Mad Money 08/27/26 | Audio Only

My mission is simple, to make you money. I'm here to level the playing field for all investors. There's always a market somewhere, and I promise to help you find it. Mad Money starts now. Hey, I'm Kramer. Welcome to Mad Money. Welcome to Craig Friends. I'm just trying to make a little bit of money here. My job is not just to entertain, but do some teaching. So call me at 1800743 CBC. Tweet me at Jim Kramer. To borrow a phrase from Mark Twain, there are three kinds of lies. Lies, damn lies, and statistics. Nothing's more misleading than a series of bogus numbers coupled with a novelistic negative narrative. So after a day when the Dow gained 106 points, that's be advanced 72% and the NASDAQ jumped 1.57%. I want to pull the curtain back here. Explain why stocks like Salesforce up $46 or 22%. And Nvidia, which rallied $18 or 8.7%. such huge single session moves. Very simply, we were in the grip of some lies and damn lies backed by chimera statistics. And now both bear stories have backfired, leading to humongous gains for those who hung in. Today was a day where a lot of wrongs were rectified. In particular, I'm talking about the canards coloring the action in these two stocks. Oh, by the way, and a third crowd strike, which we will talk to later in the show. Both Mark Beni, the founder and CEO of Salesforce, and Jensen Sum, the co-founder and CEO of Invidia, came on our show last night after they reportedly just stupendous quarters to drill home that their companies are in great shape and their businesses are on fire. Both came on proud, justifiably so, especially as they just triumphed over a course of lies, exaggerations, and fear-mongering. For months, these stocks have been held back by the bears, the short sellers who argue that Salesforce's enterprise software couldn't survive in a world of AI competition, and Nvidia would soon be overcome by hyperscalers that are desperate to develop their own chips, use them, and sell them to other clients that could they could poach from Nvidia. At least that was the narrative. How did these bearish narratives take over in the conversation in the first place? Okay, first I need to talk about say how about my involvement or lack of involvement with hedge fund managers. See, I don't like talking to them because I have to presume they're always talking their book and for the most part I don't think it's worthwhile. In fact, it can be poisonous. Many others do talk to them, though. I'm not saying they're inherently dishonest, but they've got a financial interest in promoting their positions, which gives them a reason to twist the facts if they want to. I don't want to get swept up in that because at the end of the day, you know who my boss is? You. And I don't want to lead you astray. Which brings me first to Salesforce. Mark Benov has what's known as it's called a seat model, meaning you pay Salesforce per user. It's been a terrific business for a very long time. And Mark's been wildly successful, at least until recently, when a cohort of short sellers decided that Salesforce and its ilk would be eaten alive by AI competition. They believed that it would become obvious to everyone that the whole software as a service space was a dying model because they charge per seat and with AI you simply won't need as many people to work at your company. So Salesforce had to charge less. The Bears also argued that the large language model companies and here I'm thinking about anthropic or open would be able to write their own code to duplicate what Salesforce does. Simple to do. The hedge fund managers told us that's what they said to everybody. They called it the SAS apocalypse. People kept pushing this catchy little narrative and worked on the stocks, held them down, took them lower. Now, Salesforce had a couple sub-optimal quarters, but Mark told us he was installing something called Agent Force, which he introduced on our show two years ago at Dreamforce. It uses AI agents to help boost sales and make workers more productive. During this transition though, the SAS apocalypse drum beat grew louder and louder. We heard that the growth was declining rapidly, that you'd see the annual order value plummet, that seats would go down, the customers were disappearing, that attrition was huge, big discounts were being given, and contracts were shortened as people feared that something like Claude would obiate Salesforce entirely. That was the narrative. Yet, when Salesforce reported last night, they delivered their strongest net new annual order value growth in four years. Wall seats grew year-over-year. Pricing was strong. Attrition was near its lowest level ever. Bookings for Salesforce's highest price bundles doubled. Every worry quilled. Every lie defrocked. Oh, and if Anthropic were trying to destroy Salesforce, boy, they had a funny way of showing it. Last night, Salesforce announced a major expansion of their partnership with Anthropic. They're basically embedding their platform in Claude. Here's how Anthropic CEO Dario Amade told us. >> We're not interested in destroying destroying anyone. uh you know we think of this as a very positive sum thing right that's the way that's the way markets work creating new value here and and the question is just you know h 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 I like that attitude new value sounds good to me hey what about the SAS apocalypse that was supposed to destroy sales force force you have to remember Salesforce is first and foremost in the data business. We're helping our customers to build data lakes to integrate their data, federate their data, harmonize their data. These AI models need this level of intelligence, security, the controls for users, what we call user models, sharing models, and then we put the agent model on top of that. And then this new UI, you mentioned it, cloud force. It can bring all of that together and release all this trapped value that enterprises have had in their systems, all can get revealed in this next generation AI user interface. And that's how you get a stock to rally more than 22% in a single session. Salesforce started the year at $265 and change. It dropped to $146 at the height of the AI disappointment, displacement, hysteria. Today it's back at 252. I don't think it's done going higher. SAS apocalypse. How about short apocalypse? As misleading as a SAS apocalypse tale may have been, I honestly think the rumor marking about Nvidia might have been worse. Here's a company that practically invented AI. Chess Wong, the pioneer behind the Nvidia revolution, the man called Da Vinci, took his company from a couple billion dollars when it was chiefly a maker of graphics chips for PCs to 5 trillion dollars, largest company on Earth, as it created devices that power artificial intelligence accelerated. Lately though, the stock's lagged and a lagging stock operates a lot of negative chatter. I mean, it just does. It creates it. Since May, the long knives have been out for Nvidia. As I've said many times to you, as someone who owns both Salesforce and Nvidia for my charable trust for what seems like forever, I heard the rumors sales were slowing, the hyperscalers, the concentrated customer base had turned against them. The politics of data centers had turned costic. The big builders of them bereft, their chips were losing value, not holding on to it, and the products, including the brand new Verer Reuben semiconductor, were late. Gross margins were shrinking. and they were doing circular deals where they'd invest in their customers in order to finance purchases uh well at least more purchases of Nvidia chips. That was the wrap on this one. Incredibly negative people. Incredible. And what happened? What really worked? What really was the litany? Well, I'll tell you what you just heard WAS ENTIRELY WRONG. >> THEY KNOW NOTHING. >> Every bit of it. Hyperscalers won so much of Nvidia's bulk of business are now down to 50% of it. Sovereign buyers, NeoCloud infrastructure builders getting the other 50% far less dependence on a handful of Titanic clients. The chips are lasting far longer than anyone thought maybe as long as seven years because software updates keep them refreshed. Ver Ruben on time. Yes, the gross margins took a hit, but only because Nvidia decided to eat some losses from skyrocketing memory prices, not dirt their clients. Far from running away from Nvidia by building their own chips, the hyperscalers are still embracing the king. They may be doing some stuff away from it, but Amazon Web Services plans to deploy 2 million GPUs, the kind of semi Nvidia specializes in as well as plenty of Nvidia Nvidia CPUs. Those uh supply deals, the circular ones, so many of them are working out because the investments held up or more likely increased in value. Jensen told us he wishes he'd made even bigger deals. Well, you got to love him. Profits expanding for his company and perhaps just as important, also expanding for the customers. The era of profitless chip buying is over. The era of humongous profits has begun. Worst case scenario, you can just rent out all that Nvidia computing power and make big money like Elon Musk did when he leased SpaceX's Nvidia Compute to Google Anthropic. Most of all, there was the thing that took the stock from being down six after the close as people parsed through the earnings release to being up 10 almost the moment the call began. Nvidia projects that they can put up 70% revenue growth in the next fiscal year. Uh the stream was only looking for 45% and it could have been 100% if not for supply constraints. Remember this is the largest company in the world by market cap and they're expecting it to grow at a 70% clip. That is nothing short of astounding. Oh, and the mess over the data centers just to remind us he's not all that concerned. Taking a step back, this is America's great opportunity. This is an extraordinary opportunity. AI data centers, AI factories are generating so many jobs all across America. Hundreds of thousands of jobs. They're improving communities because they're bringing a lot of tax dollars. They're bringing a lot of economy into communities. And so I I hope that people take a step back and realize that this is creating jobs. is going to re-industrialize United States. The manufacturing sector that we've lost over the last 50 years has an opportunity to come back. America, listen to that, man, please. It's amazing to me how negative people can be right down to the last minute yesterday when the stock was selling off big until we heard that 70% growth figure. More on that later in the show. And we could lament what short sellers do. I don't care. Not at all. Let them jibber jabber. Truth pull out. But here's the bottom line. The short apocalypse hedge funds got annihilated by Salesforce and Nvidia's common stocks. If you listen to me and just own these stocks and you didn't trade them, what can I say? You had a phenomenal day. Let's take calls. Let's start with Adam in Illinois. Adam, >> hi Jim. How you doing today? Here's a boo out for you. >> Oh, booyah back at you. What's going on? Well, I've been a believer in the importance of corporate leadership, just like you, and they've been very patient. But since February, and what I think was a very poorly managed Paramount offer, and now with Reed Hastings no longer at the helm, I'm starting to wonder if this is really the same company I invested in. So, is it time to hold, add, or sell Netflix? What do we >> Okay, I I I think that Netflix is a buy, not a huge buy. I mean, I wouldn't put a lot of money, but I think it can bounce here. But I agree with you. I mean they you the time the whole Warner Brothers discovery I it left me cold too. But I do think these are still the great guys that have built a terrific company. Now if you just own Nvidia and Salesforce instead of trying to trade them or gain the earnings, what can I say? You did the right thing and you had a phenomenal day. On May money tonight, Crowd Strike is soaring after what the CEO said was the quote best quarter in history. End quote. I'm finding out what made it so good when I sit down with George Kurts himself. And yesterday's earnings prices weren't limited to tech. There was also one apparel name that really stood out. I'm revealing it. And as the markets readjust their own view of what's working and what's not, I'm making sure you're prepared for whatever the winds of Wall Street blow. We're going to do that with a game of MI Diversified. So stick with Kramer. Don't miss a second of mad money. Follow Jim Kramer on X. Have a question? Tweet Kramer #madmentions. Send Jim an email to madmoney@cnbc.com or give us a call at 1800743cnbc. Miss something? Head to madmoney.cnbc.com. Like I mentioned at the top of the show last night, every major bare thesis in tech was upended. I'm not just talking about Nvidia and Salesforce. Look at Crowd Strike. Last night, the cyber security kingpin reported what they called the best quarter in the company's history, setting the stock up more than 20% today. This was a terrific top and bottom line beat with management also raising their fullear forecast for the net new annual recurring revenue growth taking it from 27.7% all the way up to 34 point uh 34%. Now that is a huge and important metric and it's a staggering number bump. Only a few months ago everyone was worried that cyber security would get crushed by AI competition. Turns out the rise of AI has only made CrowdStrike more essential because attackers have this technology too. They've become the security platform underneath the AI economy and it's making them a fortune. Do not take it from me. Let's check in with George Kirks. He's the co-founder and CEO of Crowd Strike to learn more. Mr. Curse, congratulations. Welcome back to Bad Money. >> Well, Jim, great to be here and thank you. >> Of course. Now, George, I've got to tell you, you taught me early on. We want to look at these annual recurring revenue numbers because that's when you find out the true health of a company in your industry. These numbers were spectacular. What's driving it? Well, when you think about the numbers and the quarter we delivered, it really was a quarter of records. Um, our revenue almost 1.5 billion. Annual recurring revenue 300 net new 333 million up 51% year-over-year. Operating income 372 million which was up 46% and record free cash flow of 377 million or 26% of uh of revenue. So up and down we saw just tremendous success. And what's driving that is really what I call the mythos moment. That is the realization that the AI adversary is here. They're moving at inference speed and companies need the technologies that CrowdStrike created to help stop the breach. And that's what's driving the momentum not only in this quarter but sustainable tailwinds into the future. >> You know, George, a lot of people I deal with have said to me, you know what, nothing can stop the agents now. They're out of the sandbox. we should be terrorized. I always say the same thing. I said, if you read any of the things that George Kurts puts out, they actually can be stopped, but you have to have modern technology. And the other stuff, even stuff that's a couple years old, may not work. You have a solution. Correct. We have a solution, Jim, and it's called the Falcon platform. And we've built this from the ground up to be able to adapt and and uh take advantage of this AI era, right? It's the speed at which the adversary is moving. It's the complexity of the attacks and the platform was built day one when I started this company to accommodate this. Now we see more attacks. We see these attacks faster. But you need the right AI, the defensive AI to fight the offensive AI. And that's what we've built at CrowdStrike. And that's why not only do we stop breaches, Jim, but we cure the complexity that it drives with a patchwork of products. And this is one of the reasons why Crowd Strike is the security operating system for the agentic era. >> All right, George. What percentage of companies are protected well enough do you think? >> I I think most companies uh depends on the industry, but most companies have some level of gaps and the challenge that you have even if companies are sophisticated and spending a lot a lot of money, the threat landscape is moving so quickly. We saw these escapes from the sandbox that we talked about and luckily this was an agent just trying to pass a test. They weren't actually trying to do anything evil and we saw what happened. So if we think about the AI era and how fast these uh AI agents are able to swarm and find vulnerabilities and exploit those, it's just a different quantum of security that's needed. And this is why we think we're in pole position. Well, I have to tell you one of the things that concerned me. First, congratulations on this, but you had an 8 figureure flex deal with a Frontier AI lab. Well, I mean, I would have thought that maybe they knew how to do this themselves. They sure did see one of them one of them sure didn't seem to think that they do. I guess they can't. They They're not in this business, so they maybe need you. >> Well, I think Jim, what we've seen is that we partner very well with the Frontier Labs, and a lot of that has been driven by customer demand. Customers trust Crowd Strike. We've built incredible uh credibility over the last 15 plus years. Uh we work and understand security day in and day out. And again, customers want choice. We certainly leverage the frontier models. But at the end of the day, it's very difficult to replicate what CrowdStrike does. And this is one of the reasons why customers choose us. We're cutting down complexity. We're reducing cost and we're getting the outcome of stopping breaches. >> Reducing cost. I know that's important because people can never figure out what the ROI is of what you do except for until their operations wiped out. >> Well, I tell you, Jim, we spend a lot of time actually working with customers in demonstrating the ROI. We call it proof of value. And we actually go through and talk about how many different point products we can consolidate. And routinely we we are consolidating meaning we're removing 2 3 four five and six products from a an environment to reduce the complexity and the overall cost but we get a much greater share of the wallet which is why you've seen our flex numbers which is our innovative licensing model uh reach a record uh almost $2.3 billion >> which is extraordinary. Now there isn't a moment that I come out or don't turn my head I see something new. I've got this I have a piece here from Greg Brockman a call for collective action on cyber defense open letter for a global surge in cyber defense signed by over 100 organizations. This came out today. Uh you're the you're the cyber security company on this. Well, I Jim again, I think people have recognized that if you have a unique data set, which CrowdStrike has, if you're a net uh creator of data data, which we are creating based upon our security uh agents, if you will, then you're going to need us, right? And enterprises all the way down to SMBs have figured this out. Uh the labs understand they need to work with us. The customers are driving that. And uh we are front and center in this agentic revolution, which is why we're part of that announcement. Now, uh, you've got a big conference coming up and I know that at conferences you tend to dazzle and you introduce new things. Now, I know we always think that you've got the latest and greatest. What's what are we going to see at the conference? >> Jim, what we're going to show you is not going to knock your socks off. We spent a lot of time in uh perfecting technology which we call aid as an example, which is the next evolution of endpoint detection and response, but it's for AI agents. And when we started the company, of course, we're protecting people and computers. And now it's about protecting agents. On average, the IND industry says that each person will have 90 agents they control. We want to protect each one of those and the agents in the cloud. So when you see what we've put together, it's absolutely outstanding and it's one of the reasons why this business is is massively growing. Uh and we're excited to show that. We're also excited to show some advancements in our AI technology and what we've developed to be able to combat the AI adversary. So, I can't wait for next week. I always say each Falcon is going to be our best, but I'm sure this is going to be the best one that we've ever had. >> You did. Uh they had a very timely acquisition in the identity field, didn't you? >> We did. We did. We bought a company called Signal, which uh was really NextGen identity. Uh this is an incredibly uh strong business for us. And when you look at what we've done over the years, we've built a great nextgen identity portfolio focused on human but also non-human identities, which you need to create a control plane to be able to control all these pesky agents that like to steal the identity of everything else that's out there in the environment to get their job done. >> Now, do you think some companies like I there was a a company in the medical device I don't want to pick on them, they've had enough to trouble this year in the medical device business and they got hacked pretty bad. And I was thinking, did were they just arrogant or did they not be up to date? I mean, when you find someone hacked really bad, is it because they haven't updated or because they thought that they were invincible? >> No, I I don't think most companies think they're invincible. I think there's probably two things. One, you know, if they think their security is good enough or they get it for free, you know, that generally doesn't end well. And two, you really have to have the best technologies with the right level of expertise uh to be able to combat these adversaries. They're moving so quickly. Their techniques change very dramatically. And part of the benefit of CrowdStrike is the crowd in Crowd Strike is we're able to crowdsource all this information to see to have visibility in 176 countries where we have our our software agents running. And that really helps the our algorithms get better and better. So, you know, people try their best. They think good enough is good enough, but a lot of companies are recognizing that legacy technology and technology they get for free is not good enough. >> All right, look, I want to thank you for coming on. There was a period, a period where your stock went down pretty consistently and you said, "Look, I want to tell the story." Most people do not. Most people just say, "Hey, listen. There's nothing I can do." You did not. You wanted people to understand exactly what you did and why there was a misperception. And you caught the inflection in this man's business. If you listened the AI inflection, most CEOs do not give you a chance to make this much money. George Curts, thank you so much for helping our viewers make a lot of money. >> It just was a good It's a good thing you did it. >> I appreciate it and thanks for giving me the opportunity. >> Absolutely. Good luck at the conference. George Kurts, founder and CEO of Crowd Strike. Great to see you. >> Thank you. >> Mad Money is back after the break. Coming up, Kramer is returning to an apparel company that put on a surprisingly good show yesterday. Don't miss it next. All day you've been hearing about the fantastic numbers from Nvidia and Salesforce, but yesterday's biggest upside surprise was actually abomin. The apparel chain reported a blowout quarter in the morning and the stock jumped more than 35% in response. Did the results really justify such an incredible move? When Abberroi reported yesterday morning their same store sales actually came in lighter than expected. They were flat. Wall Street was looking for8% increase. The Abberi brands doing well with copper sales up 4% much better than expected but they also own Hollister and apparently Hollister suffering with comps down 3% versus 1.1% gain the analysts were expecting. Hollister should have been carrying this inflate. Still, the company managed to put up slightly better than expected revenue, and that ended up translating into a huge earnings beat thanks to insanely strong margins. Albery's operating margin came in at 19.9% up from 17.1% the year before, basically double what Wall Street was looking for. And that's how they could deliver a staggering $218 earnings beat off a $1.99 basis. Now, a lot of that strength came from a hundred million tariff refund, courtesy of the Supreme Court. But even without the refund, their earnings would have been much better than expected. The tariff refund was worth $1.75 per share. So even without it, they would have earned $242 per share. At the same time, Abbery's guidance for the current quarter and their fullear forecast were substantially better than expected. Although these numbers are pretty noisy because management included a lot of detail about the tariff refunds and the new round of tariff replacements from the White House. For the full year in 2026, Abberrombi raised its outlook for net sales growth, operating margin, and earnings. Looks like they're taking the $100 million tariff refund, splitting up between buybacks and investments in the business. In the end, they're talking about making $1310 to $13.60 per share. The world expecting $10.72. You raise your earnings guidance by nearly three bucks at the midpoint, of course, your stock can rally maybe even as much as 35% in a single session. They clearly feel very good about the future. What makes them so confident? Well, the conference call CEO Fran Horowitz pointed out that Abberrombi has been aggressive with its buybacks. Through the first half of the year, they've actually retired 7% of their share count. Now, that is a remarkable pace. No wonder they're putting up new journeys per share. That's what happens when you shrink the number of of shares. That's why we like buybacks so much on the shelf. Now, they can do this because aside from Hollister, business is booming. Harit's noted strength in every region. The Americas grew 5% with growth across all direct channels and and meaning Abbercrombie and Hollister stores and the company's websites. 2% growth in Europe, the Middle East and Africa represent a return to positivity after that region had declined in the first quarter when the UK and Germany called out as particularly strong. I like that. And Asia Pacific up 19% which speaks for itself. Now we know the Abberries brands have been doing less discounting and more full price selling especially in the Americas. They just opened a new store in Soho, the shopping capital of New York City. I'd love to visit it. They're also entering their second season as the NFL's official fashion partner. I love their stuff on that. Honestly though, I do recall a bit when Horwitz mentioned the company's new denim campaign with New York Giants star Jackson Dart and Neighbors. I mean, I guess Jaylen Herz, Saquon Barker, maybe they were jammed, right? NFL partnership is clearly working for him, though. How about the relative weakness at Hollister? Do we have to worry? management didn't go into a lot of detail here aside from pointing out that the brand's up against some very difficult year-over-year comparisons and Hollister actually improved a bit versus the previous quarter. Harowitz did say that so far Hollister is having a pretty good back to school season and the business is already accelerating versus the quarter they just reported and that's enough for me. It takes it off the table. All that said, when you see a stock jump more than 35% see that a lot of that comes from broken short sellers who desperately are trying to buy back the stock to close out the position no longer to be short. We call that short covering. Nearly 10% of Abberromy's float was sold short going into the quarter. Those guys got blown out of their and and their panic attributed yesterday's monster move. So then you got to ask yourself, is it too late to buy this one? Listen, when you look at Abbercrombiey's chart over the last few years, we've seen a couple similar spikes. That's not uncommon in team retail. In May of last year, the stock jumped 15% in a single uh session after a terrific quarter, but that move was immediately given back. Then last November, the stock jumped 37.5% in a single. This is why people love to fool around with the options market. Same reason that time, Abra continued to climb higher through the end of the year before the momentum was broken in January with the pre-announcement of a sub-optimal guidance update in the wake of the holiday season. That was nasty. stock drifted lower for months after that before eventually bottoming in May. This is an industry that can change on a dime. People, sure, Abberrombi is printing money right now, but that doesn't mean they'll be doing that well at 6 months from now. With that caveat in mind, I'm actually going to admit that I'm pretty optimistic on this one. Even after the stock's enormous rally, it still trades at just under 11 times this year's earnings estimates. At the same time, the Abberroi brand has a ton of momentum, and I think Hollister is already turning. Here's the bottom line. the Abbercrombie and Fitch play here. It might need some time to digest yesterday's gains, but I think Fran Horowitz, the CEO, is doing an incredible job here. And if the stock gives you a pullback, may I suggest that you do some buying? Let's take some calls. Why don't we go to Sylvio in Florida. Silio, >> hi Jim. This is Sylvio from West Palm Beach, Florida. Thank you for taking my call. >> Thank you. What's going on? Um, first let me say I'm a me club member and I love this. >> Oh, thank you so much. Thank you. I'm going to tell Jeff you said that. Definitely. Okay. >> Thank you. All right. Now, I'm looking at a small retail um company. >> Okay. >> Um they actively increasing their customer base. Actually, the customer base is getting big. Growth accelerating. International market rapidly scaling and they have a fortress balance sheet no debt and aggressively repurchasing their shares. >> Okay. >> What do you think about starting a position and we evolve our >> no too erratic too erratic too up and down. Don't want that. I don't want you to be involved there. It is just too um it can just disappear and run up and disappear up. We need consistency here and Revolve does not have enough consistency. What can I say? That's how I feel. All right. Uh, Abberromy and Fitch might need some time to digest its latest gains. And you can say that's too up and down, too. But I like this Fran Horowish is doing the management. Um, if you see a pullback be a buyer much more money, including crime America's favorite game, might diversify. Then if I, you know, if you pulled the trigger on selling Nvidia before the earnings call yesterday, I think you're probably kicking yourself. I'm going to explain why it pays to wait for the company's own words before about its earnings. Just not just the press weeks and all your calls rapid fire tonight, the lightning round. So stay with Kramer. All right. Tech led the markets today, but I've been saying that's a big shift from where Senate has been for the past six months. So to m make you kind of let's say that you don't want you to get way laid by the rapidly shifting tides of Wall Street fancy. We're going to do something we haven't played in way too long. We're going to play am I diversified. Now what do you do there? You give me your top five holdings. I tell you if you're diversified or not. Maybe you need to mix it up a little bit. We're going to start with Vince in Alabama. Vince Mr. Kramer. >> Yes. How are you? You >> I am good. How you doing? >> I'm outstanding in my field. >> All right. >> I just want to say some people do like little, some people do a lot. You do a big lot. You're like a faison from the '9s. >> WELL, THANK YOU, PAL. THANK YOU VERY MUCH. WELL, LET'S GO TO WORK. >> YES. OKAY. I have JPM, I have Alphabet, I have Berkshire Hathaway, I have Apple, I have Nvidia. Am I diversified? Wow. Okay. Now, this is this is where the disciplines really contrast. For instance, I have Apple, own it, don't trade it, right? And I have Nvidia, own it, don't trade it. So, I'm kind of locked in there. I can't tell you that that's two texts. You got to sell one. Uh JP Morgan Chase the it's the best bank. I wish we owned it for the travel trust. Bergkshire has had a stunning move. Frankly, that's a conglomerate. I can call it an insure, but it's got too many other things going for it. Alphabet. Okay, we can't have Alphabet, Nvidia, and Apple. We're going to have to put a healthcare in here. So, I'm going to say we're going to add J&J and then you are diversified within the rules of owning both Apple and Nvidia and not trading them. Next up, we go to Summers in my home state of Pennsylvania. Summers, >> hey Jim, thank you for taking my call. Appreciate it. >> Of course. >> My stocks are My stocks are >> Coupang, PNC Bank, Palunteer, Herk, and Natara. Am I diversified? >> Let me see. I want to be sure I get see where these are right now. Um, PNC. Okay, that's a nice, you know, look, PNC is a nice regional bank. I I'm never going to get, you know, say, "Oh, you can't own that one. It's terrific." I I have no really edge on it, but it's nice. Palanteer, what I was looking at was trying to see whether it closed above 200 because, you know, a lot of people said to me, Jim, when it went back to 150, you really let us down and never went above went to 200. I'm telling you, this is going through 200. Okay? And I like it very much. This is a very good consulting company. I know it's much more than that, but I'm using that term. Okay. Herk Reynolds. I only like URI. I I don't like the rental business. It's too uh hit or miss. Okay. Coupang. We're not going to own any comp any companies from that area. And NAR. Now, this is a tough one. Um here's what I want to do before I I know that this is just really about about we're really only caring about sectors, but I have to do more work on Nara before I say whether I'm going to bless it. So, I'm going to say a bank. We're going to get rid of this rental company. I like this consultant. We're not going to take anything from here. Um, we're going to use we're going to right here. What we're going to do is if after what's happened today, I am saying, you know what? I want Salesforce. I want Salesforce there. I'm not kidding. And I'm going to come back on the terror. I just shouldn't be able to just say, hey, listen, the terror is fine. You don't have to worry about it. Let's go to Jeff in California. Jeff, >> hi Jim. How are you today? >> I am good, Jeff. It's a good day. You know, Nvidia did well today. Salesforce, that's how controls my day. I don't care about the weather. I'm going to talk about the weather. That doesn't bother me. What's going on? Well, as you know, Devidian and Salesforce are my neck of the woods here in San Francisco. >> I like your neck of the woods. It's terrific. >> I know. Um, I've been watching Mad Money for 20 years and a charter club member. >> Oh, thank you so much. >> You're welcome. My top five holdings are Alphabet Nvidia Apple Caterpillar and Lily. Am I diversified? Jim, >> you are indeed a club member and I love that. But we're going to have to say I want everyone to know cat, you know, I used to say that was earth moving. That's so wrong. And now turbans, it's really got a lot to do with the data center. We got to be careful. There's a data center stock. Eli Liy, you know, this is the the trillion dollar drug company that I like so much. Apple and Nvidia, that's own it. Don't trade it. I'm blocked in here. And sure enough, there's Alphabet again. Now, we already have a healthcare company. What do we need here? What is this thing? what is his need that is not necessarily tech because we have tech and we don't want to put too much more tech because caterpillar had has that peculiar relationship with the data centers. I'm thinking, oh, let me see. Okay, I want to put us I want to be a little aggressive here. I want to put TJX. I know TJX is going down. I know that the cheap retailers are good. I know Walmart's at 102, but I want to do TJX. I'm going to leave CAP, but if I didn't, I was going to say Wells Fargo. I think the Wells Fargo's good, too. So, a little controversy there by having three texts. But you know what? What can I say? This was the hardest game of my diversity. I'm probably out of practice. I because I'm I'm I'm nailed on what I like the most, which yes, is Apple and Nvidia. I got four. I want to thank all our fabulous callers. Thank you club members. And I promise I promise that I'll resolve this problem of Apple and Nvidia someday. But right now, I say own them. Don't trade them. Man, money's back after the break. >> Coming up, you've got questions. Kramer's got the answers. Get charged up for a fast fire lightning round next. It is time. It's time to light my bicep and then the lightning round is over. Are you ready to start with John in Michigan? John, >> hey Jim, I love the show. Just want to know your thoughts. >> Just want to know your thoughts on Veil SA. >> Yes. Okay. Now look, this is if you believe it as I do that we could have rampid inflation down the road. This is one of the best plays to do it. And I would actually use it as a great hedge. Uh just as good as crypto. I'm not kidding. Just kind of doing the same thing. Let's go to Gregory in New Jersey. Gregory. >> Hi. Hi, Jim. >> I'm 94 years old and I've been investing for 75 years and because of you, I have done very well in the market. >> One of my favorite companies is Apple. How do you think they can continue to be one of the best companies in the future? And do you think today is still a good buy? I do think it's still a good buy. I would own this, not trade it. I know we've got a new CEO coming in and I have made no secret of how great I think Tim Cook is. I do want to get to know the new CEO and I don't know John Turners. However, I do think the company is going to be in good hands if Tim Cook says it's in good hands because he has never been anything other than true north for me. Let's go to Joe in New Jersey. Joe, hello Mr. Kramer. Thank you for taking my call. And by the way, thank you for recommending Beckton Dickinson up uh a couple months ago. It's up 33% on me. Thank you so much. >> That was way that was the cheapest it had ever traded. You know what? That's what I was just using historic analysis on that one. Thank you, Joe. >> Yeah. And now I want to know if I should buy more shares of Cisco Systems. >> You know, look, Cisco actually had a really good quarter and I know that they gave very conservative guidance, but that's all it was. It knocked the stock down $8. The answer is I would absolutely >> let's go to John in Florida. John, >> yes. Uh Jim, thanks for having me. John David calling out of Boca Raton, Florida. We're calling about the stock E-Rock Inc. Uh ticker symbol E R O C. Is it too wishful to think that this is the next Nebia? >> Yeah, I think it is too riskful. I think you got to go No. No, we're not going to do this one. I mean, if you're going to go there, you got to go with Core. Okay. I I just It worries me. I do think that some of these are going to be too speculative and Cory is about the limit of speculation I wouldn't do. And that ladies and gentlemen conclusion of the LIGHTNING ROUND. >> THE lightning round is sponsored by Charles Schwab. Coming up, don't let Wall Street work you over. Stick around for more of Kramer's top tips next. It's the guidance stupid. Last time we got a tutorial on why you always have to wait until you hear the conference call before you decide to do anything by yourself. >> It in response to earnings. I'm talking about the crazy action in the stock of Nvidia after last night's closing bell. >> Let me set the stage. Yesterday, the stock of Nvidia, the largest company on Earth, was down three points on the session. Not a great leadin. At 420, the Nvidia release comes out. And at first, the stock collapses, plummets, down six points. What happened was it released was bare bones. I ripped through it. The numbers for the quarter look fine. Revenue is much better than expected. Gross margins in line good enough. Must be the outlook, I said to myself. Sure enough, just two lines. First, revenue is expected to be 108 billion plus or minus 2%. Oh no, that's a miss. While the official sellside sight consensus was around 104 billion, we had heard that the buy side expectation, the so-called whisper number was 109 billion billion dollar whisper mix. No, no, no. Dive dive dive dive dive. And then there it was the killer dealer, the bone crusher. The gross margins are expected to be 74% plus or minus 50 basis points. Oh me, oh my. We were looking for 74.7%. They missed. They didn't clear the bogey. It's always the gross margins. Now, the journalist started that doing the same thing I just said. Okay. They took one look at the vicious selling and of course they decided that the crowd must be right. Always right. Right. Next thing you know, that ever so slight miss in revenues and gross margin is blown up, magnified by a befuddled press. Every time the stock tries to make a stand and after hours, the sellers burst in as still one more outlet squawks about how Nvidia's margins must be coming down. Hey, maybe because of competition or because of DRAM cost or whatever other rank speculation may justify things. Maybe it's the mass hatred for the data center. They make up any narrative to fit the falling stock, don't they? The huge block of time between when the market closes in 5:00 p.m. when the call begins breeds so much fear that you can tell the owners are just panicking the same piece of news over and over again, betting that the press conference, the the conference call what verifies everything must be going ary. They're shaking. They're shaking. They're scared. This stock's traded down four straight times after the quarter. I guess here comes number five. But as I always tell you, don't jump to conclusions about a quarter until you hear the call. You simply cannot make a judgment until you hear what management actually has to say. And in the back of my mind, I'm thinking about the big Microsoft calls, the ones that change the direction of the stock for the duration. When Amy Hood, the CFO, would come on in the middle of a call and give you more color on that alloy. She had the power to change the direction of the stock and change it. She often did. Baited breath, held breath, whatever baited means. Then the call starts. CFO Colette Cres the hammer. First sentence, outstanding red. Yeah, we know. Next, strong AI demand, global infrastructure, AI, sovereign. Yeah. Yeah. I mean, sure, sure. Okay. And then, quote, we expect to grow revenues by approximately 70% in fiscal 2028. End quote. Huh? What? We were looking for 45% in 2028. But then again, 70%, NOT 45, NOT 50, NOT 65. UNBELIEVABLE. NOT POSSIBLE. Can't be. It can't be that good. And yet, you know what it was. The stock popped nine points in what can only be described as a few seconds. And then it kept ripping. Never looked back. What the heck happened here? Just one of the most spectacular guidance phrases in history. That's all. In the 1 hour between the closing bell and the first words from CFO Crest, we saw some of the most starkly boneheaded trading I've ever seen. Stoked by media that should have known better. You see, with a company like Nvidia, you really don't know what they're going to say. The call from those first moments just got better and better and better with the stock ultimately finishing today's session up 18 points. Even after I got hit with a little profit, taking near the close. The lesson, if you can't resist trading, if you can't wait less than an hour between the release and the call, go for a walk. Go play Wordle Solitaire. Go watch Reacher. I don't care as long as you don't jump the darn gun. A and try to trade when you haven't heard the call. Oh, and by the way, with Vidia, don't even bother to trade, just own. I'd like to say there's always more market summary. Promise I provided just for you. Radio Money. I'm Jim Kramer. See you next time. All opinions expressed by Jim Kramer on this podcast are solely Kramer's opinions and do not reflect the opinions of CNBC or its parent company or affiliates and may have been previously disseminated by Kramer on television, radio, internet, or another medium. You should not treat any opinion expressed by Kramer as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinion. Kramer's opinions are based upon information he considers reliable, but neither CNBC nor its affiliates or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. To view the full MadMoney disclaimer, please visit cnbc.com/madmoney disclaimer.