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Nvidia’s quarterly results, out Wednesday, have become the event of the earnings season. And who can be surprised? After all, here’s a company whose July revenue hit $46.7 billion, up 56% on a year earlier. Little more than two years ago, Nvidia’s quarterly revenue was around $7 billion! Of course, Wall Street traders have long ago lost their sense of wonder at Nvidia’s explosive growth. That growth is slowing down, as it has to eventually—the 56% compared to 69% growth in the April quarter.
Nvidia forecast a marginally lower growth rate of 54% for the current quarter, which likely accounts for the dip in Nvidia’s stock price after the results came out. That projection doesn’t include what Nvidia might get from China, where sales are in limbo right now. While President Donald Trump’s administration has approved sales of Nvidia’s China-specific H20 chips, Nvidia Chief Financial Officer Colette Kress said on Wednesday the company hasn’t yet shipped any. She alluded vaguely to continuing “geopolitical issues,” likely a reference to Chinese authorities’ pressuring local companies not to buy, as we reported here and here. For more on the quarter, see here.
Another issue, Kress revealed, is that the widely reported arrangement Trump struck with Nvidia, under which the government would get a 15% cut of the company’s China revenues, hasn’t been codified in regulations. Nvidia also noted in a securities filing that the arrangement with the government “may subject us to litigation.” Perhaps that deal isn’t quite as set in stone as Trump implied.
Musk’s Telecom Ambitions
Is Elon Musk planning his own phone and/or cellular network? That would be a much better way to pressure Apple to work with him in areas like artificial intelligence than filing silly lawsuits. Speculation that Musk has phone ambitions isn’t new, to be sure—we reported in this piece that he has considered building his own phone, and he has mused about it publicly. But the idea got renewed attention on Wednesday in a report by research firm LightShed Partners analyzing the implications of a big telecom deal on Tuesday. That deal, EchoStar’s $23 billion sale of cellular spectrum to AT&T, didn’t involve Musk—but it could have been partly triggered by his maneuverings.
EchoStar, owner of the Dish satellite TV network, has spent several years trying to build a new phone network, in part by using cell spectrum for a planned satellite-to-phone service. The going has been slow, and EchoStar acknowledged in a recent securities filing that it didn’t have the money or the financing to fund its business needs for the next 12 months. Moreover, the company said its ability to operate was severely screwed up by the Federal Communications Commission’s decision in May to investigate whether it was using its satellite-to-phone wireless spectrum as it was supposed to. Where did the FCC get that idea? Elon Musk! SpaceX wrote to the FCC in April complaining that EchoStar wasn’t properly using the spectrum and called on the FCC to allow others to use it. SpaceX, whose Starlink satellite service has partnered with T-Mobile to offer satellite-to-phone texting, obviously wants the spectrum (which the sale to AT&T doesn’t include). (This Fierce Network article on the subject is worth reading.)
So what happens next? While the AT&T deal has relieved the immediate pressure on EchoStar, the company said on Tuesday that “we continue to evaluate strategic opportunities for our remaining spectrum portfolio”—in other words, possibly selling the spectrum SpaceX covets. LightShed analyst Walter Piecyk raised the possibility in his report on Wednesday that SpaceX could be a bidder for that spectrum. Alternatively, T-Mobile could buy it and SpaceX could rent it for its own service, LightShed speculates.
One flaw with this idea is that Musk already has a lot going on—at Tesla, he’s trying to get a robotaxi service off the ground, as well as build robots. SpaceX is advancing its rocket ambitions, as its latest Starship launch demonstrated, but that flight to Mars remains a work in progress. Then there’s xAI, which is far from leading the AI race. True, Musk could use xAI’s Grok to power a phone, perhaps getting more people to use the chatbot. But adding a cellular network and/or phone to his wish list might strain even Musk’s bandwidth. Moreover, a new cell service would take years to help Grok meaningfully, and in that time, xAI might fall further behind its rivals. Perhaps he is hoping just the idea that he could launch his own phone and service would be enough to persuade Apple CEO Tim Cook to at least engage Musk in serious discussions.
In Other News
• Vast Data, a data storage startup backed by Nvidia, has considered holding an IPO in the second half of 2026 or later, Vast Data co-founder and CEO Renen Hallak has told employees and bankers, The Information reported Wednesday.
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