Nvidia results: three numbers that matter

This BBC podcast is supported by ads outside the UK. Available now on the documentary from the BBC World Service. In 2005, US Marines killed 24 civilians in Haditha, Iraq, after an IED hit their convoy. It sparked the longest war crimes investigation of the Iraq War. But BBC Eye has uncovered new evidence, raising serious doubts about what happened. Listen now by searching for the documentary wherever you get your BBC podcasts. It's a blockbuster company with blockbuster results. So it has NVIDIA, CAMD investors worried about an AI bubble. It's world business expressed from the BBC World Service. I'm Leanna Byrne. Metta is in trouble in Spain and it's banning its users under 16 down under. And we find out who bought a $12 million golden toilet. So we got those NVIDIA quarterly results and they were a real knockout. The company, which is the chip giant at the centre of the artificial intelligence boom, reported more than $57 billion in revenues, beating expectations again. So is this a sign the AI boom is far from over? Jensen Huang is the CEO of NVIDIA. There's been a lot of talk about an AI bubble. From our vantage point, we see something very different. As a reminder, NVIDIA is unlike any other accelerator. We excel at every phase of AI. Our very own Neve McDermott picked out a few important numbers to help tell the story, starting with... $65 billion. That's the amount of sales that NVIDIA is expecting for the January quarter. Now that's about $3 billion more than analysts actually predicted, which really pushed back on the idea that the AI industry is in a bubble. Interesting. Now what's my next big number I need to know? It's $500 billion because the company is heading towards a half trillion dollar revenue surge through 2026. And that forecast is actually at the low end of the range. That's according to NVIDIA's Chief Financial Officer, Collette Cress. Now the company's expansion hasn't been without its challenges. US export restrictions on advanced chips to China have shot NVIDIA out of one of its biggest potential markets. Its CEO has lobbied Washington to ease those rules, arguing that the limits undermine the national security goals they're meant to protect. And although some of the toughest measures have been rolled back, NVIDIA still isn't projecting any sales of its AI accelerators in China. Okay, right. Final number for me, Neve. What is it? It's $4.5 trillion NVIDIA's current market value. And remember, it did make history at the end of October by briefly hitting that $5 trillion mark, becoming the first company ever to reach that milestone. NVIDIA has been the world's most valuable company for much of the past year, powering the AI boom and helping drive stock markets to record highs. And based on this report, it could still be one of the biggest companies by revenue as well. Neve McDermott there with me now, Emma Wall, Chief Investment Strategist at Hargreaves Landon. Emma, where is NVIDIA's share price at now? Well, as you might imagine, it's up. The market has responded very positively to the expectation beat. The share is up around 4% in trading. And indeed, it's lifted the whole stock market with it. We actually have had quite a bad week for international stock markets, partly because of fears about AI valuations and a bubble forming, partly because of concerns about the Federal Reserve and what it might do next with interest rates. But today, we see a return of euphoria, a return of risk on sentiment. And NVIDIA is up 4%. And indeed, global markets are up with it. And Bitcoin, it's bounced back too. Yeah, that's part of that risk on trade, which is actually that we're in an expansive economy, an expansive market that the rally will continue from here. And I think whenever you see euphoria re-end the market, that end of the spectrum of speculative assets or speculative investments such as Bitcoin often does get a boost as well. All right. Well, meanwhile, we finally had those US job numbers for September. They were delayed because of the federal government shutdown. And they're showing the biggest job gains in five months. The BBC's Michelle Flurry is in New York. We finally have the jobs report for September. Remember, it was delayed by the federal shutdown. And what it shows is that American employers added 119,000 jobs in September. That was more than double what many analysts were expecting. But here's to the rub. The unemployment rate actually ticked up from 4.3% to 4.4% the worst in several years. Now, we have to note that the job growth in America has barely budged since April. And so there is increasingly a spotlight on the central bank to cut interest rates to support the economy. But with inflation still higher than they would like, those inside the Federal Reserve remain deeply divided over what to do next. That was Michelle Flurry in New York. Emma Wall, does this make a December rate cut more or less likely? I think on balance, slightly more likely. But I agree with Michelle, deeply divided is the right call. You've seen how much pressure there is on the Federal Reserve to cut rates from a political point of view. But they've always made it very clear that the decision making will be data-based. And the two key bits of data that they use to make that decision, inflation and jobs. And inflation remains sticky above where the target is, which would lead to rates being held in order to better control that. And the jobs figures are split. Half of the data that we've received today would suggest actually it's time to cut. And half of the data would suggest that it was time to hold. But I think on balance, you make it a split vote, we will probably see a cut next month. When there's that uncertainty, the risk appetite, I'm sure it's quite low. It is indeed. And of course, if we do see a hold next month, I would expect the markets to react poorly to that because it was the concern that markets would hold rates earlier this week that consents global markets into a bit of a tailspin. Okay, Emma Wall, Chief Investment Strategist at Hargreaves Mansden. Thank you so much. A solid gold toilet has sold for more than $12 million. And the mystery buyer has now been revealed as Ripley's, believe it or not, it's a fully functioning 18 carat toilet created by artist Mauricio Catalan and weighs more than 100 kilos. Now, Metta is facing a $550 million penalty in Spain over alleged unfair competition and data protection breaches. And to tell us about that, as Alina Trabotoni, an international financial journalist who's currently in Rome. Spain's Prime Minister Pedro Sanchez announced that Metta is under investigation that for basically using a hidden mechanism to track people's web browsing history, and it's specific to Android users, it started back in September 2024 and actually lost it through the summer. So that's quite a long time. What the Spanish authorities are saying is that this tracking occurred when users were using browsers in incognito mode or using a VPN. So basically, applying privacy parameters to their browsing, what Metta allegedly did, data that was collected, was then linked to users Facebook and Instagram accounts. And that triggered a whole series of potential violations of European privacy laws. It also goes beyond Spanish borders. This is a massive incident perpetrated over time, if it's actually confirmed. Another big story for Metta is that Australia is notifying under 16 year old users that their accounts are going to start being deactivated from the fourth of December. Can you tell us exactly how that's going to work? But basically from December 10th, Australia will implement this nationwide ban. And it's going to stop children from under 16 from opening or even maintaining accounts. Metta, of course, it's not the only company involved, but it does own Instagram, Facebook, threads. Metta has already begun notifying users aged 13 to 15 that their accounts will be deactivated starting from December 4th. The idea is, at least according to what the government is saying, is to give kids, teenagers at that age bracket, more freedom to grow without the pressures and the risks that come with social media. There are around 150,000 Facebook users in that age range and some 350,000 on Instagram. So it's a big, big slice of the youth population. How do they know somebody's under 16? To be really honest with you, this is a soft law that can be really skirted around. People even have fake pseudonyms on Instagram accounts. Teenagers in this case are very resourceful. I'm sure many will be determined to access social media and online communities, even if they're technically officially blocked. I actually don't want to give ideas here. Those teenagers will find a way. Yes, they will find a way. At the end of the day, enforcement alone won't be able to eliminate any attempts at getting around it. Alina Trabatoni speaking to me there. And that's it from World Business Express. Thanks for listening. Available now on the documentary from the BBC World Service. In 2005, U.S. Marines killed 24 civilians in Haditha, Iraq, after an IED hit their convoy. It sparked the longest war crimes investigation of the Iraq War. But BBC Eye has uncovered new evidence, raising serious doubts about what happened. Listen now by searching for the documentary, wherever you get your BBC podcasts.