Dario: "Saas-pocalypse is OFFICALLY OVER" + "Midterms could KILL the AI trade"

So, I was not expecting to make this video, but I wasn't expecting to come across this. Enthropic CEO on the SAS apocalypse says, quote, "We're not interested in destroying anyone." Mix that with the software earnings that we got today in after hours. Software stocks could be back. But that's not just it. I'm going to share that clip with you, provide my perspective here. Look at this. Anchor Crawford with Algars says, "The entire AI trade hinges on midterm results." You know what's funny about this? You got to give somebody their flowers when they're due. Look at this. So, when I bought Nebus over a year ago at between 23 27 a share, I think my average was like $27 and some change. She was the first one on CNBC that actually said anything about Nebius because after I had bought the stock, I was waiting for somebody to go on CNBC and and talk about it and put the opportunity out there. Look, Crawford on Nebus underappreciated AI data center play. Lots of cash on the balance sheet guided up to 1 billion in annual recurring revenue run rate. The stock was $33 per share. $33. Okay. And I only remember this because she was literally the only one on CNBC for like weeks that said anything about Nebius. So when she says the entire AI trade hinges on the midterms and the results of that, I think you should take four minutes out of your day and hear it all things considered. So those are the two things we're going to focus on here. I will touch on the catalyst coming tomorrow and on Friday as well. Ladies and gentlemen, we're talking software. We're talking AI. All kinds of good stuff here. The only thing that I ask you to do is hit the like button for the YouTube algorithm to help push this video out to more people that need to see it. And we are outperforming every single hedge funer institution on Wall Street this year in the trading community in I think I mean fact check me that. We are up almost 95% yeartoday in the trading community portfolio where our only objective is to beat Wall Street to the opportunities. Hence sort of what we're talking about in this video. If again you guys want to come trade and invest alongside of us, that link is down below in the description of today's episode. I'm not a financial adviser. I'm not a financial planner. This is not a substitute for a 401k or Roth IRA. Contact a financial adviser before making investment decisions. And of course, do not be a jackass. So, I do want to play this uh video from Algar. First things first, quote, "The entire AI trade hinges on midterm results." And then we'll discuss it. Take a listen. AI trade hang in the balance tonight. Let's ask portfolio manager Ana Crawford of Alder. She owns several of the big names in the space, if not all of them. All right, so let's do Nvidia first. What do you think's going to happen? I I mean, don't tell me they're going to beat this going to be great. like we know that, but the stock usually doesn't move on that. So, what do you think's going to happen? >> Look, I don't actually think what the numbers are matters this time around. Um, and we're just going to have to listen to what he says. And I actually don't think he'll be able to say anything that's going to change bears or bull's mind. >> Why? >> Um, because right now the argument isn't about what's happening this quarter or next quarter or even next year. It's what happens in 2029. what is the margin structure of this company? What is the growth rate of this company with with more competition? So that said, if you look at the whisper numbers on the street on 2028, this thing trades at a low double digit multiple and it is a coiled spring. And in any world of investing, a company that has duration with this kind of growth rate does not deserve to be a 10 to 12 multiple. >> Well, why what's then and why does it have that? I mean, if it's so obvious, right? I mean, you you you say all the virtues of what the story is, and Dan Ives does and and others do as well, and somehow the stock just doesn't move. It It's It's been Yes, it's up 14, I think, percent year to date, >> but it's been disappointing. Brian Bellski was sitting over there, said it's not exciting, and he owns it. How does it get that excitement back? Um, I think as people understand and are more comfortable with the application of artificial intelligence and they understand how many how much compute we're going to need and it becomes more of a reality to them, I think that kind of starts to unleash this trend in Nvidia because right now people are in disbelief that we will need this much more and I think that that is the driving force of on the duration for for the How how concerned are you about the data center backlash? >> I'm concerned. I'm concerned and in part because I think that there's a lot of FUD out there. Um there are so many arguments that are simply not factual whether it's water, the noise element. Um you know electricity is a problem and but it's not a problem today. It will be a problem towards the end of the decade and we can solve for it. So with the midterms coming, this has been a key worry on the entire AI trade that midterms would be almost like a kill the robots kind of moment where now it's like kill the AI moment and um do we actually stop the growth of artificial intelligence in our country which would be really a disaster for for us you know and our country. So the AI trade in general, the hyperscalers and others, does does that hang in the balance to some degree based on tonight? Because I, as I said at the outset, it's going to be good beat rays. Jensen's not going to be negative. What's hanging in the balance, do you think, for those others? Um, look, it's going to be I I think actually think whatever he says tonight is is positive for the rest of the AI trade, but the AI trade also has the overhang of what happens in 2029 and is 2020 truly the peak because we put in too much capacity. And so again, this this argument will not be will not be resolved tonight and it might take a few more iterations of earnings calls in order to really get at that and and seeing the the benefit to society. I mean you saw the madna merc news, you know, AI comes up with personalized cancer vaccine. As we see more examples of this in our society, I think people will start to understand the benefit that that has um and why we need it. >> So I do think she is correct. I don't think the the bigger problems are resolved by one quarter of Nvidia earnings. I do think overall AI the AI trade the FOMO is not coming back. But companies that do well might do really well. Like if Nvidia continues to dominate, Nvidia could do well and AMD could suffer. If in if AMD begins to take market share from Nvidia, maybe AMD does well and Nvidia does poorly. Or if Dell becomes even bigger and SMCI continues to fail, well, SMCI will continue to fail, right? There's going to be winners and losers within the AI trade over the next coming months and years. And I don't think one report from one company is all too important. And I do think she does have a point. I think if let's say Democrats do win the midterms, well, markets are not going to like that for the AI trade perspective. And maybe that's why the AI trade has actually started to decline recently, right? Maybe, you know, there's a lot of things going on. Enthropic OpenAI, they missed their revenue estimates. That's obviously not great either for the whole trade. And there's concerns about their CDS's. you know, you're pricing in like a over 2% chance that Oracle goes bankrupt. You're pricing in over a 1 and a.5% chance that Broadcom goes bankrupt. There's a about 0.8% chance that Nvidia goes bankrupt or can't pay their bills over the next 10, 20, 30 years. There's obviously other problems out there, but I think some of it could be political heading into the midterms. And if Democrats look like they're going to win the midterms even more, that could in the near term put additional pressure on the AI hardware trade. Now, generally, I don't like the AI hardware trade. I do like some stocks within this trade, but for all of these reasons, plus others I don't have time to talk about in this video, you guys are well aware, I'm not a big fan of the AI hardware trade. I don't think there's a lot of value there. I don't think there's a lot of opportunity there. If you really want to make a lot of money in the stock market, you have to go to places where Wall Street isn't super bullish on. You have to find that company that is expecting to be average and it's actually exceptional, right? You need to find that company where Wall Street thinks is going to be terrible that is actually okay or good, right? That's how you make money in the markets. You want to be early to opportunities and you want to execute when you find them. And I do think the new AI trade where you're going to find the five baggers, the 10 baggers, the 20 baggers, four areas, robotics, automation, AI software, and cyber security. On that note, you did have Salesforce that came out with earnings in after hours today. Stocks up like 15%. Octa's up 20%. Um, Crowd Strike up up over 10%. Cyber and your software stocks that did report earnings today did very very well. Now, part of that could be or could have to do with this anthropic CEO on the SAS apocalypse says, "We're not interested in destroying anyone." And uh this is in conjunction to the Salesforce partnership with Enthropic called Clawed Force. So, take a listen to this 4-minute long clip and then I want to talk about this new AI trade, the software trade a little bit more in depth. us now to discuss the partnership is our own Jim Kramer along with Dario Amade anthropic CEO and co-founder and Mark Beni off chair and CEO of Salesforce. Jim, take it away. >> Gentlemen, couldn't have really a more exciting combination. This is terrific and I want to thank you both for being with us. >> Mark, I'm go right to you. >> Yeah, we're thrilled to be here. We're thrilled to be here for having us. >> All right. All right. Well, it's great to have not interviewed before. This is very exciting for me. >> We're at the top of Great to meet you, Jim. Thank you and I look forward to talking to you more maybe at next week at Dreamforce. I don't know. I want to start with Mark. Mark, I've been a customer of Salesforce for a long time. All I can tell you is that I always thought I knew how to query Salesforce. Why do I need Anthropic to help me query Salesforce? >> Jim, this is really the best of both worlds. This is the number one AI in the world. philanthropic and the number one CRM Salesforce coming together for the first time in an incredibly powerful way to build a new product called CloudForce. And you're right, Jim. Cloud Force gives you the ability to look at all of your Salesforce data, all of your data systems, all of your applications and what we call our semantic layers, all of our agents as well, and even building incredible new applications on top of this kind of stack. This idea that you can use Cloud Force to not only query your systems, but build applications dynamically, it's really a first in the industry, Jim. We've never seen anything like it. It's completely exciting. I think that this is the way all enterprise systems are going to run in the future. >> All right. So, Dario, I think that the combination is terrific, but I also know when I go to my Asian Force page, I I I see Open AI there. I I don't know how exclusive this is. I don't know what you get out of it. Tell me how this distinguishes you from other LLM models and why this is so exciting for you. Well, look, our our view is that is that Claude is the best model for integrating uh complex amounts of information. We've been we've been using uh uh Salesforce and Claude within Enthropic. We're huge Salesforce customers and you know, as you can imagine, uh the pace of things at Enthropic is is is is is incredible. Uh, and we have to both manage individual accounts and we have to answer all these incredible strategic questions that change every time a new model and a new product comes out and and we've found that this this combination product that we've built together is is the most useful thing in accelerating it. you know, within Entropic for a long time, we've been accelerating the research teams within Claude, but but this is the first time that we've really been able to incredibly accelerate our go to market efforts within Claude and we want that for all the other enterprises and we want to we want to me and Mark want to bring it together to everyone. >> Well, [snorts] look look we see the numbers we also see the tape underneath you Salesforce fantastic numbers but I do want to ask you I know I normally should ask Mark this but I want to get to Dario. You know, there's this whole SAS apocalypse thing, which we thought that you were going to destroy Mark. I I know Mark has a big investment in you, but I was waiting for you to put him out of business. What do you think about the SAS apocalypse thesis? >> We're we're not interested in destroying destroying anyone. Uh, you know, we think of this as a very positive something, right? That's the way that's the way markets work. We're creating new value here. And and the question is just, you know, how it's not about destroying anyone. It's about how much of these enormous gains go to various various people and various companies. And our philosophy always has been that we want to work with our customers. We want to empower empower our customers to share these gains with us. And so we've already worked with Salesforce in a number of ways. We're big users of Salesforce. Salesforce is big users of Claude code, of co-work, of other tools. We've put products like clawed tag in Slack already um which is which is a part of Salesforce and now this combination is a way to to gain something that's you know it's 1 plus 1 equals three something that's bigger than the sum of its parts and and and I think that's the right way to think about >> that obviously sounds good to hear but what the [ __ ] is going on with this smile >> okay [laughter] I don't like that man looks like a a nervous squirrel or something. Okay, but beyond the point here, this is great to hear. This is great to see. From my understanding, Daario has not really commented on the SAS apocalypse all too much. And to hear that Enthropic is not coming for the throats of their customers is a logical but good thing to hear. And I do think it will help p power or pave the way, however you want to put it, for AI software to do very well together. This has been the core philosophy why I was buying the dip so heavily during a SAS apocalypse because it never really had any logical grounds to stand on anyways, right? Vibe coding your own solutions does not work. And I know I got a lot of backlash for saying this at the time, but I think a lot of people have come to that understanding as a lot of these software stocks are up 50 or 100% in the last, you know, couple of months. But vibe coding your own solutions does not work. Imagine it like this. Imagine Walmart tries to vibe code their own service now. They're like, "Okay, I'm going to vibe code my own solution." That's going to cost 5 to 10 times more than just paying for a service now subscription. The only way vibe coding something would make sense is if you're able to sell it to other companies. I don't think any logical company would cancel their Service Now subscription for a vibecoded Walmart Service Now subscription. You can't make the math make sense unless you can sell it to other companies which you're effectively just trying to replicate Service Now. it it's pretty illogical mental pathway usage. And following Nvidia earnings, I will say I do think uh AI hardware and software could actually rally together here. Although again, I don't think AI hardware is all going to rally. I I don't think it's going to be FOMO like and and that's why hardware or that's why software and really the rest of the markets did poorly as hardware was you know ripping is because there was so much FOMO nobody wanted to touch anything else but as long as hardware does not go through a FOMO rally I think software could do very well I think robotics automation cyber these are the new AI trades they are here to stay now we do have big catalysts throughout the rest of this week. Tomorrow in after hours, you have a bunch of software earnings as well as additional cyber security earnings. That's really the big catalyst over the next 24 hours is the earnings story tomorrow in after hours. Friday, you have the speech from Kevin Walsh. I think this is a sell the news by or by sell the news by the rumor situation, right? People are selling the news of, "Oh my gosh, what if Kevin Walsh is a hawk and talks about rate hikes, but the reality is we're not going to hear any of that on Friday and the markets are going to love it and stocks are going to go up." That's my opinion. That's my perspective. Again, come to your own conclusions, but I'm actually quite optimistic into the end of this week. The the the one thing I just don't know is the war with Iran. that could come to an end any time or it could get worse at any time and there could be sanctions thrown on China and things like that. So, you do want to be careful here because that's an exogenous risk that me or you have no idea the timeline on. So, let me know your thoughts on all of this down below in the comment section. Hit the like button as well as subscribe to the channel if you guys have not done so already. Have a fantastic rest of your day and I will see you in the next