| From: Julius Wong | 9/10/2024 8:12:37 AM | | | | | | Taiwan Semiconductor's August sales surge as AI demand continues
Sep. 10, 2024 7:53 AM ET
By: Chris Ciaccia, SA News Editor
 shih-wei
- Taiwan Semiconductor (NYSE: TSM) said on Tuesday that sales for August surged year-over-year, buoyed in part by demand for all things artificial intelligence.
- Taiwan Semi, which manufactures processors for Nvidia ( NVDA), Apple ( AAPL), AMD ( AMD) and others, said revenue for August came in at approximately $7.8B, or NT$250.87B, up 33% from August 2023, albeit down 2.4% from July.
- Revenue for the eight months ended in July jumped 30.8% to approximately $55.16B, or NT$1,773.97B.
- Shares fell 1.2% in premarket trading.
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| To: Return to Sender who wrote (92966) | 9/10/2024 5:47:17 PM | | From: Return to Sender | | | | BPNDX Remains 47 PnF Buy Signals - [AMZN added TEAM removed]
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| To: Return to Sender who wrote (92969) | 9/10/2024 5:57:03 PM | | From: Return to Sender | | | | Market Snapshot
| Dow | 40736.96 | -92.63 | (-0.23%) | | Nasdaq | 17025.86 | +141.28 | (0.84%) | | SP 500 | 5495.52 | +24.47 | (0.45%) | | 10-yr Note | +5/32 | 3.65 |
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| | NYSE | Adv 1426 | Dec 1305 | Vol 902 mln | | Nasdaq | Adv 2133 | Dec 2001 | Vol 5.0 bln |
Industry Watch
| Strong: Real Estate, Utilities, Consumer Discretionary |
| | Weak: Energy, Financials |
Moving the Market
-- Apple (AAPL) down after losing EUR13 bln back-tax ruling in EU Court of Justice
-- Comments from JPMorgan Chase (JPM), Goldman Sachs (GS), and Ally Financial (ALLY) weighing down financial sector
-- Hesitation in front of tonight's presidential debate and tomorrow's release of August CPI
| Closing Summary
10-Sep-24 16:25 ET
Dow -92.63 at 40736.96, Nasdaq +141.28 at 17025.86, S&P +24.47 at 5495.52
[BRIEFING.COM] The stock market exhibited upside and downside action at the index level, but moves in either direction were relatively limited. The S&P 500 (+0.5%) traded up as much as 0.5% and traded as low as 0.5% today. The mixed action was influenced by volatile moves in some mega cap names, along with hesitation in front of tonight's presidential debate and tomorrow's release of the August Consumer Price Index at 8:30 ET.
Apple (AAPL 220.11, -0.80, -0.4%) was an influential mover in the mega cap space, trading below yesterday's close through the entire session after disclosing that it expects to record a one-time income tax charge in its fiscal Q4 of up to approximately $10 billion after losing a back-tax ruling in the EU Court of Justice.
The Dow Jones Industrial Average (-0.2%) lagged the S&P 500 and Nasdaq Composite (+0.8%), trading lower most of the session due to sizable declines in its large bank components.
JPMorgan Chase (JPM 205.56, -11.25, -5.2%) was the worst performer in the DJIA, followed by Goldman Sachs (GS 467.13, -21.44, -4.4%), after the former suggested expectations for 2025 net interest income are a bit too high and the latter said it sees Q3 trading revenue tracking towards a 10% decline.
Other bank stocks traded down in response to the aforementioned headlines, and in response to Ally Financial (ALLY 32.67, -6.99, -17.6%) saying credit challenges have intensified. The SPDR S&P Bank ETF (KBE) settled 0.9% lower and the S&P 500 financial sector closed 1.0% lower.
The only other S&P 500 sector to register a decline was energy, which fell 1.9% amid falling oil prices. WTI crude oil futures sank 4.1%, or $2.81, to $65.85/bbl.
Treasuries settled with gains ahead of tomorrow's release of the August CPI. The 10-yr yield dropped five basis points to 3.65% and the 2-yr yield settled six basis point lower at 3.61%. On a related note, the $58 billion 3-yr note sale met strong demand.
- S&P 500: +15.2% YTD
- Nasdaq Composite: +13.4% YTD
- Dow Jones Industrial Average: +8.1% YTD
- S&P Midcap 400: +6.0% YTD
- Russell 2000: +3.5% YTD
Today's economic lineup featured the NFIB Small Business Optimism Survey, which dropped to 91.2 in August from 93.7.
Looking ahead, Wednesday's economic lineup features:
- 7:00 ET: Weekly MBA Mortgage Index (prior 1.6%)
- 8:30 ET: August CPI (Briefing.com consensus 0.2%; prior 0.2%) and Core CPI (Briefing.com consensus 0.2%; prior 0.2%)
- 10:30 ET: Weekly crude oil inventories (prior -6.87 mln)
Treasuries settle with gains ahead of CPI
10-Sep-24 15:35 ET
Dow -128.30 at 40701.29, Nasdaq +148.46 at 17033.04, S&P +22.59 at 5493.64
[BRIEFING.COM] The S&P 500 (+0.4%) and Nasdaq Composite (+0.9%) remain near session highs ahead of the close.
Treasuries settled with gains ahead of tomorrow's release of the August Consumer Price Index (CPI) at 8:30 ET. The 10-yr yield dropped five basis points to 3.65% and the 2-yr yield settled six basis point lower at 3.61%.
In addition to the CPI report, the weekly MBA Mortgage Applications Index will be released at 7:00 ET tomorrow and the weekly EIA Crude oil Inventories will be released at 10:30 ET tomorrow.
NVDA, META recover early losses, coinciding with indices moving up
10-Sep-24 15:00 ET
Dow -133.04 at 40696.55, Nasdaq +110.45 at 16995.03, S&P +17.27 at 5488.32
[BRIEFING.COM] The S&P 500 (+0.3%) and Nasdaq Composite (+0.7%) trade near their best levels of the session.
NVIDIA (NVDA 107.13, +0.66, +0.7%) and Meta Platforms (META 505.77, +0.98, +0.2%) had been trading down when the S&P 500 and Nasdaq Composite were at session lows, but the shares have recovered losses, contributing to index level improvement.
The financial sector (-0.9%) and energy sector (-2.1%) continue to show weakness, but other sectors are mostly higher. The real estate (+1.5%) and consumer discretionary (+1.2%) sectors lead the pack.
Digital Realty Trust, Moderna outperforming in S&P 500 on Tuesday
10-Sep-24 14:30 ET
Dow -150.59 at 40679.00, Nasdaq +109.14 at 16993.72, S&P +13.04 at 5484.09
[BRIEFING.COM] The S&P 500 (+0.24%) is in second place on Tuesday afternoon, moving mostly sideways over the prior half hour.
Elsewhere, S&P 500 constituents Digital Realty Trust (DLR 155.41, +6.07, +4.06%), Moderna (MRNA 79.18, +2.57, +3.35%), and Molina Healthcare (MOH 333.77, +10.05, +3.10%) dot the top of the standings despite a dearth of corporate news.
Meanwhile, APA Corp. (APA 23.50, -1.42, -5.70%) is one of today's worst performers, dipping alongside broader weakness in the energy complex and losses in crude oil futures.
Tuesday strength in gold adds to Monday gains
10-Sep-24 14:00 ET
Dow -190.05 at 40639.54, Nasdaq +78.41 at 16962.99, S&P +6.84 at 5477.89
[BRIEFING.COM] With about two hours to go on Tuesday the tech-heavy Nasdaq Composite (+0.46%) is today's best-performing average, up about 78 points and near afternoon highs.
Gold futures settled $10.40 higher (+0.4%) to $2,543.10/oz, this as yields slip as we inch closer to this week's key inflation data.
Meanwhile, the U.S. Dollar Index is up about +0.1% to $101.64.
Academy Sports + Outdoors sporting solid gains as it puts rough quarter in rearview mirror (ASO)
As anticipated, Q2 was another difficult quarter for Academy Sports + Outdoors (ASO) as a combination of macroeconomic, weather-related, and company-specific headwinds caused the retailer to fall short of sales and comp expectations while downwardly revising most of its FY25 guidance. Similar to the past several quarters, reduced spending power from ASO's primary customer base -- households with incomes between $50,000-$150,000 -- weighed on demand, especially for big-ticket product categories like trampolines, pools, marine, and fitness.
- Making matters worse, the Texas-based company contended with several major weather events during the quarter, including tornados in Houston and Dallas, as well as Hurricane Beryl hitting in July.
- Meanwhile, in Georgia, ASO had troubles converting a distribution center to its new warehouse management system, resulting in out-of-stock situations across part of its store footprint. The primary issue was that the ramp up in productivity from the new system didn't keep pace with the accelerated throughput ASO needed to keep shelves fully stocked during the busier summer months. This situation cost the company approximately $32 mln in sales during Q2.
- As a result of the above headwinds, comps came in at -6.9%, missing expectations and representing a downturn from Q1's -5.7% comp. A decline in store traffic resulting in a 7.4% drop in transactions was the main driver behind the Q2 comp shortfall.
- There were some pockets of strength, though, during the quarter. For instance, the footwear category saw a 1% increase on a yr/yr basis, with solid results from brands such as NIKE (NKE), New Balance, and ASICS. Team sports, such as baseball, football, and pickleball also posted modest growth, but the declines in big-ticket items were too much to overcome.
- Looking ahead, ASO doesn't expect the macro-related headwinds to ease, prompting the company to lower its FY25 EPS guidance to $5.75-$6.50 from $6.05-$7.05, its sales outlook to $5.895-$6.075 bln from $6.07-$6.35 bln, and its comp forecast to -6% to -3% from -4% to +1%. The one silver lining is that ASO maintained its gross margin guidance of 34.3-34.7% as it continues to effectively manage inventory, which was flat on a yr/yr basis and down 5% in terms of units per store.
- Amid this difficult environment, ASO is still executing on its growth strategy which centers on both store and eCommerce expansion. The company said that it remains on track to open 15-17 new stores this fiscal year. On the omnichannel front, the eCommerce business posted its third consecutive quarter of positive growth and penetration increased by 30 bps yr/yr to 9.7%. ASO also rolled out a new loyalty program called "My Academy" and the early returns have been positive as daily sign-ups are over 3x the level it previously saw from customers opening a new Academy credit card.
Expectations were quite muted heading into the Q2 report. Although ASO's results and outlook were indeed soft, investors are hoping that the worst is now behind the company as its distribution center issues get resolved and as its new loyalty program provides a much-needed sales boost.
Under Armour heads lower on restructuring update;makes us more cautious on turnaround prospects(UAA)
Under Armour (UAA -10%) is heading lower after providing an update on its previously announced FY25 restructuring plan last night. On the one hand, it was good to see UAA reaffirm its FY25 adjusted EPS outlook at $0.19-0.22. However, the company also raised its outlook for pre-tax restructuring and related charges, which are not included in adjusted EPS.
- Following further evaluation, it identified approximately $70 mln of additional charges, largely related to its decision to exit one of its primary distribution facilities located in Rialto, California, by March 2026. Accordingly, UAA now expects approximately $140-160 mln of pre-tax restructuring and related charges to be incurred in FY25 and FY26.
- Recall that UAA reinstated founder Kevin Plank as CEO, effective April 1, 2024. The stock gapped lower on the announcement as apparently investors were not too happy to see Plank back at the helm of the struggling athletic brand. He founded Under Armour in 1996 and served as CEO from 1996 to 2019.
- He replaced Stephanie Linnartz, who was CEO for just over a year and had been seen as making some positive changes. She brought in new people to lead UAA's product, design, consumer, supply chain, and communications teams. She also streamlined its business to be more responsive, including its marketing functions.
- Based on the stock reaction, it seems investors would have preferred to keep Linnartz or perhaps an outsider would have been a better choice to offer a fresh look.
The stock popped higher in early August when UAA reported a surprise profit in Q1 (Jun). However, last night's news is weighing on the stock today. While adjusted EPS did not see a change, we suspect investors are disappointed to see the higher charges. And that's not just for the increased costs, but we think it also reduces confidence that UAA is on top of everything. It spurs questions as to whether UAA has a good handle on what needs to be done to turn the brand around.
Taiwan Semiconductor Manufacturing inches lower despite posting healthy August revenue growth (TSM)
Shares of Taiwan Semi (TSM -2%) continue to steadily decline, down nearly 10% over the past month, which followed a substantial rally off August 5 lows. Today's underlying driver is a minor cooldown in August revenue growth following a robust July. The world's largest chip manufacturer reported August revenue growth of 33.0% yr/yr, underpinning a healthy demand for its chips and reflecting continuous AI-related orders; AI giants like NVIDIA (NVDA) and Advanced Micro (AMD) are some of TSM's customers. However, on a mo/mo basis, August revs ticked 2.4% lower.
- Why was this minor dip enough to trigger selling pressure today? The market has started expressing concerns over an economic slowdown. For instance, even after NVDA reported another impressive beat-and-raise in JulQ last month, its shares shed over -6%. Further, Broadcom (AVGO), a prominent AI chip and software stock, sold off despite lifting its FY24 (Oct) AI revenue outlook last week; a moderately lower-than-expected Q4 consolidated revenue forecast sparked growth worries.
- Against this recent backdrop, any seemingly minor blemishes, such as a 2.4% mo/mo drop in revenue for TSM, can garner a concerning response.
- It is also worth noting that TSM was lapping a less challenging yr/yr comparison in August compared to July. Last year, revenue fell by 13.5% yr/yr in August versus a 4.9% drop in July. However, this year, TSM delivered a less impressive 33.0% pop in August revs compared to a 44.7% improvement in July.
- Nevertheless, despite growth concerns, TSM still recorded a robust yr/yr growth rate for August, sustaining its excellent recovery momentum this year following a lackluster 2023. As the company's Q2 results illustrated, AI demand has not budged. In fact, management raised its FY24 revenue outlook considerably while keeping its growth prediction for the overall semiconductor market unchanged, reflecting confidence in the AI frenzy persisting through the back half of the year.
The main takeaway from today's adverse reaction to an otherwise decent growth rate for August is that some tech stocks, specifically those that have soared over the past year (like TSM), might be finding themselves on relatively shaky ground. Any blips or speed bumps can ignite quick downside action. Still, when taking a step back, TSM's monthly revenue growth throughout FY24 has been tremendous. While it helps that TSM is lapping an awful year that saw growth contract yr/yr in all but three months, its increased revenue outlook for the year alongside bullish remarks on the state of AI, noting in July that demand for the technology continues to accelerate, should help put broader growth fears at ease.
Goldman Sachs slides lower as downturn in trading business to weigh on Q3 results (GS)
August was a bumpy month for the financial markets, particularly at the beginning and the end of the month, and that rough patch battered Goldman Sachs' (GS) trading business. After the close last night, Reuters reported that CEO David Solomon stated during the Barclays Global Financial Services Conference that trading revenue is tracking towards a 10% decline in Q3 due to the more challenging conditions last month.
For other firms that rely heavily on their trading operations, like Morgan Stanley (MS), JPMorgan Chase (JPM), and Citigroup (C), the warning from GS represents a red flag of sorts, although a recovering investment banking industry should help to offset this trading downturn.
- GS and its competitors are coming off a strong Q2 for trading, especially on the FICC (fixed income, currencies, and commodities) side. Last quarter, FICC net revenues increased by 17% for GS, driven by strength in interest rate and mortgage products. However, the market for these FICC products soured in August. At the same time, GS is lapping a strong yr/yr comparable in Equities this quarter as net revenue in Equities grew by 8% in 3Q23.
- For some context, combined FICC and Equities trading net revenue in Q2 represented approximately 50% of GS's total net revenue. In comparison, Fixed Income and Equity trading net revenue accounted for about 33% of MS's total net revenue last quarter as the company's more diversified business model helps to insulate it from the swings in the trading business.
- GS has taken the opposite approach as MS, scaling back on its consumer business, while sharpening its focus on its core investment banking, asset management, and trading businesses. About one year ago, the company sold off home improvement lender GreenSky to a consortium of institutional investors led by Sixth Street. During the presentation last night, Mr. Solomon disclosed that GS plans to pare back further on the consumer business by exiting a credit card partnership with General Motors (GM), creating another top-line headwind.
- The good news, though, is that the prospects for lower interest rates continues to fuel a comeback for the investment banking industry. In Q2, investment banking fees jumped by 21% to $1.73 bln, reflecting substantially higher revenue in both debt and equity underwriting, mainly from convertible offerings and IPOs. The improved landscape for dealmaking should be a significant positive factor when GS reports Q3 earnings on October 15.
GS is taking a pretty good hit today, indicating that the downturn in Q3 trading revenue is worse than the market anticipated. Similar to the past few quarters, Q3 is shaping up to be a mixed performance for GS, with the investment banking business leading the way.
Oracle gaps higher; trades to new all-time highs even as other tech names falter (ORCL)
Oracle (ORCL +12%) is trading nicely higher today after reporting nice EPS upside with its Q1 (Aug) report last night. Revenue rose 6.9% yr/yr to $13.31 bln, which was above expectations. Oracle also guided Q2 (Nov) EPS and revs in-line. What is interesting is that this marks Oracle's fifth consecutive earnings report that led to a gap in the share price. Q1 and Q2 were down but Q3, Q4 and now Q1 gapped higher.
- In addition to earnings, Oracle announced a deal with Amazon's AWS segment. Oracle Database@AWS is a new offering that allows customers to access Oracle Autonomous Database on dedicated infrastructure and Oracle Exadata Database Service within AWS. AWS has now joined Microsoft Azure and Google Cloud in making OCI and Oracle available in their respective clouds.
- Let's dig into earnings. Oracle actually missed on EPS and revs in Q4, but RPO was its saving grace. That metric helped propel the stock higher despite the EPS/revenue miss. RPO was a bright spot again in Q1 as it rose +52% CC to a record $99 bln. What's more, Oracle typically sees a seasonal decline of RPO in Q1. However, the company signed several large deals this past quarter, resulting in a sequential increase. Further, its cloud RPO grew more than 80% CC and now represents nearly 75% of total RPO.
- Oracle also echoed what we heard from Azure and AWS, which is that both are ramping up investments to build out their infrastructure to handle increased demand. In fact, Oracle says it expects its FY25 cap-ex will be double what it was in FY24. That's a big amount of growth and demonstrates Oracle's confidence in its pipeline. Oracle currently has 85 cloud regions live, with another 77 planned, with more to follow.
- The company said Oracle Database is thriving, and the multi-cloud agreements it has with Microsoft, Google, and now AWS make it easier for its customers to run their Oracle Databases in the cloud. Also, Oracle noted it's rapidly expanding its OCI capacity to meet the demand that was seen in its +52% CC RPO cloud growth. Furthermore, while much attention is focused on its GPU-related businesses, Oracle noted that its non-GPU infrastructure business continues to grow much faster than its competitors.
Overall, investors are clearly impressed with how Oracle is starting off FY25. It was not huge upside for Oracle. However, after a miss in Q4, it is nice to see Oracle get back to reporting upside. We think the huge RPO growth is having a bigger impact on the share price today. RPO typically declines sequentially in Q1, but it saw growth this year. We also think investors are pleased to see AWS partner with Oracle, which now has deals with the big three cloud names. Finally, the stock has been making a strong move since mid-December, up more than 50% since then, to a new all-time high today. And that is despite other tech names pulling back on AI jitters. We have to tip our cap to Oracle.
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| From: Julius Wong | 9/11/2024 8:46:16 AM | | | | | | Arm becomes new Top Pick at Morgan Stanley on emerging Edge AI opportunity
Sep. 11, 2024 8:01 AM ET
By: Ravikash Bakolia, SA News Editor
 Michael Vi
Morgan Stanley made Arm Holdings (NASDAQ: ARM) its new large-cap Top Pick, citing mobile recovery, new edge AI opportunities and the resulting royalties' expansion.
The firm maintained an Overweight rating and a $175 price target on the stock.
Analysts led by Lee Simpson said that after the launch of Apple's ( AAPL) iPhone 16 on Monday and the indicated use of Arm v9 architecture in the A18 processor, the British company remains their favored play on the emerging Edge AI opportunity.
The analysts expect mobile to drive initial upside, followed by infrastructure and autos.
The analysts think Arm is an important part of the shift to edge AI. Arm royalties expansion is driven by mobile (35% compound annual growth rate, or CAGR, FY24-27), with medium-term momentum seen in autos, alongside solid growth in Infrastructure. The analysts expect the growing use of v9 cores, plus a shift to more custom silicon work, to be a feature of mobile growth.
Simpson and his team noted that the iPhone 16 release suggested the use of an Arm-based A-series processor (A18) in the device. They think this is likely an Armv9-based core, probably using CPU extensions that give greater resource balance in the device across CPU, NPU and GPU.
Apple is expected to stagger the release of its AI features, and with expectations for 225 million to 240 million iPhone units in FY'25 but the analysts believe that this could climb to a range of 230 million to 260 million and above in FY26. Arm's fiscal year 2025 ends in March 2025.
In addition, the analysts stated that Arm is the global leader in silicon IP and is often overlooked as an AI beneficiary. They think of Arm as more than a mobile CPU story, and instead look to the growing use of custom silicon on Arm as a strong driver of royalties' expansion (including a shift to higher royalty rates) in the next two-to-three years at least.
Drivers of custom silicon royalties already come from cloud AI (initial volumes), but this will shift in large part to mobile soon (starting in the March quarter or fiscal fourth quarter 2025), according to the analysts. |
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| To: Julius Wong who wrote (92976) | 9/11/2024 12:25:52 PM | | From: Return to Sender | | | | Nvidia CEO Says Customer Relations Are ‘Tense’ Due to Shortages
finance.yahoo.com
(Bloomberg) -- Nvidia Corp. Chief Executive Officer Jensen Huang, whose products have become the hottest commodity in the technology world, said that the scramble for a limited amount of supply has frustrated some customers and raised tensions.
“The demand on it is so great, and everyone wants to be first and everyone wants to be most,” he told the audience at a Goldman Sachs Group Inc. technology conference in San Francisco. “We probably have more emotional customers today. Deservedly so. It’s tense. We’re trying to do the best we can.”
Huang’s company is experiencing strong demand for its latest generation of chips, called Blackwell, he told the audience. The Santa Clara, California-based business outsources the physical production of its hardware, and Nvidia’s suppliers are doing their best to catch up, and are making progress, he said.
Nvidia leans heavily on Taiwan Semiconductor Manufacturing Co. for production of its most important chips and does so because that company is the best in its field by a large margin, he said. But geopolitical tension has raised risks. China sees TSMC’s home island as a rogue province, stoking concerns that it might try to reclaim the territory. That could potentially cut off Nvidia from the key supplier.
Huang said he develops much of the company’s technology in-house and that should allow Nvidia to switch orders to alternative suppliers. Still, such a change would likely result in a reduction in quality of his chips, he said.
TSMC’s “agility and their capability to respond to our needs is just incredible,” he said. “And so we use them because they’re great, but if necessary, of course, we can always bring up others.”
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| From: Julius Wong | 9/11/2024 12:50:57 PM | | | | | | Nvidia's CEO sees $1T data centers getting accelerated due to advent of gen AI
Sep. 11, 2024 12:26 PM ET
By: Ravikash Bakolia, SA News Editor
 Justin Sullivan
Nvidia's (NASDAQ: NVDA) CEO Jensen Huang said that trillion dollars worth of general purpose datacenters are going to get modernized into accelerated computing. "That's going to happen no matter what," Huang noted while discussing the data center market.
Huang, who is also Founder and President of Nvidia, was speaking at the Goldman Sachs Communacopia + Technology Conference on Wednesday and responded to questions on data center markets, and AI growth among other things.
Huang said, "we are now in this computer revolution, now what's amazing is, so the first trillion dollar of data centers is going to get accelerated, in the advent of this new type of software called generative AI. Because generative AI is not just a tool, it is a skill... this is why a new industry has been created."
Huang noted that's why people think AI will expand beyond $1T of data center and IT and into the world of skills — such as digital assembly line worker (a robot), a digital customer service (chatbot).
Huang added that "densification" of computers will happen. Nvidia wants large data centers to be compressed into a small area, as the ones spread across a large are not very efficient.
Discussing the company's new Blackwell chip system and pace of innovation, Huang said that "we have 7 different chips and they all contribute to the performance, so we could innovate and bring a new AI cluster, a super cluster to the market every single year that is better than the last generation because we have so many pieces to work around."
On Blackwell's delivery, Huang said that Blackwell is in full production and the company would ship in Q4, and start scaling in Q4 and next year. "The demand on it is so great, and everybody want's to be first, everybody wants to be most," Huang commented.
Separately, Huang said that productivity gains from AI are incredible.
Speaking on the use of AI in Nvidia itself, Huang stated that "there is not one software engineer in our company today who doesn't use code generators." He added that "the days of every line of code being written by software engineers are completely over."
Huang noted that the idea is that each software engineer of the company would have companion digital engineers working with them 24x7 in the future.
The Nvidia chief also tried to calm fears related to supply chains from Asia, mainly Taiwan.
Huang said that the company tries to design diversity redundancy into every aspect it can. He added, "to have enough intellectual property in our company, in the event that we have to shift from one fab to another, we have the ability to do it. Maybe the process technology is not as great, maybe we will not be able to get the same level of performance or cost but we will be able to provide the supply." |
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| To: Julius Wong who wrote (92978) | 9/11/2024 12:51:26 PM | | From: Julius Wong | | | | Oracle is designing a data center that would be powered by three small nuclear reactors
Oracle chairman and co-founder Larry Ellison had a “bizarre” announcement to make this week.
The electricity demand from artificial intelligence is becoming so “crazy” that Oracle is looking to secure power from next-generation nuclear technology, Ellison told investors on the company’s earnings call Monday.
“Let me say something that’s going to sound really bizarre,” Ellison told analysts. “Well, you’d probably say, well, he says bizarre things all the time, so why is he announcing this one. It must be really bizarre.”
Oracle is designing a data center that will require more than a gigawatt of electricity, the company’s chairman said. The data center would be powered by three small nuclear reactors, he added.
“The location and the power place we’ve located, they’ve already got building permits for three nuclear reactors,” Ellison said. “These are the small modular nuclear reactors to power the data center. This is how crazy it’s getting. This is what’s going on.”
Ellison did not disclose the location of the data center or the future reactors. CNBC reached out to Oracle for comment.
Small modular nuclear reactors are new designs that promise to speed the deployment of reliable, carbon-free energy as power demand rises from data centers, manufacturing and the broader electrification of the economy.
Generally, these reactors are 300 megawatts or less, about a third the size of the typical reactor in the current U.S. fleet. They would be prefabricated in several pieces and then assembled on the site, reducing the capital costs that stymie larger plants.
Right now, small modular reactors are a technology of the future, with executives in the nuclear industry generally agreeing that they won’t be commercialized in the U.S. until the 2030s.
There are currently three operational small modular reactors in the world, according to the Nuclear Energy Agency. Two are in China and Russia, the central geopolitical adversaries of the U.S. A test reactor is also operational in Japan.
cnbc.com |
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