Charting the Consumer Comeback, Awaiting Nvidia Results 8/25/25

0:02Live from the Nasdaq market site, this is Fast Money and here is what's ahead. Deals all day long. President Trump bragging about the government's new stake in Intel and says there could be more on the way, the companies that could be next, and if investors need to worry about this. Plus, car and truck prices to the moon, and there is no sign of them coming down. Some new numbers you've got to hear. And later on, Google's red hot summer. What the technicals are telling us about potentially discretionary stock breakouts and Netflix's K-pop pop, the animated movie, giving the streamer its first box office win.

0:43Believe it, when you'll see it, and you'll see it. Hi, everybody. I'm Brian Sullivan. In for Melissa tonight, coming to you live from Studio B at the NASDAQ. On your desk here tonight, bottom one, I see Dan Nathan, Guy Adami, and Chris Verone, partner and chief market strategist at Strategas, a Baird company. Welcome to you all. All right. Stocks closing out the day a little bit lower. The Dow retreating a bit from that record high that it hit on Friday. The S &P and the Nasdaq also down. Nasdaq was up much of the day and then kind of faded toward the end. President Trump doubling down on getting more involved in corporate America.

1:20The president saying the government will make deals like the stake they just took in Intel. And he says they'll do it, quote, all day long, maybe twice on Sunday. Intel jumping four and a half percent since that announcement, having its best month since March 2023, up 24 percent. And the Trump administration saying it might just be getting started. CBC's Megan Casella has more at the White House. What do we know tonight, Megan? Hey, Brian. So that's all exactly right. Intel warning in an SEC filing today that the government taking a stake in a company like this is so unprecedented that it couldn't even list all of the possible risks.

2:00But the president making clear to reporters today that he wants to get as much as he can from private companies and that this could be a new model for industrial policy. I just made$10 billion or$11 billion for the United States of America. And yeah, there will be other cases. I have that opportunity again. I would do that. And then, you know, you do have stupid people say, oh, that's a shame. It's not a shame. It's called business. Now, it's not clear which companies might get this treatment next. But we can take a look at who the White House has targeted so far. So it could be companies that depend on regulatory approvals, including for things like export licenses.

2:38That's sort of what we saw with NVIDIA and AMD, and they're selling to China. Or it could be companies in sectors that the government deems crucial to national security. But for this White House, that's already a long list. It's not just chips, but it's also things like lumber and furniture today, as well as pharmaceuticals, metals, drones, even wind turbines, Brian. So a long list here and just not clear at this point who might be next on the docket. Megan, you're doing amazing work. Question to you. Is this the beginning of this sovereign wealth fund? I mean, I think the Swiss National Bank has about$170 billion worth of equities.

3:12I mean, that is sort of the gold standard. Is that the type of thing we're probably looking at? It very well could be. We heard Kevin Hassett hear from this camera at the White House earlier today on CNBC saying that that's why he believes there are more transactions coming. And he said maybe not in this industry, meaning semiconductors, but it could be in other industries because it would be the start of some sort of a sovereign wealth fund. We also saw this come up in a similar way with the U.S. deal, Nippon deal, and the U.S. taking a golden share there. Also something where the sovereign wealth fund was discussed.

3:44Didn't come up explicitly with NVIDIA and AMD, but that's why so many companies now, so many business associations around town are whispering about this, wondering who might be next. because we know, we've long known, that the president really wants to build up a wealth fund just like that. Meg Excella at the White House. Megan, thank you very much. So, guys, I mean, politics aside as much as we can. All right, this is not GM in the bailout, the government took equity, the banks. Anybody remember Solyndra? Sure. Okay, what I'm trying to say is that it doesn't, those are different scenarios, Dan, but at the same time, it doesn't guarantee the success of a company.

4:22Let's separate a couple of things here. OK, this is a bailout for all intents and purposes. This company is going in the wrong direction. I think we can all look back through our careers and say there's plenty of strategically important companies in this, you know, the history of this country that we bailed out. Fine. When you talk about a sovereign wealth fund, sovereigns invest in things that they expect to do really well. If you look at some of the largest holdings of the sovereign wealth funds that exist, you know, Norges Bank's one of them. Obviously, the Saudis have a big one. Guy just mentioned the Swiss.

4:49They are investing in growth situations. This is not that. Right. So when you think about that, it's not a sovereign wealth situation. I'd take you over to China and I'd think of state owned enterprises that are strategically important. So 50 or 60 percent of the Chinese stock market. OK, in market cap terms are SOEs. All right. So this is really what this looks like more. And then there's a certain sense of irony here. If your government owns a stake in the company, that means that you're going to have a level of regulatory oversight that might not exist in a company that doesn't have a stake.

5:22And this administration is meant to be the hands-off regulatory, you know, from that standpoint. So I just think there's a lot of things going on. It is a slippery slope. I wouldn't think of it as something sort of a, you know, a sovereign wealth fund where you're investing in the best companies because you want a big return. But, Guy Domi, it's also popped the stock. Intel's up 24%. And let's put up a chart of MP, right? MP Materials. The MP, by the way, stands for Mountain Pass. I've been to the mine twice. The Department of Defense, soon to be renamed the Department of War, has a 50 percent stake in that company now.

5:55And guess what? You can hate it, but stockholders have minted money. And that's what we're tasked to do here to figure out what it means for the stock. And listen, I will say that a year, year and a half ago on this desk, we talked about the importance of Intel and how it should be some sort of homeland security play. By the way, the stock was probably in the mid 30s at the time. So that might have been the right idea in terms of the stock market was the absolute wrong thing to do. But I do think this is just me. I do think there's this floor in the stock in terms of Intel. Now, playing it forward are now.

6:28Would you have bought debt instead of equity if you were the U.S. government? If they said, I don't know where the Intel. Why are they buying stock? I can't speak to where Intel debt was trading. I mean, if it was trading at some depressed level, I'd say yes. If they made the if they made the assessment that the stock is more attractive than debt. I mean, I can't speak to that. But I understand what you're saying. And hopefully they'll have those conversations. But I think at least for the short term, the Intel bottoms in. And I think on nothing other than these types of headlines, this could be a$32 stock, a level we saw a year, year and a half ago.

6:57You know, Guy, I would tend to agree in the tactical sense. I mean, I think one of the best things going for the stock is everyone to a person hates it. There are 52 analysts that cover it. There's only four buys on the name. It certainly seems like 2425 has shown up as some type of tactical floor. Where can it go? 30, 31, 32. But don't forget the longer term picture. This remains a absolute long term bear market. I think 32 best case here. This stock peaked five years ago. It's down 75. Chris, all those things are exactly correct. Yeah. But now. Remember good. You ever see the movie Goodfellas?

7:34Yeah, of course. Right. Remember when they bought they bought into the restaurant. No, no, they bought into the restaurant. Now, that didn't end well. Did not end well. But a match. But they have now a partner, if you will, in the U.S., the most powerful entity in the world, the U.S. government. So how do we know what Intel's face is going to be? Because you can't fit$80 billion in revenues four years ago to about, what is it now,$52 billion. I mean, they have all the business now. As you know, we've been in the greatest maybe tech bull market of anyone's careers at least in the last 25 or 30 years.

8:06And the stock's down 75 % over the last five. This is a bailout. This is not a recognition of strength. This is not a growth company as the Norwegian Sovereign Wealth Fund would buy. This is something very different. Yeah, I tend to agree. It is a bailout. Now, trying to kind of part and parcel some of the positives and negatives here. So there's an argument to be made that the weighted average cost of capital might be actually lower. Counterbalancing that is that this is probably dilutive. And if the government comes in and we don't know ultimately what they're going to do, they may retrade this situation and they're coming in on the preferred level, I think that would actually give investors a lot more caution and maybe this momentum that we're seeing to the upside might start to kind of wane.

8:46With that said, I think Dan makes a great point in terms of these being state-owned enterprises. I mean, this is essentially what this is. This, to me, screams of GM, screams of Lehman and Bayer and things of that nature. So, again, I'm with the crew in terms of thinking that this really isn't a growth story here. Now, in terms of national security, I can understand the argument there, and I think that's kind of like the logic behind an MP materials. However, if you look at Intel's revenue line, 76 percent of their revenue last year was from international. And you really start to wonder whether or not that starts to cramp a little bit of this and what's signaling that the government now owning a significant portion of this company kind of messages.

9:25Because I love the point. And let me take the other side of my own argument then, Guy Adami. You are equipped to do that. I am equipped to do that. Did they invite you back to that mine for the second time? And by the way, the second time I was at the MP mine, there was a department defense person there poking around. I said that on the air. Now I know what they were doing. Anyway, could you make the argument that Intel, and they won't call it a bailout, right? But you guys are saying that. Make the argument that what did the U.S. government see that required them to take the stake? Was there a level of worry?

10:00I think that's fair. And so people who buy the stock on this news just know that the core, to your point, Chris, how does the core business look going forward? What did Lip Bhutan tell President Trump in that Oval Office meeting? There's a lot there. So what I've said, and I'm not suggesting this is right, I think there's a thought that Intel could become sort of like what Taiwan sent me is to Taiwan, Intel could become to the United States. Different companies, same type of premise. It actually makes sense if you think about it. The difference here, though, and I think this is important to bring up, this is not political.

10:34On August 6th or 7th, the president effectively accused Lip Bhutan, the CEO of Intel, of being, and I'm paraphrasing to a point, some sort of operative for the Chinese military and or government. So he went from that extreme where you should resign immediately. Then they met and he called him a great man with a great backstory. So what's your point, Guy? Well, the point is, you know, if you could set up a situation like that where you basically cast dispersions against a sitting CEO for whatever reason, have he or she come to the White House and then on the back of that get some better deal than you would have, you have to say to yourself, how compromised are these people and what are they willing to give up in the path of self-preservation?

11:19Because in a lot of ways, that's exactly what this was. Yeah. So a couple other things. So, you know, Bob, I'm going to just mention how much of their sales are overseas. Okay. So the government is obviously a big customer. When you think about their other kind of businesses, they own 50 % of the laptop CPUs. They own 70 % or so of desktops. As far as data centers, and again, this is not like the data centers are trading the models. I think they also have 65%, 70%. So this is all technology, for the most part, that is backward looking. If you think about why NVIDIA is a$4.4 trillion market cap company, because now they own the GPU market.

11:51Now, Taiwan Semi makes about 90 % of those chips that NVIDIA has about 90 % market share. So when you think about Intel, they are not a manufacturing company. Creating fabs and keeping them up, you know, well-tooled and all that sort of stuff, it is not, you know, it's not an easy business, right? So the idea that Intel is less than 10 % of global, you know, manufacturing, they're not going to become a manufacturing powerhouse here in the U.S. The last point I'll just mention, we've been watching, you know, Facebook, OK, spending hundreds of millions of dollars to acquire talent. OK, they keep screwing up their AI strategy.

12:26And what did they do? They went out and they had to buy it from OpenAI, from Google, from all these other firms. And so this is not a company that's going to be able to buy talent. People don't want to work for a company that you think is going to continually get more and more capital from the government. I actually wouldn't call it a bailout because it's not desperate times yet. Could it go that way? Sure. But, you know, right now it's just like the government thinks that they have, I think to Guy's point, a necessity to kind of keep these guys going. I think one of the ironies here is Senator Sanders is endorsing us.

12:57Right. So to put this kind of in some context, I would encourage everyone to read James Freeman in The Wall Street Journal this morning talking about the irony of that moment. If this is another nod at this de-globalizing world that we're in and a global world was very counter-cyclical, is this another nod to the idea that we're in a much more cyclical type of environment? But the U.S. government is also helping TSMC in Phoenix, Arizona. We were there with Secretary Lutnik by expediting permits. Let's stay on the semiconductor theme because there's a company that Dan just referenced. Guy, you might have heard about it.

13:27It's called NVIDIA. They're pretty big. Their earnings are out on Wednesday. I suspect, by the way, we're going to get a huge reaction on this show on Wednesday. Just want to throw deep tease is what we'd say to that. Shares just off an all-time high on NVIDIA. You've also got Snowflake and CrowdStrike reporting on Wednesday after the closed Bono one. But I mean, the every the market's attention and focus and what's going to move the market, I think, is in video. Yeah, we've had the Fed speak out and you saw what reaction we have from the market there. I think that was a tell one. I think in video, I think that all bets are kind of hanging on this one, at least in terms of short term momentum.

14:07As I said before, if you really look at the rally that we've really had since the bottoms in April. It really has been a re-ignition of that AI trade. And I think you're going to need to see NVIDIA deliver here. I think there is some back and forth. We discussed it earlier on the call in terms of whether the setup is good. You'd probably like to see NVIDIA probably not trade so strongly into the earnings print in terms of seeing some upside follow through. Dan mentioned the 6 % implied move, which we know is in line. I would probably take the over there. But going back to China. I think the fact that China sales and revenue segmentation has been cut so much in this serves as a positive tailwind setup.

14:45We know the noise around the age 20, but I think the fact that it's gone from 26 to 12 or 13 percent probably gives you some upside there if that's able to turn around. Chris, how's the technical setup on NVIDIA heading into earnings? I think it's essential that you protect actually Friday's low, which is 171.20. Underneath that, you kind of risk a deeper pullback or pause here. I subscribe to the view of the world that when you're in an uptrend, expect surprises to be on the upside. And I suspect that's how we are set up here. And I wouldn't say, you know, look at the whole space. ADI broke out today.

15:15Texas Instruments broke out today. Taiwan Semi is right there as well. So I still like Semi's over software. Certainly we'll learn more on Wednesday. How important is NVIDIA? For the broader market, I think it's extraordinarily important. Go back to April and look what happened to the broader market. Look what happened. NVIDIA went from, I think, 153 and change. it's all-time high. Chris probably has it right in front of him. Trade it down to$90 on the April low. I mean, percentage-wise, that is a significant move. And obviously, the broader market, not necessarily on the back of that, but it pretty much acted in kind.

15:46So I think it is important. I think you're looking at a revenue quarter that's probably north of$48 billion. I think the street's at 46. I think the numbers will be staggering. The size of the numbers, I think the The concern should be the magnitude of the growth in terms of revenue growth for the forecast, because the numbers are getting bigger. The percentages are getting smaller. Well, eventually the law of large numbers kicks in. And what are you referring to? The law of large numbers is if you flip a coin five times in a row, it could be heads five times. Over a million times, it's going to be 50-50.

16:21So I think it's used improperly at times. I'm not suggesting you are. This law of large numbers is the number of revenue is so large, the market is rewarding them for that. But the percentage beats or the percentage gains basically guide higher are getting smaller and smaller. Think about where this was. We went from a$7 billion to$11.5 billion guide. I mean, you can do the math. It's a 50 percent revenue guide higher. That continues to get small. I'm old enough to remember we talked about NVIDIA with gaming. Then we talked about NVIDIA with crypto. So we don't even mention those anymore. Dan, is there, I don't want to say, is there another NVIDIA?

16:59Because this is an unbelievable stock story. Sure. But are there other names out there that? Listen, this is kind of consensus here, but it would be Broadcom and Marvell. So the idea that, you know, NVIDIA has this customer concentration, you know who they are. They're all the hyperscales. They're open AI. And all of them are working, let's say, with Broadcom or Marvell to create their own custom chips, right? They're going to do specific duties or whatever you want to call them. I just said duty. You said duty. But, you know, they're going to do all these specific sort of things, right? And so, like, that would be the reason why you see a broadening out of this GPU trade.

17:32It's not like there's some company out there that it's going to develop the next mousetrap that's going to take on NVIDIA and they're going to lose$2 trillion in market cap. Because, unfortunately, for those companies, innovation is going to come, you know, at a cost, right? They're not going to be able to kind of do this. They're going to get bought by one of these other companies. And from a regulatory standpoint, that's one of the other things I'd say about Intel. They might be able to make acquisitions and kind of thwart some innovation, and that's their only thing. Because I'll go out of here and get in a cab, and the cab driver is going to ask me two questions.

18:02Number one, can you introduce me to Dan Nathan? Right. I'll say no. And then he's going to make a statement. He's going to say, who's the next NVIDIA? What do I say? Is there a next NVIDIA? One of one. One of one. Some crap coin or something like that. Well, Brian, I think Guy makes a great point. Of course he does. Duty. Duty coins. As you know, if you look at it over the last decade, it goes down by 50 percent every couple of years. What happened this spring? It went down by 50 percent. What do you tend to see in the months that follow? A double or a triple? So I still think we're very much in that throw here.

18:34So if you want to buy in video, we're waiting for some kind of a fall and just sit back and wait, save your money and boom. No, I think the trend is up. If you're long, you stay long. If you want to add before earnings, you do it. The question I often get is Brian Sullivan as tall and as good looking in person. And, of course, I say actually far better. It's remarkable. And this is interesting, and this is just tying this whole A block together. I actually had a baby Ruth prior to the show. The baby Ruth was the candy bar that they talked about, Judy. Now, a lot of people think that was named after Babe Ruth, but, in fact, it was Grover Cleveland's daughter.

19:08Yes. You know this. I do. Is Grover Cleveland the president? Lived in Princeton. Yeah. There you go. All right, coming up, Google's rebound keeps ripping, but is the rebound for real? More alliteration in that story ahead, plus a check on China. You see? Results out of T-Moves, parent PDD, formerly known as Pin Duo Duo. Fast Money is back right after this. You're watching Fast Money here on CNBC. We'll be right back.

19:49All right. The macro markets may have been down a little bit today, but guess what hit a new record high? That is Alphabet. Alphabet marking the first time that it's closed at a record since February. This is Elon Musk's XAI sues Apple and chat GPT parent OpenAI over alleged antitrust violations, accusing the companies of colluding to maintain monopolies in the smartphone and generative AI markets. OpenAI firing back saying in a statement, the move is consistent with what it calls a pattern of harassment by Elon Musk. We're not going to go into that, Dan, but we will talk about Alphabet because you flagged this possible move in that stock.

20:35Wait, Space Karen is suing somebody right now? That's a shock. So when I think about Google here, it did make just a new all-time high, as you said,$2.5 trillion market cap. And this is one of the names I think that there was the most trepidation about. And, you know, when you think back to that Q1 earnings, we saw, you know, a lesser of a beat when it comes to Google Cloud as you did to Azure and you did to AWS. And I think that's something that a lot of folks have been, you know, kind of looking at and saying, okay, it's not seeing that sort of acceleration, which maybe means they're not seeing the sort of uptake of the models that are on Google Cloud.

21:09Well, that's changed a lot. I think a lot of investors have gotten a bit more, you know, less concerned, I would say, about what the remedies might be from this DOJ case. And not only that, they're going to be appealed. So the idea that they may now be considered to kind of fix Siri, which is going to be a key component of Apple intelligence at a time where the company, Apple, is launching new cell phones and there's really no reason to buy them other than a better battery and maybe a better screen. So this would be really important. They need to be able to kind of show some sort of framework or timeline about how their generative AI capabilities are going to get better.

21:42Maybe this Google deal helps them do that. Yeah, I mean, as Dan said, this has been somewhat of a laggard in terms of the Mac 7 recently because of the DOJ overhang. And then really, I mean, the elephant in the room has been whether or not generative AI is starting to cannibalize our traditional search. There's been a lot of back and forth. The management has come out and said no. In fact, it enhances it. that's still to be determined. I'm still in the camp that I think they will eventually find a way to wrap AI into search and have it augmented in such a way where they're able to kind of monetize ad going forward.

22:16I don't think traditional search is going away. I think particularly as we see more and more agentic AI, you're starting to see that whole ecosystem done in a way and in a chain like Logic Manor that lends itself to more creatives and actually getting work done, not into like simple queries. That's my take there. Yeah, there is. And we don't know and we got to go, but we don't know, Guy Domi, what the court's going to rule. But there is a possibility. Everything I'm reading suggests it won't happen. But there is a chance that Google is forced to sell off its Chrome browser and or other parts. Is that clouding the stock a little bit, even at a record high?

22:55I mean, if we get that cleared up, does that help? See, I think the enthusiasts would say, you know what, break it up, because some of the parts is actually going to be worse than the actual entity itself. You can play that game, too. But to your point, I mean, the level of uncertainty around search has definitely held this stock back. But I know Chris Verone can speak of this. The fact that we took out the January prior all-time high and closed above it suggests that now people say, you know, it's cheap, breaking out to the upside. You could be setting up for another 15 % or 20 % move off the back of today's close.