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QF Research Profile picture
@ResearchQf
Jan 13, 2023 • 4 tweets • 3 min read • Read on X
1) I respect @garyblack. He deals with facts tho may disagree with analysis.

Here's $TSLA '23 sales and OP est in same format (no updates for US/EU price cuts yet).

'23 cons rev $109B (+33% Y/Y). Cons OP $19B or 17% OM.

~ 10-20% price cuts ...

$SPY $QQQ $TLT $GLD #Commodities ImageImage
2) flows directly to bottom line (assuming all else equal for now e.g. opex unchanged).

It's tough for OM not to decline 50% or more even if units grow > 50% (and I'm doubtful).

I.e. EPS could easily fall 50%.

After every price cut there's a quick orders spike. Unknowns ...
3) dominate after that.

Reminder orders had to double (or more) 1H '23 just to make estimates given depleted backlog (meant Q4 orders were as low as ~200-250K).

Now even if order run rate double (we'll see) profitability falls something in order of ~50%.
4) Gary must realize this isn't correct way to view '23 consensus since most estimates are stale.

Avg $TSLA '23 EPS post 1/13 is $3.88.

Avg '23 GM is 22.1% (too high IMO).

Big dispersion. Will change with more updates.

$SPY $QQQ $TLT $GLD #Commodities

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More from @ResearchQf

QF Research Profile picture
Feb 23
1) $MSFT DC scare 🧵. High level with details if have time. Some know all datapoints mentioned. Or more (if you have non-MNPI data pls DM me).

a) Conclusion 1st. Global AI capex next few years went UP recently. Even MSFT.

Is this just the latest AI scare? Again, Trump & co finally began scaring investors. Have pet theories about scenarios but a different thread.

The usual discussion about LT AI variability later in 🧵. Even Satya, Sam, Ilya, Jensen, Dario, Jeff etc don't know > 5-10 year consequences of AI. I have no idea. There's never been a tech cycle like this in human history.

But let's start with MSFT Dec Q & 10Q. Keep in mind, that as of 1/29, MSFT already embedded diffusion rule, DS, @OpenAI, Stargate, Cowen "news" and prob much more we don't know.

- Commercial bookings grew 75% Y/Y (!) but guided flat Y/Y Mar Q. Watch OAI commitments going forward

- Capex ~ flat Q/Q Mar & Jun but rises again F26, which is some info. Lower growth rate? No real info, since range is huge

- Have discussed leases being much larger % of MSFT capex last few years. It helps to analyze lease data in 10Q/K's

- "Expect capex to increase in coming years" in 10Q/K's have been stated forever and is a general statement. Has occurred before down capex years

- MSFT clearly said spend shifts back to "short-lived assets (i.e. infra) which are more correlated to sales growth. That's real infoImage
2) Next elements of Cowen note. International first.

Channel checks "indicate MSFT is also re-allocating a considerable portion of intl spend to the US, which suggests to us a material slowdown in intl leasing."

b) Are we sure?

Mentioned "pre-diffusion" for APAC capacity plans on purpose. This is one estimate (Citi) of APAC ex-China DC capacity. Only months old but it's outdated. Possible new projected would've created GWs of spikes.

Japan, Australia, Korea are Tier 1. Consider Tier 2. India, Malaysia, Indonesia etc. Comb thru diffusion rules. E.g. Malaysia was already higher (but pre-diffusion). Well over 3 GW is nowhere near happening with low GPU limits.

Who's who of hyperscalers and DC developers are involved in some projects. Could this be why capex is being reallocated back to the US or other Tier 1's?Image
3) Here are locations of Malaysian DCs & projects from one source. Details around involvement of US hyperscalers and developers $EQIX $GDS etc can sometimes be found.

I've been posting "every self-respecting economic & military power" has no choice but to invest because AI = economic, political, military survival.

And "India has grand ambitions because India has no choice. Not sure how long diffusion rules lasts."

Outcomes are super variable if policy changes for India alone due to Trump. Or others. No clue but look for hints.Image
Read 10 tweets
QF Research Profile picture
Dec 20, 2024
1) Robots are making huge strides. Mechanical multiplied by AI 3D vision, physical models etc.

It's only one AI adjacency but its impact alone is enormous coming years/decades.

Imho this alone could be by far largest macroecon driver yet it's being ...
citigroup.com/global/insight…Image
2) generally ignored.

AI eyerolling has faded. Hmm maybe this is real. But with exception of few forward thinkers, macro analysts seem want whole thing to just go away.

Look at Citi report in 1). It's public. Payback could be 29W at $7.25/hour or ~ my earlier back of envelope. Image
3) Robotic cost curve is more predictable (largely physical engineering). But AI turbocharges productivity vs auto mfg 20Y ago.

Pace of tech progress is incredible on all levels.

E.g. Citi mentions LiDAR for 3D. Remains portfolio theme despite huge vol. More up vol vs down ... Image
Read 6 tweets
QF Research Profile picture
Nov 14, 2024
1) Holy crap this is gen2 like $GOOGL NotebookLM I've wanted.

Already copy paste and analysing financial data, charts, AI papers. Grad student level. I'm talking to the damn thing and asking questions.

A famous paper by John Bell that ended up disproving Einstein's attempt ... Image
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2) to frame an objective reality with his EPR paper (QM is correct but are there hidden variables?).

Bell's inequality was demonstrated by '22 Nobel Laureates. Almost a "what is reality" Nobel. So this sometimes shows up in pop science "what is AI & consciousness" discussions. Image
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3) Double slit experiments, entanglements, non-locality stuff.

But that's besides the point. This is just 2M after NotebookLM. It's gonna be incredibly useful. Not even a smarter model yet but workflow & UI productivity is off the charts.

Gen 4 super AR analyst with 1M Rubins. Image
Read 4 tweets
QF Research Profile picture
Sep 15, 2024
1) Reasoning/inference and domain knowledge/ability stood out first right?

An interesting but less explored direction? A long thread but worth it. Conclusion first:

AI is on verge of (or at) design & engineering across major industries. Or medical diagnosis etc.

Coding/SW ...
Image
2) Ph.D. STEM problems, agents etc skills are better known and amazing, but here is just one example that combines reasoning, expertise, application (interconnects will be huge + also dear in my portfolio) in a way I haven't seen.

I'll compare Claude later. It's night and day.
3) The prompt again, thought process and answer. I'll show 2nd prompt later.

Will also describe idea more intuitively later.

But o1 thought more like an engineer. It didn't take an equation from the internet and do a simple division like other models. It thought, calculated ...


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Read 16 tweets
QF Research Profile picture
Aug 28, 2024
1) Fate of markets depends on $1B or $2B difference in $NVDA guide.

There are tons of whisper surveys. Some game them. A bear might answer too high. Or a bull answers too low.

But it seems Asian investors do have higher expectations than US investors. Will Oct guide really ...
2) matter?

After hours prob. Or days or even weeks. But unless BW cycle or LT AI growth outlooks change, is it ultimately that imporant?

Not sure I'd present this framework. Implies $43B upside case Jan Q vs $31B cons (DC)! Unless something drastic ...
3) changes (fixes, ramps, capacities) that's unlikely. I know this post is well meant but FYI.

Why? Pre-glitch models had 500-600K BW GPUs F2H. But PRODUCTION not rev.

It's clearly lower now. But even if it's 300K F2H as in that model, it won't be incremental $11B rev. Plus ... Image
Read 5 tweets
QF Research Profile picture
Jul 8, 2024
1) My 2¢ on "AI capex cycle has to pause soon right?" part X.

Even as an AI bull, this is a discussion I had to have with myself and people on and off this site. As soon as right after $NVDA Apr '23 Q blowout.

Conclusion 1st. Outlook improved after every broad overview of data.
2) And that wasn't about next few Q. If cyclical indicators were peaking, would be short today even if thot beat & raise next Q. But even defining cyclicality (inv, B:B, consumption vs shipments etc) needs change for AI. Much more later.

Little doubt ...
3) David Cahn @sequoia is smart, but there are prob more smart folks on the other side.

And even some very smart people often lean on what they know vs what they know they don't know. E.g. software margin. Or it's all rates.

Btw GS report reads bit ...
sequoiacap.com/article/ais-60…
Read 6 tweets

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