New Record Highs, Nvidia Joins the $2T Club, Slide and a Miss for Warner Bros. Discovery 2/23/24

Carl Quintanilla (0:00)

Market Moving Insight and Analysis join Jim Cramer, David Faber and me, Carl Quintanilla, on the opening bell hour of CNBC Squawk on the Street.

Good Friday morning. Welcome to Squawk on the Street. I'm Carl Quintanilla with Jim Cramer at Post 9 of the New York Stock Exchange. David Faber has the morning off. We put this barn burner of a week to bed today, coming off the S&P's best day in more than a year post-NVIDIA. Yields are a bit elevated as both JP Morgan and Goldman make some hawkish adjustments to their rate forecast. Our roadmap begins with Nvidia versus the Fed. Stocks riding Nvidia's coattails, while Fed officials yesterday signaled no rush to cut rates. Block shares are surging ahead of the open. Company reports a surprise profit, some strong revenue growth, and Warner Bros. Discovery today turning a full year streaming profit, the first of any studio to do it, but sees some continued ad headwinds and shrinking North American subs.

Let's begin with the markets, though, after that Nvidia-fueled rally. Jim, I think we're gonna flirt with two trillion today, which would be the first for a chip maker.

Jim Cramer (0:57)

Right, I mean, it's interesting that the stock can continue to climb here because you really did get the full story. There was nothing new that came out overnight.

I think that what's happening is a belief, Carl, that the idea that everything's overblown, the idea that there is nothing to AI, or if it's AI, then it's literally just something that we talk about to add to your, the draws added to Intuit's conference call, so we'll use that for today. And we're discovering, no, it's actually substantive, and people are using it, people are clamoring for it. My favorite part of the whole conference call was the sovereign, the sovereign notion that you can't do your country's culture in English. You have to have your own sovereign statement, and Colette Crest, the unbelievably good CFO, would tell you there's still a lot of countries that haven't even thought about it.

Carl Quintanilla (1:48)

I'm just thinking of other business models where your product is not fungible from international market to market.

Jim Cramer (1:55)

Yeah, I mean, this is, it's almost, I think one of the problems people have with this is they think Jensen just came up with this. But Jensen's been thinking about this for maybe 10 years, for the 200 that's coming out. Now there'll be a 500, and he started thinking about that probably in 2018

We'll know a lot about it when he speaks March 18 to 21, but what's really dawning on people is that they can't live without something that they didn't even think they knew about.

And companies, like if I were McDonald's right now, I would be saying get them on the phone or get service now because McDonald's may not even think they can do it. And let's get rid of the person who answers the drive-thru. But this was something he thought of five years ago. Why do you have a person who speaks only English answering a drive-thru with possibly 27 different languages coming to you of which the error rate is incredibly high? So let's just go save that person and have it be non-human and people will be very happy because that person will say, what language do you speak?

And I think McDonald's is right now saying, who's that guy? Is that a gents? Is it gentsen? Is it sensen? You know, and that's what's going on. And I happen to like, I happen to think him just very good. I'm just saying that it seems like it's out of nowhere, but he's been begging people to at least listen to what he was doing, begging people. And now people wanna beg him and good luck.

Carl Quintanilla (3:21)

But one thing that people started to put together yesterday was the activity in Nvidia, meaning their business activity and financial conditions, meaning the more they go, the hotter economies run, and the more we get commentary like the Fed gave us yesterday.

Jim Cramer (3:37)

Well, look, I think that if you're going to do wholesale replacement of all the technologies in the world, basically going from CPU, which is Intel, and remember, at the beginning, they talk about, listen, Moore's Law is dead. Well, it's Gordon Moore, he really was the creator of Moore's Law, and he started Intel, which is that every two years, things double, and they go down in size. That's over, there's no longer advantage. Pat Gelsinger will completely say that's totally untrue. I have said over and over again how nice Pat is.

I do believe that what's going on here is a recognition that maybe everything that we have, everything has to be replaced, because it's 20 times faster, it burns less hot, and it has a better return on investment. So let's just rip the stuff out. He even talked about how right now, all the big companies are, they're changing the way they depreciate because they don't want to buy more CPU. Now, the great thing for those who are thinking, well, wait, is this game set match? AMD has another, they have a different and good piece of metal, but they don't have all the software stack that's in it.