The Rundown (Public.com)

Episode: Nvidia Invests $2B into xAI, Oracle's AI Business Weighs on Profits

Date: October 8, 2025
Host: Zaid Admani

Episode Overview

On today’s “The Rundown,” host Zaid Admani breaks down the latest market movements, focusing on:

• Why Wall Street is nervous about gold’s rally and what it signals for the economy
• Oracle’s struggles with profitability in the booming AI cloud sector
• Nvidia’s massive $2 billion investment in Elon Musk’s xAI and the resulting ripple effects
• Major company stock moves, including Confluent and Tesla
• A fun fact about the Nobel Prize in quantum physics and Google’s position in the quantum computing race

The episode maintains a light, conversational tone with Zaid’s signature humor and clear explanations of technical financial topics.

Key Segments & Insights

1. Market Snapshot: A Winning Streak Ends, Gold Surges

[00:25–02:35]

• The S&P 500 dropped 4% and Nasdaq 7%—breaking a week-long rally.

  • Zaid jokes: “Now, this might be partially my fault. I might have jinxed the markets on yesterday's show...” [00:30]
  • “Stocks don't always go up. But you know what does always seem to go up these days is gold.” [00:38]

• Gold crossed $4,000/oz for the first time—up 50% YTD.

• Wall Street concern: Ken Griffin, Citadel’s founder, calls the rally “concerning.”

  • “The U.S. economy is basically on a sugar high right now.” — Ken Griffin via Zaid [00:55]

• “Debasement trade”: Investors are flocking to gold, silver, and even Bitcoin due to inflation and concerns about the dollar.

• The Fed is expected to cut rates soon, possibly prolonging the rally.

• Fun take: “People say that AI is the new gold, but gold might be the new gold because gold is outperforming Nvidia’s stock this year. Imagine telling that to someone back in January.” [01:40]

• Costco gold regret story adds a personal touch.

Insight:
Gold’s surge reflects deeper market anxieties about inflation and currency value, despite ongoing hype about AI as the new market “gold.”

2. Oracle’s AI Cloud Business: Growth Vs. Profit

[02:36–04:17]

• Oracle’s AI cloud revenues soared (stock up 70% YTD) due to big new deals with OpenAI, ByteDance, and Meta, renting out Nvidia GPU-packed data centers.
• “Margins are getting squeezed”: Only 14 cents of every dollar from GPU rentals is profit—down sharply from Oracle’s usual ~70% margin.
  • “That 14% gross margin is brutal when you consider that Oracle’s usual margins hover around 70%.” [03:20]
• Oracle may have offered heavy discounts to win contracts, prioritizing growth over short-term profits.
• Stock dropped 6% but recovered by end of day.
• Zaid wonders if other AI cloud players face the same margin squeeze.
  • “Oracle’s chasing growth at the expense of profit, at least in the short term... I wonder though if other AI cloud providers are also operating at thin margins.” [03:55]

Insight:
Aggressive competition in the AI infrastructure space is driving risky pricing and razor-thin margins, raising questions about the sustainability of current growth strategies.

3. Nvidia’s $2 Billion Bet on xAI: Circular Financing in AI?

[04:18–06:00]

• Elon Musk’s xAI seeks to raise $20B for its new Memphis data center, “Colossus 2.” Nvidia is a headline investor, reportedly putting in $2B.
• Structure: Special purpose vehicle buys Nvidia GPUs, then rents them to xAI—allowing the latter access without direct purchase.
• Colossus 2 will need about 300,000 chips; xAI reportedly losing ~$1B/month keeping pace with OpenAI & Anthropic.
• Zaid’s skepticism: Little recent buzz from xAI’s Grok; lots of catch-up needed.
• Major concern: The deal exemplifies “circular financing.”
  • “Nvidia is handing out money to companies so they can use that money to buy more of their chips. The money seems to be going back and forth amongst a handful of companies.” [05:45]
• Zaid references his Instagram flowchart and a prior episode for deeper analysis.

Insight:
Circular financing in the AI industry—investors funding clients who then buy the investor’s products—raises concerns about a bubble and the true sustainability of AI’s rapid expansion.

4. Stock Movers: Confluent (Up On Takeover Rumors), Tesla (Down On “Affordable” Launch)

[06:01–07:44]

Confluent:

• Shares spiking 15% pre-market as Reuters reports the company is exploring a sale, drawing interest from private equity and tech companies targeting AI infrastructure.
  • “Right now the company's market cap sits around $7 billion which is nothing for a big tech company.” [06:30]
• Confluent fits the AI acquisition wave narrative.

Tesla:

• Shares dropped 4% on the launch of “affordable” new Model 3 and Model Y versions after investor expectations for a truly low-cost option were not met.
  • “Both these cars are still pricier than the sub $30,000 range that investors were hoping for.” [07:00]
  • Cost-cutting comes via stripped features & shorter range (320 miles).
• Motivation: Offset ending of federal EV tax credit.
• Zaid doubts effectiveness vs. cheaper, feature-rich Chinese competitors (BYD):
  • “I think investors were disappointed with these new cars, and that's why Tesla stock slid yesterday and it continues to slide this morning.” [07:41]

Insight:
While AI-related acquisition targets remain hot, Tesla’s inability to meet expectations on affordability highlights challenges even for market leaders in adapting to policy changes and international competition.

5. Nobel Prize Fun Fact: Google’s Quantum Leap

[07:44–08:50]

• Three U.S. physicists win the Nobel Prize for foundational quantum computing research (quantum tunneling).
  • “The three scientists are winning the prize for experiments they did back in the 1980s when they proved that quantum laws, stuff that we usually can't see, could actually be observed with the naked eye.” [08:00]
• Two winners work at Google’s Quantum AI Lab.
• Zaid notes: This bolsters Google’s position in both AI and quantum computing and helps explain their surging stock price.
  • “That explains why their stock is at all time highs right now.” [08:36]
• Bonus trivia: $1.2M prize will net each scientist $400K—Zaid jokes about them investing it in “quantum stocks.”

Insight:
Momentum in quantum computing is moving out of academia and into tech giants like Google, potentially laying groundwork for the next market boom.

Notable Quotes

• Zaid Admani:
  • “Stocks don't always go up. But you know what does always seem to go up these days is gold.” [00:38]
  • “AI is the new gold, but gold might be the new gold because gold is outperforming Nvidia’s stock this year.” [01:40]
  • “Oracle’s chasing growth at the expense of profit, at least in the short term.” [03:55]
  • “It just feels more and more like a bubble...” [05:56]
  • “I think investors were disappointed with these new cars, and that’s why Tesla stock slid yesterday.” [07:41]
  • “That explains why their stock is at all time highs right now.” [08:36]

Key Timestamps

• 00:25 — Market update: Stock dip, gold rallies, Ken Griffin’s warning
• 02:36 — Oracle’s AI business: revenue growth, margin squeeze
• 04:18 — Nvidia’s $2B xAI investment and circular AI funding
• 06:01 — Confluent’s takeover rumors; AI stock movement
• 06:45 — Tesla’s “affordable” Model 3/Y reaction
• 07:44 — Nobel Prize in quantum physics; Google’s quantum computing edge
• 08:36 — Fun take on Nobel prize money and quantum stocks

Tone and Style

• Informal and engaging, with personal anecdotes and industry jokes
• Clear, jargon-free explanations aimed at retail investors
• Critical but not alarmist, with skepticism about AI market dynamics

For New Listeners

This episode covers the intersection of gold, tech, and AI investing—offering both immediate market alerts and deeper commentary on tech finance strategies, market psychology, and the next technological revolutions. Highly recommended for anyone watching the AI boom, gold rally, and the Big Tech power struggle in quantum computing.