Your questions answered Vol 2 - IM Private Clients
Discussion
Hi All,
Nvidia report after hours tonight. Expectation is for $8.1B and $1.29 eps. Gross margin expectations are circa 65%. A lot has been in play for Nvidia in a good way this quarter so I expect the results to be strong. I would expect them to beat expectations on all fronts. As to guidance it's difficult to say but the demand drivers are very strong so I would expect solid guidance of +8% over this quarter which represents around 40% y/y. Inflation should be relatively muted for the business.
I know Meta just signed a huge Azure deal (this week) to run their AI research which utilises and entire cluster of 5400 NVDA Ampere 100 GPUs-a big win for Msft and another win for Nvidia. This on top of Meta building a new Super Computer using Nvidia GPUs . 16,000 in total when finished at a cost of 150k each.
I will update with actuals/highlights later.
Cheers
AIM
Nvidia report after hours tonight. Expectation is for $8.1B and $1.29 eps. Gross margin expectations are circa 65%. A lot has been in play for Nvidia in a good way this quarter so I expect the results to be strong. I would expect them to beat expectations on all fronts. As to guidance it's difficult to say but the demand drivers are very strong so I would expect solid guidance of +8% over this quarter which represents around 40% y/y. Inflation should be relatively muted for the business.
I know Meta just signed a huge Azure deal (this week) to run their AI research which utilises and entire cluster of 5400 NVDA Ampere 100 GPUs-a big win for Msft and another win for Nvidia. This on top of Meta building a new Super Computer using Nvidia GPUs . 16,000 in total when finished at a cost of 150k each.
I will update with actuals/highlights later.
Cheers
AIM
Everyone is getting ready for more important things with British GT at Donington Park this weekend and Intelligent Money Racing live streamed at Croft on Sunday afternoon. 
- https://youtu.be/WKXsepIxX7g
- https://youtu.be/WKXsepIxX7gSteve H said:
Everyone is getting ready for more important things with British GT at Donington Park this weekend and Intelligent Money Racing live streamed at Croft on Sunday afternoon. - https://youtu.be/WKXsepIxX7g
Yes I think so - https://youtu.be/WKXsepIxX7g
Shame about this clash, I would have liked to gone to Croft but I will be going to Donington and very excited.
That trailer is very impressive.
Nvidia reported excellent results, exceeding expectations on both top and bottom lines. 8.1B expected/8.3B delivered and $1.36 eps. Guidance was cautious ($8.1B) due to an expected $100M revenue hit from Russia (immaterial) and $400M in gaming due to logistics issues intra China, due to Covid lockdowns. This is a timing, rather than a permanent impairment to this business segment. The market reacted to this point(off 5%).
My thoughts are, here is a business which grew 46% y/y, is still constrained by semiconductor bottlenecks and is trading at a Fwd multiple of almost half its growth rate.
Data Centre revenue is now their number 1 segment and for good reason. And I wanted to point out that this segment didn't exist 2.5 years ago. They generated a mere 1.6B in total 2019 data centre revenues, $2.05 in 2020 and 3.7B in 2021 (fiscal). As you can see they just reported $3.7B for 1 quarter and it's not slowing down. Nvidia own 90% of this market and it's anticipated to be worth $26B annually by 2026.
If you look at Automotive, a small segment ($136M) today. This segment covers automated drive systems for cars and robots. Nvidia has signed contracts with 35 of the biggest car and robotics OEMs who will utilise their DRIVE O-RAN processor, described as revolutionary. The current value of these contracts is $11B. This product will start shipping next quarter and will find its way into warehouses controlling stock, last mile delivery and autonomous cars. Nvidia is the biggest vehicle autonomy system vendor and their tech is ahead of Tesla. This is a huge market which will start producing material revenues imminently.
Professional Visualisation is essentially machines that can see. This segment includes medical equipment that can look for cancers, farm equipment that can observe diseased crops or ready to harvest, cars that can drive and robots that can navigate their environment. Tesco are trailing this tech in their stores whereby the customer just adds products to their basket and leaves the premises. The cameras tally the cost.
The CFO noted that margins are increasing over time due to the additional software element in their product mix. Margin is fundamental to driving earnings growth.
Large Language Models, not just human spoken language but teaching computers, Chemistry and physics is driving new drug discovery. This was key in the accelerated time to market of Covid vaccines. Nvidia lead the space and co developed the biggest Natural Language Processor 'Megatron' with Microsoft.
Of all the businesses we invest in, I am most excited about Nvidia. I think their technology will change the way we live in fundamental ways and their breadth of offerings is unmatched given they also own the software that runs it. Here is a business with several multi billion$ emerging markets which all the evidence suggests they will dominate.
A quick takeaway on how disinformation is created across all industries. Nvidia is the undisputed leader in AI chips. Its A100 (Ampere) chip is inside 90% of machine learning computers. Last week Intel had a press release regarding its Gaudi2 chip exceeding Ampere (the new King). The article failed to mention that Intel hasn't produced any chips and hopes to do so later this year. However there was a slew of analyst reports stating Intel will challenge Nvidia. The A100 chip is a 2020 product, it's excellent but old tech. Nvidia is about to release their H100 (Hopper) chip which is vastly superior to their A100 chip. Intel is years behind as are AMD.
My thoughts are, here is a business which grew 46% y/y, is still constrained by semiconductor bottlenecks and is trading at a Fwd multiple of almost half its growth rate.
Data Centre revenue is now their number 1 segment and for good reason. And I wanted to point out that this segment didn't exist 2.5 years ago. They generated a mere 1.6B in total 2019 data centre revenues, $2.05 in 2020 and 3.7B in 2021 (fiscal). As you can see they just reported $3.7B for 1 quarter and it's not slowing down. Nvidia own 90% of this market and it's anticipated to be worth $26B annually by 2026.
If you look at Automotive, a small segment ($136M) today. This segment covers automated drive systems for cars and robots. Nvidia has signed contracts with 35 of the biggest car and robotics OEMs who will utilise their DRIVE O-RAN processor, described as revolutionary. The current value of these contracts is $11B. This product will start shipping next quarter and will find its way into warehouses controlling stock, last mile delivery and autonomous cars. Nvidia is the biggest vehicle autonomy system vendor and their tech is ahead of Tesla. This is a huge market which will start producing material revenues imminently.
Professional Visualisation is essentially machines that can see. This segment includes medical equipment that can look for cancers, farm equipment that can observe diseased crops or ready to harvest, cars that can drive and robots that can navigate their environment. Tesco are trailing this tech in their stores whereby the customer just adds products to their basket and leaves the premises. The cameras tally the cost.
The CFO noted that margins are increasing over time due to the additional software element in their product mix. Margin is fundamental to driving earnings growth.
Large Language Models, not just human spoken language but teaching computers, Chemistry and physics is driving new drug discovery. This was key in the accelerated time to market of Covid vaccines. Nvidia lead the space and co developed the biggest Natural Language Processor 'Megatron' with Microsoft.
Of all the businesses we invest in, I am most excited about Nvidia. I think their technology will change the way we live in fundamental ways and their breadth of offerings is unmatched given they also own the software that runs it. Here is a business with several multi billion$ emerging markets which all the evidence suggests they will dominate.
A quick takeaway on how disinformation is created across all industries. Nvidia is the undisputed leader in AI chips. Its A100 (Ampere) chip is inside 90% of machine learning computers. Last week Intel had a press release regarding its Gaudi2 chip exceeding Ampere (the new King). The article failed to mention that Intel hasn't produced any chips and hopes to do so later this year. However there was a slew of analyst reports stating Intel will challenge Nvidia. The A100 chip is a 2020 product, it's excellent but old tech. Nvidia is about to release their H100 (Hopper) chip which is vastly superior to their A100 chip. Intel is years behind as are AMD.
Edited by AdamIM on Thursday 26th May 10:32
If it's of interest, here is a video which illustrates a valuable use case for Nvidia Omniverse. In this case it is a digital simulation/design of a real world scenario which drives efficiency. You will hear the narrator talk about NL models. These are the proprietary models created by Nvidia which enable super computers to learn 'language', in this case physics. Omniverse is synonymous with the Metaverse. It is very new but has already been adopted by BMW to create digital twins of their factories and train their digital robots for new tasks which once learned, the software is loaded to the physical machine in the real factory, ericsson for 5G tower placement, Bentley systems for road design and Amazon to drive logistics efficiency. Endless possibilities.
https://youtu.be/XcHi6vKYb9o?t=549
https://youtu.be/XcHi6vKYb9o?t=549
It’s interesting watching that omniverse video.
Nvidia are clearly shooting for being the aggregator and processor for industry.
Ie, every architect, mech engineer, surveyor, civil engineer, structural engineer, blah blah, will all just pay to use omniverse and process on their gear.
They’ll usurp autodesk in this process I’d assume.
Smaller software teams may even find themselves become superfluous to need if everyone just starts using Nvidia.
But the competition is going to be very high in the coming years.
Nvidia won’t create new value, as the video notes a bit, all this stuff already happens.
They will charge an overall premium vs their efficiency gains, so the cost/speed/quality triangle isn’t going to get an overall boost.
So nvidia might steal from autodesk on the software front.
Nvidia software/omniverse might take away from their own professional hardware sales.
Epic games might take away from Adobe.
My take away is that nvidia will have to fight and win all its battles to get where it wants to be, which is likely what it’s projections are based on.
Out of interest are Nvidia investing in their own production facilities in Western countries?
I know TSMC produce vast amounts of chips… yet China talking about Taiwan a great deal makes me wonder if there is a risk factor there in the short and medium term?
Nvidia are clearly shooting for being the aggregator and processor for industry.
Ie, every architect, mech engineer, surveyor, civil engineer, structural engineer, blah blah, will all just pay to use omniverse and process on their gear.
They’ll usurp autodesk in this process I’d assume.
Smaller software teams may even find themselves become superfluous to need if everyone just starts using Nvidia.
But the competition is going to be very high in the coming years.
Nvidia won’t create new value, as the video notes a bit, all this stuff already happens.
They will charge an overall premium vs their efficiency gains, so the cost/speed/quality triangle isn’t going to get an overall boost.
So nvidia might steal from autodesk on the software front.
Nvidia software/omniverse might take away from their own professional hardware sales.
Epic games might take away from Adobe.
My take away is that nvidia will have to fight and win all its battles to get where it wants to be, which is likely what it’s projections are based on.
Out of interest are Nvidia investing in their own production facilities in Western countries?
I know TSMC produce vast amounts of chips… yet China talking about Taiwan a great deal makes me wonder if there is a risk factor there in the short and medium term?
Mr Whippy said:
Out of interest are Nvidia investing in their own production facilities in Western countries?
I know TSMC produce vast amounts of chips… yet China talking about Taiwan a great deal makes me wonder if there is a risk factor there in the short and medium term?
China has been limbering up to take Taiwan for some time, and has no doubt been watching closely how the West responded to Russia vs. Ukraine. China is a bit brighter than Russia.I know TSMC produce vast amounts of chips… yet China talking about Taiwan a great deal makes me wonder if there is a risk factor there in the short and medium term?
If I was Nvidia I'd be hastily building factories somewhere safe.
Mr Whippy said:
It’s interesting watching that omniverse video.
Nvidia are clearly shooting for being the aggregator and processor for industry.
Ie, every architect, mech engineer, surveyor, civil engineer, structural engineer, blah blah, will all just pay to use omniverse and process on their gear.
They’ll usurp autodesk in this process I’d assume.
Smaller software teams may even find themselves become superfluous to need if everyone just starts using Nvidia.
But the competition is going to be very high in the coming years.
Nvidia won’t create new value, as the video notes a bit, all this stuff already happens.
They will charge an overall premium vs their efficiency gains, so the cost/speed/quality triangle isn’t going to get an overall boost.
So nvidia might steal from autodesk on the software front.
Nvidia software/omniverse might take away from their own professional hardware sales.
Epic games might take away from Adobe.
My take away is that nvidia will have to fight and win all its battles to get where it wants to be, which is likely what it’s projections are based on.
Out of interest are Nvidia investing in their own production facilities in Western countries?
I know TSMC produce vast amounts of chips… yet China talking about Taiwan a great deal makes me wonder if there is a risk factor there in the short and medium term?
Did we watch the same video?Nvidia are clearly shooting for being the aggregator and processor for industry.
Ie, every architect, mech engineer, surveyor, civil engineer, structural engineer, blah blah, will all just pay to use omniverse and process on their gear.
They’ll usurp autodesk in this process I’d assume.
Smaller software teams may even find themselves become superfluous to need if everyone just starts using Nvidia.
But the competition is going to be very high in the coming years.
Nvidia won’t create new value, as the video notes a bit, all this stuff already happens.
They will charge an overall premium vs their efficiency gains, so the cost/speed/quality triangle isn’t going to get an overall boost.
So nvidia might steal from autodesk on the software front.
Nvidia software/omniverse might take away from their own professional hardware sales.
Epic games might take away from Adobe.
My take away is that nvidia will have to fight and win all its battles to get where it wants to be, which is likely what it’s projections are based on.
Out of interest are Nvidia investing in their own production facilities in Western countries?
I know TSMC produce vast amounts of chips… yet China talking about Taiwan a great deal makes me wonder if there is a risk factor there in the short and medium term?
Ominverse is a simulation and machine learning tool. Autodesk is just design software which has partnered with Omniverse. You design a car in Autodesk. Omniverse brings it to life.
Epic Games is a billion dollar losing private company cf Adobe is a highly profitable software multinational.
Nvidia is fabless and uses TSMC, yes. They are the only foundry that can manufacture at 5nm nodes(and soon 3nm). Is China a risk. I don't think so. Well not enough to avoid investing. Taiwan Semi produce 90% of the worlds next gen chips and supply the US Military as well who won't tolerate their tech being taken by a foreign country
. They have fabrication facilities all over the World.Good afternoon all
So, we are starting to see signs of a bit more positivity in the markets, particularly in the UK. PHE is still suffering, but signs of a return there showing through and as Adam has mentioned, the damaged stocks are the ones that historically bounce back the quickest. It doesn't heal the pain now, but this it is just part of the process of market cycles.
On a lighter note, I am looking forward to seeing everyone here who is going to Donny this weekend. I'll be there tomorrow morning for the TV interview and then in the garages and the VIP before the race kicks off.
For anyone without Sky Sports F1, live streaming can be found at www.britishgt.com so tune in if you get the chance!
Cheers
Julian
So, we are starting to see signs of a bit more positivity in the markets, particularly in the UK. PHE is still suffering, but signs of a return there showing through and as Adam has mentioned, the damaged stocks are the ones that historically bounce back the quickest. It doesn't heal the pain now, but this it is just part of the process of market cycles.
On a lighter note, I am looking forward to seeing everyone here who is going to Donny this weekend. I'll be there tomorrow morning for the TV interview and then in the garages and the VIP before the race kicks off.
For anyone without Sky Sports F1, live streaming can be found at www.britishgt.com so tune in if you get the chance!
Cheers
Julian
JulianPH said:
Good afternoon all
So, we are starting to see signs of a bit more positivity in the markets, particularly in the UK. PHE is still suffering, but signs of a return there showing through and as Adam has mentioned, the damaged stocks are the ones that historically bounce back the quickest. It doesn't heal the pain now, but this it is just part of the process of market cycles.
On a lighter note, I am looking forward to seeing everyone here who is going to Donny this weekend. I'll be there tomorrow morning for the TV interview and then in the garages and the VIP before the race kicks off.
For anyone without Sky Sports F1, live streaming can be found at www.britishgt.com so tune in if you get the chance!
Cheers
Julian
I did a recce today and I can confirm the coffee machine in the SRO tent is working So, we are starting to see signs of a bit more positivity in the markets, particularly in the UK. PHE is still suffering, but signs of a return there showing through and as Adam has mentioned, the damaged stocks are the ones that historically bounce back the quickest. It doesn't heal the pain now, but this it is just part of the process of market cycles.
On a lighter note, I am looking forward to seeing everyone here who is going to Donny this weekend. I'll be there tomorrow morning for the TV interview and then in the garages and the VIP before the race kicks off.
For anyone without Sky Sports F1, live streaming can be found at www.britishgt.com so tune in if you get the chance!
Cheers
Julian
JulianPH said:
Good afternoon all
So, we are starting to see signs of a bit more positivity in the markets, particularly in the UK. PHE is still suffering, but signs of a return there showing through and as Adam has mentioned, the damaged stocks are the ones that historically bounce back the quickest. It doesn't heal the pain now, but this it is just part of the process of market cycles.
On a lighter note, I am looking forward to seeing everyone here who is going to Donny this weekend. I'll be there tomorrow morning for the TV interview and then in the garages and the VIP before the race kicks off.
For anyone without Sky Sports F1, live streaming can be found at www.britishgt.com so tune in if you get the chance!
Cheers
Julian
Thank you for the tickets So, we are starting to see signs of a bit more positivity in the markets, particularly in the UK. PHE is still suffering, but signs of a return there showing through and as Adam has mentioned, the damaged stocks are the ones that historically bounce back the quickest. It doesn't heal the pain now, but this it is just part of the process of market cycles.
On a lighter note, I am looking forward to seeing everyone here who is going to Donny this weekend. I'll be there tomorrow morning for the TV interview and then in the garages and the VIP before the race kicks off.
For anyone without Sky Sports F1, live streaming can be found at www.britishgt.com so tune in if you get the chance!
Cheers
Julian
This is very exciting for me. My first time at Donington. Hopefully it is dry for the parking.
But it would make it very interesting if it's wet for part of the race.
leef44 said:
Thank you for the tickets
This is very exciting for me. My first time at Donington. Hopefully it is dry for the parking.
But it would make it very interesting if it's wet for part of the race.
Tou are more than welcome!This is very exciting for me. My first time at Donington. Hopefully it is dry for the parking.
But it would make it very interesting if it's wet for part of the race.
Donington is a great track, I was on it a few weeks ago with Steve doing testing in the IM Racing Porsche.
The forecast is currently dry for tomorrow...
Looking dry for IM Racing at Croft as well but maybe the chance of a shower or two which should liven things up. Two hour race starts at 15.25 if they are on schedule!
Live stream at https://youtu.be/WKXsepIxX7g
Live stream at https://youtu.be/WKXsepIxX7g
Steve H said:
Looking dry for IM Racing at Croft as well but maybe the chance of a shower or two which should liven things up. Two hour race starts at 15.25 if they are on schedule!
Live stream at https://youtu.be/WKXsepIxX7g
I won't wish you good luck Steve, as you don't need it! I wish I could be at both but Donington has the advantage of being right next door to an airport!Live stream at https://youtu.be/WKXsepIxX7g
Luckily, we start at Croft when the GT finishes, so anyone wanting a double fix just has to change live stream!
JulianPH said:
leef44 said:
Thank you for the tickets
This is very exciting for me. My first time at Donington. Hopefully it is dry for the parking.
But it would make it very interesting if it's wet for part of the race.
Tou are more than welcome!This is very exciting for me. My first time at Donington. Hopefully it is dry for the parking.
But it would make it very interesting if it's wet for part of the race.
Donington is a great track, I was on it a few weeks ago with Steve doing testing in the IM Racing Porsche.
The forecast is currently dry for tomorrow...
Too much fun packed in one day. Brilliant hospitality. Thank you so much for a wonderful experience.
The track is great, so many viewing points up close. And such intense racing.
leef44 said:
It was a great day. Lovely to finally meet Nik in person. Sorry I didn't get to see you.
Too much fun packed in one day. Brilliant hospitality. Thank you so much for a wonderful experience.
The track is great, so many viewing points up close. And such intense racing.
I am very glad you enjoyed it!Too much fun packed in one day. Brilliant hospitality. Thank you so much for a wonderful experience.
The track is great, so many viewing points up close. And such intense racing.
Sorry we didn't get to meet up. I was all over the place and then had to get my flight back to Portugal with my wife and daughter - the first time they have been and they loved it!
leef44 said:
It was a great day. Lovely to finally meet Nik in person. Sorry I didn't get to see you.
Too much fun packed in one day. Brilliant hospitality. Thank you so much for a wonderful experience.
The track is great, so many viewing points up close. And such intense racing.
I'll happily second every word of that. Thank you to Nik and the rest of the IM team as it was indeed a cracking day! Too much fun packed in one day. Brilliant hospitality. Thank you so much for a wonderful experience.
The track is great, so many viewing points up close. And such intense racing.
(Leef44, I've seen your name on PH several times; if I'd known you were there as well then I'd have introduced myself! Good to hear that you had a good day as well.)
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