to make things that make it so that everything that you currently did is digitized in your world and it has to be replaced. And it has to be-- there's going to be some that'll be at the edge. You can do some edge computing in your phone. But most of it is in the data center. And what he's saying is, look, everything that you have is too slow. Everything you have does not do what my computers can do. So $2 trillion, $4 trillion. I don't know what it takes to replace everything. But David, everything was replaced by Intel. Everything. And everything is going to be replaced by NVIDIA. And I think the people who don't understand that, don't understand how much more a computer can do this morning. Dylan, who works with me, he wanted me to send a memo to him. Well, I had to type in the memo. I had to send an email. I had to attach it. Now, come next year. I'll just say, will you please send that more-- send the March 18 email about what I'm looking at to Dylan. I'm not going to type anything. But that's Jensen. And just something we are going to give Lisa Sue some do here. She also has that. But that's the new world. Are you ever going to sit there and type an email again? If you can just say, will you please send that thing to Faber? Send it to Faber right now. And it might come back and say, sure. Or it'll actually be like, you sure you want to do that? Really, for sure? But why would we ever want something where we type? What was the typing thing about? I'm going to say a typewriter store in Florida the other day. It was obviously closed. I mean, what is this thing with keyboard? Oh, that makes a lot of sense. Let me type in letters that send something to David Faber. Now, how about I say, send it to Faber? Isn't that better? That's Jensen's way. You can have the other way. I'm giving you the other-- I'm giving you the keyboard. You want the keyboard so you're yours. I want to move on. But just to finish up, when you say that everything is going to be replaced-- Yes. What does that mean for the Intel's of the world then? Well, it's interesting because if you hit up-- if you go on Microsoft, you go co-pilot and you say who's the best partner, it says Intel. Of course, that's completely untrue. I think that what happens with Intel is there's still room for CPU, not a GPU. And look, ARM has their CPU and their partner with Jensen. You have CPUs for 20% of what's basically a box that Jensen's. Not really a chip. It's like a box that Jensen has. So there's room. There's room for CPUs. But in the end, David, there was room for IBM too. Yeah, well, there still is. Yes, there is, IBM's very good partner with NVIDIA, but what? All right, let's move on. Speaking of potential partners, let's move on to the story this morning, Jim, because it's an interesting one. It's got both Apple shares and even more so alphabet, which, of course, hasn't been doing particularly well this year, at least as a member of the mega-cap tech group. They're both up. It's Bloomberg's story in which they cite sources saying that Appleson talks to build Google's Gemini AI engine. It'd be a part of the iPhone, essentially. Both companies are apparently having active discussions about Apple licensing Gemini and then it being able to power new features and things of that nature, things we're waiting for, of course. We may get some details around come June. Also, by the way, the reports as Apple recently held discussions as well. With OpenAI, they consider using its model. Give me your take. I don't have a lot of additional reporting here. I think we certainly could use some. They've had a long relationship as we well know. Let me just set it up. I mean, we all know Google has paid Apple as much as, what, $20 billion a year to be the default search engine on the iPhone. And we've been waiting for what Apple is going to do when it comes to generative AI. We're still obviously waiting for that. What are your thoughts here on the story? This is huge because a lot of people thought that the next iteration of the phone may not have anything really big AI, which, therefore, makes it so Samsung does have an advantage. Samsung's phones are selling very well at Best Buy right now, versus Apple. This would change things. It would make it so that without spending a lot of money, because it costs a lot of money to get into AI, it would be seamless. And you suddenly would have a great AI engine within your phone, and you'd have a reason to upgrade. So if this is true, and they can get this into the next phone, holy cow, all the bears on Apple are going to have to eat crow. Bears don't. Do bears eat crow? Yeah, I don't know. No, they're the best humans. They're the best humans, yeah. But I do think it's huge, and I think obviously, Alphabet needed this. You correctly pointed out, Alphabet has been other than Tesla, one of the weak sisters during this period. So this is great for both of them. I think that the people who think that Apple has no AI, they got up this morning, and they said, I hope Bloomberg has that story wrong. Please, Bloomberg be wrong. And that's not a really good bet. No. By the way, bears, I mean, they need anything. They need all the bears, of course, as we all know. Yeah, I can see people. Oh, that's right. You can't go camping them, and they're not fun at all. The Grizzlies love their salmon. All right, but what about Alphabet? We've talked a lot about the innovators dilemma about this fascinating story that's going to be unfolding for quite some time, which is, are they going to get disintermediated from their monopoly on search? And or is the response a proper one, given that perhaps they'll be able to use their engine here as search for Apple? I think this was a game changer. I think that I was very worried about search being supplanted entirely by going to micro the co-pilot or to Claude. That's another one I use. Claude, how you doing? It's like Claude Rains. But yes, this is huge. And what it says is, don't count Apple out anymore, because this combination makes both of them more relevant. I know we have to go, David. I know. But when's Oracle on? I don't. I don't know. We're waiting. I'd love to have software cats on. I tried to get software on. That's the funny thing. I literally tried to get it on for tonight. That was a promote for a show that I was trying to do for tonight. That's what happened. Maybe that's where the confusion came in. No, but we do have Cisco coming up in Chuck Robbins. Company has completed its acquisition of Splunk. We'll have the CEOs of both companies more squawk on the street as straight ahead. At the UPS Store, we know things can get busy this upcoming holiday. You can count on us to be open and ready to help with any packing and shipping or anything else you might need. Is there anything you can't do? Actually, I don't have a good singing voice. The UP. Noop. But our certified packing experts can pack and ship just about anything. At least that's good. The UPS Store. Be unstoppable. Most locations are independently owned. Product services pricing and hours of operation may vary. See Center for Details. Come in today to get your holiday goodies there on time. Now is the time to embrace a new wave of workers. Every day, your team grows younger, more digital, and more drawn to entirely new ways of working, which means you need flexible solutions to connect them where business gets done. T-Mobile for Business was born digital. With America's largest 5G network, we can make it easier to work together from virtually anywhere. Your team may be changing, but with the right tech, it can be more productive than ever before. Get started at T-Mobile.com/Now. Cisco announcing it has completed almost a $28 billion deal, all cash, to acquire the data services company Splunk. Joining us now first on CNBC is Chuck Robbins. He's the chairman and CEO of Cisco. And Gary Steele. CEO of Splunk was here when you guys announced the deal. Now Gary's going to be a part of Cisco's executive leadership team. Gentlemen, nice to have you. It's great to be here. It's great to be here. You know, all right, it's part of the company now. So you have some other products out there in security offerings, for example, I think, AppDynamics, Thousand Eyes. How do you sort of address potential overlaps, redundancies? How do you go to market now with your product portfolio, given the ones you previously had, and what you now have? Yeah, well, first of all, thanks for having us. We're in a situation where we have very little-- we have zero overlap in security, with basically zero. We have slight overlap in what's called observability, which is basically monitoring the infrastructure for application performance and those kinds of things. And we've been working really hard over the last six months to actually address those and build an integration plan. Gary, you may want to talk a little bit about it. We're actually going to move the Cisco assets into Splunk on that particular part of the business. You want to talk to me? Yeah, no, I'm super excited about this. I think the combination of AppD+ Splunk's observability cloud gets us the best multi-cloud hybrid solution industry. So while there's some really good work that's going to happen, we think we can do a lot for our customers. What does that make some really good work that's going to happen? Simply bringing the AppD capabilities into Splunk, so driving that integration, and bringing the capabilities of AppD with the observability cloud. So customers can monitor their digital footprint and really understand their uptime and ensure that they don't have outages. Chuck, I want to get Jim in, but just the bigger picture here in terms of what it means for the future of cybersecurity, observability, and how Splunk fits into the vision overall for Cisco. Well, if you look at the combination of their data platform with our security portfolio, and particularly with our extended detection and response capabilities, you think about taking the data platform that they have for the customer. You apply high-end AI-based detection and response. What we believe we'll be able to do is give our customers the ability to identify threats and dynamically react to those threats in real time, because as the bad actors become better at utilizing AI to launch attacks, we think the real-time correlation of disparate events that together might indicate a security problem is a critical capability that our customers are going to need, and between our technologies, their data platform, we believe we can actually deliver that to our customers. >> Hour and there, you're the same now, you know. >> That is true, hour and hour. >> Yeah, hour and hour. >> It just happened in the last hour, you know. >> It did, yeah, the big wire transfer has been completed. Jim, I know you got a question. >> Sure, first congratulations, gentlemen. Successful at putting this together, I think it's really important. Gary, I'm going to go to you first. What is percentage of recurring revenue do you have, and now you're going to be part of the magic team? What will your recurring revenue do for the whole mosaic that is Cisco, and what will it mean for the compound annual growth rate of the combined companies? >> So Splunk brings basically $4.2 billion of annual recurring revenue to Cisco. We just wrapped up a very good year where ARR was growing 15%, and while we generated over $1 billion of cash flow on that ARR. And I'll let Chuck speak to how that comes together in terms of the overall ARR for the combined companies. >> Hey, Jim, it's good to see you, and I hope you enjoyed being on the West Coast. I'm sure you're going to have fun this week. When you look at the combined ARR, I think we're approaching $29 billion now. So it's a meaningful amount of our business. It's been a journey we've been on since I became CEO. We actually, as you know, achieved 50% of our revenue last quarter came from recurring revenue, which has been another thing that we've been trying to achieve. And if you just do the math on adding, I mean, obviously in the first four quarters, Splunk's going to be a significant growth driver from a financial perspective. And then even beyond that, growing the four plus billion dollars growing in the mid teens on our business, layers of point of growth on just by that alone, even in the outbound years. So, and that's without any of the revenue synergies, which were really the things that drove this deal in the first place. >> Okay, so Chuck, in the last time I spoke with you on money, you did talk about activation issues. You talked about the idea that you could be limited this quarter just because there was kind of a backup in the system that, from your customers. Can we make it so that that's not the focal point of the discussion now that this deal's closed? >> Yeah, Jim, I think we talked a lot about the fact that on the tail end of this supply chain problem, the customers now are sitting on the inventory that we delivered and they're trying to get all that installed. And so they've kind of slowed down their ordering patterns until they get that digested. And, but I think the reality is, is that the transition that we've made to ARR and software and the recurring revenue is not fully appreciated because of that right now. And I think once we get through that, it will be fully appreciated. You got, you're, we're looking at a company now that has over $20 billion in software revenue. 50%, over 50% of our revenue now is coming from recurring offers and almost $29 billion of ARR. So, we think over time it's going to be very positive and we're looking forward to the future. >> Okay, you have the luxury now with Splunk of the Genre of AI that they have, which is immersive chat experience. That's now you. That's one part of the puzzle. I know that Jensen Wong, obviously GTC this week, has his own networking capacity, but somehow you're part of it too. And could you explain how you, which I regard as having a competitor product, are also in video support? >> Well, Jensen approached us as I've talked about it and he basically understands the relationships that we have with our enterprise customers and our understanding of how they deploy applications and how they build their infrastructure. And so he felt like we were the right partner for him to actually take his GPUs, create integrated stacks to help facilitate the simple deployment of advanced AI workloads for our customers. And that's what you're going to see from us over the next three to six months. But if you look at the Splunk acquisition also, we think that same infrastructure now can power some of these data platforms that Splunk built over the years. And as you know, the more data you have, the more powerful your AI capabilities are going to be. And so we think between their data platform and our technologies, we can bring the ability for customers to let the enterprise customer to actually deploy and gain benefit from AI workloads in a very unique way. >> Gary, Chuck referred to threats, obviously, as a result of AI in particular great advancements. I mean, how quickly are things moving in the threat environment? I'm just curious to get your perspective. >> Yeah, I think we're in a pretty difficult time right now. I think the threat actors continue to use advanced technology to design more sophisticated threats, whether they're phishing related threats or other kinds of sophisticated attacks. The good thing is we're the defenders. All of us are leveraging AI in a very constructive way to better defend the enterprise today. >> And so while the stakes get higher, I think we're doing a great job of continuing to defend. >> And finally, Chuck, let me just end sort of again, back to sort of Cisco overall. I was only on Feb 14 when you were talking about coming out of the quarter of guidance. You were cautious. Our customers this quarter, you said, saw more caution than the prior quarter, which led your teams to express more caution in the forecast. Is that still the case a month later? >> Well, we're in the middle of the quarter, but I'd say that the dynamics haven't changed meaningfully. I think the good news is the economy, I talked about this a couple of weeks ago. I think the economy is good. It's not great, it's not bad. I think it's good. And I think that's what's going to be reflected in our customers ordering over the next several quarters as we look forward. >> Right, so unchanged at this point. >> Unchanged, yes, I'd say. >> Guys, thank you both. Chuck Rollins, Gary Steele, both of Cisco. >> We are both in Cisco. >> Yes, we are. >> And very happy to be part of Cisco. >> All right, there you go. Coming up, it's a West Coast edition of Jim's Mad Dash. We're counting down on an opening bell as well, which is about six and a half minutes from now. Stay with us. >> Now is the time to embrace a new wave of workers. Every day, your team grows younger, more digital, and more drawn to entirely new ways of working, which means you need flexible solutions to connect them where business gets done. T-Mobile for business was born digital. With America's largest 5G network, we can make it easier to work together from virtually anywhere. Your team may be changing, but with the right tech, it can be more productive than ever before. Get started at T-Mobile.com/now. >> Our first cross-country mad dash of the week. You want to talk a little hurts is what I've been told. >> Yep, Steve's sure who was very successful, obviously CFO at Goldman Sachs for a long time, and could be no missed three decades there. Then went to hurts a couple of years ago. Had a vision that maybe what he can be doing is trading cars. It's like you're trading stocks. Trading like you're trading bonds. It didn't work. The strategy to be able to make it so you take down him, by the way, the company had put in big orders for EV. The EVs, maybe he was the first cousin to him. You tell me, the EVs appreciated rapidly, which therefore made it so that his fleet of Teslas was worth less than he thought. Maybe he thought the day would go up in value. Anyway, so he's leaving. Gil West is coming in, former COO of Delta, terrific guy. But it is David, frankly, a defeat. It was initially very exciting, but the idea that you could somehow make it so you can trade cars, like you can trade stocks and bonds, did not work, and it was not fun for Steven. That did matter, he was hoping to have a great time. His skill set was not correct in the end. Saw slowing in EVs, moving on. David, it's a shame because I thought Steve was gonna do unbelievably well with this strategy. I, too, did not seem to decline in value of the Teslas that hurt his company so much. Yeah, well, you've talked about it. We have as well, of course. That was a fateful decision to go big in that area, and to your point, when the value's declined in the used car market, that had negative consequences. They've had so many different people run this company over the last 10 years, Jim. Yeah, it's just not work for anybody. Remember, it didn't go bankrupt, but it stayed. The stock continued to trade. David, I think it's just a very tough decision. And because, remember, travel is done well. We've seen cruise ships do very well. American Express obviously doing very well. Hotel change is doing very well. There's an expedient thought, okay, bookings does really well. This did not take part in the great travel resurgence after COVID, and I think that maybe if you had just focused on that, and I don't have training on cars, it might have been fun, but that's not what he went there for. He didn't go there to run a travel company. He went there to do fleet management. That had been a great idea until the fleet depreciated, and then there was just not much of a strategy for him to, let's say, take advantage of. Yeah, the fleet was not managed the way that he'd hoped. No, it didn't quite work out. It was not until we get started with trading, and the sound picks up, and I can barely hear you, I'm sure, when that happens. So, tell me what you think the key to this market is this morning before we get started with the weeks trading. I'm actually gonna go with the alphabet, because I think it was stunning. If it's true, the Bloomberg story true, it makes it so that Apple, which many people thought would fall behind in the race to the next three trillion, right? 'Cause it fell down from Microsoft's three trillion. A lot of people felt that maybe Nvidia could pass it. I think that this says, wait a second. This could be the break that Apple needs, and suddenly, Apple and it is far more relevant than we thought with Gemini, which allowed me with those imposts. Clearly not a bust. Maybe a return use for both. We've got to talk more about some of these problems. (audience cheering) - Elle. - Yeah. (bell ringing) - What a start. (bell ringing) - Listen down here, see, take a look at the, feel it's time to change back it on. Headquarter support, here's the big board. Elf Beauty celebrating the 20th anniversary of its founding. We're gonna be talking to the company's CEO. That'll be in the next hour at the next segment. - David, David, yeah. You gotta ask Trey, I mean, when some short solo went after him, he buried the guy alive. And the guy is just under like a lot of really bad cosmetics. I'm not kidding, he buried the guy alive. And that's because he's a great executive, the stock is to obtain a tenfold. - I'm gonna make sure to talk about it. I'm sure Sarah's gonna have a lot of questions. Over to the NASDAQ, that's Greek based ship owning company C3IS. That's what I'm going with, that's what it says. - Who knows? - Who knows, though, you know. - We have no idea. - All right, no idea. - So where do you wanna start now that we got things open, Jim? - Well, you know what, David, can I just mention this Reddit deal that's coming? Because we don't know who it's gonna be placed with to come tomorrow. It's very exciting to see a whole new cohort of people might come into the stock market, but they are rebels, they're renegades, and they don't like the, a lot of them don't like the big monetization advertising push that Reddit has made. But you know what, David? I find that if you're going to be a public company, you have to try to make money. It's just something I've discovered in 40 years. It's important. You don't see a lot of charities coming public. I don't know if you know that. But Reddit is a company that it's in a crossroads where they gotta make more money. At the same time, they gotta keep the Redditors, and that means they have to keep the people who were, let's say, GameStoppers. Let's hope that that group turns out and owns the stock and doesn't trade it, and then you'll have a very successful deal. But it's not an unimportant IPO, though. Very, I think it's very important because frankly, we keep thinking that we're gonna have a good IPO market when Birkenstock came, and we don't. I mean, Birkenstock just turned out to be like Mattel. You know, it's like Barbie. Jeez. - Well, remember we all got excited? Yeah, Birkenstock and Kava, which actually hung in there, did pretty fairly well. - And David, may I comment that my wife Lisa, we did have a baked canator by a website, Wendy's. My wife has a pair of Birkenstocks. I think they're 30 times the price of my Crocs, but they look exactly the same. - Okay, so you're not a buyer of Birkenstocks, I guess. Is what I'm here for? - No, no, and I'm not really a buyer of Crocs, but I think the fact is, is my Crocs hold up better than Birkenstock or cool than Birkenstock, but, you know what, there's no accounting for taste, David. - That is the case, that is often the case, but Reddit will be an important test, at least, I mean, again, to your point, we have not seen what we thought in terms of the IPOs that, especially given how many companies have been out there waiting for the window to open, how much more open could it be than it is period of time? - I mean, people should be jumping out of the darn thing. David, just in AI alone, the companies that are gonna be speaking at the conference, in video conference, there's gotta be 50 that wanna come public. I mean, unless, didn't change, David, that people feel like if you're in public, it's, I don't know, it's not fun. I mean, come on, don't people wanna make money anymore? What happened to that? - I know, I don't, listen, I don't know. Given the momentum in the market, given where we came from last year, where the windows seemed to be slightly opening at least, and we did get a number of them, are obviously being the most important, perhaps, and certainly a great performer. We've talked about the fact that there are not many shares out, but nonetheless, a great performer. One would have thought we would have seen more, and again, to your point, maybe it's a little early in the gestation for some of these companies that are specific to large language models, generative AI, things of that nature, but there are plenty of other SaaS companies out there, Jim, that have been waiting. - Right, and that's why Birkenstock Arm, we've gotta get something going, and I'm hoping that Reddit gets people excited again. Right now, it's just once again, people want that 5%. We didn't mention the Fed yet, okay, the Fed. Now let's go back to Nvidia for a second. Nvidia's got a lot of part, you heard Chuck Robbins, I mean, everyone wants the halo of Jensen One. Everyone wants to be associated with it, in part because it's been such a great performer. However, there are already naysayers, David. I am hearing people, including people in our network, we're saying this marks the peak. We've got the Fed talking tough, we're gonna be finished with GTC, we're done with AI, I don't know, how can you say it marks the peak if you're talking about a multi-year transition from CPU to GPU? But I know short-termers are saying that this is the peak this week. I'm hearing it, I'm hearing from a lot of people. - There are, but there are also plenty who say that we are just at the very, very beginning, and the amount of compute power that we're going to need is staggering, and I've talked often, frankly, about one of the gating issues, not even being the chips themselves, but the power that is going to be needed to actually have these data centers operating at full capacity, which is not there. - I'm so glad you mentioned, do you know that? - We have the great a bit more button, there haven't been more electricity used for many decades. Suddenly we're having a 5% increase over last year, 'cause of data centers. Next year, pork has to be 5%. We're gonna need solar, we're gonna be needing wind. New guy, you think you and I both know, is terrific, but it's not gonna happen. But we are the need so much generation that the natural gas business, which right now natural gas is very cheap, is gonna go into high gear, which is why I keep saying this for Nova, is very interesting, this GE spinoff, that we have in April. I think for Nova could be interesting, and I thought it would be a loser. But the need for power, as you correctly point out, is just humongous, and I know that Jensen's gonna be talking about how much heat these generate, they obviously generate less heat than you think. But wow, David, this data center move is making so our electric grid is being taxed severely, and no one's talking about it except for you. >> Yeah, you know, I just, I had some interesting conversations as I think I'd said with those who are in the data center business, and that's what struck me was that that's the key issue. And again, it doesn't mean we're gonna be having blackouts or anything of that nature. It simply means that if you wanna put shovels in the ground for the next data center, you've gotta make sure you have a secure supply of power, and that may really begin to be an issue. We've discussed that we were continuing to get to it. >> Well, that's why I'm getting a prologist tonight. They have $500 million in data center. >> A lot of these utilities and whatnot went up. The stock prices went up a lot as though it says years to come in terms of being able to build the capacity that's needed. I mean, was that a justified move in many of those days? >> No, no, not a justified move, because these companies have to find a lot of way. They have to finance, and obviously rates went up. The stocks are not great buys, I think Semper is, Semper's got a lot of very good natural gas. But yeah, David, the country isn't ready for it. Eaton had a meeting last week as a home, but I'm not a terrible trust. They're one of these companies that is done with trying to get the electrification grid going. The federal government, obviously, spending a lot of money on this, too. But we're not ready, we're not ready for the demand, and it is gonna be something to see where they put all the data centers, 'cause they gotta go where the power's cheapest. And right now, there's a hunt. One of the reasons why I wanna talk to prologists, they have 12,000 acres, ready to put new data centers on. It may be the most important thing, look at that, that's not something worse. That's all data center. You're looking at a data center play. Vertev, by the way, is the one that you and I know, Dave Cody, the chairman of Vertev is the pure play in terms of what's in the data center, and wow. And then don't forget Super Micro, out into the S&P. I mean, there's a good chart. Super Micro's got a chart. >> Look at that. It all comes back to, of course, NVIDIA in some ways. Dell is another name, right? I mean, you're in different things about just how profitable they are. Servers that go into the data center that have the NVIDIA chips are. But it helps, boy. I mean, look at the move that that stock had after earnings, because they have access to the key here, which of course is those H100s. >> Well, David, do you hear bubble? Do you hear people talk bubble? >> Well, yeah, you hear it, you hear it, Jim, but I don't know that the comparisons are appropriate. >> I don't think they are. >> The bubble that you and I both live through, I reported through it, you invested through it in the late '90s. So this is very different. >> Now, I mean, Michael Dell, as you know, an incredibly serious business person, is making a fortune doing the, a little bit attenuated part of AI. NVIDIA is able to charge what it can do because it's basically a monopoly. But it works. The total cost of ownership is not that bad. It's kind of like a, you got to think of it like a car. It performs very well after you buy it. But when you buy it initially, it's expensive. I just think, David, these companies are making fortunes. And that's why they're stock. Well, AMD is making fortunes. That's why AMD's chart, if there was no NVIDIA, you'd say AMD is the greatest stock in history. But we have just many, many companies that are making fortunes in this business. And are, I'm going to use the word that, I'm just going to use it, indispensable. These companies are indispensable. >> Yeah, even though AMD is no match for NVIDIA when it comes to actually powering accelerated computing, essentially. >> Well, AMD doesn't have the data. It doesn't have the, what you need to learn from. So, therefore, it doesn't have the inference where you, you ask it something and it comes back with an answer. But it is a chip that's incredibly fast. And so, I don't want to say that Lisa's who doesn't have something in the game. It's just that you need all the data already in before you can start asking it. And NVIDIA's got just tremendous data. They have, you know, the large learning models are smart. And they know things. And they've combed the web and you want to just plug in your questions. You don't want to wait around. >> Jim, I want to come back to really what is the, you know, we've mentioned a number of times, but it's the story powering two of the largest market cap companies. And that is this Bloomberg story again. Alphabet shares are up almost 7%. Now remember, there's a decent amount of people who are short this stock in part because of the story we've been discussing, which is will they move quickly enough to defend search as it changes from the Google search to what will become the new search, which is you just go to a large language model and use that, whether it's chat GPT or Gemini, which of course is their entrant or co-pilot or perplexity, which actually allows you to use all of them. Perplexity is sort of almost like this Google floor or large language models. It is possible, isn't it, Jim? You know, again, it's early reporting here from, it would seem to a certain extent from Bloomberg and I'm just guessing, but it is possible that isn't it that Apple could be using all of them, right? I mean, do you have to sign up an exclusive deal? >> That's a great question. >> Which is Gemini? >> That's a great question. I don't know. They do need to have something quickly. I think the Gemini is good. I mean, yes, you can make deals with everybody, but Gemini is good. I just think the problem with Gemini is that what you said, which is it's gonna take away from the ad revenue from search. When I think about Google these days, I was always just hoping that maybe YouTube would take up the vacuum and Google Cloud would take up the vacuum. I think your search has to go down because of all these new different systems, but this makes their search and their AI supreme again. David, this is huge. I mean, my channel just owns it and we have just been lamenting alphabet for months. Well, no lamentation today. >> Yeah, although again, I would caution. Early, nothing says this is going to happen. We've made the point many times when it comes to Apple, they don't have to be first. They got 1.2 billion people in their system. They oftentimes are not necessarily. It's just they have a better user experience than anybody else, and that typically wins the day. At least certainly when you have 1.2 billion installed base, with touching 2 billion people. Remember, you got this great service revenue stream. Tim Cook has always said, look, we are a tech company first with a consumer that loves us and is very satisfied. You don't get that satisfaction, which is almost 100% satisfaction, by offering an inferior product. But again, I keep going back to the Best Buy conference call where they just shocked me and said, "Look, the Samsung phone is the hottest phone." And the Samsung phone has a lot of AI. Yeah, I know you've mentioned it any number of times. Did I pour you with it? I mean, what the hell, I was the only person on the phone. No, I don't have one. I don't know. I haven't used it. I was on the Dick's call. That was a good call. You want to talk about that in Powell? That great move under armor? You want to take the hotelier and you can't her and bring back the shoe guy? No, I mean, I could talk about a lot of companies. What would you like to talk about? (laughing) I don't know. You want to talk a little Disney so we can do a point counterpoint on that too? Well, sure. I mean, Jim Stewart with a very big piece in the New York Times that I think concludes, if you get to the end, that maybe Nelson would be valuable. David, kind of a knock that positive article in the Wall Street Journal about Nelson. No, but competing articles over the weekend, very interesting in the timing. As you say, one quite positive I would argue overall in terms of Nelson Pouts. And then the Journal focusing more on the internal going on at Cheyenne itself. I was surprised the Times did not have any mention of Ed Garden, of course, who helped run that firm for many years. Certainly the author of, or at least behind many of the white papers, no mention at all in the New York Times story, but the Journal spent a good amount of time on it. The news this morning, Jim, is that these proxy advisory firms often do play an important role here. They advise many of the passive investors, namely the index funds, at least on how they should vote their shares. We do have one in so far that I'm aware of, which is Glass Lewis. That goes for Disney. Got it here, I think, in terms of their recommendation. And they will, ISS, I haven't seen yet. That's still to come. Both sides have been busy in meetings as I pointed out last week. Of course, Bob Iger making the rounds in Boston and Baltimore, and wherever the big institutions are, making their case in terms of why Pouts and Resilience should not be on the board. Well look, I do think that on the one hand you've got a stock that is going down substantially, and it's just been miserable of which some of that was higher. On the other hand, you've got a stock that's been red hot and maybe that's Pouts, maybe that's this competition. But if Nelson's going to be defeated, he'll be defeated by the stock price being up so much. Because people just say, hey, listen, it's fine. Maybe they've gotten more focused. I come back, David, and you say that the white paper that Nelson Pouts put out is really about how the board is dysfunctional, not how the company's dysfunctional. And the board seems to have so many powerful, fantastic people. It is a little surprising that they were really bad at succession. It is surprising that they were bad at guidance of the CEO. And I think there's this misperception that if you're on the board, it's supposed to run the company. Nelson doesn't run the company. He wants the board to be more focused on costs on what they produce. But look at that board. It's like, how can they have so many great people and not be more thoughtful? Well, there's arguments to be made. Obviously, they are in the midst of a seminal transition in the industry, of which they're a part we've talked about it many times. It's easy enough to say you could have done this or that. But it's not-- It's the point. When you do compare them to some of their competitors who've been similarly involved in that transition, they look better by comparison. Obviously, they have the parks to help fuel it. But not these years ago. When it comes to succession, there's no argument to be made there. They screwed it up. I know. Period. You have Jimmy Pitaro. The guy who runs ESPN, he's a smart guy. And what are the smart guys I've never met? He's a terrific guy. David, ESPN, they lost so many subscribers. I mean, it's a little bit like the Dutch boy with the dyke. And yet, they're very thoughtful about what they do. Pitaro's a really good piece about it. I mean, really smart guy. But you know what? The industry is in top industry right now. You're absolutely right. And thank heavens for theme parks. Thank you. Listen, ESPN still generates $2.8 billion in operating profit. And they're a very good company. Obviously, it's a cable network. And there are far fewer people out there available to watch. Those that are watch us, of course. Of course. They watch us on Reddit. Oh, no, no, Reddit. No, they don't. They're not on Reddit. All right, we'll figure out Reddit. While we do that, let's give you a quick look at the bond market this morning. We call it the bond report. It's when we check out how surgeries are bearing and what the yields are. You can see right now, we are up across the board with that 10-year at 4.316. The two-year note yielding 4.73. We're right back. All right, let's get to it. Things have finally quieted a bit here, Jim. PepsiCo is the name you want to talk about? Yeah, up almost 3% on an upgrade by a thaw. There's more than one Darrow Wall Street. Darrow Moscenian, who's really one of the best analysts who covers this consumer package. Good group, Morgan Stanley. And it's a very cogent upgrade. This is a man who said, look, this company's slowing down. It's going to miss his targets. Guts, you think, because Ray Mullen-McGarden doesn't miss targets. He's the CEO. Well, he did. And now, Darrow comes back and say, it's bottoming. It's about to inflect. I really like this call. The only reservation I have is that he really doesn't address the GLP-1. We haven't talked about Lilly at all today or Novo. He's saying, you know, he's basically saying, look, this thing is so cheap and it's going to come back. I like the call, but I also want to keep one eye always on what people are doing with the Olympics and the Majoros and the Zepbounds. Yeah, all right, what does that tell you of late? Anything new on the old GLP-1 front? We actually can talk about Eli Lilly or Novo this morning. No, I think there are people who are just saying, all right, let's see how big the numbers are. Now, we're cutting this backlash. Small companies that are picking away at some of what these companies might or may not be able to accomplish. I say use any weakness by Eli Lilly. It's a core position for travel trust and I think it goes much harder. You do. Yeah, because I think that hypertension and heart attacks have been preventable. Well, you didn't even mention? You didn't even mention Alzheimer's. Well, I was disappointed that Lilly didn't get it. It's all Alzheimer's review. And then it's going to be a full bore of you. And I don't think they thought that would happen either. Let's see what's put with it. That's going to be a very big drug. But people are very concerned how much it's going to cost the system. But I thought that they are ready. And I was disappointed. There's no doubt about it. I'm not going to change my mind. That was just not great. Yeah, but it's not as so it was cast aside. It's just going to take longer. They're giving it a little more. Right. It's just that there was a lot of talk that would be done by this quarter. And a lot of people-- the work I do at the American Brain Foundation, everybody I talked to thought that this was a gimme. And not Lilly's fault. Lilly was never promotional. But let's watch. You're absolutely right. It's not going to sidetrack it. It's going to happen. All right. What do you got on the big show tonight from one market? Our headquarters out in San Fran. OK. First, I've got prologists. And again, they're just a gigantic warehouse company. But they have been focused very much on data center. Let's find out how much power they use. David Crowdstrike is now the acknowledged king of cybersecurity. We heard what Chuck Robbins was talking about with Gary Steele. These are the guys that are doing the best. 30% revenue growth for as far as the eye can see. It's a big company now. And on semi, which is a company that's stumbled, why? Because it's really related to auto. But it's got a solar business that I'm interested in. Because it converts solar energy into regular energy for electricity. And again, David, you're-- I think you're focused on what's going to happen to the grid and 5% increase in the amount of power we need year after year. We're just not ready for this country. Yeah, well, a story we'll continue to discuss. Jim, have a great rest of the day. Thank you. I'll see you tomorrow morning. But of course, you'll see everybody else on Mad Monday tonight coming up right here. Thank you. In the next hour, ExxonMobil CEO Darren Woods, he's live from Sarah a week, more Squawk on the Street, straight ahead. 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