Things Asa Says on Podcasts

you? No, it doesn't sound crazy. I mean, it could be a good bet. You know, a lot of these companies were, you know, are doing pretty well in the end and will continue to have assets that have value. And even if those assets have to be sold off. Now, of course, one thing that's kind of a question mark over all of this is this notion that NVIDIA wants to promote that the GPUs, the chips are especially commodities. I mean, Jensen Huang, CEO of NVIDIA, has like repeatedly talked about how these chips are quote-unquote fungible, you know, almost as if they're a currency that you can just exchange from one thing to the next. That is to some degree true. You know, especially if you're talking about just NVIDIA's chips moving from one place to another, one owner to another. It's not always the case, though, because you have setups like Google's TPUs, for example. Sorry, what's a TPU?

Well, I think that one of the takeaways here is that capital is king, right? I mean, the capital window is wide open. People can raise money. I mean, Anthropic can, at least, they hope. They're hoping to raise up to $100 billion in this IPO. So what matters now for these companies like Core Weeve, like Anthropic, like others, is capital. And if you look at other players like Meta platforms, wants to, you know, they're raising $35 billion in equity at the moment, and they plan to raise another $60 billion through at the market transactions, meaning basically they just issue stock at different times strategically. You know, this is a lot of money.

I wrote a piece not too long ago saying essentially that NVIDIA needs Core Weave, and they do. I mean, NVIDIA is selling chips to a lot of customers that want to compete with it. You know, its main customers are Google, Microsoft, of course, Meta. But all of these companies have programs where they're making their own AI chips. You know, NVIDIA has a gross margin of greater than 70%. If you're NVIDIA's customer and you're paying this huge margin and you're a huge tech company with a lot of resources, you would be insane not to try to develop your own chips and save some money, especially when people are deploying AI Trade and inference at the scale they're doing it at. So NVIDIA kind of sees a future, I think, where it could be a little bit in trouble if everybody kind of does their own stuff. So they need an outlet where, you know, they have companies to sell to that aren't trying to replace them. And Core Weave for NVIDIA is really the primary outlet for exactly that.