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Thank you so much for joining us for this special edition of Bloomberg Daybreak. Happy New Year, everybody. Welcome to 2025. Markets are closed for the holiday. I'm Nathan Hager. Coming up this hour, they are back. It's become a bit of a tradition here. Two of the most prominent tech analysts on Wall Street are with us for the entire hour. Getting you ready for what's hot in high tech.
in 2025. So without further introduction, we are pleased to welcome back Jean Munster, managing partner at Deepwater Asset Management and Dan Ives, Global Head of Tech Research at Wedbush Security. So great to have the both of you back with us on this holiday. And let's kick this off if we can with a look at artificial intelligence because obviously this has been the, maybe the biggest theme on Wall Street since chat GPT came out two years ago. So Jean,
Here's what you told us this time last year about where you think we are in the AI cycle. Listen. We think we're in the early stages of a three to five year bull market. And I wouldn't don't worry about the after. Don't worry about the hangover at this point. I think you just embrace that this is as the substance will exceed the hype. And we've got some great years ahead of us from the market. You told us it's the third inning of the AI ball game, Gene. So where would you say we are now?
I think we're probably on the fourth inning. We're still early, which seems out of touch with reality. But I think that that is how significant this transformation is going to be. And so we're definitely further along. But I still believe I talked about three to five years. I think we've still got another two good years left here. And I think that as
The, you know, this concept of the substance exceeding the hype. We are seeing that with some of the hardware companies, but we really haven't seen it beyond a few companies. I'll just put this. This is one of the more encouraging data points is that opening eye doesn't break out these numbers.
But you can back into them. They're daily active users for GPT global are around 150 million, 150 million. Google's daily act of search users are 2.5 billion. In other words, even though we talk a lot about this, the whole train really is still in the station.
So it's still early innings for you. Let's turn to you, Dan, because here's what you told us about where you think the AI boom was this time last year. I mean, I think there's a two year bull cycle. I mean, at points when we get toward 3.34 AM, there will be issues, especially for ones that don't actually execute, but I see it. It's an auto bond. Is it still an auto bond for you, Dan? Or are we running into speed bumps?
Oh, well, it's 10 p.m. in this AI party that goes to 4 a.m. And I think if you see how this is all played out, as Gene has talked about, this is just the first step in two trillion of AI catbacks. And I just went going to, for every dollar spent on a video chip, we believe there's an eight to $10 multiplier across the rest of tech. And that speaks to why we believe
This is a bull market that continues to play out throughout 2025 and ultimately in 2026 because of where this spending is and it just is starting. And that's why I always say the bears when they're in their caves in hibernation mode, like the last two years, they can find AI in the spreadsheet.
But if it's still progressing, if we're still at the early innings for both of you guys, when do these companies need to show that they're getting past the early stages? I'll start with Eugene.
I think with the software company, so we've obviously seen it in the hardware and I love that 8X multiplier. I think that you're framing in there and I think it just, it paints the picture of the scope of what's happening with the hardware and also that this year, we're going to have to see some improvement in some of the software growth rates and it doesn't need to be significant. We're talking about acceleration in the case of like sales force. They grew bookings last quarter at 10%.
I think an inch that up to 12%, for example, I think that that would be enough. All investors need to see in 2025 is just that the numbers are starting to move higher. These companies don't need to have breathtaking breakout like we've seen within video. We just need the tide to slowly rise, and I think that the trade is going to be intact.
Is that how you see it, Dan? I mean, you were talking last year about an Autobahn about this sort of breakneck speed at which AI could develop. Is a slowdown going to be enough to keep investors in this? Look, I think, I mean, to what Gene's talking about, it's about software now is at the AI party. I mean, they were behind the velvet ropes waiting to get their name on the list, and now look who's there. It's the messy of AI pound tier.
You got sales force, you got service now, because the use cases are happening. And that's how Palantir, remember, the heater, the heat is a teenager. It took $13 stock. Now the heat is a senior citizen in 80 because it's just starting to play out in terms of the second, third derivative. That's software. That's cyber security. That's AI infrastructure. And Christmas came early to the bulls with con out the FTC.
That means deal making finally is going to start up because that was a nightmare in Elm Street for the pack kind of the FTC. That's over. And in Trump administration, it's a Goldilocks scenario for the Bulls, especially the AI revolution here. And it's still in 1996, not in 1999, in terms of our view, how this all plays out. Talk to me a little bit, Gene, about how you see the regulatory environment playing out once we get into the early days of 2025.
I want to add something to what Dan just talked about in terms of the 1996 analogy. Dan and I were around there.
covering tech at that point, and lived that just really special time in investing. And I want to just mention, there's an important nuance to how the market, I think, plays out in 2025, is that during that run from 96 to 2000, during that period, there were 10 pullbacks. There was 12 pullbacks from 95 to 2000, so 10 pullbacks. So about two per year is what we saw of 10% or greater on the NASDAQ.
And I just want to anticipate joining Dan later on in 25 and talk about this pullback in the market, like, is this over? And I would just say this is really healthy for these multi-year runs to have these pullbacks. And so I'm anticipating, as I said, a couple of those. And what's going to be the piece that kind of, what's the catalyst that does that? It's always hard to predict.
But we're going to get those and I still continue to believe we're going to end 25 much higher on the NASDAQ than we started. So I just quickly on the on the on the regulatory piece and I think that big tech has been largely in the penalty box when it comes to
trying to acquire and innovate around that. And my hope, my expectation is that I think that that's going to loosen. And they were going to see some bigger acquisitions in 25. And I think it's going to be about bigger. They're small companies, but they're going to have high valuations that are in the private market today. And we can talk more about those. But I think this is going to be a good year for big tech from that perspective.
Yeah, we are going to get into some of that. We are speaking with Gene Munster, the managing partner at Deepwater Asset Management, and Dan Ives, global head of tech research at Wedbush Securities. Dan, to Gene's point about the possibility of pullbacks in big tech in 2025. I mean, obviously, we've seen the valuations where they are. They're sky high for a lot of people. You say they're justified. What is the risk that we could see a little bit of choppiness as we head into the next few years?
Look, and to that point, I mean, think about this year, Tokyo Black Monday, right? I mean, you had five or six other points, some of the Fed and the bond venture landies come out and those create the opportunities. And I think with Trump coming in, there would definitely be some white knuckle moments with China tariff discussions, game of high stakes poker going on, right? So there's been a lot of headline risk. But the jeans point, that's why you tune the noise out, you focus in the winners,
And again, the barriers that talk about valuation, that's how they missed every transformational tech name in the last 20 years. Because when you're in the right lane going 35 miles an hour, you're not focused on paying up for the Ferrari going 90 miles an hour in the left lane. But that is AI revolution. You will have those moments and you have your pencils ready.
just to play. Let me add some to the evaluation because you're right on Dan another great point just about, you know, the bears are looking at valuation not recognizing the significance. The valuation, let's just go back and use the example of what happened from 95 to 2000. The NASDAQ peaked at 100 times earnings.
On future right now, we're, what are we, high 20s, something like that? We're not even close. Now, given the dynamic of the mega caps today that we didn't have 25 years ago, you're not going to get 100 multiple on the NASDAQ, but you might get a 50 multiple on it. And so I think that the conversation about valuation to me misses the point when a paradigm shift happens and euphoria kicks in, really impressive things can happen on multiple expansion.
i'd say framework what would genius that print that out frame it will be talking about that in a year though i got asked i mean it's the point that i guess gets brought up every year around this when you bring in the analogy of nineteen ninety five verses now it raises the question about whether this is going to be a repeat of the dot com boom i mean you both have talked about how
artificial intelligence could potentially be a paradigm shift. We've seen it play out in certain ways. But other than chat GPT, cute chatbots and, you know, changes in the way people search for things online, how do we see that paradigm shift? When do we get to the point that we're going to see the kind of productivity improvements across the economy that so many of the bulls around AI have been predicting? I'll start with you, Dan.
of the enterprise, that's where it's happening. Consumers not even going to happen for all these second half 25 going to down 26, but look what's happened in the enterprise. That's where you're seeing the cat back. That's why Jensen's the godfather of AI. That's what we're seeing across cloud. You're going to see the paradigm change authority happen with use case on the enterprise. Consumer, that's coming still ahead.
It speaks to this multi-year run in terms of what we're going to see in terms of their fourth industrial revolution. And your thoughts just quickly, Gene?
I mean, I think it's starting if you look at enterprise piece that's listen to Benioff's comments from Salesforce about how he sees agents basically taking over half of the human's work. It's in medicine. We're doing experiments and projects and using AI and the investment side too. Bottom line is massive.
cost savings. So I think it's actually happening more. It's just that the consumer piece is Dan said hasn't kicked in yet.
And we're going to talk much more about this potential use cases for artificial intelligence and more of the hot tech trends coming into the new year as we continue on this special edition of Bloomberg Daybreak focused on tech with Gene Munster, managing partner at Deepwater Asset Management and Dan Ives, the global head of tech research at Webbush Securities with us for the full hour on this New Year's Day. So stay with us. It is 20 minutes past the hour.
I'm Nathan Hager and this is Bloomberg.
The forces shaping markets and the economy are often hiding behind a blur of numbers. So that's why we created The Big Take from Bloomberg Podcasts to give you the context you need to make sense of it all. Every day, in just 15 minutes, we dive into one global business story that matters. You'll hear from Bloomberg journalists like Matt Levine. A lot of this meme stock stuff is, I think, embarrassing to the SEC. Follow The Big Take podcast on the iHeartRadio app, Apple Podcasts, or wherever you listen.
Welcome back to the special edition of Bloomberg Daybreak. I'm Nathan Hager. Markets are closed for the New Year's holiday, but it's a high-tech power hour. We are speaking for the entire hour with Dan Ives, global head of tech research at Wedbush Securities and Gene Munster, the managing partner at Deepwater Asset Management. Of course, we've been focused for most of the start of this show.
on the promise for artificial intelligence, the continued potential for investment in this sector. I want to ask you guys where you see winners and losers now that we are at this stage in AI development. So Dan, I'll start with you. Who do you see as some of the biggest winners in AI heading into 25? Well, I think winners are software is going to be a huge winner. And that's pound here. That's Oracle at salesforce.com.
MongoDB, Snowflake. I mean, the point is, I think software is really going to be the beneficiary in 2025, is to use cases, build out. And I think more investors start to play second, third derivatives of AI. When you look at losers, I think it's hardware. I mean, I think right now, they'll try to do acquisitions like Cisco, review for Cisco, HP, Dell,
I think a lot of the core infrastructure where they're set up. This is not a good place. They're going to have to do M&A, but this is trending much more to software driven. And I'd even say hyperscalers are just going to try to gain more and more market share, especially with Khan, and they don't at the FTC. What's your view on this, Gene? Who do you see as the winners and losers at this stage?
I think the sweet spot, I would agree with Dan. I think the sweet spot is going to come from software. I think the hardware piece is going to last a little bit longer, but the companies that Dan highlighted is in a troubled direction. I think that they're going to continue to be in a trouble. Basically, if you don't have a real hardware AI play, you're just going to die in the vine.
You know, there's still more room with NVIDIA, for example, I think that some of the other micron, big sell-off recently, and I think that these companies are still going to meet a good place. But the substance of the trade, I think, is going to shift to software. I think there's another piece that probably follows the fold for a lot. We do private investing, and a couple companies, Databricks, is getting a ton of share, and you're going to hear a lot more about them. They basically help organize unstructured data for AI training.
And then, Andrew, the defense tech company. I mean, the last valuation was at $15 billion. If this was a public company, it would be a meme stock of all meme stocks. I don't know what the valuation would be. It would be exponentially higher. And so I think there's some really exciting things going on with those two private companies that are going to be part of our everyday conversation in the year or two.
In terms of the software plays, Dan, how do you see AI playing out in terms of software, in terms of use cases in 2025? Look, I think it's going to be about the install bases because as much as NVIDIA is going to clearly be a winner, continued, I think, 4 trillion mark cap along with Apple. So again, 25. It's going to be about the install bases. So when you look at from Adobe to Oracle to service now,
to many awful, I think the master piece where I see first for salesforce.com. And of course, names like pound tier, I think the use cases, it's going to be agent force, what we're seeing with salesforce, but it's going to move to marketing to analytics, ERP. We're going to see these use cases go from spot, spot, spot. And I think that is going to be a huge part of the investing cycle as investors now focus
on, okay, wait, skip to where the puck's going. And I think that's going to create the opportunities as software. This is going to be a golden aid for software as well as cybersecurity, you know, led by the Fourth Industrial Revolution.
Gene, do you see some of these software cases playing out this year? Do you think that we'll see the kind of use case for artificial intelligence that you guys have been predicting over the last couple of years actually starting to come to fruition in 2025?
Yes, I think that in the back half of this year, this software piece, we're going to start to see a slight increase in revenue. These tools are starting to get rolled out and look at companies like ServiceNow. They're already directly benefiting from this. It's going to be...
This year in 25, it's probably going to come mostly from the mega caps. And I think, you know, Dan's comment about Benioff, I just emphasize, listen to that, his comments. He spoke for 25 minutes, 22 times. He gave some statement about how transformative AI is going to be. If you take that and divide it by five, it's still going to be a, I think this year is still setting up to be an acceleration in growth.
I think we will see the substance this year, but I would just also caution people that some of the substance you're not going to see. It's not going to be obvious. It's going to be behind the scenes. It's going to be in things like improving margins as companies start to implement these at the enterprise level and start to implement just more efficient agents. And so I think that that's a different, another piece that we're going to start to see in the back half of 25 is improving margins.
Speaking with Gene Munster, the managing partner at Deepwater Asset Management, along with Dan Ives, the global head of tech research at Wedbush Securities. With these kinds of changes, guys, there's the continued need, I think, for capital investment. We've seen so much of that, particularly in some of the biggest players whose market capitalizations have grown by such leaps and bounds, not the least of which is NVIDIA.
Dan, how do you see CAPX playing out? Is it sustainable for this kind of growth? Look, I think it brings up a great point and I'd be interested to hear Gene's thoughts on this as always in terms of when you compare .com to here. Because here, the CAPX, we're talking about 2 trillion of AI CAPX. And what's amazing, eye-popping, is sovereigns
haven't even got into this yet. You haven't even had the rest of Fortune 500 global 2000. It's really, really big tech today. So when you look at this AI CapEx, you follow the yellow brick road, you follow the CapEx. Because if you follow the CapEx, you're going to win on these stocks from semis to software to infrastructure, and then ultimately to the consumer piece.
And to this point, you have tech companies with 1.2 trillion of cash in the balance sheet generating $300 to $400 billion a year. As opposed when you go to .com and every time someone to do the scary Cisco Nvidia comparison on the chart, those are funded by companies that were basically levered, no business models, and it goes back to that .com era. I'm just trying to say a much different and apples to oranges comparison.
you follow the cap backs and I just want to hear Gene's thoughts on this. Yeah, that's the the yellow brick road down. You got a great way of just illustrating things. And I'm going to I'm going to play on that yellow brick road is that when this amount, this level of a cap X happens.
That's one of the reasons why I'm so confident that AI, the substance is going to exceed the hype, and this is going to be bigger than the internet, is that this degree is multiple times bigger than what we saw with the internet build out. It will be 10x, 12x, 15x bigger. And when you have that kind of infrastructure in place, there's just a natural
gravity that the theme starts to pull in all these different applications. And so I think that CAPEX is probably the most important factor to continue to gauge how well this is, you know, like is this going to play out? At this point, for those who believe that this is just going to be something more like mobile, the level of investment I think is justification that this is going to have more substance to it.
But Dan, you mentioned that sovereigns haven't really gotten in on this as much as some of the bigger companies have, raises the question about what kind of impact trade wars could have on artificial intelligence. If we get into a scenario where soon to be President Donald Trump starts putting tariffs on many of these sovereigns, could that be a hindrance to AI development?
See, I view the barks going to be worse than the bike. I mean, the point is, Greg, if you look at how this is all going to play out, I think you're going to ultimately have carve outs for the likes of Tessa Apple and a lot of the chips that NVIDIA makes. And look, this is all going to be a game of high stakes poker. But when it all comes down to it, I don't think it disrupts supply change dramatically. And I don't think it disrupts the AI revolution because
This book, China wants to benefit to the same extent that we're going to see here in the US.
But that's the only thing when it comes to Trump administration. Trump administration is bullish for AI. The risk of these nations not investing in AI could be the end of these countries. I mean, ultimately, countries are going to need an AI-first approach. And so anything that happens with tariffs or any sort of economic slowdown that we may see across the globe is a small impact, is a small factor relative to
what needs to be invested. And so this is top of mind spending. It hasn't started, as Dan said. There's another piece that hasn't started as well, which is industrial AI, the enterprise AI, all of this, and this, the concept that this is still largely big tech that's doing it. And I think that, again, is another piece that gives me so much confidence and sovereigns going to be there as well. So Jean, how do you see that? Yeah, sure. I'm going to say, if you're a great point, because me and Gene have seen
over the decades and decades covering Apple, China, tariff, supply chain, retaliatory, Tesla. There were so many moments over the years where you could just give in a little cave and just basically hit the exit button on these stocks. The point is it will create the opportunities when we sit here a year from now and I believe tax up another 25%.
I think sovereigns become more involved and the tariffs become some white knuckles, but it doesn't ruin anything. Gene, how do you see sovereigns getting into this? What's the catalyst for sovereigns to get into the AI story?
I think you have to have, notoriously, governments are slow to move. And I think the catalyst is gonna be when, like the US and China are largely on board with that. So I think there's a competitive piece that needs to kick in as a catalyst. And I think that that probably starts sometime this year. I think that they were gonna see, that's one of the reasons not just the sovereign AI, the catalyst is the competition.
But also with industrial AI, I think that that's one of the reasons why I think that the NVIDIA trade is going to continue to be a good place to be. So it's different than consumer and enterprise. That's for sure when it comes to sovereign, but there's a lot of money to be spent there and they are just getting going.
And we're going to wrap up this hour-long discussion on high-tech trends as this special edition of Bloomberg Daybreak continues with Gene Munster, managing partner of Deepwater Asset Management, and Dan Ives, the global head of tech research at Wedbush Security. So stay with us. It's 37 minutes past the hour. I'm Nathan Hager, and this is Bloomberg.
The forces shaping markets and the economy are often hiding behind a blur of numbers. So that's why we created The Big Take from Bloomberg Podcasts to give you the context you need to make sense of it all. Every day, in just 15 minutes, we dive into one global business story that matters. You'll hear from Bloomberg journalists like Matt Levine. A lot of this meme stock stuff is, I think, embarrassing to the SEC. Follow The Big Take podcast on the iHeartRadio app, Apple Podcasts, or wherever you listen.
Thanks again for being with us on this special holiday edition of Bloomberg Daybreak. All is quiet in markets on this New Year's Day. I'm Nathan Hager and it's time to wrap up this special high-tech roundtable. We have been spending the entire hour with Gene Munster, managing partner at Deepwater Asset Management and Dan Ives, the global head of tech research at Wedbush Securities. It's been a great discussion on where things could go.
with artificial intelligence. But as we close this out, guys, I want to focus in on some individual stocks, some of the biggest names that you cover on Wall Street. And I guess we'll start with one that fits the theme. Nvidia. Where do you see Nvidia going, Gene?
I think it's going higher and I think that it is like a surprisingly inexpensive stock when you think about off of the 2026 numbers. Dan mentioned the white knuckling. I'll tell you what a lot of investors and video investors are white knuckled over the boom and bust of hardware.
The business was about a $20 billion business before the AI training got going. And it's going to be about $150 billion next year. So I've never seen anything like this at this scale. And because of that, it just creates this concern that it can't go on. And I want to stress too, Nvidia will have its day when the second derivative kicks in and slows down a little bit more than people think and the stack is throttled. I don't think that's this year. I think this is the year where we start to
Reach out and video starts to reach out beyond some of the hyperscalers into some of these other markets that we're talking about. And they're another piece that is just getting kicked off what we're seeing around this time scale, this inferencing time scaling that's going on, these models starting to think more. Jensen talked a little bit about on their last call, but that's a whole other wave.
in terms of the models needing more compute capacity. And so when you put all this together, I think NVIDIA is setting up to have a good year, a great year, because the expectations for calendar 26 are going to move higher.
There have been so many expectations built into this stock. You mentioned some of the need to move beyond the hyperscalers into the sovereigns. Those are things that we've been talking about when it comes to NVIDIA for the last several quarters, Dan. Can NVIDIA sort of live up to a lot of the expectation that's been built into this stock? Look, our recent Asia trip, demand the supplies 15 to 1 for NVIDIA chips. Three months ago, it was 12 to 1. It's accelerating.
And that's why there's only one red phone if you need an AI chip. It's the guy, Father, AI, Jensen, and NVIDIA. I mean, you look at AMD, others that may be called 12, 18 months now will be there. But they continue to be the only game in town. And I ultimately look, you look out here. Could you get the $6 earnings? You're looking $180, $200 stock. And that's why I think this is one where any selloffs in NVIDIA, they're table pounders. You just own them.
I think you've called for Nvidia to be one of the first $4 trillion market cap stocks. Is that right? Well, guys, the first one will be Cupertino. They'll cut the ribbon being the first $4 trillion. And then that exclusive club, they're going to welcome in Jensen and Nvidia, that $4 trillion club and then followed by Microsoft.
alluding to Apple with the reference to Cupertino. I know another stock that you watch very closely, Gene. What are your predictions for Apple heading into 2020? I want Dan to go first on this one. I want to pull up, please, Dan. Look, I'd say Gene and I, for decades, why I respect him more than anyone on Wall Street, it's seen the forest of the trees. And Apple's another one, the AI revolution.
The consumer AI revolution comes through Cupertina because it starts with iPhone 16 Apple intelligence just rolling out, but it's a multi-year. China's not even going to be rolled out till April. So you start to look at this with 300 million iPhones in a window of an upgrade opportunity. This will be the renaissance of growth for Apple. And that's why I think ultimately, we're looking at a $4.5 trillion mark cap
You know, as Apple goes through what I believe, we start to look at 325, 350 hours, and I know Gene has talked about this a lot, but this is the moment for cook and cook patina. Gene? You know, in terms of the numbers that back up that theme is that the iPhone, as the iPhone goes, so goes Apple, so goes the stock, and iPhone in 20, fiscal 24 was flat. Fiscal 25, the streets looking for 3% growth.
It was 5% at the end of September. So analyst expectations actually come down. And the reason they've come down is because the initial rollout of Apple intelligence in the US has been in some eyes underwhelming. And so the analysts bring their numbers down. For fiscal 26, it's 8%. So it goes 0, 3, 8%. They're going to beat those numbers.
And I think that I love to handstake on this. Mine is. So for fiscal 25, the streets at 3%, I think we're probably going to be closer to 5 to 8% for iPhone growth. And for fiscal 26, that 8%, I think it's probably closer to 10 to 12, which is like an order of magnitude outside of where I think most investors are thinking. But ultimately, I think that these features are going to drive an upgrade cycle.
And I just add the gene, 240 million units for iPhone, which will break, you know, break a record. That's where I think they end up for fiscal 25. And that's why the heater, they hated 2 trillion, despised it at 3 trillion. At 4 trillion, they'll be yelling from the treetops.
So does Apple get to look past Vision Pro, some of the other products that have had to fall by the wayside, things like the Apple car? Is it all about the iPhone? Can it continue to be, Gene? Definitely in fiscal 25, it's about how Apple intelligence drives iPhone growth. And like Dan was talking about is there's also this pool from what happened in 2021. iPhone was up 37%. You get that effect starting to kick in.
That just boggles my mind that investors just aren't tracking to that wave that's come as much as Dan has talked about it. It's still like that light still. I think largely hasn't gone on. But they get because of that opportunity. They do get a pass on Vision Pro. It's been a disappointment. It is.
I think that the strategy, I think they just need to shift to doing more smart glasses, AI glasses. I think that seems that that's where the markets can evolve. I don't think we're going to see any products this year from that perspective, but I do ultimately think that that is where Apple goes. So in the midst of not having a new product category, it really is about a hardware category. It's about the software, the AI product category in 2025.
We're speaking with Gene Munster, Managing Director, Deepwater Asset Management, and Wedbush Securities Global Head of Tech Research, Dan Ives. Let's shift gears to another stock, Dan, that I know you watch very closely. Tesla, it's been on a tear since the election of President-elect Donald Trump. Elon Musk is very close to the President-elect. Where does Tesla go in 2025? Can it continue this breakneck pace?
Look, there was a bet for the ages in terms of must bet on Trump. And I think it's just starting because the autonomous future, that's the goal of the end of the rainbow for Tesla. Deliveries to be out right now, I think that's 10% of the story. The autonomous and AI future, I think is worth a trillion dollars alone to the Tesla story in which I believe in a bulk case, you could see a $650 stock. And you look now for crowded kid fans, a sweep the leg moment,
for regulatory knits and others. And now autonomous starts to get, I think, a huge sort of catalyst with Trump in there. And Tesla is going to be the mean beneficiary. I could argue Tesla could be the best AI play out there. You agree with that, Gene? Best AI play is Tesla.
Definitely like it's what that company is doing is more exciting than I think the rest of the mega caps all all put together when you look at whether it's autonomy whether they're changing how they produce vehicles what's going on with optimist all this puts it in that category so super exciting high valuation but really exciting that I think from from my perspective is that
They're just solely checking the boxes. I don't know what the stock is going to do month to month on this. I do feel it's going higher, longer term because they are the most exciting company in AI. And I think they just kind of put one other, like further point of how they turn the screws down on these trends is we just had GM back out of their autonomous program effectively, which is huge news. And then separately, what's going on with Honda and Nissan, it's really noteworthy.
The car part of the business doesn't get as much attention, but it's worth noting that that relationship is evidence that the car industry is going to get turned upside down in the next decade. And there are going to be brands that we've known for a long time that aren't going to be around. And my prediction is that this mashup between
Nissan and Honda is going to essentially be a slow decline to the both companies will be a fraction of what they are even today. And the reason for that is for what Tesla is doing, not just on the electrification side, but autonomy and just those two companies just haven't innovated. And if you're not innovating at just a lightning speed, you're on your way to being irrelevant.
In the time we have left, guys, let's talk about some of the stocks that we haven't talked about just yet that need to be on investors' radar. And I'll start with you, Dan. Well, I think it starts with Palantir. I mean, the messy of AI, I think what carbon-palantir have done, that continues to sort of be the first piece of the software layer. And I think this is really the model that more and more companies are going to go down. And the other thing is that
The amount going to be spent in the belly on AI is mind-blowing. Names like Palantir are going to continue to benefit. I believe Palantir could be the next Oracle. And that's why the heaters will heat is a teenager stock, the heat is a senior citizen, continuing over topics. Gene, what should be on investors radar?
I think Google, it's a company that is keeping investors up at night because they don't know how perplexity or search with your GPT is going to be impacting their business longer term. But search is just such a habitual behavior. It's got to be 10x better. I don't think these other players are 10x better yet.
And separately is that Google's made a lot of progress. I think that the company still needs a fire under them. Don't get me wrong. I mean, they've been sleep at the wheel here, but just in the past year, they made a lot of progress. And the models that they showed at the end of December, the new models that they came out with, horrible name, Gemini 2,
flash thinking. I mean they couldn't have created a worse name for the product but it came, it's out and available for developers and GPT is not there yet. They just announced that it's coming just on the heels of Google and that's a flip-flop from a year ago. Now you see Google ahead and I think that that's going to start to resonate with investors in 25.
This has been a real pleasure, you guys, to have you on for the full hour to talk about tech trends heading into the new year and looking forward to doing this again, seeing how many pan out as we continue tracking the trajectory of the artificial intelligence trend and how it's going to play out on Wall Street. So thanks again to Gene Munster, managing partner in Deepwater Asset Management,
for joining us on this high-tech roundtable, along with Dan Ives, Global Head of Tech Research at Wedbush Securities. And we'd like to thank you as well for spending time with us on this New Year's holiday. Hope it is a healthy and prosperous 2025 for all of you. I'm Nathan Hager. Stay with us. The day's top stories and global business headlines are coming up right now.
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