00:00 welcome in folks it's a four piece here
00:01 today buy 1 get three free four videos
00:04 up here for me to react to first one up
00:05 here and video will continue to be in
00:08 bold position say Bren Tarkington so
00:10 we're going to react to that one want to
00:12 share my opinions and perspectives there
00:13 okay then we're going to react to these
00:15 folks talking about nvidia's quarter
00:18 there then I want to talk about rivan
00:20 stock rivan stock crashing today um
00:22 stock down to oh gosh I don't know maybe
00:24 122 $13 a share or something like that
00:27 so going to talk a little bit about
00:28 rivan react to this and then the CEO
00:30 went on CNBC a few hours ago 3 hours ago
00:33 and spoke about where the company's
00:34 going so you know just kind of thinking
00:36 about is there any sort of opportunity
00:38 in there with rivan is there not and uh
00:41 if you don't know Amazon owns a huge
00:42 portion of rivan and I own a lot of
00:44 Amazon stock so I'm very you know
00:47 interested to kind of hear that in this
00:48 video here today okay appreciate yall
00:50 joining me as always thanks so much for
00:51 being here all I ask in return is that
00:52 you smash that like button and make sure
00:54 to subscribe to the channel I hope
00:55 you're having a great day out there it's
00:56 a lot of money to be made I can tell you
00:58 out there today man it's is a is a good
01:01 one is a good one folks okay if you're
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01:18 comment down there all right guys so
01:20 let's start getting into this with
01:21 Nvidia first and foremost isn't it Bren
01:24 as Stacy rascon as Josh just said quote
01:27 the story this is what he says today the
01:29 story still feels like it has legs we
01:31 marketly increase estimates again and
01:34 take our price Target to $11,000 he was
01:36 at700 which we asked him about yesterday
01:38 said don't pay too much attention to my
01:40 target there but he bumps it to a
01:43 th000 yeah I mean hey hey who who put
01:46 $1,000 price Target on Nvidia before
01:49 everybody else did who did it who did it
01:52 I told you they're all going to do it
01:54 they're all coming man they're all
01:55 coming and just wait $1,500 price
01:57 targets coming on Nvidia you just wait
02:00 on it what's so incredible if you think
02:02 about it if you take a Google Apple meta
02:05 Microsoft and Amazon what 12 trillion
02:09 market cap when all of these companies
02:11 get together behind the same theme which
02:14 AI Nvidia is the recipient of all of
02:17 that the majority of that capex and so
02:20 it just said a 37 forward P that's
02:22 likely wrong the nvidia's forward piece
02:24 probably as of today is probably about
02:26 30 or maybe 28 this call if you haven't
02:29 listen to the call as an investor I
02:31 implore you to go listen to the call it
02:32 was like a master class um and this is
02:35 so exciting because I've just never seen
02:38 a company that in 2021 they had revenues
02:41 of like just shy of 17 billion for 2024
02:45 they're going to do 60 billion I just
02:47 don't know of a company this size that
02:49 have had just this catapult and so
02:52 investors need to remember the revenue
02:54 that was for their fiscal year but let's
02:55 be honest this upcoming year that we're
02:57 going into now uh they're going to
02:59 likely do hundred billion dollar in my
03:01 opinion earnings are growing really in
03:03 lock step with the price and so I think
03:05 they're hitting on all cylinders I will
03:07 say Scott though if you think about it a
03:09 year from now I don't think you're going
03:10 to continue to see 200% growth
03:13 year-over-year because you're going to
03:14 see that stable that that stabilize but
03:17 you're still even looking out even
03:18 further out this company is probably
03:20 going to be growing at 15 to 16% a year
03:23 so they just continue to be in pole
03:24 position while everyone else is just
03:26 trying to ride ride ride their ride
03:28 their wave you were you were calm cool
03:31 collected yesterday going into the
03:32 number two I asked you straight up if
03:33 you were nervous you said no no because
03:36 you believe in the company you believe
03:37 in the stock they obviously delivered
03:40 Jim lenthal go to you next because you
03:42 also Own It reasonably new uh position
03:44 for you you were looking for this thing
03:46 to trade lower so that maybe you could
03:48 buy more uh you're not going to get that
03:50 chance or maybe you had it and didn't
03:52 buy enough yeah no I don't think it's
03:53 going lower from here but I also think
03:55 the major point that I would make is
03:56 that you do have to own this now I know
03:58 that's a controversial statement there
04:00 are some uh on the desk and I told you
04:02 guys yesterday every flip and Flapjack
04:04 and dip in this stock will be bought for
04:06 quite some time on the desk who would
04:07 say there's no stock you ever have to
04:09 own but look clearly all the oxygen in
04:12 the room and by that I mean the cash
04:13 flows in the market are going to Nvidia
04:15 and fundamentally there are strong
04:17 reasons which Josh and Brin just pointed
04:19 out for that to continue um you know I
04:21 said last week Scott and you'll remember
04:23 I said listen you got to own this at 1%
04:25 that's a small enough position that on
04:27 any dips you can add to it I'm saying
04:28 that again today if you don't own it I
04:30 do recommend that you add a 1% position
04:33 to it when you when you look at this
04:34 compared to your other Holdings so this
04:36 company 21% operating margins last year
04:40 this year uh 62% this is unheard of I
04:43 mean here's my question so you look at
04:45 that and you say maybe maybe 1% is not
04:48 correct maybe it should be more well we
04:50 all own we all own like some exp we have
04:53 these companies that are earning maybe
04:55 like 2% profit margin trying to scratch
04:58 nuggets Co I'll I'll dance with you I
05:01 mean look the only thing the reason I'm
05:02 saying 1% is let's face it it's up 15%
05:04 today and you know we can go through the
05:06 superlatives of its price return year to
05:08 date the last two years whatever you
05:09 want me the 1% It 6 it was 660 I'll go
05:13 back it was 666 yesterday ahead of the
05:15 number I was like oh man that's an
05:16 ominous number to go into a print on and
05:20 777 so it's up 100 I'll I'll just close
05:23 on this from a fundamental point of view
05:25 and I know it sometimes drives you crazy
05:26 when I do this or when Stephanie does
05:28 this but you look at the valuation
05:29 you're going to say as Stacy Ryon just
05:31 said it's not expensive I mean the
05:33 earnings estimates are going to go up
05:35 after this and it's probably below 30
05:36 times Ford uh earnings uh you got a
05:39 growth rate of above 50% the PEG ratio
05:41 price to earnings to growth ratio folks
05:43 is below one for a company that is just
05:45 absolutely knocking the cover off the
05:47 ball and the cover and the ball are out
05:49 of the park yeah so Steph you don't own
05:51 it um I think people know that by now
05:53 you own broadcom you own lamb you own
05:54 IBM I put a sad face emoji by by your by
05:58 your name today in our document today
06:01 uming bus playing a little bit on that
06:04 Stephanie why do you hate Nvidia going
06:07 to say that or why am I shorting video
06:10 why are you shorting in video to this is
06:12 not me S saying this um I I'll Channel
06:16 rascon and say no one has to own
06:19 anything but don't tell me you don't own
06:21 it because it's too expensive because as
06:23 he makes the case it's still actually
06:26 the cheapest of all of the AI stocks St
06:29 no it's not at 32 times actually
06:31 broadcom's at 27 times and I think that
06:34 broadcom is a great way to play Ai and
06:36 so that's what I've chosen to do as well
06:38 as lamb as you mention come on I mean no
06:40 disrespect to broadcom but look at
06:42 broadcom's growth rates and nvidia's
06:44 growth rates okay uh the reason you know
06:48 here's a deal in regards to Nvidia the
06:49 the reason a lot of people don't own it
06:51 or trying to figure it out is is just
06:53 where are the growth rates in the future
06:55 and that's very hard to figure out right
06:57 now because they've been through such
06:58 kind of a parabolic cycle here so
07:00 there's a lot of people of the belief
07:01 and thought process of like is this
07:03 really lasting is this like you know
07:05 this year maybe next year and then it
07:07 dies down is it something that continues
07:09 on for years to go in the future and a
07:13 lot of people can't really have
07:14 conviction there so they before they
07:15 can't make that kind of like you know uh
07:19 decision to kind of get in or get
07:20 involved in things like that it's not
07:22 it's not as easy as like an Apple stock
07:24 for instance where you can kind of like
07:25 oh you can foresee like oh how you know
07:27 this many people could get iPhones and
07:28 these sorts of things this is like kind
07:30 of a little bit further out there for
07:33 folks and so you know I think that's
07:34 that's a tough part and you know even to
07:37 myself I'm like I'm pretty confident
07:38 Nvidia is going to do hundred billion do
07:41 of Revenue in 2024 or above pretty
07:44 confident in that but with that being
07:47 said ask me nvidia's Revenue four years
07:50 from now and I just really don't have a
07:52 dang clue okay that's just a truth in
07:54 regards to that um I can't really gauge
07:56 it like that I can gauge a lot of other
07:58 stocks and have pretty strong conviction
07:59 on where their revenue is going to be 4
08:01 years from now Nvidia I don't know like
08:04 maybe their revenue 4 years from now is
08:06 um 250 billion maybe it's like 50
08:09 billion right and maybe the AI was a
08:11 bubble in like you know the the products
08:14 didn't take off the way people thought
08:15 and I don't know you know and so I think
08:17 that's the hard thing in regards to
08:19 Nvidia yeah and we're going to talk
08:20 about another name down the road in the
08:22 next block but look I mean the stock is
08:24 going to continue to work especially as
08:25 the hyperscalers continue to show that
08:28 demand so it's really durable and the
08:30 inference numbers were huge at 40%
08:33 that's double what people were expecting
08:35 um so all that's great I just feel like
08:38 I missed it and I also feel like I have
08:40 better value for what I see as Superior
08:44 growth not to an Invidia but to many
08:46 other technology companies especially
08:48 with broadcom I mean broadcom is the
08:50 number two AI supplier $8 billion a year
08:53 they're the number one custom Asic
08:56 player $12 billion per year and and they
09:00 have Cloud they've got data center
09:01 they've got Wireless they have VMware
09:03 and I know you want to have this
09:05 discussion more about Nvidia but I'm
09:06 just saying that you can own both I
09:08 don't own both but I own a good player
09:10 and I've had a nice return in this thing
09:12 I appreciate very much you your
09:16 reasoning admitting hey okay I missed it
09:18 you just said I missed it but I have
09:20 these other ways that I can still play
09:22 the trend in really key players that are
09:25 cheap on a valuation standpoint where
09:27 you can get comfortable around it not
09:29 everybody picks every single stock
09:32 perfectly okay I think he was actually
09:34 making a great point there and I think
09:35 this important I say this to everybody
09:36 watching this video right now okay you
09:39 don't have to get them
09:41 all you don't have to get them all if
09:43 you miss Nvidia or you miss paler you
09:45 miss meta or you miss an elf or whatever
09:48 like there's so many fish in the
09:51 sea there's so many fish in the sea
09:53 there's so many great opportunities for
09:54 this next 5 10 years there's so many
09:56 great opportunities for the past 5 10
09:58 years you don't have to get them all man
10:01 A lot of times people think like if you
10:02 missed one you know you suck no it's
10:05 such a false way of thinking right no
10:07 different than you're going to pick bad
10:08 stocks sometimes they're not going to go
10:09 up they're going to go down massively
10:11 you're going to sell for a big loss it's
10:12 all part of the process that's part of
10:14 being a winner like part of winning in
10:16 the stock market is realizing you're
10:18 going to miss some and sometimes it's
10:21 going to be your missing stocks upside
10:22 sometimes it's going to be just ones you
10:24 had to sell for a loss right it's part
10:25 of being a stock market investor and
10:28 there's no other way around it you're
10:29 going to miss them Warren Buffett's sold
10:32 plenty of stocks for losses Warren
10:34 Buffett's missed out in a ridiculous
10:35 amount of opportunities and look at him
10:39 fine the only people that that you know
10:42 try to vilify you for missing it those
10:45 people aren't even players they're not
10:46 even players in the game those are
10:48 quarterback you know on the couch people
10:51 they're not even in the game so their
10:53 opinions are really irrelevant right um
10:56 you know anybody with money understands
10:57 you're going to miss it that's just the
10:59 bottom line with that next one up here
11:01 let's get an N Video a little more and
11:02 then we'll get into rivan quarter sales
11:04 more than triple driven by strong demand
11:06 for AI chips guidance exceeds consensus
11:09 this is Jensen Wong on the call last
11:12 night this last year we've seen
11:15 generative AI really becoming a whole
11:18 new application space a whole new way of
11:20 doing Computing a whole new industry is
11:22 being formed um and that's driving our
11:24 growth we guide one quarter at a time
11:27 but fundamentally the conditions are
11:30 excellent for continued growth calendar
11:33 24 to calendar 25 and
11:36 Beyond biggest single day market cap
11:38 move Jim beating meta a few weeks ago
11:41 yeah it should be more up more I think
11:42 that what's happened is you realize as
11:45 often been the case with Nvidia 100% I I
11:47 told you guys if if the shorts are lucky
11:50 lucky if this stock closes today under $
11:53 800 cu the stock should be $800 today
11:56 okay and it's on its way to 1,000 2014
11:59 that when you see uh a number you
12:01 realize that the stock turned out to be
12:03 very cheap a year ago and I think people
12:05 have to realize for instance really some
12:07 amazing data of when of when we thought
12:11 we thought that they were going to earn
12:12 $20 at the end of the year in the
12:16 calendar year the prob I think that they
12:17 could now do 2460 so even in just 6
12:22 weeks ago we thought they were going to
12:24 earn $4 less than they're going to know
12:26 people have to understand when you're
12:27 trying to value a stock what that says
12:29 is that stock that was very expensive
12:32 eight weeks ago turns out to be
12:33 reasonably valued and that matters so
12:36 you don't have a problem with key going
12:37 to 1100 or Bernstein going to a th000 to
12:41 no no I think that what Jensen spent a
12:43 lot of time laying out when he talked
12:45 about the notion remember we've got two
12:47 things going on we have we have the
12:49 acceleration Computing and then we have
12:52 uh gener of AI what he did was lay out a
12:55 something that people have not been
12:56 willing to do which is to say it's not
12:59 38646 uh pennium pennium 2 where the 386
13:04 is is really OBS obsolete it's that you
13:07 can use the h100 the h200 they'll do
13:09 some new software there's not going to
13:11 be a difficult transition and that was
13:13 really important because I think a lot
13:14 of people were worried that there could
13:16 be a gap as is the case in a lot of
13:18 Technology uh and this is one of the
13:20 great secular growth stories now
13:21 remember he's using trillions he's
13:23 basically saying the whole world
13:24 everything that we have which is just
13:26 general computing is out of date so we
13:28 have to redo everything if we have to do
13:30 everything whether it be Auto you just
13:33 think he has said to me over and over
13:35 again that manufacturing is by far the
13:36 biggest Market in the world well
13:38 everything this manufactured will also
13:40 have to use his chips yeah I mean and
13:42 that's why the the basket of redoing old
13:45 data centers building new data centers
13:47 uh huge buckets of demand these shorter
13:50 um lead times Jim is that a sign of
13:52 cooling demand no not at all it's just
13:54 finally they've got Taiwan semi cooking
13:57 uh these things are very hard to make
13:59 they're very big uh and one of the
14:02 things he also talked about is that
14:03 there are dual uses so if you're a cloud
14:06 service provider you want them for
14:07 yourself but you also want them for the
14:09 cloud couple companies that were that
14:11 were called out mightily meta called out
14:13 as a monster user of of their product
14:17 and I thought that was very important
14:18 because I think people should realize
14:19 that that's inference that's why their
14:21 Instagram ads are so good called out
14:24 Google called out service now service
14:27 now twice saying that the ones that have
14:29 been able to use the uh theyve able to
14:31 developed gener of AI in order to be
14:32 able to help workflow uh the call was
14:35 magnificent it was a well orchestrated
14:37 call I'm trying to see 777 over here so
14:39 yeah I mean that Nvidia conference call
14:42 was a who's who's uh type conference
14:44 call where they were just name dropping
14:46 big company after big company uh using
14:48 their products uh coac Crest one of my
14:50 favorite CFOs she does she was a little
14:53 bit more uh effervescent uh she told me
14:55 that she thought that was not true but I
14:58 could detect enthusiasm from anyone and
15:01 then Jensen comes in on the Q&A Jensen
15:04 was he was more Stravinsky last night
15:06 than he was than he was Taylor
15:10 swi he can be Stravinsky he can be he
15:14 i777 because he may be the smartest man
15:17 in the world well the stock has
15:19 certainly replaced Tesla as the name
15:21 that trades most a dollar volume uh per
15:24 day less erratic and to your point about
15:27 the tone last night this is Jensen
15:28 talking about growth on the
15:31 call generative AI has kicked off a
15:34 whole new investment cycle to build the
15:36 next trillion dollars of infrastructure
15:38 of AI generation factories we believe
15:41 these two Trends will drive a doubling
15:44 of the world's data center
15:45 infrastructure installed base in the
15:47 next 5 years and will represent an
15:50 annual Market opportunity to hundreds of
15:52 billions so two core things happened on
15:56 the one was on the number side side one
15:58 was on that conference call the number
16:00 side is obvious what happened there
16:02 right they they destroyed it it was
16:03 phenomenal the numbers were amazing
16:05 right we all know that but there was
16:07 something very important that happened
16:08 on the conference call okay and I think
16:11 it's one of the other reasons is you
16:12 know just one of many reasons why the
16:14 stocks about to climb to $1,500 here
16:19 call he laid out the future and how many
16:24 growth prospects Nvidia has over the
16:26 coming years there was important because
16:29 a lot of people get in this thought
16:30 process of like it's going to end like
16:32 their big numbers that are going to like
16:34 end right now like you know that's what
16:35 everybody thought in this quarter oh man
16:37 if inid and and so this keeps kind of
16:39 being this thought process about and and
16:41 probably next quarter it's going to be
16:43 as well oh maybe this is it for nvidia's
16:45 growth maybe the numbers are going to go
16:46 down now and then the next quarter is
16:48 going to be like that as well and he
16:49 laid out how this company grows for
16:52 years to go in the future not just like
16:54 the next quarter or something like that
16:56 I thought that was really important
16:57 because I think they gave a lot more
16:58 investors conviction on kind of the
17:00 story here right no he could also be
17:02 wrong in regards to that growth in the
17:04 future but it was important he laid it
17:05 out that way basically saying you've got
17:07 a couple trillion dollar infrastructure
17:09 that has to be redone uh there's
17:11 arguably there's 40 trillion in
17:13 manufacturers arguably everything has to
17:15 be redone you have to look at like he
17:17 says the general computing which is we
17:18 think of as Intel has run out Mo's law
17:21 has run out and so what's happened is is
17:23 that there's no more game even talk
17:25 about how they're they're depreciating
17:26 this stuff longer because they w't put
17:27 any more money in it this is where the
17:30 money is um it's 20 times faster and yet
17:32 it burns cooler which is very important
17:34 to Jenson cuz he's anti-waste there's a
17:37 dazzling call and I think that there
17:39 will be people I call them l l i these
17:41 are people who wanted to destroy the um
17:44 the loom in 1811 they came defended from
17:47 descended from Sherwood bars Nottingham
17:50 sure and felt that perhaps it's wrong
17:52 that we have such a a powerful Loom that
17:54 wipes out seamstresses well this company
17:57 uh is going to wipe them out out
17:58 everywhere and by the way one of the
17:59 most powerful moments was when they
18:01 talked about Sovereign AI that we can't
18:03 just have it be in English every country
18:06 every country in the world save perhaps
18:08 China uh has to have its own its own
18:12 Jensen its own Enid yeah that's the
18:15 Sovereign element has been one of his
18:16 big doctrines last few weeks help um
18:19 viewers understand the impact China had
18:21 on data center in the quarter well look
18:23 I mean he's been saying over and over
18:25 and I was joking about it yesterday he's
18:26 going to say that it's great
18:28 degradation uh it's going to not go away
18:32 but it's going to decline substantially
18:34 but the issue there is is that everybody
18:36 wants them there was a tremendous amount
18:37 of talk about allocation and how
18:40 Jensen's going to give them away fairly
18:42 so believe me the Chinese uh are going
18:45 to um their product will be sold and V
18:50 disputed this with me originally when I
18:52 said listen can't you mark that product
18:53 up that would have gone to China and
18:55 said look Jim we don't do that we don't
18:57 take advantage of any customer and say
19:00 listen China's not use them we're going
19:02 to mark them up 20% one of the things
19:04 that they they spent you know they're
19:05 very close with all customers and one of
19:06 the reasons they're so close is they
19:07 don't do that stuff Jensen's very close
19:09 with Zuckerberg I think we've actually
19:12 seen I will go so far as to say that
19:14 you're seeing a Jensen influence in the
19:17 way Zuckerberg carries himself because
19:19 Jensen is light he's light he is not I'm
19:23 saying not serious one of the serious
19:25 people think people understand but but
19:27 but you see work very close they are
19:29 actual friends because I I asked him I
19:31 said how often do you speak to Mark he
19:33 say all the time and initially I said
19:36 well how's that possible he stands for
19:37 combat you stand for peace and he said
19:40 no no that's not that that on the
19:43 surface on Surface but there's a lot of
19:46 uh conviviality Congeniality in the
19:48 relationship and that's why I think meta
19:50 came out as being the number one user in
19:53 terms of import of their
19:56 business oh man man very entertaining
19:59 but uh yeah I mean like I told you guys
20:02 of my four biggest stocks in the public
20:04 count right my four biggest positions
20:06 are are meta Tesla PayPal and Amazon
20:12 three of those four companies are
20:14 getting their hands on as many Nvidia
20:15 chips as they possibly can right and
20:18 especially the h100s that's meta that's
20:21 Tesla that's Amazon right and so that's
20:24 pretty that's pretty powerful when you
20:26 think about it from that context okay
20:27 let's dive in a rivan here for a bit and
20:30 see if there's any opportunity in rivan
20:32 stock today after reporting results in
20:34 that production guide our Phil leau
20:35 talked with the CEO this morning on
20:37 squawk and joins us with more hi again
20:40 Phil hey Carl when you take a look at
20:42 shares of rivy and the stock down now
20:43 now 94% compared to its all-time high of
20:47 $172 which happened shortly after it
20:49 went public in November
20:51 of2 oh it's down 1111 that might be a
20:54 sign oh my gosh I didn't know it was
20:56 down to 11 today and take a look at
20:59 what's really happened here this is a
21:00 market where luxury EVs and that's what
21:04 rivan is it's a luxury priced EV it's
21:07 just not selling right now their lost
21:10 per vehicle in the fourth quarter 43,372
21:13 on top of that their guidance for
21:17 production this year came out to 57,000
21:20 vehicles and that's well below where the
21:22 street was expecting the street was
21:24 expecting production guide of close to
21:26 81,000 that's incorrect that that
21:28 graphic there the production guide is
21:30 not 66,000 it's 57,000 and as you take a
21:33 look at their annual deliveries only
21:35 building 57,000 means they're not going
21:38 to be getting close to the mid 60s in
21:40 terms of deliveries this year they
21:42 delivered 51,000 last year most are
21:44 going to have to BR bring down their
21:46 delivery estimates here's CEO RJ
21:48 scaringe talking with us this morning
21:50 about the changes they're putting in
21:52 place to lower costs well here's a deal
21:55 with rivan okay uh first off let me let
21:57 me say this okay I like rivan if Tesla
22:00 didn't exist I would probably own a
22:02 rivan or two but there's a problem a
22:06 huge problem for rivan there's a lot of
22:08 problems but this is a huge problem
22:10 Tesla does exist and so therefore
22:13 Tesla's ridiculously competitive with
22:15 pricing and they're Relentless and so a
22:19 lot of people look out there and they
22:21 say okay maybe I get a rivan or maybe
22:23 I'll get a model y or model X and then
22:25 they look at kind of the price of rivan
22:27 SUV look at a model y model X and
22:29 they're kind of like uh I don't know now
22:33 Tesla's getting in the truck game
22:34 cybertruck the most talked about hyped
22:36 vehicle in the history of mankind it's
22:39 going to put a huge dent into rivian's
22:41 truck business at least in the short
22:42 term right in the long term it could
22:44 actually help rivan but in the short
22:46 term there no doubt it's going to hurt
22:47 right and so that's the trouble for
22:49 rivan right now right and just as Lucid
22:52 about trying to compete with Tesla right
22:54 Lucid can't even get off the ground I
22:56 mean it's a joke Lu talking about 9,000
23:01 produced in 2024 it's like that's like
23:03 literally nothing like Tesla almost
23:05 produces that much in a day you to be
23:07 flipping my flapjacks right but Lucid
23:09 tries to compete with Tesla and Tesla
23:11 has two very competitive cars in the
23:13 market the model S and the model 3 and
23:16 uh yeah you you just you know good luck
23:18 trying to compete against
23:20 those as we look at 2024 uh we have a
23:23 few things playing out one is we're
23:25 making a number of changes to the way we
23:28 uh as well as our our material costs our
23:30 build of materials and we'll be shutting
23:32 down the Plant for several weeks in the
23:35 second quarter to make these changes so
23:37 that's an interruption to production and
23:39 then we we're being very realistic just
23:42 around the overall a number of vehicles
23:44 being purchased at these price points at
23:46 at you know in the price range of over
23:50 $70,000 by the way shutting down the
23:52 Plant for several weeks in the second
23:53 quarter that's been known about for some
23:55 time that was not a surprise that's part
23:57 of the what they're doing in Normal
23:58 Illinois to adjust production remember
24:00 they also make the electric delivery van
24:02 that is used by Amazon that's part of
24:04 the adjustment in production they will
24:06 be unveiling the Next Generation model
24:08 the R2 on March 7th but keep in mind
24:12 that doesn't go into production until
24:13 the Georgia plant opens up in 2026 so
24:16 we're a long ways from that mass Market
24:19 Next Generation model and Carl their
24:21 market cap is now a little over $10
24:23 billion remember after the IPO back in
24:26 21 market cap was something like $160
24:29 billion hire market cap than GM and Ford
24:32 together and a lot of people at that
24:34 time said slow down here these guys are
24:36 a long ways from getting to
24:39 profitability look how things have
24:40 changed you know two and a half years
24:45 think my guess is with rivan and Lucid I
24:49 think I I think there's a couple
24:51 possibilities one is bankruptcy for both
24:53 those companies I think another
24:54 possibility is acquisition right we do
24:58 know that the traditional players in the
25:02 auto market have had incredible trouble
25:05 launching into the EV market right so it
25:08 could make a lot of sense to pick up a
25:10 rivan at some point later this year or a
25:12 lucid for very cheap price you get a a
25:15 brand there that is dedicated to EVS
25:17 that is focused on building EV brand
25:20 versus let's say Ford that everybody
25:21 thinks about as internal combustion
25:23 engine people are like why would I buy a
25:24 Ford electric vehicle like what right or
25:27 why would I buy a Chevy electric vehicle
25:29 like what like why I would just buy an
25:31 internal combustion engine if I'm going
25:32 to go that route right so you need to
25:35 have brands that are specific in EVS
25:38 right which obviously Lucid is and rivan
25:40 is and obviously these companies are
25:42 going to be trading at very joke prices
25:44 this year right I mean look at how bad
25:45 the pricing is and this is in a pretty
25:47 risk on Market this is this the most
25:50 risk-on Market I've seen no definitely
25:52 not that was 2020 2021 right but I got
25:55 to say this is a pretty risk on market
25:57 and and so for these stocks to be at
25:59 three bucks and 11 bucks in this type of
26:02 Market what happens if let's say later
26:04 this year we have a downtrending market
26:06 a rivan could easily be 7 five bucks a
26:08 lucid could easily be a dollar or two
26:11 right and so that's where then these
26:13 company start to say gosh we're not even
26:15 going to be able to raise Capital if we
26:16 need to raise Capital because our stock
26:18 price is so low and so that's where
26:20 maybe these other guys come in and say
26:22 you know what we'll come in pick up
26:23 these companies yeah they're losing a
26:25 ton right now but we'll build them out
26:26 over the coming years and it's better
26:27 than trying to build Our Brands we'll
26:29 Build That Brand in the EV space and and
26:32 you know compete there and then we'll
26:34 keep our our other brands more focused
26:37 on internal combustion engine vehicle
26:39 business which is where they make their
26:41 big huge profits right so I think that
26:43 could make a lot of sense I think that
26:45 can make a lot of sense in my personal
26:46 opinion I think if you're going to pick
26:48 up one of those two companies though I
26:50 think rivan's definitely the more
26:51 interesting acquisition Target than a
26:53 than a lucid now let's hear the whole
26:55 interview by the CEO and let me see if I
26:57 Chang my opinion in deep in the red this
26:59 morning this after the company reported
27:00 fourth quarter results and Phil abau
27:02 joins us now with the company's CEO
27:06 Phil thank you Andrew let's bring in RJ
27:08 scaringe RJ uh it was a rough report for
27:11 you guys let's be blunt uh plus you
27:13 announced 10% of your salaried Workforce
27:16 is going to be uh laid off as you guys
27:18 are cutting your costs I'm I'm curious
27:20 in a general sense how much has the EV
27:22 Market slowed down in the last three
27:26 months yeah I mean we've seen um
27:28 historically High interest rates and we
27:30 um along with a lot of the geopolitical
27:33 uncertainty uh particularly for high
27:35 pric products you know in the in the
27:37 premium segment we're seeing the effect
27:39 of interest rates the effect of
27:41 uncertainty really uh impact how people
27:44 are thinking about purchase decisions
27:45 and uh it led us to uh accelerating the
27:49 launch of our standard pack to make sure
27:50 that we have our full portfolio of
27:55 available so when you look at where
27:57 where the market is right now your
27:59 guidance for building 57,000 Vehicles
28:02 this year is well below what the street
28:04 was expecting at 81,000 where's the
28:06 disconnect did the market I mean we've
28:08 been talking about the market slowing
28:10 down why did analysts miss it by such a
28:14 margin well our our r1t r1s products
28:17 these are our Flagship products um they
28:20 have been performing really well uh
28:22 relative to the market so we have the
28:24 bestselling electric vehicle with a
28:27 price point of over
28:28 $70,000 and so as I said the you the
28:31 impact of interest rates um is impacting
28:34 the whole the whole segment you know the
28:35 whole call it premium segment uh but
28:38 relative to the rest uh we still have
28:40 the bestselling product in the market
28:42 and so as we look at 2024 uh we have a
28:45 few things playing out one is we're
28:46 making a number of changes to the way we
28:48 operate our plant uh as well as our our
28:51 material costs our build of materials
28:53 and we'll be shutting down the Plant for
28:55 several weeks in the second quarter to
28:57 make these changes so that's an
28:59 interruption to production and then we
29:01 we're being very realistic just around
29:04 the overall number of vehicles being
29:06 purchased at these price points at at
29:09 you know in the price range of over
29:11 $70,000 but as far as as I said as far
29:13 as premium products go uh we do have the
29:16 bestselling uh EV in the United States
29:19 today let's talk about some numbers you
29:22 $43,000 roughly speaking per vehicle
29:25 that you built in the fourth quarter
29:26 about a ,000 increase in the amount lost
29:29 compared to the third quarter and I know
29:31 you outlined some of the changes that
29:33 you're making in terms of cutting your
29:35 cost is it realistic to think that you
29:38 can get back uh or get to uh some type
29:41 of a a profit you know positive profit
29:44 margin in the fourth quarter given the
29:46 losses where they're at right
29:48 now well if if we look at the the fourth
29:51 quarter of 2022 and compared to the
29:52 fourth quarter of 2023 we reduced our
29:55 overall cost per vehicle by about
29:58 $81,000 and that's a combination of
30:02 better operation you know better U more
30:04 fishing operations within the plant and
30:07 you know really improving some of the
30:09 fixed cost absorption within the
30:10 facility due to the ramp up but the
30:12 other big element here is continued
30:14 progress on our material cost and that's
30:17 our all the components that go into the
30:18 vehicle and so the shutdown I just
30:20 referred to that that we're going to be
30:22 making these pretty significant changes
30:24 across the vehicle in terms of cost
30:26 structure in terms of compon agree uh
30:29 that is going to be a huge enabler uh
30:31 for us to get to positive margin and as
30:34 as we talked about earnings call
30:35 yesterday uh we still have confidence
30:38 and want to be very clear that uh fourth
30:41 quarter of this year uh we will be uh we
30:43 will be positive gross
30:45 margin do you have confidence you have
30:47 enough Capital to make it to the R2 and
30:51 26 we're incredibly excited about our to
30:53 I mean when I look at the brand strength
30:57 that we've we've established with our
30:59 our launch products the r1t the r1s and
31:02 just how well consumers have responded
31:04 uh Consumer Reports as an annual brand
31:06 survey and rivan came out as the number
31:08 one rated brand um with by far the
31:12 highest rate of repurchase meaning if
31:14 you're going to buy a vehicle again
31:15 would you buy rivan again and by a
31:17 significant degree uh relative to all
31:19 other brands uh rivan uh came in the you
31:22 know number one number one spot and so
31:24 as we think about taking that brand
31:26 position and now applying it into a
31:29 smaller footprint vehicle with with a
31:30 meaningfully lower price point to be
31:33 able to translate not only some of the
31:34 brand excitement but importantly the
31:36 significant market share that we've
31:38 we've built with our Flagship product
31:40 we're we're incredibly excited so with
31:42 that said uh the organization is is
31:45 heads down focused on delivering to that
31:48 uh the the product itself is coming
31:50 together beautifully we're going to be
31:51 unveiling it on March 7th and that
31:54 really only because RJ we're running up
31:57 against a break I know I don't mean to
31:58 belabor this understand the strength of
32:00 the brand and where you guys are at but
32:02 to get to my question are you confident
32:04 you have the capital needed to get to R2
32:07 production or do you think there's a
32:09 possibility of a capital raise between
32:11 then what we've said is um we're very
32:15 confident in the capital we have
32:17 supporting operations through the end of
32:19 2025 there's a variety of of ways we we
32:22 intend to ensure we can launch our two
32:25 so there's certainly opportunities to
32:26 look at the cap markets uh but we're
32:28 also driving efficiency into everything
32:30 that we do and the emphasis on driving
32:34 cost efficiency into operations into how
32:35 we deploy capital from a capex point of
32:37 view and of course as I said on on the
32:39 Cog side on the on the gross margin side
32:41 is is the highest Focus within the whole
32:44 business and so right there he basically
32:46 opened the door to Capital raise right
32:48 and that's why that stock likely went
32:49 from then 12 something to 11 bucks right
32:52 um let's let's check where the stock
32:53 price is right now let's let's check
32:55 where it is right now I'm quite
32:58 interested uh to see where exactly that
33:01 stock price is right now ribbean let's
33:04 see let's see yeah 11:30 right but uh
33:08 yeah and and so for a company like
33:10 rivian man they're just in a really
33:11 really tough spot really tough spot
33:15 cuz I mean they're they're they're
33:17 putting up these really bad numbers in a
33:19 great employment market right now right
33:21 with unemployment in the threes it's
33:23 like what if that number was a lot
33:25 higher than this I mean gosh where would
33:26 that company be in that situation so
33:28 just not ideal for that okay all right
33:31 guys appreciate you joining me as always
33:32 much love thanks so much for being here
33:34 if you're looking to support my content
33:35 do so on patreon pin comment down there
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