9AM HOUR: Nvidia Shake-Up: Jensen Huang Resigns As CEO 11/12/26

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0:42They also have integrated risk management technology and nearly unlimited customization so you can shape the platform to fit the way you trade. And when you do that, you can analyze trades from angles you won't find anywhere else. Go see what that looks like at schwab.com slash trading. Market moving insight and analysis. Join Jim Cramer, David Faber and me, Carl Quintanilla, on the opening bell hour of CNBC's Squawk on the Street. Good Thursday morning. Welcome to Squawk on the Street. I'm Carl Quintanilla with Jim Cramer, David Faber at Post 9 of the New York Stock Exchange. There is big news out of NVIDIA today.

1:13The company's board of directors announcing that Jensen Wong has resigned as president, chief executive officer and a member of the board, effective immediately. Colette Kress, the CFO, has agreed to serve as interim CEO. She will continue to serve as EVP and CFO until a permanent successor has been named. The board says it is initiating a search for a permanent chief executive officer and will consider internal and external candidates. We're going to stay with this breaking news, Jim, as you've already shared some thoughts with the crew on Squawk. Look, she's natural. She is someone who has been leading the calls.

1:49That's funny, Carl. There's 42 ,000 people there. A lot of people feel there's never been anybody. who really stands for the company or means anything. Colette's been my contact person other than Jensen for years. Colette runs a conference call. By the way, Colette runs with a steel fist. I will tell you that. I have lots of good relationships with CFO. I think I'd like to have a good one. I have a good one with her. But she's no nonsense, and she is absolutely the one that you need right now because she has the bearing. She will accept no nonsense. Now, I think what I think everyone feels like, because it's so political right now.

2:26OK, what does she know about? What does she know about Kimberly Powell? And I know Kimberly well. She's been the person who's run health care for a long time. What does she know about this? What does she know about that? And all that I can tell you is that I think that Colette is above all this stuff. Now, you can say, well, Jim, you thought that you like Jensen. You love Jim. But you know what? At least when it comes to running the call and being organized and telling you about the cash, which I think at some point, Dave, people are actually going to be worried about because everything else is on the table.

2:53I trust her. I do trust her. I trust her. She's tough as naps. I do think it's worth stepping back for just a moment and thinking about just what the last six days has brought, of course, from when we first heard or five days when we first got the reports about an affair with an alleged Chinese spy, of course, that being Jensen Wong, and starting to raise real questions, The relationship the company had with Megaspeed, the company that Alice Wong was representing ostensibly, and buying enormous amounts of chips, at least conceivably, given the actual footprint that that company currently had in Malaysia and or Singapore, which would have been far outsized versus their chip orders.

3:36And then here we are. Of course, we get news yesterday of another affair with a person you just mentioned. And now Mr. Wong is out after 33 years. the company as its co-founder, as its CEO, as the single biggest voice in this world for the benefits of AI, for open source, and as well for allowing the Chinese to at least buy a level to a certain level of NVIDIA chips, Jim. Although it is important to point out that was pre the alleged spy. He had been after me, two years before this to say, listen, Jim, we want a dollar to be the U.S., to be the world card. Oh, I know that. But he was still arguing.

4:22I've read a lot of stuff in the papers that made it sound like he didn't give a damn about China until he was asleep. No, no, no, no, no. But the point is that he was still, we can debate this. And obviously, listen, Mr. Wong is going to be the subject of a great deal of investigation. We know that. Absolutely. We talked yesterday about the enormous distraction that would represent. He's going to be spending a lot of time with his lawyers. Yes. at this point, who we know are top-notch, and they're going to need to be because of everything coming at him. So it was hard to imagine in some ways that he could continue to run the company in the way he did.

4:53Then we got the news about the affair with the employee, and that apparently was the final straw for the board. And by the way, I've never seen anyone who has been, Justice Parham's gone after, serious fashion, ever be able to have any contact with the company. Okay, over. I mean, this idea that he's going to stay as an advisor. I mean, whoever's making that stuff up. I mean, like, look. You want to put space between yourself, between him and the company? The Justice Department would like him to spend more time with somebody. As you might imagine, I know you were doing, I'm sure Carl was. You know, any number of people trying to understand so many different things this morning.

5:32Yes, I know. But the impact that NVIDIA will have here in terms of a change in leadership, at least perhaps on an interim basis. It may not be collect crisis for the long term. Who conceivably will take over? What are the outside candidates that people are thinking about? And more importantly, what is the impact going to be overall on the ecosystem of which they are the key supporter? Not to mention, of course, the central bank, as we like to refer to them, with all of the different investments they've made. And what does it mean for 2027? And, you know, what the order book for 27 or 28? 27 book is solid.

6:04Right. 27 book is solid. And the Richard Feynman plan, which is the next one, if you're here, Rubin, is solid. These are solid with orders, with software, with ready. And I just want to point out again that CollectCrest is someone who everyone, when I read, there is an article, Carl, that I read which just says it's a one-man ban. And yet if you've dealt with this company, you've dealt with Collect. Well, some of the downgrades this morning, and there are seven of them at least, Oppenheimer in particular, worries about the brain drain that they think might happen as a result of Wong's departure.

6:35I think that there are many people at the company who are very upset that they look like that they've had nothing to do with the company. Five people, Kimberly Powell. Five people went public with Kimberly Powell. And those people are very high level. And they ratted him out. Five people. It is not like everybody's sitting there saying, oh, my God, I've made billions. I want this thing to go away. But you're right. The rank and file have gotten very wealthy. They don't need to stay. No, nobody needs to stay. I think, you know, I know he has 60 reports. I know that he has not made available a lot of great people.

7:12But why has he made people available to me when I go to these events? He's wanted me to know who they are. I mean, he's not like saying, listen, Jim, it's just you and me. I want you to meet this person. I want you to meet that person, of which Kimberly Powell was part of the retina. All right. But is there anybody who has his level of technical knowledge, his ability to sell, his ability to communicate in that way and understand exactly what's going on within the organization? Well, the stock's not at$240 ,000, because the answer to that is no. Right. And you just said this. I mean, it's impossible to know what an appropriate price would be at this point.

7:44Is that a fair statement? I think that's correct. Even if it trades down to, obviously, a multiple that is extraordinarily low on what are expected to be 27 earnings? Well, look, you have a$238 billion buyback. We don't know how much is spent. They could announce the earnings next week and announce a giant buyback. They could pre-announce the earnings right now and go to the SEC and say, listen, we have the numbers. We'd like to do that. We don't like people trading with no knowledge. I don't know why they don't do that. It's something they should do right now. They have a general counsel. I'm not sure exactly.

8:11It's a wartime conciliary they do not have. Yeah, no, this is a company, to your point, and separating him out and now him having to deal with his own legal battles, which are going to be significant, and the investigations at least saves the company to some extent. I don't even know in terms of, I assume, Wachtel will continue its own investigation for the board so they can understand what happened. Let me just give you guys some of the questions that were being raised by the people I spoke to this morning. Obviously, one of the key ones is who benefits, who doesn't. You know, is Broadcom a beneficiary?

8:40Yes. Is AMD potentially a beneficiary? Are OpenAI and Anthropic beneficiaries because open source is no longer as big a threat to them because you don't have the single largest proponent for open source on the field anymore? Well, I mean, you could argue that, but you could also argue that you never want to, This man is so powerful, you don't want the money withdrawn. Okay. That'd be harsh. I mean, if you came out right now and withdrew the money, I think people would say, well, wait a second, maybe we can't. Well, I don't know to what extent they can withdraw the money, but you're raising that important point, and that's another one, which really gets to how much of the order book for next year is actually related to some of the circular financings that we've talked about.

9:24How much is related to the neoclouds, for example, and or others that Jensen ran that, right? He was the decider. He was the decider of the capital. I'm not going to deny that. I also think, though, David, that there will be some people who would say, you know what? New broom sweeps clean. You know what? We've got to stop these kinds of arrangements. Well, that would be bad. That would be not good for a bunch of companies. I agree. Some that are starting out that where the NVIDIA says we'll give you, we'll match whatever you raise? Well, then you're saying that, you know what, what Jensen told me, which is, Jim, we have to build an ecosystem.

10:01It's not circular read over and over again. By the way, you mentioned the circular read. You said, what kind of ecosystem do we have? Do you see the federal government stepping up and backing these companies? Like, we've decided to make optical the future instead of copper because optical burns less, okay? That was Jensen. Now you're approaching sort of the pernicious bear thesis, which is that the whole effort to move supply to Asia and China was to create a framework that suggests overall supply is tighter than it actually is. And we've heard a lot about stranded compute from Elon, from CalPERS yesterday.

10:36I find it hard to believe from the sources I have that there's anyone who's not on allocation when Elon Musk would say he takes everything that we'd offer. Everything. Musk is an incredibly important company. Sorry, a customer of this company. One reason why he may have tweeted what he did overnight. Look how much money he's made. Look at what they're going to make. By the way. Look at that perspective. You know, you do wonder, right? Musk is talking about SpaceX's annual recurring revenue by the end of 27 being somewhere between half a trillion and a trillion dollars. A lot of that is going to be based on his ability to get access to these chips and resell them at incredibly high prices.

11:12The fourth quarter is going to be the reason. The reason why people keep raising numbers for Elon is because of how much money that Antwerp has to pay. It's real business. By the way, I don't think anybody is going to be hiring Jensen Wang, just to make the point. No, that's it. That's the other theory, is that he could raise a lot of money and start something fresh on his own. Once he gets out from the national security implications, conceivably, that were raised by having a relationship with a Chinese spy. The possibility of a Justice Department. Justice Department has historically not really let you get in business that fast.

11:48Yeah. You mean the thing Intel has known about for more than a year and we've done nothing? Yes, that one. Yeah. Yeah, that one. That's the other implication, Jim, for D.C. When are we going to hear from Howard Lutnick? Who is Treasury really out to? I mean, my understanding was from the company was that they went to Commerce and Commerce said this company's fine. They went to Commerce and said, listen, we have the possibility of another core weave in Southeast Asia. We can make it a pole client, a temple client, and Commerce didn't object. Yeah, and now we hear from Singapore today that they impounded Alice Wong's passport in 25 amid their own investigations.

12:31Look, NVIDIA said that they didn't ship anything to them. No, but what they did shift to them was far above what they ever could have deployed based on at least the footprint they even hoped to have in terms of data centers, correct? Not if you thought that they were going to be the neocloud of Southeast Asia. Okay. By the way, a few weeks ago we would have said, you know what? They could be a good client. We didn't know. Well, no, some people. No, we didn't know, and there's a lot we still don't know, including, of course, who's going to take over this company longer term. Right, and I think it has to be an outsider because you want someone who is not going to be interviewed endlessly about why did he say something or she say something about Kimberly Powell.

13:10It's an incredibly important executive. So obviously Colette is one of the names. She's now going to be running this company, Colette Kress. Ian Buck is another name I know people have been banning about as an internal candidate. Because he's in charge of the hyperscaler and he did CUDA. Can I give you other names? Fire away. Thomas Kurian. Would he take the job? I don't know. Will he be unbelievable? Absolutely. You just had him on a few weeks ago, right? His numbers are what saved Google Cloud. Matt Garman, the guy who runs AWS. I love Matt Garman. He's sensational. He would be terrific. Doesn't have the high profile.

13:43Away from web services. Brett Taylor. Too hot. Too many places. Too many places? Too many places. Nikesh Arora. Done. But Nikesh, I don't think, wants it. Why wouldn't he want it? Well, because Nikesh would tell you he's doing a damn good job at Palo Alto, and he likes it. Okay, okay. He gets offered that job. He gets offered that job. Of the ones you mentioned? He takes it, of course. I'll ask him. I have a relationship with him. I have a relationship with him. I don't want to sit here and say, hey, listen, I'm trying to book you for the quarter. Can we ask him right now? Hey, by the way, are you taking that job?

14:16Yes, we'll ask him now. I'll get to him first because I have the better number. You probably do. I'm happy that—I'm sure he's happy we put him up. Keep playing this game. It's a very valuable game. You like the game? Yeah, how about— I'm not putting off—I took some people off that I didn't think were appropriate, so I'm not going to say their names. You're not going with Rene? Nope. I'm not either. Nope. And I'm not going to go with Rene. Hey, what would happen if a guy went on Cal Shee and you knew that he's up for it or she's up for it? Would that be like betting on yourself? Is that like a Pete Rosen?

14:48We've already seen some sports leagues like the NBA try to tackle that. That would be another reason why you would. I love this. I try to keep my list short, and that's it. How about George Kurtz? You didn't want George Kurtz? No. No, because I talked to him. He's not doing it. Who else do you want? That's my list. I like the Thomas Curran. Ed's yours. You got any others? Why did you do Ruth Porat? Ruth Porat? She runs day-to-day of a lot of Google. I know. Does she have the technical knowledge as well that you'd want in somebody who'd be leading the company? She's financial. You just keep collecting.

15:20Yeah. That's the thing. It sort of seems more like... You're right. We just saved them$20 million in consulting. No,$1 billion in consulting. It's right there. And also, I want to search, if it goes to Curran, Thomas, not Tom, if it goes to Curran, and if it goes to Nikesh, well, let me just wrap that one up right now. Yeah, you guys are moving really fast here on the succession thing. 152 now. Jim. It's going to 145, Carl. Well, you know the other name that people had is like to say it would be Tim Cook, right? Would he come back and do something? That's not going to happen, right? Tim Cook is an outstanding American who has done a great job.

15:58Can we let him alone? I didn't say. What do you think it does, Jim? We've got AMD, Google, Broadcom, higher in the pre-market. You think this is a boom for TPU? They all deserve to be higher. They all deserve to be higher. The one I was asking was, when is he going to say Matt Murphy? Say again, I didn't hear you. I thought you were going to say Matt Murphy. Matt Murphy, oh, from Marvell. Yeah, interesting. Matt is busy doing... Can I just say, we're throwing these in. These people are real good people that have jobs. They have contracts. they are doing great and it's a little somewhat, if I were listening if I were listening I would say, who are those two guys trying to make book when I have like a company that I'm running and a lot of people are looking for me today and they're saying hey, I heard you might believe it and I want to have a little more be a little more circumspect like you didn't say hot tan, that was good.

16:51No, I can't no, I mean again, that was great I'm like, come on, please, thank you And you didn't say Lisa Su. No, because, again, I rule that out. You're not going to leave. All right. But the other one's TBD. Yeah. Which is not, by the way, TLDR. This will be something that will go on for some time. Obviously, they're going to take their time, one would expect, although you do want to move with all due speed to deal with the level of uncertainty that you have within the company. And, again, to remind people, the most important company, arguably, there is. Well, I do think that the reason why it has to be outside, Carl, was because you're going to be grilled about whether you knew about Kimberly Powell.

17:30And that's a really important thing. You're not going to be grilled about what you knew about Megaspeed? Of course you are. I'm adding that to, I'm looking at like Kool-Aid over here. We have time, so that's up going. And I'm thinking about, is that a Hawaiian punch, David? Here's what I'm thinking, Dave. Yes. I think that if you knew, what will happen is you'll be tied up. When did you know about Kimberly Powell? Right. And she is a very high-level executive, and that's because you have to do that investigation. And that's open and shut. I don't know about the Chinese. Arguably, that's when it's going to be harder.

18:05She's not claiming she's an agent. They can argue that she wasn't an agent to China. You know, that could go on forever. Yeah. I mean, how about this journal piece, though, Jim, speaking of financial disclosures, about the fact that they suddenly abruptly stopped breaking out Singaporean revenue. John Weil with a crack at that in the journal today. I know, that was bad. But they also told me that they didn't sell anything to them in 2025. So it wasn't like they didn't really break it out. There was nothing to break it. Now, again, you can say, well, Jim, you have been not exactly getting the full story.

18:41I think that the disclosure has been suboptimal from the very beginning. But I think it's because it's so influx, Carl. I mean, it's just so influx. It's minute to minute. It's not even hour to hour. I mean, did he negotiate a pay package? Who was he in there with? What was it in the end that made the straw? And why did five people come forward with Kimberley Powell now? Why did we find out that they had film of him and Kimberley Powell at an event that I was at for a second? I don't know. All I can tell you is that there's so many variables that I am glad that CollectCrest is there. Because no one thinks that she has anything other than a salesperson.

19:24I was going to say, why is your trust in her so robust, given how much you think the disclosure has been faulty? Because when I have made a mistake, or when she questions my coverage, there's not a lot of niceness. She's just tough. Jim, this is what you did. Look, we all have to make judgments about bearing. Her bearing is so significant that, and I'm not saying, well, I'm scared of crossing anybody. I don't play for dinner. But I just think that she's a person who has never led me astray for a second. Has Jensen led me astray? Jensen has got a lot of hype. There's no hype to collect. I have often said, Colette, go on the conference call.

20:05You said this, this, this. Why did you do that? Because I said it. There's a Belichick nature to her. The Patriots Belichick. Not later Belichick. Meantime, there's a lot of fallout on supply. TSM you saw lower. Baba's lower, Jim, on worries that they're not going to get. No, Baba, because everybody thinks that all it was was a sieve from Singapore to Baba. Correct. That the chips were actually going to Alibaba to begin with, yes. And or others. Look, Jensen said over and over again, I comply with the law, I comply with the law. I know. Again, you know, is the guy a serial liar? Although, you know what?

20:41I mean, the Goldman desk points out today, semis are up 20 % from the local low. And that's not with NVIDIA participating much. No. Which is kind of an impressive bounce as the queues have held the 200-day. No. Look, I just think this stock, because of the way the analysts have cut and run, there's going to be a lot of people just said they have to cut. Is it at the end of the day at 145, 140, where I think it'd probably go? Is that a buy? Well, I mean, like anything can bounce. They're going to have a quarter. Meanwhile, they're going to have a quarter. They could announce the biggest buyback ever.

21:17Probably not, but they could do it. I do wonder longer term what the implications will be again for the open source movement, whether we will see, Carl, as well, changes in the administration in terms of some of their posture. You raised some of the questions around commerce. The State Department, as we know, has been very much involved, perhaps, in this overall effort here. Where is the president on all of this? And where is that going to lead us? Because if it does lead to sort of, well, open source maybe is not quite as good as we thought, and the Chinese ultimately just distill our models, then give us an open source model that we then use, and they use the data that we put in, it may lead you down a path that says, no, thank you.

21:59That's a benefit, obviously, for Anthropica and OpenAI and some others. if it were to happen. Who knows? But there are so many different implications of this, and it's still too early. It's simply too early to know. It is true, but I did think it was interesting that very few analysts just said, you know what, this is one where there are a lot of good people. I wouldn't worry. That's not been the narrative, and I think people at home have to recognize that. I do think that there are really good people. David's right in the sense that some of the people, even that we just discussed, find it more intriguing than I thought.

22:32Well, again, it is still such a stunning downfall in such a short amount of time. It's almost hard to take it in. You were. Yeah, some of the people. So they have to give these people cowbells when they come and visit? Yes. Okay. Today, yes. Just wanted to make sure. Today, yes. Thank you. Today, yes. Craft Tines is here on the floor. People like that. You can hear them already. It's Kale. You like Kale. By the way, just taking a look at the NVIDIA investments tracker we have. Yes. Put up the thing. Because it's going to be important. Whether it's OpenAI in for$30 billion. Obviously, they're buying Hugging Face.

23:06Anthropic, they're in for$10 billion. XAI,$10 billion. Intel,$5 billion. MediaTek, Corning, Meta, Iron, Marvell, Lumentum, Coherent, CoreWeed. You go on and on, even down to Mr. Reflection AI, Thinking Machines as Miramirati's, where you need to raise more money based on what they're going to give you. Do you care that they're up 190 of those? No, I just... They're so central. What do you say? This company's not just central to... Anthropic is central. The GPUs. Yes, it is. You get the GPUs. You get... Yes, it is. All that Jensen wanted to do was build an ecosystem. He didn't want to rule the world.

23:44I could have made an argument coming into today that if Jensen Wong resigned, that would be bad overall for the market and therefore bad for Anthropic's upcoming IPO, but I'm not sure. I mean, NVIDIA's got a$10 billion anchor order. You think that's still firm next week, Jim? Who's ready for a bike ride? Peppa Pig is learning to ride her bike First, pop on her helmet Safety first Then, attach the push stick And give her bike a push And watch Peppa paddle Her legs go round and round As the wheels turn With more than 75 sounds and phrases Every ride is a big adventure Peppa Pig Ready Paddle Go available at all major retailers now.

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25:02Schwab's think-or-swim trading platforms were built for real traders like you. They have an insane amount of chart studies. I'm talking over 300 studies for virtually any strategy. They also have integrated risk management technology and nearly unlimited customization so you can shape the platform to fit the way you trade. And when you do that, you can analyze trades from angles you won't find anywhere else. Go see what that looks like at Schwab.com slash trading. Yeah. I would assume you have to keep that stuff, right? I am. Meanwhile, we talked to CoreWeave yesterday. We got an EBS last night.

25:39EBITDA was a beat, but they do say revenue will be at the low end. That was disappointing. They just made that forecast two months ago. What the hell? I mean, how can they, two months ago you make your forecast, they decide you're at the low end? What is this, Yeti? Yeti did that. Meanwhile, Cornweave yesterday. That's a company. I know Yeti. I like their products. Yeah, very nice. Yeah, I'm just making it. Expensive. Pretty high price. I'm just saying that, you know, you're a high-profile company. That is not, by the way, in the list of who GE Vernova sells to. That's important. Wait, what? The neoclows are not necessarily as respected in the food chain as the other companies.

26:17Okay. By the way, GE Vernova, that's like AEP. That's who they use. I mean, I was just confirming that SoftBank had not canceled. Right. You're referring to a story from a couple of days ago where there was concern around what SoftBank had to say around its investments in power infrastructure and what it was seeing, that they were actually pulling back some orders. And you're saying that's not the case. Not the case. But Nebius, of the ones that, I mean, this is going to sound like I'm a total dope. I questioned Nebius. So there was a man who took me aside to the booth of Nebius, introduced me to that.

26:49Yes, we remember this story, yes. And that was Jensen. He said, look, these guys are very real. Yeah. And I didn't know them until he told me they're real. And they do have a lot more. You should see I've got a sheet of all the ones they have. That's why I was a little depressed that they didn't make the higher end. Because this guy over here, Intrader did. Although Intrader did a bond deal, Dave. Yeah, they got$4 billion in a high-grade loan. We knew that the term loan was in the works. By the way, yesterday was their second best day since the IPO. Stock was up 25, over 25 % yesterday. Right.

27:22Added a quarter of its market cap. The bonds didn't move, although, as we know, as the traders said, they are not going to be raising money in the bond market unsecured in any way, shape or form for the near future. How about if he felt that he could do better than 15 %? Bonds are 15 %? And he says, look, why should I buy it back? I could do better than 15%. But CourtWeave is obviously a key customer of NVIDIA. Yes. And it is one of the names on the other side of the ledger, not a beneficiary necessarily. Tell me. Kraft Heinz. No, they're not. Okay, there. They rang the bell and they're not a key.

27:53It's that for, it's that for, the universe of companies that are not, AMD is not and Broadcom is not. All right, give me the bold case on NVIDIA. Because stocks, let's say it starts open, it's down 13%. Okay, I'm going to give you the bold case. And you get a bunch of people rushing in there. I mean, I know it's going to start with the multiple and 27 is safe, right? Jensen would tell you that there's a four-year roadmap. four-year roadmap of superior product to everybody else and all the benchmarking. You're going to still be quoting Jensen? I don't think you can anymore. Jensen telling you anything doesn't matter anymore, Jim.

28:24Oh, I don't know Ian Buck. I'm kidding. I'm kidding. No, I like what it says. It's insane. It's pretty new to say I just got it on the last trip. Okay, so let's understand that NVIDIA is not just Jensen. There are people working on Feynman. Feynman is Jensen. Okay, I do. I did get my information from Jensen. So I guess now that means, well, whatever I got from him is worthless? Of course not. Thank you. But Richard Feynman is very exciting. He made me read a book about Richard Feynman. There's this one, like, it's about whatever. Surely you're joking. Yeah. And I said, man, that was great. Because, you know, I sucked up.

28:58I said it was great. I didn't really like it, frankly. But Feynman is the next one after Vera Rubin. Yes. Vera Rubin just started shipping. Understood. So imagine, think about the roadmap he had in his head. But he communicated to the 60 reports, which I know you probably had a good laugh at. How can people see it? It was an awful lot of direct reports. In fact, it is somewhat laughable. Yes. OK. Well, you saw Jeff Sonnenfeld's piece this morning, right? I mean, that was that was the fault of the board. To allow that kind of structure to treat your CEO as infallible. Absolutely. Right. And that was they did that wrong.

29:33But you know what they did, right? They created one of the greatest, largest companies on Earth. they create an ecosystem. I am not going to say that the man in the leather jacket is someone I do not hold with any respect. I am saying that he took ill-advised actions that have made it so it's very difficult to feel the same way about him. But what he will cannot be denied. And what he has is a roadmap. If we had Lisa Suhier and Hawk Tan there, they would respect his roadmap. They would not say, you know what, I can go in right now and savage them. No, there's no question that he saw the creation of LLMs and got his company positioned to feed it.

30:15There's no doubt about that. It's also dead money for a year and a half. The stock has been, yeah, well, now it's even worse. I'm not willing to say, there are people who could be picked that I think would say, some of whom are in the running that were discussed, whom I think would bring order to the situation. They would bring order to the situation. Did anybody replace his voice in the industry? I mean, again, I've made the point many times because it was extraordinary how often he showed up, wherever it was he showed up, randomly in various places, every week almost, if not more than once a week, just talking.

30:51Well, okay, he did a lot of talks. And does anybody replace him in that way? What somebody in video said to me hasn't really been working as much as you think. Right. Because all he did is talk. No, I agree. Now, in 2011, was there anyone who could ever replace Steve Jobs, ever? I was being interviewed at 2.30. I was in the pocket. No, you're right. And I was asked, can anyone ever replace? He was irreplaceable. Well, there's a fellow. He's irreplaceable. I wasn't asking about running the company as much as I was the larger debate going on that he's on one side of, right? And that we know, by the way, a lot of other people are on the other side of because they fear AI, data centers being the physical manifestation of that.

31:28He may not have been doing the greatest job of articulating the benefits of AI to begin with, but I wonder who replaces him in that. All I know is that Tim Cook was one of those CEOs that everyone said was the caretaker. He would never be able to create anything. And he created more wealth than the man in the leather jacket. He created more wealth than the man in the leather jacket. And let's not forget that. If you go back to 2011, I did, which I did, ahead of this. And it was like, end of an era, end of a company. End of a company. End of a company. Let's get the opening bell here this morning.

32:07You might have heard the cowbells already. It's Kraft Heinz at the big board celebrating Investor Day and the transfer of its listing to the NYSE. At the NASDAQ and Times Square, it's Aspen Neuroscience. BioTech, developing cell therapy for Parkinson's, celebrating an IPO. It's CBO in Chicago. It's Jalen's Legacy Foundation, supporting first-generation HBCU students through scholarships and educational opportunities. With all the news and this drama, Jim, I mean, are we S &P getting away with only a 60-point decline here? Look, I do think there's a lot of panic. When I spoke to a bunch of the analysts about their down rates, they all feel the same way, which is I can't take it anymore.

32:55Or it's just enough, the drama. as if that's how you make a decision? The drama? Should drama play a role? Or how about the specs of the Richard Fyler? How about the possibility that maybe we see how the universe does post-anthropic, which, by the way, NVIDIA is going to be a crucial part. If Anthropic could have been a moment when we thought if Anthropic failed, then NVIDIA would be crushing it. Right. There was also a thought that if we got this news, which we now have, and the impact it would have on the market would not necessarily be a positive for Antropic, which is now less than a week away from pricing its initial public offering.

33:36But it's not, look, we are not in some Netflix patent place here. I mean, but... Oh, this is going to be one hell of a movie, though. I will tell you that. Well, why would I deceive you? Why would I deceive you? Because I think Theranos is like now. I mean, like, Theranos was like last week's show, right? I mean, shower-seeing and all. I'm going tonight, actually. I'm finally going to go see it tonight. Oh, really? You haven't seen it? No, I haven't seen it. Well, how can you opine on these things? Opine on what things? On his list that he put together, of which, by the way, some of them are intrigued.

34:15Oh, the list. Yeah. Guys, probably not a huge surprise that Broadcom's going to lead the S &P here at the Open Gym. AMD's not far behind. Yeah, well, look, I know this isn't how Lisa Su wants to win, okay? This is not the way she wants to win. I think she's amazing. We said a lot of good things about her. I think she would not like that I said that the Richard Feynman, which is the next addition after the Bureau of Reuben, is already better than what she has lined up because she has done a remarkable job. Hock Tan, who regards himself as a primary competitor to NVIDIA, would also not really care to hear what I said, but that there's already specs that are so great.

35:00But the specs are not gen-seats. There are a lot of people who put together these products. And again, I reiterate, what an insult to the 42 ,000 people there who work very hard and have done incredible things. and they're listening and they're saying, do they not know that I work here and I do important things? Of course, right. There's other people. There are other people. There's no doubt about that. Many other people, many very highly talented people. And nobody is a replaceable, as we've seen. Because this board, which we gave a hard time to earlier in the week, talking about how, frankly, weak it seemed, ultimately did dismiss the most high-profile CEO there is.

35:41Yeah, and the lawyer from Cooley, important. Yep. Important. No-nonsense. I know, and I think also I learned Suzanne Nora Johnson, a no-nonsense board member as well. They could have picked someone other than Wachtell. Wachtell is on sale. And Wachtell will continue that investigation on behalf of the board, as we said yesterday. And this was sort of our conversation yesterday, just in terms of all the time that Jensen Wong would be spending in meetings, getting ready for whether it's testimony in front of Congress and or whether it's, who knows, potential litigation and dealing with the investigation that Wachtell is undergoing or undertaking on behalf of the board as well.

36:22I will say, I mean, I talked to somebody who usually is able to get him on the phone right away because that's the way Jensen operates, as you know. And no surprise, of course, you're saying he's been incommunicado. So that will be the case now. He will not be. Well, I think it was the Times that got him on the phone and he said, I think you should not be talking to me directly. Of the decisions that Mayna's made in the last six months, that's probably the most intelligent. There are, I urge everyone to go on conference calls of what this company's like. And I think you would say, well, I guess that the person who really runs it day to day is collect crabs.

36:58And, you know, this is not a financial scandal. That's very important. It's not a financial scandal. You may say that Singapore, where he shipped, where... But I am saying that if my hands are in collect press in terms of knowing finances, she's just monstrous. Do you think, then, that she has a reasonable shot at becoming the permanent CEO? I think they have to go outside. You do? Yeah, and she's a great finance person. Oh, you've said that, actually. Do we know whether or not she enabled and argued for Chinese AI the way he did? I think that, yes, I do know. I do know that the theory, not in practice, but the theory had been from the company, that if you could get all the engineers around the world to write on NVIDIA, that would be a colossal coup.

37:48Of which, by the way, when I deviated that for a moment, I mean, they showed me evidence of what happens if you can dominate throughout the world. and they were very adamant that you think the Chinese communists are going to use us in the military? Are you crazy? It's not going to happen. But this was during the Biden administration. But I questioned because I'm kind of more of a bit of a hawk on China. And they were explaining to me, Jim, what you want to be is in favor of the U.S. dominating AI. And if we stop, if they build on NVIDIA, then Huawei will be stopped. And I was convinced of that.

38:21Yeah, that was the argument. That was the argument made. The Hawks argue they do that until they no longer have to. And then they build their own. Well, they know that if you want AI to fall behind in China, then you let NVIDIA in because the PLA is not going to. There's some guy saying, oh, he's selling the PLA. That's disgusting. I mean, look, Jensen Wang had a view, all along, which is that if the world writes on CUDA, the operating system, Ian Buck operating system, then what would happen is the world would be dependent the same way the world's dependent on the U.S. dollar. He presented this to me a long time ago, and it was hard for me because he knew I was a China Hawk.

38:56And I came away thinking, I'm wrong. I mean, there's the old, like, you know, there's the metaphor of do you want to see another country's ballistic missile, your enemy's ballistic missile, with a Boeing case shell, right? That's not a good look. I don't think that the Chinese economy, the PLA, which some people feel run the country, is going to let a NVIDIA chip into their equipment because maybe they, remember, they don't think that we are. They would say, you know what, the U.S. is in that NVIDIA chip, and they'll shut those down when we go to launch. That's been the wrap. Look, I bought that wrap.

39:33Yeah. I bought that wrap. You can see, well, Jim, your child trust owns it. You bought it. But no, I think the wrap is cool. We really don't know how many NVIDIA chips have truly been deployed in data centers controlled by Chinese companies. No, we don't. We really don't. We know that the H20 has been allowed to be sold. We know that then the H200 as well. And that's the 25 % of the revenues. The H20 was 15 % of the U.S. government. But we don't know, frankly, how many have actually been sold. Not many, right? Let's say we're on to Pallion right now. Let me just finish the thought. We also don't know just how much of NVIDIA's true revenues are derived from China.

40:10No, we don't. But let's look at the way China works. Let's get Nucor on here. I'm trying to pick a whole other industry. Nucor knew that China gets everywhere. They send their stuff where they want. They export what they want. They take in what they want because they're brilliant at doing that. I think that if you talk to Micron, Sanjay Mirogin, the landmark lawsuit that Micron bought against the Chinese government, they are great at stealing. They are adept at it. And it's very hard to stop them. Jensen has sworn to me multiple times he would never violate the law, and I believe that. It is worth noting, guys, the stock is well off the lows, at least, that it showed in the pre-market.

40:50I'm telling you, Collette is a real deal. I will point out the stock is down 15 % for the year. The market value of a company that once supported the highest valuation in the world for quite some period of time has now fallen below that of Microsoft. Obviously, Apple remains at the top at over$5 trillion. How can it not? No, of course not. Come on, Nikesh. There are people who want this job. Yes, there are. There are people who want this job. Of course there are. And they are good people. And I think you would be surprised already this morning who would be interested. And a lot of people would be a breath of fresh air.

41:28And so I think that why this market's rallying is one, Colette ran the conference call, she will run the call on Tuesday, no change from that. And the number of people apparently who want this job is surprising. Yeah, the overnight low was 156.20. That was before the news this morning. Jim, we are going to get some clues on demand out of Cisco this week. Hey, Matt. Cerebris. Chuck will be here tomorrow. Chuck's very, he can't wait to come on the show. I know Chuck is probably not that thrilled, but we're going to pepper him with questions about this. By the way, it's a lab work at Cisco. But I do think that I'm thrilled that Chuck's going to come on.

42:03Chuck's a statement for American business. I do want to make one point, which is that everybody I talk to is deeply sad about this because he was so respected. The Kimberly Powell thing, we cannot underestimate that because that's a direct report. And in America, we know that is sacrosanct. We already litigated that issue. We litigated that issue. Yeah, we've been going through history, the Steve Easterbooks and McDonald's, the Mark Hurds. And this is bad. The Krasanichs at Intel. Yeah, I mean, when I talk to Kimberly, there are legitimate talks about drugs and what they're going to do. And there was one right after that terrific David Ricks conversation with Jensen where David Ricks was saying, listen, I think we could live to X.

42:53Jensen was saying we could live forever. But Kimberly Powell was not in those discussions. that I could do. Actually, interesting you bring that up because Dario Omode did suggest this week that cancer, heart disease, Alzheimer's could become relics of the past within a decade because of AI. And then Ricks, yesterday, Onyx, says that would be amazing, but I don't think it's likely. I thought that was incredible because what Ricks knows, and I've talked to him very often about this, the false hope stuff, man, just can't. Anyone who's had relatives die of cancer, like I have. We talked about this with Ricks.

43:29You just never say that. You just don't do it. I mean, this guy is very... I'm getting to learn the way he talks. He's like, I mean, I'm known for hyperbole. He'd be the king of hyperbole. And he's also kind of like he was all over the place. One minute, we're all going to die. The next minute, we're going to live forever. Forever. But, you know, if you have a relative or if you're suffering from cancer and you read that, I think you just say, you call your relative and say, listen, there's hope. And I say, I have my turn on today. Let's talk about how hard to just even create a vaccine. No, I thought those were...

44:02Which one? NVIDIA is certainly well off again below what it had in the free market. That said, Jim... The analysts, they were like rats. It's very early to try and understand what's going to happen here. 941. Yeah, it's 941. I know, it's not early for you because you were up at 330, if you even slept. I slept very little last night. I would assume you did. Well, because I kept waiting for the other shoe to drop. And it finally did. Yeah. I kept going and going. at 8.50 a.m. this morning. Well, that was smart before the market opened. A week ago, if I'd sat here and told you that Jensen Wong was going to resign as the CEO of NVIDIA.

44:34I said it on Sunday night. You would have looked at me like... I did a Sunday night piece that said, basically, that he was a gore. It was for the club. It's a very harsh piece. So this one's not good. It wasn't good. No, it wasn't good. I know we were saying that from Monday morning when we began our coverage. Of course not. The facts, as we said many times, the facts almost always get worse. And they did. They did. But remember, there's a lot of cash in the balance sheet. They do have earnings coming up. They have a remarkable roadmap. They have lots of people there. The insult that I keep hearing about the 42 ,000 people really rankles me.

45:11I do believe that this is a competitive company, that the other guys who are against them are saying, I wish it were that easy to top them. They're very ingrained in the system. really great. I mean, Jim, competition is not going to sit still. No. You don't think Google and AMD and Broadcom are working on things now with this new information? And by the way, Amazon as well. Anybody making their own chip, as you know. So TPUs, TPUs, Traniums. Josh, you should come out right now and say, I told you I have a$50 billion chip business, and it's going to be quite evident in the second half. No, everyone is going with the Conception of arm holdings, it's not in Rene Haas' view that he does.

45:53I mean, the companies I'm looking at, those are all clients. But I do think that there's a lot of people who are going to say it's up for grabs in 2029-30. And I'm not going to disagree with that. It does kind of reset the playing field. But if you get the right person in and collect the livers on Tuesday and they have the buyback and they put it in, because they think that a$230 billion buyback can take a lot of supply out. And then I'd say, you know what? Downgrade it then. Downgrade it then. You downgrade it into the bottom. The path is clear. Collette Crest is not to be trifled with. I guess maybe these guys have never been on the...

46:32Their targets were$500. Now we're getting in back to the 180s. Well, stocks should go down. Yes. But look, anything orderly as opposed to what we've had is a great pleasure. The fact that in the last, in nine, I know it's early, but 944, you like that? Very nice. 944 looks like Billy Joel, my wife, right? 944, a number of people who wanted that job that have come in to me. Cal Sheehy, here I come. Any of them that I mentioned? I'm not going to mention that it was the people you mentioned. Watch bonds today. Actually, tenure got back to 506. No, the president did write that we do not need a deal with Iran.

47:17You got Brent almost back to 94, although AAA gas 391 today. Stay with us. Who's ready for a bike ride? Peppa Pig is learning to ride her bike. First, pop on her helmet. Safety first. Then attach the push stick and give her bike a push. And watch Peppa paddle. Her legs go round and round as the wheels turn. With more than 75 sounds and phrases, every ride is a big adventure. Peppa Pig Ready Paddle Go. Available at all major retailers now. If you like YouTube, you'll love YouTube Premium. It's destroying athlete, creator, and YouTube Maxer. YouTube Premium enhances how I use YouTube with awesome features like offline downloads so I can download my favorite training videos before I hit the gym.

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48:45Download the latest episode and subscribe at schwab.com slash marketupdatepodcast or find Schwab Market Update wherever you get your podcasts. If you're just waking up out west, Jensen Wong resigns as CEO and board member of NVIDIA. Company launches a search. CFO Colette Kress will be interim CEO. Stock got to 148.80 this morning on that news, although rebounding now back to 160 and change. Of course, guys, this was a$210 stock last Tuesday. So we'll watch it closely. Yeah, look, this is a company that obviously the most important person in semiconductors, more even than Andy Grove, more than Craig Bauer, more than Gordon Moore.

49:30Yes. And because he made it more than semis. Remember, semis were really second-rate to software. Another company that we, of course, follow closely here that is private still is OpenAI. And I did want to share some recent news on that company. By the way, a company that has taken in some$30 billion from NVIDIA, some$65 billion from SoftBank. but has had the need to continue to raise more money as a result of what is an enormous cash burn, despite what is also significant revenue growth at OpenAI. I remember we reported yesterday about 50 % revenue growth from the second to the third quarter for the company.

50:05I can tell you now, according to people familiar with the situation, they've raised$15 billion in their latest effort to do so at a$1.25 trillion valuation. Recent reports have the company at$11 billion. I can now tell you they're at$15. Unclear whether they will go beyond that or whether that will be sort of where they end this latest fundraising at OpenAI. And again, at a$1.25 trillion overall value. You may recall the company actually did go to the market with the intent of raising as much as$30 billion at a$1.4 trillion valuation. It had to pull back both the valuation and its ambitions for raising new capital, at least based on what it actually was able to get from existing and some new investors as well.

50:55This, of course, comes as we're less than a week away, guys, from Anthropix IPO, in which it is going to be raising at least, let's call it 80 plus,$84 billion, some$26 billion from strategic partners that do include NVIDIA and, of course, from the public as well, both institutional investors and investors around the world and retail investors also. You know, I am hearing some positive chatter around Anthropik, Jim. As I sort of said on Monday that, you know, they talk 1.3 to 1.4, but really they may move pricing up to as high as 1.5 trillion. I'm hurting 1.5, 1.6. 1.6. And then you see where it trades in the aftermarket.

51:36Again, we shall see. Unclear exactly how this news from NVIDIA this morning is going to play out. But I did offer up the idea that to the extent that it lessens the influence of open source, given you've taken the largest single supporter off the field in Jensen Wang, might be seen as a positive for the Frontier Labs. How much do you think it matters that they have the big stock-based compensation that if you took away the, you know, And they're spending a lot of time defending their actual profitability. This is anthropic you're talking about. Yeah, but the stock-based compensation is huge. It is huge, although, frankly, it's huge at a lot of other public companies as well.

52:15And then we sit here and we talk about adjusted EBITDA, and every so often I'll point out, oh, by the way, if you actually add back stock-based compensation, the differential between gap earnings and non-gap was enormous. So I don't know is the answer how much it's going to matter. I'm just thinking, I mean, to me, I've been going over the valuation. I think the valuation is stunning. And I know that the number that Goldman put out for 2030 revenues is extraordinary. Right. And I think they can be beat. I mean, the number that matters is the one we got earlier this week, namely$81 billion in annual revenue run rate from Anthropic and moving up from there.

52:44And so trying to judge in terms of at least potential profitability and the like, you know, and what their margins are, which are pretty significant. That said, not as significant as Nvidia's, which runs 75 to 80 percent. Can we believe, as we watch the stock, by the way, here now hit a new high on the morning session, that they can maintain those kinds of margins that have helped this become one of the most profitable companies the world's ever seen? Look, in the end, Elon Musk has more to do with that than anybody else. Because Elon Musk knows that the clients like this. Now, we mentioned a lot of companies that have tried to diversify away from NVIDIA, but they have customers who say, listen, I know you've got your own chip, but we want NVIDIA.

53:26And everybody provides it. So it's not like it. Now, NVIDIA is often viewed as a tax on the system. They're seeing that stuff is so good, customers are convinced that it's the right thing to own. So not everybody wants to buy the Amazon chipset. And I think Andy and Jess would admit that because it's just a simple rule. And there are, like I said, Jensen did not, if you remember, Jensen always said, I'm thinking 20 years out and I'm working back, which I thought was a great way to think. But I am very forward in terms of the next four or five years. And I think people have to remember the next four or five years, the roadmap is real and that the people who were part of that are still there.

54:09Right. Are you willing to buy here knowing the pace of investigations in the coming months? I mean, at least the potential for more disclosures about. No, I know. I mean, I would love to see what Colette said. Like I said, she's a straight shooter. They have to, I think that the government is going to go after Jensen, not the company. And I think that matters. I think that separating him from the company was a very good thing for shareholders today. But we don't know, right? We don't know. No, but you don't want the person who is the focus to be the person who's running the company. Because that person is going to be in depositions from National Kingdom.

54:50Agreed. And will not be able to run the company. But they don't know where the facts are going to lead them, do they? No, they don't. But I do think that if you get an outside person and says, you know what? I want a clean, clear slate. Yeah. Now, I know, David, I'm using an analogy and it's not national security. But when Charlie Scharf came in for Wells Fargo, which was regarded as being a rogue bank, Charlie had to do root and branch. Right. Is this going to be root and branch? I don't think so. You don't think so. And I know that I keep talking about this person, Collette, as being important, but I need people to go back and listen to any of the conference calls.

55:24And she's in charge. She's the keeper of the numbers. And to date, I've not heard anything about how the financials are wrong. And I think in the end that a lot of people who are buying the stock are saying, you know what, I hear all the chatter, but the money is there. And I believe that is absolutely true. And by the way, you have spoken very favorably about her for years. For years. So it's not like you're just sitting here today saying. She's a teacher. I go over the call. As soon as the call's over, I go over with Colette, and I just am in awe of her and her knowledge, and she has been a great teacher and educator about this industry.

56:00Not Jensen. I think Jensen's fun and terrific. I did love going out with him, and I didn't know about this side, obviously. But if I want the rigor of what's going on at that company, there is a person, and that person's name is Colette Crest. So you'll, I guess, try to package this and you'll try to package the way to think about this tonight on MADD? Oh, my God, yes. Yeah. But I'm very happy that she got the interim job. And, again, there are 42 ,000 people who did not wear leather jackets who had a lot to do with that company. And I've got to tell you, we may think that people are loyal to him, but I think they're loyal to NVIDIA.

56:35And I don't want to insult them anymore by saying that the man who they revered, like we all did, was the only game in 10. Seems wrong to me. Jim, we'll see you tonight. Yes, and I have Criptines, too, which is going to be terrific. And I have Stefan Benzel because I want to find out how much is AI on that melanoma vaccine, which a lot of people are very hopeful for. The one that they partnered with Merck on. Yes, that's a very big deal. I like Merck, too. Guys, this is a great show. I wish we had more. I mean, it's not like this is very fluid. I mean, even during the hour, things change. Well, we will have more.

57:11But I'm saying people that were suggested by you, that was not idle. Thank you. I spent some time on it. Well, isn't that something? Isn't it? Shocking. I do love you. Should I love you? You've been listening to the opening bell on CNBC's Squawk on the Street. All opinions expressed by Squawk on the Street participants are solely their opinions and do not reflect the opinions of CNBC or its parent company or affiliates, and may have been previously disseminated by them on television, radio, internet, or another medium. You should not treat any opinion expressed on this podcast as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinion.

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