Prof G Markets | Nvidia Earnings Brush Off AI Bubble Fears — For Now

Date: November 20, 2025
Hosts: Ed Elson
Guests: Gil Luria (DA Davidson, Head of Technology Research), Jonathan Kanter (Former Assistant Attorney General, DOJ Antitrust Division)
Podcast Network: Vox Media

Episode Overview

This episode dives into Nvidia's blockbuster Q3 earnings, their impact on the ongoing debates around an AI investment bubble, and what the financial exuberance in the sector signifies for investors and the wider economy. The show then shifts to a deep analysis of a major antitrust ruling in favor of Meta (Facebook), what it reveals about the current state of tech regulation, and the recurring spectacle of massive but substance-light foreign investment announcements by the U.S. administration.

Nvidia’s Record Earnings & Impact on the AI Market

Key Highlights

• Nvidia reported a record $57 billion in Q3 revenue, up 62% year-over-year, beating expectations and providing robust guidance for Q4 ($65 billion projected).
• Data center sales, the AI-driven core of Nvidia's business, grew 66% YoY.
• The strong earnings countered recent concerns about an "AI bubble," with the stock rising up to 6% in after-hours trading.

[02:15–03:40] Setting the Scene

Ed Elson:
"The major indices all climbed for the first time this week ahead of Nvidia's earnings...Nvidia delivered a record $57 billion in third quarter revenue. Data center sales also hit a record up 66% year over year...Jensen Huang put it simply: he said Blackwell sales are off the charts and Cloud GPUs are sold out."

[03:40–04:14] The AI Super Bowl

Gil Luria:
"Happy Nvidia Day... It's the Super Bowl of the quarter."

Bubble, Borrowing & How Real is the AI Boom?

[04:14–05:24] What the Results Mean

• While Nvidia leads with "real winners"—big cloud customers with substantial cash flow—much growth is driven by customers borrowing to build AI infrastructure.
• Not all AI investments are equal: Real businesses vs. speculative, debt-fueled spending.

Gil Luria:
"The fact that they have customers borrowing a lot to buy chips is great for Nvidia ... But for financial institutions lending them money, this isn't good news."

[05:46–06:57] Longer-Term Guidance Calms Investors

• Nvidia broke with tradition by guiding far beyond one quarter: plans to sell $500B in Blackwell and Rubin chips through 2026, increasing investor confidence in at least the medium-term buildout.

Gil Luria:
"That gives us visibility five quarters out... That's the first time we've had that since the beginning of the AI era."

[07:27–09:23] The Bubble Isn’t Dead—It’s Inflating

• Major risks center on the borrowing frenzy in building data centers and AI infrastructure, possibly amounting to $100B+ in loans at high interest.
• When AI compute demand inevitably plateaus or price wars erode margins, there is a risk of defaults and cascading losses.

Gil Luria:
"We're not at a bubble, but we're inflating a bubble. And if we don't stop now...the exuberance comes back tomorrow and we lend another half a trillion dollars... two, three years down the road will come back to bite us."

[10:24–12:03] What Happens When the Music Stops?

• If companies borrowing to buy GPUs (e.g., CoreWeave) can't maintain spending, Nvidia could see earnings fall whenever the investment cycle turns.
• Valuation for Nvidia reflects its cyclical semiconductor nature—less risky than if it was priced for endless secular growth.

Gil Luria:
"The rules of gravity haven't changed. Semiconductors are a cyclical industry... We're exaggerating the cycle, but the valuation...reflects that it is still a cycle."

[12:03–13:16] Where’s the Real Risk?

• Cautions against highly leveraged new entrants (CoreWeave, Oracle, Blue Owl, OCLO, certain quantum firms) versus established hyperscalers (Microsoft, Amazon, Google) who can weather cycles.

Gil Luria:
"Microsoft and Nvidia will do well in a wide range of scenarios... There's plenty of places to invest that are not companies borrowing 90 to 100% of their capital to build what is still a speculative asset."

Big Tech Antitrust: Meta’s Legal Victory and Its Implications

[16:43–17:52] Meta Wins Its Antitrust Case

The court ruled Meta's acquisitions of Instagram and WhatsApp did not create an illegal monopoly, citing robust competition (YouTube, TikTok) emerging since the acquisitions.

[17:52–19:48] Historical Lens & The Court’s Reasoning

Jonathan Kanter:
"The case...was about whether Facebook broke the antitrust laws, entrenched its monopoly power by acquiring these nascent threats... The court listened to the evidence and said...today... TikTok and YouTube are competitors, therefore Facebook doesn't have a monopoly, therefore they didn't violate the antitrust laws."

[19:48–22:23] Problems with This Logic

• The judgment discounts the possibility of past illegal conduct just because competition appeared later.
• Indicates the need for timely antitrust intervention—don't wait years after deals close.

Jonathan Kanter:
"We need to block deals in real time...waiting down the line and trying to deal with it 10 or 15 years later is probably not the smartest move..."

[22:27–24:02] Is Present-Day Competition a Get-out-of-Jail-Free Card?

Ed Elson:
“It doesn't seem to make sense to say you never did anything illegal because of what's happening in the present...am I getting that right?”

Jonathan Kanter:
"I agree... It doesn't make sense ...court is saying that, okay...since 2012, you have illegally monopolized the market, but because 10 plus years later, somebody else came along...we're gonna say you're not a monopoly. ... that’s an inaccurate, incorrect reading of the law."

[24:58–27:34] Integrity of the Justice System

• Judges are not corrupt, but corporate deference in the process is problematic.
• Systemic issues allow large companies leeway that ordinary individuals do not receive.
• Key lesson: Don’t delay; act early on competitive harms.

Jonathan Kanter:
"They are noble jurists...I think they both fucked it up, but they are good, well intentioned judges... the process is...massive deference to companies and markets... Unless there’s accountability, we're never going to see the kind of compliance with the antitrust laws..."

[28:03–29:29] Does Meta Have a Monopoly Today?

• Kanter affirms Meta still has monopoly power in personal social networks, emphasizing the lack of “rules of the road” for data-driven business, especially in AI and social platforms.

Jonathan Kanter:
"We’re dealing with tobacco companies with data and they're incredibly harmful to society...we need some basic rules of the road...and right now we have none of the above."

[29:29–30:35] What Antitrust Cases Should We Watch?

• Closing arguments in the DOJ's Google advertising case (remedies phase) could result in a breakup of the ad tech stack.
• The Live Nation–Ticketmaster case, with broad public and state support, heads to trial March in New York.

Jonathan Kanter:
"The Live Nation Ticketmaster breakup case...has tremendous amount of popular support and backing... likelihood that case gets to trial is very high..."

The US–Saudi Investment “Deal”: More Show Than Substance

[30:48–36:56] Trump & Mohammed bin Salman’s $1 Trillion “Announcement”

• Trump hosted the Saudi Crown Prince with grand fanfare and announced a $1 trillion Saudi investment in the US, echoing similar splashy deals from recent months and years.
• Ed Elson points out no treaties, contracts, or signed agreements exist; such investment numbers are near or above the value of Saudi Arabia’s entire sovereign wealth fund—highlighting the emptiness of the promise.

Ed Elson:
"Here we have the same thing. Big number, big headline, no substance. Nothing that actually means anything. ... This deal is a lot like the other deals. And that is, it probably isn't one."

Notable Quotes

Gil Luria, on the AI cycle and bubble risk:

"We're not at a bubble, but we're inflating a bubble. And if we don't stop now...it will come back to bite us." (08:14)

Jonathan Kanter, on the Meta antitrust verdict:

"It doesn't make sense ... the court is saying that, okay, since 2012, you have illegally monopolized the market, but because 10 plus years later, somebody else came along ... we're gonna say you're not a monopoly. ... that’s an inaccurate, incorrect reading of the law." (22:48)

Ed Elson, skeptical of White House–Saudi “deals”:

"Here we have the same thing. Big number, big headline, no substance. Nothing that actually means anything. ... This deal is a lot like the other deals. And that is, it probably isn't one." (35:42)

Jonathan Kanter, on antitrust process:

"They are noble jurists...I think they both fucked it up, but they are good, well intentioned judges... the process is...massive deference to companies and markets..." (24:58)

Timestamps for Key Segments

• Nvidia Earnings Breakdown & AI Bubble Risk: 02:15 – 13:16
• Meta Antitrust Ruling Analysis: 16:43 – 30:44
• Saudi–US “Investment” & Media Spectacle: 30:48 – 36:56

Takeaways

• Nvidia’s blowout quarter validates AI infrastructure demand but raises questions about borrowing-led froth in the sector.
• Many AI-related companies are leveraging up on debt, potentially amplifying risk if/when demand or pricing conditions turn.
• Big Tech continues to outmaneuver regulatory challenges, in part due to delays and shifting legal standards.
• Grand geopolitical business announcements may mask a lack of substance, serving more as political theater than actual policy or economic progress.

This episode was rich in insight for investors, tech observers, and anyone interested in how today’s capital markets intersect with global business and regulatory politics.