Nvidia’s Blowout & an E-Shaped Economy 8/27/26

**SPEAKER_1** (0:00)
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**SPEAKER_2** (0:29)
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**Andrew Ross Sorkin** (0:59)
Bring in show music, please.

**Cameron Costa** (1:03)
This is Squawk Pod and I'm CNBC producer Cameron Costa. On today's episode, AI anxiety be gone. Maybe? It was a blowout quarter for the world's most valuable company, Nvidia. After a blockbuster revenue forecast, investors seem relieved. But there's always more to the story. Kristina Partsinevelos breaks down the report.

**Kristina Partsinevelos** (1:25)
Even Nvidia, the most important tech company out there, wasn't prepared for how expensive memory costs are going to be.

**Cameron Costa** (1:32)
Then, President Trump's plan for an economic D-Day in Iran. Pennsylvania Senator Republican Dave McCormick joins us. A veteran, an elected and a former businessman with an eye on jail politics.

**Dave McCormick** (1:46)
This war with Iran is an added burden on an already weak Chinese economy.

**Cameron Costa** (1:52)
And finally, what travel trends can tell us about the American consumer. CEO of Chase Travel, Jason Wynn, doesn't see too many trade downs, despite the pressure on American wallets.

**Jason Wynn** (2:04)
Internally, we've started to call it the E-shaped economy because each one of the income brackets is performing almost equally well to each other.

**Cameron Costa** (2:12)
It is Thursday, August 27th, and Squawk Pod begins right now.

**Jason Wynn** (2:18)
Stand under by in 3, 2, 1, cue Andrew.

**Andrew Ross Sorkin** (2:23)
Good morning and welcome to Squawk Box right here on CNBC. We're live at the NASDAQ Market site in Times Square. I'm Andrew Ross Sorkin, along with Joe Kernen. Becky is off today, but it's a big news day, so we have somebody very special sitting in her chair.

**Jason Wynn** (2:35)
We'll get to that in just a moment.

**Andrew Ross Sorkin** (2:38)
We're going to wait for the proper introduction.

**Joe Kernen** (2:40)
One of the key reports of the week, morning, month, year. It's in the books, and Kristina Partsinevelos, which we already talked about, joins us with a more on Nvidia's quarter, and Kristina just as an intro, stocks up 200 and change. I guess I didn't do the math yesterday on an analyst we had. He had a $400 price target. It's a $5 trillion company at 200
Does that equate to $10 trillion?

**Kristina Partsinevelos** (3:11)
It could eventually, and you're even seeing more of the re-rating, and Wedbush, for example, they also raised theirs to $400.

**SPEAKER_9** (3:17)
$400. Yeah.

**Kristina Partsinevelos** (3:18)
So perhaps that's going to be...

**Joe Kernen** (3:19)
So there will be a $10 trillion...

**Kristina Partsinevelos** (3:20)
But that's why we're seeing the stock up at 7% because the re-rate from a lot of these analysts, they're going to be increasing all of their estimates because now they realize they're wrong. And why am I saying that? The worry hanging over Nvidia all year is that its biggest customers are turning into competitors. Amazon, Google, Microsoft, Meta, all designing their own chips to lean on Nvidia less. But on the call, CEO Jensen Huang's answer was, in effect, let them, because those four are only half of Nvidia's business now. The other half is everyone else. AI startups, enterprises, governments, smaller clouds, Sovereign, and it's growing faster, up 138% last quarter, year over year, versus 102% for the big four. Jensen Huang said those customers want the whole Nvidia system and aren't just building their own chips like the hyperscalers. And even the hyperscaler, with the most reason to pull away, leaned in. Amazon will deploy another 2 million GPUs this quarter, plus Jensen Huang told Mad Money, Jim Cramer last night, millions of Nvidia new VARUS CPUs. It wasn't all clean, of course, you can nitpick certain things, margins guided lower before price hikes pull them back up, receivables climbed, I know on X there's a lot of complaints about that, and then the AI Labs, Nvidia's financing, will be about a quarter of next year's business. The concentration that worries bears. Nvidia says the risk is, quote, limited, and that those one-time AI Lab investments won't repeat once the companies go public, freeing up more cash next year for buybacks. Listen to it.