The Rundown - Nvidia Secures Massive AI Chip Deal with Saudi Arabia, Chime Files for IPO

Episode Date: May 14, 2025

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Public.com presents the rundown, your daily market update in under 10 minutes. My name is Zad Admani, and today is Wednesday, May 14th. In today's episode, we'll tell you about a major deal announced between Nvidia and Saudi Arabia and why there might be more to come. We also recap earnings from American Eagle and Sony and tell you why Sony might start stockpiling PS5s in the U.S. Then stick around to the end of the show to find out about the latest streaming service from Disney that I think could be a surprising hit.

We got a great show for you today. Let's go. We are so back, everybody. The S&P and NASDAQ continued to rally. Both of them were in the green on Tuesday, with the S&P 500 rising 0.7% and the NASDAG jumping 1.6% thanks to a rally in big tech stocks like Tesla and Nvidia.

We're going to talk more about Nvidia in a bit. The S&P is now officially back in the green for the year after being down more than 15% back in April. So it's been an incredible turnaround for the stock market. And honestly, if you didn't pay attention to the stock market for the last six weeks, you would think nothing had happened. You would have also missed a great opportunity to buy the dip. But yeah, the market comeback has been fueled by a number of things.

The main thing being the easing of trade tensions. Now, tariff rates are still higher than they were at the start of the year. But the jaw-dropping reciprocal tariff rates that were showed off on Liberation Day, most of those are on pause right now. And the market seems to be optimistic. that some sort of long-term trade deal is going to get worked out to where those tariffs aren't going to be coming back. Then to add to that, we've had a pretty solid earnings season. 90% of S&P 500 companies have reported earnings so far, and 78% have beat on earnings expectations. So that's

been adding some fuel to the fire, and then inflation continues to cool. We got some encouraging inflation data yesterday. We talked about that on yesterday's episode, so go check that out if you missed it. Let's run through some headlines. NVIDIA announced place. to sell 18,000 of their latest Blackwell AI chips to Saudi Arabia. And that announcement sent Nvidia's stock up more than 5% yesterday. These chips are being sold to the Saudi AI company Humane, which was launched by the Crown Prince Mohammed bin Salman, to build data centers and develop artificial intelligence infrastructure in Saudi Arabia.

This company is going to be owned by the Saudi Public Investment Fund. And apparently these 18,000 chips are just going to be the first wave of sales. The plan is that Nvidia will supply several hundred, 100,000 of their most advanced AI chips over the next five years. See, Saudi Arabia has been trying to diversify their economy away from oil. And one of their major initiatives is being the global hub for AI. And this deal with Nvidia to secure some of their best AI chips definitely puts them on the map. And this is great for Nvidia because it gives them a foothold in that region

and an opportunity to do business with a customer that seems to have unlimited money. In fact, Nvidia's CEO Jensen Huang was there personally in Saudi Arabia and made the announcement of this deal on stage at the Joint Saudi U.S. Investment Forum in Riyadh, which is the country's capital. And by the way, I was watching some videos of this investment forum in Riyadh. The guest list was absolutely insane. It kind of looked like the Met Gala for billionaires. Elon Musk was there.

Sam Altman was there. The CEOs of BlackRock, Blackstone, Amazon, Google, and Palantir were just some of the handful of big names there. And of course, President Donald Trump was there as well as part of his tour of the Middle East this week. In fact, President Trump used this form as a moment to announce that Saudi Arabia was going to invest $600 billion in the U.S., including a $145 billion defense sales deal, which involves more than a dozen U.S. defense firms. I wonder if the Saudis are going to use some of that $600 billion to invest more in sports. Maybe they'll buy an NBA team or something.

Maybe they'll start their own league and pay LeBron like $250 million a year. I'm only half joking, by the way. I would not be surprised if this happens in the next three to four years. Now, look, I know we talk a lot about AI on this show. So I need to mention this really cool AI tool that public just launched this morning. And it could impact the way that you invest. This AI tool is called generated assets. And it can essentially turn your investment ideas into an investable index.

So the way it works is you can ask this tool to generate an index of companies that are tariff resistant or companies with CEOs under the age of 40 or companies with high growth and high dividend. You can have this AI tool identify those companies. and turn it into an investable index. I even saw someone use this tool to make a list of companies led by bald CEOs

because apparently those companies outperformed the S&P 500 over the last 10 years. So you can get really creative with this tool. I got a sneak peek yesterday and I've been messing around with it ever since. The tool is live for everyone now and you can check it out

at generatedassets.com. I will also put a link in the description. Let's shift gears and talk about fintech. The fintech company chimed has filed for an IPO on the NASDAQ. Chime is a no-fee banking app that's been pretty popular with younger people. It's one of the hottest names in the fintech space. But Chime is trying to shake the reputation of being a bank.

In fact, in their IPO filing, they say they're more of a technology company and not a bank. Probably has to do with the fact that tech companies trade at a higher multiple than banks do. But still, Chime list Wells Fargo, Bank of America, J.P. Morgan, and others as their competitors. Now, while this did give me some flashbacks to WeWork, which was pitching himself as a tech company, and not a office sharing company, CHIME does have a stronger case, though, of being a tech company. For one, they don't actually operate a bank themselves.

They don't hold deposits or make loans directly. Instead, they operate the front end app layer and they partner with banks behind the scenes. And the way CHIME makes money is through interchange fees. Every time someone swipes their CHIME debit or credit card, a small fee goes to the bank, and the bank then gives a cut of that to CHIM. And Chime's business has been pretty good.

In Q1 of 2025, Chime pulled in 5.5, CHIM pulled in $519 million in revenue and made a net profit of $12.9 million. And they also reported 8.6 million active users, which was up 23% from last year. So CHIMM is showing solid growth, and that's why they're ready to IPO. Now, it'll be interesting to see what valuation they trade at. According to CHAM's last funding round back in 2021, they were valued at $25 billion. So we'll see if this IPO will surpass that. And this IPO might be a big moment for the broader fintech sector.

If this IPO goes well, you might see more fintech companies IPO in the near future. Chim stock is going to trade under ticker symbol C-H-Y-M. And you should be able to find them in the public app as soon as they go public. No pun intended. Let's talk about some stocks making moves today. Shares of Sony are up this morning after the Japanese conglomerate reported a mixed bag of earnings. Now, they did be on Q1 estimates thanks to a strong performance in their movie and music business, but the company is worried about the outlook of their video game business and the impact of U.S. tariffs.

Sony says that U.S. tariffs are expected to knock about $678 million off their operating profits this year. Sony is even considering stockpiling PS5s in the U.S. right now during this tariff pause that we have to avoid future tariff pain. So there might be warehouses and underground bunkers stockpiled with PS5s all around the country, which is just kind of funny to think about. Overall, though, Sony continues to diversify as a company. fact, their entertainment unit accounts for 61% of their sales now, and that's where they're focused on going forward. The company also announced $1.7 billion in share buybacks.

So all in all, investors like what they heard, and Sony's stock is up more than 5% this morning. On the flip side, same can't be said for American Eagle. Shares of the clothing retailer are tanking after they warned of slowing sales. American Eagle expects Q1 revenues to drop 5% compared to last year. Now, the CEO admitted the company dropped the ball when it came to their Q1 merch strategy, so they're having to do heavy discounting to get rid of the excess inventory. The company is writing off $75 million in inventory related to their spring and summer merchandise.

But to make matters worse for American Eagle, they're also worried about macroeconomic uncertainty and as a result pulling their full year guidance, which means they don't have a feel for how their business is going to perform for the rest of the year. And that's always a concerning sign for investors, which is why American Eagle stock is down close to 15. This morning. Let's wrap the show with a fun fact. ESPN is launching a standalone streaming app, and it's going to cost $30 a month.

Now if you're wondering, hey, doesn't ESPN already have a streaming app? No, you're thinking about ESPN Plus, which is a separate streaming service, totally not confusing. This new ESPN streaming app will include all of the ESPN channels, so ESPN 1, ESPN2, the SEC network, ABC, all the major live sports. But what really caught my eye is that Disney is going to be offering a bundle that includes ESPN, Disney Plus, and Hulu for $36 bucks a month. That's actually not bad. I mean, I already paid for Disney Plus and Hulu, so this is a pretty significant bundle discount. And I kind of want to just roll with this Disney bundle and cancel my YouTube TV, which has gotten really expensive over the last couple of years. So I wouldn't be surprised if this ends up being a surprising hit for Disney.

This new ESPN streaming service is expected to launch sometime later this year. Well, all right, guys, that's the rundown for today. Hope you guys enjoyed today's episode. We are getting some pretty big earnings tomorrow morning Walmart and Alibaba both report. So we're going to be recapping those on tomorrow's episode, so you definitely don't want to miss that. By the way, if you guys enjoy listening to this show and want to help us out, consider giving us a five-star rating on Apple or Spotify. And if you're listening on Spotify, don't forget to vote in today's Spotify poll. Leave us a comment on Spotify.

All that engagement really does help us out. and it helps other people find the show. Thank you guys so much for listening. Shout out to Mike and Connor. For all the help behind the scenes, and we'll see you guys back here tomorrow.