The AI Trade in Focus: Altimeter's Brad Gerstner joins "Halftime Report" live in San Francisco 10/15/26

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Scott Wapner (0:57)

I'm Scott Wapner and you're listening to CNBC's Halftime Report, the podcast, the most profitable hour of the trading day. We record this live weekdays at 12 Eastern. Listen in.

Carl, thanks so much. Welcome to that special Halftime Report today, AI in America. I am Scott Wapner at One Market in San Francisco and over the next hour and during closing we will have a look at the future of AI as well later on this afternoon. We'll look deep into the AI trade, assess the risks and rewards of this societal transformation and what the recent action in the stock market suggests about the road ahead for investors. Altimeters, Brad Gerstner is with me today for the hour. He's been in nearly every major meeting at the White House that they've held on AI. Snowflake CEO is gonna join me as well today as the future of software in this AI age remains a hotly debated subject. The Investment Committee is with me as well. Josh Brown, Stephanie Link, Malcolm Etheridge. Can't wait to hear from everybody today. You know what the market picture looks like, but let's show you because the Dow's up big, but AI stocks are not. I wanna start with you as we think about semis, what's happening with CoreWeave, and we'll get to CoreWeave more specifically in a moment.

Is this about AI slowdown concerns? Is this about debt levels and interest rates going up? Is this about choice C, all of the above? What do you think?

Brad Gerstner (2:21)

Yeah, of course, it's all of the above. Well, first, great to be back here.

We talked about this maybe a month ago, right? The number one question in the market today is, do the AI revenues justify the CapEx build out? I mean, frankly, it goes back to the conversation I had with Sam Altman on my podcast last October when I asked him the question, how can you make a trillion dollars of spending commitments when you have 13 billion in gap revenue? Well, what happened this year is revenues exploded higher, right? Remember, the forecast for Anthropic at the start of this year, $30 billion.

Now, a lot of the reports have them doing at least $100 billion. We'll get into that a little bit today. But the fact of the matter is, AI revenues exploded higher this year, and now we're in this phase of consolidation. People are starting to worry, is open source commoditizing the frontier labs, are the revenues sustainable? At the same time, then they're hearing in the marketplace that things may have slowed down. So that plus higher rates plus some of the political stuff going on in the background, has people scared? I will tell you, I'm on the more positive side of this, but I think it's good. We have this churn in the market, it avoids bubbles.

Scott Wapner (3:25)

Okay, you're on the more positive side, but your actions suggest that you are getting more cautious. Don't they? I mean, you've taken your exposure down.

Brad Gerstner (3:36)

Yes, I mean, I did a presentation at the All In Summit about a month ago. I said I had taken my exposure down to medium small. I think I had shared that with you just the week before then. And the reason for that is I saw a lot of these AI stocks in April and May, we had the biggest move in semis in history, right? And that fuse was lit by the Anthropic Revenue Report in March of the year. And I just thought they got ahead of themselves, that we were going to consolidate a little bit, and it turns out there were even more fears that came along, inflation rates, et cetera. So our exposures are the lowest they've been in three years, right, over the course of the last couple months.