The shares of FANGs are all about to double in value in the Silicon Valley if commercial real estate is any indication of the future growth rates.
The group is gobbling up office space at such a prodigious rate that only a vast expansion of their business would justify these massive long-term commitments.
Commercial real estate commitments are one of the most valuable leading indicators of stock performance out there. They show what the companies themselves think are their future prospects.
Apparently, the stock market agrees with me. Technology is virtually the only group of shares moving to new all-time highs in these otherwise dismal trading conditions.
Just this month Facebook (FB) signed a lease for the entire brand new 43-story Park Tower in downtown San Francisco, and that's just to house its Instagram business.
Google (GOOGL) is leasing 39% of the office space in Mountain View, CA. It is currently in negotiations with the nearby city of San Jose to build a skyscraper occupying an entire city block that will house 10,000 tech workers. It also is building another 1 million square feet near an old prewar dirigible landing strip in Moffett Park.
Apple (AAPL) is hogging some 69% of the office space in Cupertino, CA. It is just now moving into its new massive spaceship-inspired headquarters, where 10,000 workers will slave away. The world's largest company is currently on the hunt for a second headquarters location.
Netflix is slowly gobbling up Los Gatos, CA. It was recently joined by the set top device company Roku (ROKU), which is growing by leaps and bounds.
Fruit canning was the original industry of Silicon Valley at the turn of the 20th century, taking advantage of the surrounding peach, plum, and apricot groves. When I was a kid after WWII, defense firms such as Lockheed (LMT) took over, creating thousands of high-paying engineering jobs.
It didn't hurt that Stanford University was spitting distance away, and the University of California was just on the other side of the bay. These two schools supplied the manpower to fuel the hypergrowth ahead.
To say the growth has caused local headaches would be an understatement in the extreme. The San Francisco Bay Area now sports the world's most expensive residential housing. The median San Francisco home price has skyrocketed to $1,334,000 and requires an annual income of $334,000 to support it.
Small businesses such as dry cleaners, nail salons, restaurants, and barber shops have been driven out by soaring rents. It's not uncommon now to go out to dinner only to find a "closed" sign on your favorite nightspot. Your personal assistant now has to travel miles just to get your suits pressed.
As for traffic, forget about it. Rush hour has ceased to exist. Freeways are now jammed a nonstop 12 hours a day in the worst neighborhoods.
Success has its price, and this was never truer than in Silicon Valley.
https://www.madhedgefundtrader.com/wp-content/uploads/2018/05/APPLE-HQ-story-2-image-6-e1527804149789.jpg326580MHFTRhttps://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.pngMHFTR2018-06-01 01:07:092018-06-01 01:07:09Why Your FANG Stocks are About to Double in Value
Coders relish the opaqueness surrounding the industry infatuated with developing the next big thing to take Silicon Valley by storm.
There is nothing opaque about the Mad Hedge Technology Letter.
I grind out recommendations and you follow them. Period. End of story.
To put it mildly, the letter has gotten off to a flying start since its inception in February 2018, and there is no looking back, only looking forward.
Micron (MU), Red Hat (RHT), Microsoft (MSFT), and Intel (INTC), just to name a few, have been solid recommendations standing up to all the nonsense and mayhem permeating throughout the periodically irrational markets.
Have you noticed lately when you open up the morning paper while sipping on a steaming mug of Blue Bottle Coffee, that almost every story is about technology?
It's not a mistake. I swear.
Technology is permeating into the nooks and crannies of our society and the leaders of this movement are laughing all the way to the bank.
One of those aforementioned pioneers is no other than local lad, Salesforce CEO and perennial Facebook basher Marc Benioff.
I recommended Salesforce at $110 and it was one of the first positions in the Mad Hedge Technology portfolio.
You can't blame me.
I saw this stock pick from a million miles away and I will explain why.
Salesforce set ambitious targets that nobody thought were realistic at the time.
How high in the sky does Benioff want to build his castles?
By 2022, Marc Benioff set out sales targets of a colossal $20 billion per year.
Then Benioff gushed that Salesforce would pass the $40 billion mark, done and dusted by 2028 and $60 billion by 2034.
Remember that tech CEOs are incentivized to forecast ludicrous sales targets because it lures in the unknowledgeable investor.
Unknowledgeable or pure genius, it does not matter, Salesforce is an emphatic buy.
Salesforce is the ultimate growth stock.
In 2016, annual revenue came in at $6.67 billion, which is about the same size as a middle level semiconductor company.
They followed that up with $8.38 billion in 2017, demonstrating the parabolic shaped trajectory of the company.
At the end of fiscal year 2017, Salesforce announced that it expects revenue of around $12.60 billion in 2019.
The latest earnings report, Benioff disclosed full year guidance of $13.13 billion.
This puts Salesforce in the running to achieve its lofty aspirations.
Apparently, the castles Benioff is building aren't in the sky after all.
Theoretically, if Benioff expands the business into a $16 billion to $16.5 billion business by 2019, Salesforce will have a more than likely chance to pass the $20 billion mark by the end of 2020, a full two years than initially thought.
Salesforce will have ample wiggle room on the way to $20 billion if it is 2022 for which it aims.
Why am I rambling on about revenue?
It's the only metric that Salesforce investors value.
The company registered two straight years of less than $200 million in profits then followed it up with a less than stellar 2016 where it lost almost $50 million.
Don't expect any dividends from this neck of the woods anytime soon especially after acquiring MuleSoft, an integration software company, for $6.5 billion last quarter.
This purchase will add another $315 million of annual revenue to Salesforce's quest of eclipsing its future sales targets. This was after MuleSoft made $296.5 million in 2017 before it became a part of Marc Benioff's stable.
Benioff has proved a shrewd dealmaker, taking advantage of cheap capital to add suitable parts to his business.
Since 2016, Benioff has snapped more than 50 niche software companies that he rebrands as Salesforce products and sells them as add-on products.
This is further evidence that any funds available will be allocated toward reinvestment into products and services deeming any future dividend inconceivable, especially with the elevated revenue targets to surpass.
As for the business. Do we still need to talk about it?
Rip-roaring growth was seen across the board with total revenue increasing 25%.
Investors should stay away from any cloud company that is growing less than 20%.
Market intelligence firm International Data Corporation (IDC) voted Salesforce as the No. 1 client relationship management (CRM) platform for the fifth consecutive year.
It is the industry leader in sales, marketing, service, and increased market share in 2017, more than its closest competitors.
Larry Ellison must be tearing his hair out as Oracle's (ORCL) share price has been excommunicated to purgatory indefinitely.
Oracle is a company that I have been pounding on the tables to stay away from.
The Mad Hedge Technology Letter seldom recommends legacy companies that are still legacy companies.
Driving past his former estate, emanating from a sparkling perch in Incline Village overlooking Lake Tahoe, my neighbor gives me the goose bumps.
The property was later sold for $20.35 million. All told, Larry has around $100 million invested in real estate dotted around Incline Village. I sarcastically mentioned to him last time we bumped into each other to call me immediately when his $90 million estate in Kyoto, Japan, hits the market.
Oracle's position in the pecking order is a telltale sign of the inability to land the creme de la creme government contracts that ostensibly fall into Amazon (AMZN), Alphabet (GOOGL), and Microsoft's lap.
And it's not surprising that Larry is spending more time tending to his vast array of glittering luxury properties around the world rather than running Oracle.
Oracle is like a deer caught in the headlights and Marc Benioff is at the wheel.
On the Forbes 500 rankings, Salesforce has moved up almost 200 spots.
This position will rise as Salesforce is under contract booking a further $20.4 billion of commitments driven by its subscription services offering cloud products.
On the domestic contract front, it was much of the same for Salesforce, which inked premium deals with the U.S. Department of Agriculture, Kering, and sports apparel giant Adidas.
International companies such as Philips and Santander UK are expanding their relationships with Salesforce. A firm nod of approval.
Salesforce has been voted in the top three of most innovative companies for the past eight years by reputable Forbes magazine. The list was started in 2011, and it has never dropped out of the top three.
The gobs of innovation are the main logic behind the top five financial institutions expanding their relationship with Salesforce by an extra 70%.
Once companies start using the CRM platform, they become mesmerized with the premium add-ons that help companies run more efficiently.
Benioff has been a huge proponent of artificial intelligence (A.I.) and is an outsized catalyst to product enhancement gains.
Salesforce has taken Einstein, it's A.I. platform, and allowed all the applications to run through it.
The integration of Einstein has resulted in more than 2 billion correct predictions per day paying homage to the quality of A.I. engineering on display.
Instead of hiring a whole team of in-house data scientists, Salesforce is A.I. functionality by the bucket full and it is easy to use on its platform.
In some cases, incorporating Salesforce's A.I. into the business has bolstered other companies' top line by 15%.
Often, Salesforce's A.I. tools are declarative meaning the technology can identify solutions without a fixed formula.
Benioff has choreographed his strategy perfectly.
He is betting the ranch on unlocking data from legacy companies that migrate to his platform.
MuleSoft will help in this process of extracting value, then A.I. will supercharge the data, which is being unlocked.
What does this mean for Salesforce?
Higher revenue and more clients leading to accelerated growth. The share price has powered on north of $130, and after I recommended it at $110, I am convinced this stock will surge higher.
Salesforce is an absolute no-brainer buy on the dip.
"If we become leaders in Artificial Intelligence, we will share this know-how with the entire world, the same way we share our nuclear technologies today." - said current President of Russia, Vladimir Vladimirovich Putin.
https://www.madhedgefundtrader.com/wp-content/uploads/2018/05/Consisten-organic-growth-image-2-e1527711389771.jpg247500MHFTRhttps://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.pngMHFTR2018-05-31 01:05:522018-05-31 01:05:52How Salesforce Ran Over Oracle
AT&T (T), Verizon (VZ), and the other telecom heavies are in the process of investing $30 billion to make sure that fifth-generation wireless, or 5G, will roll out on time in 2020.
What 5G will do is improve the functionality of IoT (Internet of Things) by 10 times at one-tenth the cost, bringing a 100X increase of functionality over price.
The last time I saw a leap that great was when Intel (INTC) brought out its groundbreaking 8008 8-bit microprocessor chip in 1972. I remember it like it was yesterday.
The news that gravitational waves were discovered, as well as wrinkles in the space-time continuum, was big news in my family. 5G will be of that order.
Of course, we knew it was coming. It was just a matter of when.
I have 11- and 13-year-old girls (I can't help it if the plumbing still works!). Whenever we drive somewhere, we carry out what Einstein called "thought experiments."
They will come up with scientific questions, and I then direct them into finding their own answers through a series of prodding and hopeful questions.
It is much like how the children of royalty were tutored during the Middle Ages.
So they asked, "When will we get driverless cars?" which they had heard about on TV.
I answered in about two years, but that I had friends who run Tesla (TSLA) who already have them now.
And you know the interesting thing they discovered? After two years of beta testing, the cars are starting to develop their own personalities.
Each car has highly advanced learning software. When the mapping software requires one to take a difficult sharp left turn, the vehicle may miss it the first time.
It will then make the next legal U-turn, and then nail that turn every time in the future.
The cars are all programmed to drive like little old ladies. It will never speed, break the law, and always lets other cars cut in front. Over time, some are becoming cautious, while others are getting more aggressive depending on each individual's driving experience.
In other words, experience is turning them into "people."
I asked my daughters, "What would the world be like if everyone had driverless cars?" which will occur in about 30 years, or during their middle age.
They pondered for a moment. Then my older daughter shouted out, "There won't be car accidents anymore!" "Right!" I answered.
"But what will that mean?" I asked.
They puzzled over this.
A few seconds passed. Then it came. "The people who fix cars won't have anything to do!"
"You got it," I replied.
In fact, about 1 million people in the car repair industry will lose their jobs. A small group of vintage car fanatics will survive, much like horse and buggy hobbyists do today.
I pointed out that this is already happening because electric cars don't require any maintenance. You just rotate the tires every 6,000 miles (because electric batteries are so heavy).
I moved on. "Who else will lose their jobs when cars become self-driving?" They hit a brick wall. Then I asked "What else breaks when cars have accidents?"
A few seconds later it came. "People!"
"For sure," I shot back.
Actually, about 35,000 people die in car accidents every year in the United States, and another 500,000 are injured.
This means the demand for doctors, hospitals, and ambulances will go down. Say goodbye to another 1 million jobs.
"So, what else will self-driving cars do?" I was relentless.
My older girl was first: "If cars are driven by computers, it means they can drive closer together." I said, "That was true, but what was the consequence of that?"
The mountain scenery whizzed by. Then they got it.
"There won't be traffic jams anymore."
"Yes!" I blurted out. If a car can drive 70 miles per hour, but only needs to remain one car length behind the one in front of it, that effectively increases the capacity of freeways seven times.
We will never need to build another freeway again. Another 1 million jobs go down the drain.
"What else will self-driving cars do?" I carried on.
They hit a dead end. So, I gave a hint. "What do you see in cities?" After going through buildings, parks, roads, lots of cars, and bridges, I finally got the answer I wanted: "Parking lots."
I then posed the conundrum, "What's the connection between self-driving cars and parking lots?"
Now they were getting into the spirit of the thing. "They won't need them." I replied, "Absolutely."
Self-driving cars won't need to park. They'll just be able to drop you off and drive around the block until you are ready to go home.
This will be economical because after three decades of battery and solar improvements, energy will effectively be free, like air is today.
Oh, and at least 100,000 parking attendants might as well start joining the unemployment lines now.
It gets better.
Entrepreneurs now are developing apps for cars so they never need to park.
In an iteration of the sharing economy, and in a club or membership type format, your car will just drive person to person, selling rides, until you are ready to go home.
Think of it as Uber, without the drivers, that pays you.
Today, parking lots occupy about 15% of the land area of large cities. Self-driving cars will free up a lot of that space for other uses, such as housing and parks.
Then I asked the really big question. "What do all of these changes have in common?"
My 11-year-old picked up on this immediately. "A lot of people are going to lose their jobs!"
"For sure," I bubbled. Notice that every new technology improvement creates a lot of job losses. I went on.
"The trick for you girls is to always stay ahead of the technology curve so your job doesn't get lost, too." This is why I have been sending them to Java development school since they were 8 and 9.
They looked daunted.
And this is what 11- and 13-year-olds were able to figure out. Granted, they were MY kids.
Imagine what Google (GOOGL), Apple (AAPL), and Tesla are doing with this idea. It has become a hot bottom "next big thing." Silicon Valley is now rife with rumors of breakthrough developments and the poaching of staff.
The U.S. military and the Defense Advanced Research Projects Agency (DARPA) are involved in self-driving vehicles in a big way as well, holding regular contests with big prize money and the prospect of mammoth government contracts.
More and more generals and admirals are telling me that the wars of the future will be fought with software.
The bottom line is that things are happening much faster than we imagined possible only a few years ago.
Then my oldest daughter piped up.
"Dad, can I get my driver's license before all the cars are self-driving?" I said, "Sure. What kind of car do you want?"
"A red one."
My first car was a red 1957 Volkswagen Beetle.
On our next trip we will cover gravitational waves, Einstein's Theory of Relativity, and the significance of the clock tower in Bern, Switzerland.
By the way, these girls will be graduating from college in 2026 and 2027 and will be looking for jobs.
"Homo sapiens, the first truly free species, is about to decommission the natural selection, the force that made us," said E.O. Wilson, a Harvard University biology professor.
https://www.madhedgefundtrader.com/wp-content/uploads/2018/05/John-and-car-image.jpg312553MHFTRhttps://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.pngMHFTR2018-05-25 01:05:362018-05-25 01:05:36Where 5G Connectivity Will Take Us
Luke Skywalker and Obi-Wan Kenobi will enter the cloud and use the force.
Not the Jedi of the famous George Lucas films, but JEDI - Joint Enterprise Defense Infrastructure commissioned by the Department of Defense.
This large contract is up for grabs.
Rumor has it that Amazon is in the driver's seat to become the government's right-hand man.
The purpose of this broad-based upgrade is to enhance communication channels among military branches by loading up operations into the cloud.
Artificial Intelligence (A.I.) and machine learning will be integrated as well.
One task slated for modernization includes the heaps of documents waiting to be translated from Arabic, Farsi, Chinese and other foreign languages into English.
A.I. will organize which documents have priority over others as well as aiding in raw translation. This will save the Department of Defense's overworked linguists thousands of hours in brute translation work.
As it stands, the government is grappling with an overlapping fractious system with legacy software up to 20 years old.
These legacy systems of yore are poor at keeping out the cyber criminals looking for a smash-and-data grab.
One instance where massive inefficiencies rear its ugly head is in the Department of Agriculture.
This department has 22 chief information officers that require seven more personal assistants inflating the IT budget.
The government could become the best turnaround story in the tech industry in years.
This turnaround could eventually become bigger than Microsoft and Cisco, which are the poster children for extreme cosmetic surgery in Silicon Valley.
The government burns $90 billion per year servicing IT operations, and JEDI is slated to offer an attractive sum of $100 billion over 10 years to a private company.
Not only will the Department of Defense modernize, but every part of the government will adopt new technologies.
Security is a priority for this administration after its legitimacy was questioned due to alleged nefarious Russian involvement.
The Committee on Foreign Investment in the United States (CFIUS) has buckled down rejecting a myriad of attempted foreign takeovers of cutting-edge tech companies stressing the need to properly harness local tech companies' ingenuity to the benefit of the country.
These new opportunities do not affect the already $1 billion per quarter that Alphabet (GOOGL) takes in from government servicing.
The $1 billion contract was given to Alphabet to develop the Algorithmic Warfare Cross-Functional Team industrially working on Project Maven.
Project Maven is the Department of Defense's attempt to integrate A.I. and machine learning into motion detector technology applied to surveillance drones using the Google cloud.
Project Maven received an additional boost to its objectives with an additional $100 million cash injection recently underlining the government's efforts to make warfare more efficient and less expensive.
Amazon Web Services (AWS) has also carved out a nice $5 billion per quarter business thanks to the power brokers in Washington.
Another side deal consummated recently has thrust Microsoft into the frame as well.
Microsoft (MSFT) agreed with the Office of the Director of National Intelligence to service 17 intelligence agencies with the Microsoft Azure cloud platform.
The deal was reported to be valued at "hundreds of million" of dollars.
Another separate deal agreed by both parties has Microsoft migrating another 3.4 million users and 4 million devices from the Department of Defense into the cloud.
All told, Microsoft has pulled in more than $1.3 billion of orders from the government in the past five years.
Bill Gates's old company was rewarded certification to supply the government with computers, operating systems, Microsoft Office, and the cloud services bolstering their credentials to potentially extract more government business.
The administration has adopted a winner takes all approach to the JEDI contract preferring one cloud provider to maintain the infrastructure.
Companies are scratching and clawing to get within a shout of winning this valuable revenue stream that could extrapolate down the road.
JEDI accounts for just 20% of the cloud possibilities for the tech companies in the government system.
The further 80% of digitization will happen down the road.
Firms are up in arms about the single platform solution and believe branching out to multiple platforms will come in use if part of the operation goes down.
Hybrid solutions are the norm for 80% of Fortune 500 companies.
As it is, International Business Machines Corp. (IBM), Oracle (ORCL), Alphabet, Amazon (AMZN), and Microsoft have been adamant that they are the best candidates for the job.
Amazon has been on a one-man mission mobilizing its all-star team of lobbyists to gain an edge.
Amazon has been part of the government's purse strings for quite some time.
It was awarded a $600 million contract in 2013.
Secretary of Defense James Mattis spoke about the relationship with Amazon in glowing terms characterizing Amazon's performance as "impressive" in terms of securing data and functionality.
The positive Amazon feedback has given AWS a head start. It hopes to capitalize on the biggest transfer of data to the cloud in modern history.
Once completed, departments will at last be able to access files from different branches on the same platform. This process is currently done manually.
Quickening the pace of modernization is a prerogative for the new administration.
President Donald Trump signed an executive order to spur on the process of getting rid of the decaying system.
Son-in-law Jared Kushner has also been an advocate of the agonizing overhaul.
This bold initiative ties in well with enhancing cybersecurity inside Washington at a time when hackers have penetrated legacy systems with ease.
Getting the White House up and running will improve the operation of the government. From an investor's point of view, it will add materially to the bottom line of companies that start to win more contracts.
This underscores the reliance of our government and economy on the large cap tech companies that are single-handedly propping up the current bull market.
The White House will wake up one day and understand that technology innovation is more powerful than ever, and even the mayhem inside the White House can't stop the digitization of politics.
Going forward Amazon and Microsoft should get a healthy boost to their overflowing coffers. Legacy companies such as IBM and Oracle could be punished by the government as well as investors for being legacy companies, which could lead the government to pass over IBM and Oracle.
"What would I do? I'd shut it down and give the money back to the shareholders." - said Michael Dell in 1997, the founder of Dell Technologies, when asked what he would do if he was in charge of Apple.
https://www.madhedgefundtrader.com/wp-content/uploads/2018/05/Trump-and-people-image-4-e1526679142910.jpg272580MHFTRhttps://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.pngMHFTR2018-05-21 01:05:542018-05-21 01:05:54Here's the Biggest Technology Contract in History
Fetch a measuring stick from the cupboard, gauge the levels of innovation around Silicon Valley, and Nvidia's name floats straight to the top of the list.
Nvidia has it all and more.
Not many firms can brandish one of the best CEOs in all of tech.
Nvidia CEO Jensen Huang is a true visionary.
When he hops on earnings calls, investors and analysts rejoice about the breadth of innovation percolating through the corridors in Santa Clara, CA.
Nvidia was able to increase quarterly revenue by an eye-popping 61% YOY. And this company is one of the quintessential growth companies in tech.
Huang is one of the few CEOs confident enough to talk all the way through the earnings call like he is talking about the back of his hand.
Most CEOs delegate to the CFO after a carefully choreographed introductory statement.
He knows everything about the company and is not afraid to go into detail.
The past few weeks have been hell for chip companies.
The cascade of downgrades undercut momentum with chip shares prices falling across the board.
Every nonsensical downgrade has proved unjustified with chip earnings displaying the robust potency that only FANGs can replicate.
Delve into Nvidia's latest performance and two parts of the business have gone into overdrive.
Gaming has burst to the forefront providing a sturdy pillar to Nvidia's income stream.
Fortunately, crypto mining and e-gamers are dual drivers fueling a rapidly expanding market.
In Q1, crypto miners and e-gamers faced a hysterical "scarcity" of high grade GPU hardware.
To make matters worse, Apple and Samsung are using the same memory as graphic cards.
These two global giants front ran other companies agreeing pricier per unit contracts to guarantee sufficient supply for their product lineup.
This led to a huge famine or feast environment to secure the necessary components.
Huang has ensured investors that Nvidia is moving mountains to meet demand and he hopes prices will "normalize" in the upcoming quarter.
Advanced Micro Devices (AMD) is the other player producing GPU chips that is experiencing a demand overload.
On the last sell-off, AMD dropped as low as 9.50 and was the perfect entry point into a great company led by Lisa Su, PhD.
AMD continued to bounce off the $9 handle and is trading at $13 after an outstanding earnings report.
Huang also caveated his hopes of chip prices normalizing by saying the "pent-up demand" could get worse because of the unbelievable gaming options in the market, such as blowout title Fortnite and popular online game Player Unknown's Battlegrounds that have sold more than 40 million copies throughout various platforms.
Nvidia has caught the innovation bug with new products coming off the conveyer belt sooner than expected.
Nvidia has announced NVIDIA RTX, the "holy grail" of graphic performance that will offer gamers Hollywood cinematic production quality lighting, reflections, and shadows.
This product has been in the works for the past 10 years and has gamers and miners drooling over this new technology called ray tracing.
Revenue from crypto miners is not a part of Nvidia's core mission, and the stronger than expected numbers are just the beginning.
If bitcoin takes another stab at $20,000, GPU demand will go through the roof.
As the price of cryptocurrencies rise, the profit-making opportunities to mine are greatly enhanced.
Another division running on all cylinders showing no sign of slowing down is the data center segment.
Initially, this industry was tabbed by Nvidia as a $30 billion opportunity by 2020.
They were completely wrong.
Nvidia moved the goal posts and announced at a recent investors day that it believes data center revenue will be a $50 billion market by 2023.
Data center revenue spiked 71% YOY to $701 million highlighting the innovation leadership Nvidia enjoys.
The data center incorporates Nvidia's Volta architecture and adoption has been broad-based.
Volta offers 500% more deep learning power than its previous edition Pascal.
The stamp of approval is evident with every major cloud player embracing the Volta technology.
At some points during the earnings call, it appeared to be a commercial for data center, gaming and crypto because of the strength of these two segments.
Huang did talk about other businesses such as autonomous driving buttering up its place in Nvidia's lineup.
Autonomous driving will be a $60 billion opportunity by 2035, according to conservative estimates.
Nvidia's DRIVE Constellation continues to be the bread-and-butter platform for automotive companies.
The platform allows car companies to use virtual reality (V.R.) to carry out driving trials.
Two servers have been built to aid in development.
The first server allows simulation in the form of a pseudo video game, and the other server is used to process the simulated data.
In whole, autonomous driving lagged gaming and data center with 4% growth YOY.
This should not alarm investors because Nvidia is in it for the long run.
The software system and infotainment in the first generation of commercial autonomous vehicles will have plenty of Nvidia chips hovering around under the hood.
At some point, every vehicle in the world will require autonomous technology. As Nvidia stays ahead of the innovation curve, buyers will gravitate toward its products.
The architecture of Nvidia chips allows car companies to advance their autonomous vehicle technology.
Nvidia is partnering with other industry leaders such as Tesla and Mercedes Benz, just to name a few.
Going forward developers will harness the power of artificial intelligence (A.I.) to build new software programs for the car.
The new car software will be part and parcel with voice recognition that has quickly come to the forefront of tech development.
Creating a whole autonomous vehicle system to just drag and drop into its business could lead to Nvidia's products becoming the industry standard.
Technical superiority eventually wins out.
Nvidia has diversified into every cutting-edge trend in technology.
Huang understands that to keep buyers salivating over its products, they must be the highest quality.
The reason Alphabet (GOOGL) or Apple partner and synergize with Nvidia so well is because it makes the best of the best and they cannot copy their products.
This is why ZTE, one of the biggest tech companies in China, practically went out of business after Donald Trump cut of its pipeline of critical American components.
Chinese companies have been attempting to buy American chip companies for years because the quality of chips is significantly superior.
Amid a backdrop of a trade war, Nvidia shares have been trading choppily from a strong support level of $200.
It is only a matter of time before Nvidia explodes through the $250 resistance level and climbs higher.
To watch a video demonstration on Nvidia's new RTX ray tracing technology click here.
"The United States must possess unquestioned capacity to launch crippling counter-cyberattacks. This is the warfare of the future ... America's dominance in this arena must be unquestioned and today, it's totally questioned." - said President of the United States Donald J. Trump.
https://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.png00MHFTRhttps://madhedgefundtrader.com/wp-content/uploads/2019/05/cropped-mad-hedge-logo-transparent-192x192_f9578834168ba24df3eb53916a12c882.pngMHFTR2018-05-17 01:05:062018-05-17 01:05:06Nvidia Nails it Again
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