Bloomberg Technology provided live coverage of significant market anxiety this week, dissecting major divestments, capital market maneuvers by tech giants, and the continued volatility in the AI trade. The show, hosted by Caroline Hyde and Ed Ludlow, opened by reporting the dramatic news that Peter Thiel's macro hedge fund offloaded its entire holding in Nvidia, estimated to be around $100 million worth of the company's stock. This divestiture followed a significant stake reduction by SoftBank the previous week. Bloomberg Technology noted that such a shift in Peter Thiel's conservative, concentrated portfolio "holds a lot of meaning" and suggests "directional and concerning" movement, reflecting broader concerns about AI space valuations and the "circular nature of investments".
Despite the selloff pressure from major investors, Nvidia’s fundamentals remain strong. CEO Jensen anticipates "half a trillion dollars' worth of earnings" in the next few quarters, asserting that "nothing to see here". However, Bloomberg Technology highlighted persistent investor concerns about concentration risk, noting that approximately 50% of Nvidia's data center revenue comes from hyperscale's like Amazon and Microsoft. Investors would prefer to see this number decrease, suggesting AI revenue is "being spread throughout the economy". This skepticism signals a shift in the AI trade, moving from simply focusing on CapEx (capital expenditure) to demanding a clear ROI (Return on Investment). This demand for profitability is pressuring compute providers like Core Weave, which is financing much of its growth with debt. Conversely, Micron is seeing its memory chips "flying off the shelves," resulting in a 24% rise in its share price.
In other tech news, Bloomberg Technology detailed Apple’s upcoming seismic change to its product release cycle. Instead of concentrating flagship launches just ahead of the holiday season, Apple will move toward a staggered approach, releasing three phones and following up six months later with mid-tier models. This new strategy aims to ease the "strain on various teams inside Apple from marketing to engineering" and address the downside of concentrated revenue. Meanwhile, the corporate spending management platform Ramp achieved a new valuation of $3.5 billion following a new primary funding round, marking a notable success in the private market.
Bloomberg Technology concluded by addressing the continued instability in the crypto market. Bitcoin is currently down 25% from its October highs of $126,000, with smaller cryptocurrencies like Dogecoin also down 15%. The market is still recovering from a "large population event" and massive liquidation in early October, confirming the market remains "fragile". Despite the near-term volatility and headline risks like the massive AI stock selloffs, many investors view AI as a long-term structural theme, maintaining high conviction that the sector’s overall trend has only been "gaining steam". The Bloomberg Technology coverage ultimately emphasized the current market climate where investors are being "more selective" about AI beneficiaries.
