AI and the End of Traditional Hollywood

Colin’s Note: We got another knockout earnings report from Nvidia on Wednesday…

And the incredible results prove that AI investments are not only growing… they’re accelerating.

That’s why we’ve got our sights set on other areas of the artificial intelligence (AI) industry that are set to take off thanks to the foundation Nvidia has built.

And one under-the-radar sector I want to talk about today is the media and content business…

We’ve seen glimpses of the potential of AI-generated video… and it’s still fairly new. It still has a little ways to go. But you shouldn’t underestimate the trend. AI is going to change the entire video and content media business forever… and soon.

It’s all in today’s video. Click below to watch… and let us know what you think at feedback@brownstoneresearch.com.

Nvidia’s latest beat-and-raise quarter signals that this sleepy sector of the stock market is about to get disrupted in a major way in the months ahead.

Today, we’ll dive into what that sector is and who will capitalize on this fast-approaching AI trend.

What is going on, investors? Hopefully, guys are doing well. Happy Friday and – in honor of Memorial Day on Monday – I’d like to thank all who sacrificed everything for us to be here. Thank you very, very much.

Nvidia’s earnings report on Wednesday was nothing short of spectacular. The company delivered revenue that was well above expectations. Maybe more impressively than that, Nvidia’s products are practically selling themselves, leading to gigantic profits.

Unlike other chipmakers that we’ve warned you about, like Intel, Nvidia has very little to spend its mountain of cash on.

So the company amplifies its exceptional financial results with stock buybacks, dividends, and even a 10-for-one stock split. I still anticipate that investors will fully price in the upcoming years of growth for Nvidia, leading to a plateau in the company’s performance that will likely occur in late Q3 of this year.

Now, don’t get me wrong, Nvidia is still a great investment. It’ll still be a great investment. And it’s still not time to sell all of your Nvidia shares just yet.

However, other areas of the artificial intelligence (AI) industry are set to take off.

Nvidia’s results prove that AI investments are not only growing, but they’re accelerating in the growth. We also know that growth at Nvidia will lead to growth in other areas of the stock market.

That’s because Nvidia’s chips serve as the foundation for AI infrastructure, and it’s only a matter of time before more exciting software and applications are built upon them.

Last week, I discussed a secret path to invest in the $1 trillion data center expansion.

I talked about the tool renting sector, which is made up of primarily a few companies that stand to benefit from a surge in infrastructure spending on the data center side.

We also talked about the utility or power and energy business. There you have sleepy government-regulated companies that rarely see or experience growth… But a surge in AI demand in the utility sector is off to its best start in years.

Another under-the-radar sector I want to talk about today is the media and content business… Nvidia CEO, Jensen Huang, just said, “There’s a lot of information in life that has to be grounded by video. So that’s the next big thing.”

We’ve already seen glimpses of what AI video will do and bring in the coming years. On the scary side, deep fakes of politicians and celebrities can be eerily realistic.

OpenAI has shown demos of its Sora application that can produce stunning videos in just a few sentences. That’s right, you can type in just a few sentences and it can make a movie-quality video off of your prompt.

Very soon, the entire video and content media business will change forever.

Soon, I’ll be able to tell a computer system that I want to star in an action thriller alongside Brad Pitt with a soundtrack of 1990s rock music. Instead of Hollywood making content in the studios, AI will be making the content on Nvidia chips inside of data centers.

Just this week, it was reported that both Meta and Google are offering tens of millions of dollars to Hollywood production companies for access to their work.

Google and Meta are being very, very savvy here. Right now, Hollywood is the gatekeeper of movie production and, maybe more importantly, distribution.

If Google and Meta can successfully train AI systems to produce Hollywood studio content using their content to do it, Google and Meta will become the gatekeepers… given that they’ll have distribution platforms far larger than Hollywood does.

Given the fragile status and nature of many Hollywood studios right now, I fully expect many will accept Google and Meta’s terms, essentially drying up any moat Hollywood has left.

This will be one of the greatest disruptions that we’ve ever seen… far bigger than the demise of movie rentals and Blockbuster Video brought on by the internet.

That was The Bleeding Edge for today. Have a great weekend, and again, thank you to all who have fallen serving this country. Bye for now.

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