TheBRRR’s Thoughts

GM.

On Friday we wrote the following about Apple:

“We’re covering a story about an AI acquisition made by Apple today. Broadly perceived as a laggard in AI with a lackluster vision, Apple is now forced to play catch-up by buying what they cannot build internally.”

We learned today that if not by acquisition alone, it will be by partnership as well.

This morning reports leaked that Apple is in active negotiations with Google to integrate Google’s Gemini AI product into future iPhones.

Gemini was recently skewered for released a terribly “woke” image generation tool, as Google continues to tailspin in AI as they’ve been hyper careful to not disrupt its own infinite-money-glitch / search engine dominance.

Zooming out on the macro now:

Equities are broadly higher today with crypto mixed as markets await the results of Wednesday’s FOMC meetings.

The Fed is all but guaranteed to leave interest rates unchanged, but we’ll hone-in on tonal guidance from the committee and Powell as they prep markets for the first rate cut later this summer.

We sold a stock in the newsletter’s portfolio last week and plan to deploy the cash at an opportune moment later this week. We’ll alert premium subscribers when we do.

Apple & Google Negotiating iPhone AI Partnership

WHAT HAPPENED:

• Apple's AI Negotiations: Apple is actively discussing integrating Google's Gemini generative AI technology into iPhones and has also considered OpenAI's ChatGPT.

• CEO's AI Focus: Tim Cook announced Apple is heavily investing in AI, with features expected to release "later this year."

• Potential Google Partnership: A deal could extend Google's AI technology to over 2 billion iPhones, but signals Apple may be behind in AI development.

• Regulatory Scrutiny: Both companies could face increased antitrust scrutiny, especially considering existing controversies over default search engine agreements.

WHY IT MATTERS:

• Tech Ecosystem Impact: An Apple-Google AI partnership could significantly shift the competitive landscape, enhancing iPhone capabilities while acknowledging Apple's current AI development gaps.

• Market Influence: Shares of Alphabet rose 4.5% in premarket trading on the news, indicating investor optimism about the potential deal's market impact.

• Antitrust Implications: The collaboration could intensify regulatory scrutiny on both tech giants, already under watch for their dominant market positions.

• Innovation and Growth: This move is part of Apple's broader strategy to incorporate advanced AI into its ecosystem, reflecting the tech industry's swift pivot towards AI-centric functionalities.

This development underscores the intensifying race in AI technologies among leading tech companies, with significant implications for market dynamics, regulatory attention, and consumer experiences.

TechCrunch

NVDA To Dominate AI Event with Chip Reveal

WHAT HAPPENED:

• Nvidia's Big Reveal: CEO Jensen Huang is set to showcase the company's newest AI chips at a major event, referred to as the "AI Woodstock," held in a California arena with a crowd of 11,000.

• Star-Studded Lineup: The event will feature key figures from OpenAI, xAI (Elon Musk), Meta, Google, and Microsoft, alongside a diverse array of Nvidia's corporate AI chip users.

• B100 Chip Expectations: Analysts anticipate the unveiling of the B100 chips, successors to the H100, predicted to be four times faster and possibly priced around $50,000 each.

• Market Impact: Nvidia's sales have soared, tripling over the past year to $22.1 billion, with its stock value also tripling, elevating its market valuation above $2 trillion.

WHY IT MATTERS:

• AI Industry Leadership: Nvidia's continued dominance in the AI chip market underscores its pivotal role in powering the ongoing AI revolution, with a market share exceeding 80%.

• Strategic Vision: Huang's vision for AI's role in future technologies emphasizes Nvidia's central position in what he describes as a new industrial revolution, necessitating massive data center investments.

• Competition and Challenges: Despite Nvidia's success, it faces increasing competition from both established players like Intel and AMD and emerging startups. AMD's MI300 AI chip, in particular, has garnered significant attention.

• Sustainable Growth: Nvidia's strategy reflects an understanding that maintaining leadership in the AI sector requires not just innovation but also adaptability and cost management as the industry matures.

Nvidia's event, by pulling together influential figures and revealing significant advancements, signals a pivotal moment for the AI sector, illustrating both the immense potential and competitive dynamics shaping the future of technology.

WSJ

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The BRRR is meant for informational purposes only. It is not investment advice. Please consult with your investment, tax, or legal advisor before making any investment decisions.ll