The Kobeissi Letter (@KobeissiLetter)

Jensen Huang and the Nvidia board just made a massive mistake. He should not have resigned. The board should have taken the time to conduct a thorough investigation, consult with shareholders, and carefully evaluate the long-term implications of this decision. There is no clear replacement for Jensen Huang, and we believe his departure will ultimately be a net negative for Nvidia, $NVDA, and its shareholders. This will go down as the most costly mistake of the AI Revolution.

Our message to Nvidia's board: Do not fire Jensen Huang. There is no clear replacement for Jensen Huang. We are confident that his departure would ultimately be a net negative for Nvidia, its shareholders, and the AI Revolution. First, take a look at the data. History also suggests that removing a successful CEO will come with a significant cost. A study of 187 forced CEO departures from S&P 1500 companies found that removing outperforming CEOs resulted in negative long-term stock returns. This case would be no different, in our view. Jensen Huang is the definition of an outperforming CEO. Nvidia's board must not make a decision in the heat of the moment. The board should take the time to conduct a thorough investigation and consult with shareholders, with a strong emphasis on the latter. Quite literally, Nvidia's board should convene a special shareholder meeting and hold an advisory vote on this decision. This is the most consequential CEO controversy in world history. Shareholders deserve a say. In addition, Nvidia's stock, $NVDA, is now down -35% in 26 trading days, nearly half of which is a result of the recent scandal. We believe Jensen Huang's potential removal as CEO is now ~80% priced in. Why take an action with massive downside potential when the market has already priced in much of that risk? The downside of retaining Huang may be limited, while the potential upside is tremendous. Lastly, history shows that retaining Jensen Huang could still lead to a favorable outcome. In 2019, Amazon retained Jeff Bezos as CEO after his extramarital affair became public, and the company's stock subsequently surged +108% by 2021. Personal misconduct should not be ignored, but it must also be distinguished from corporate wrongdoing and weighed against the consequences of removing an executive who is instrumental to the company's success. We believe Jensen Huang is an irreplaceable part of Nvidia and the AI Revolution more broadly. Once the dust settles, firing Jensen Huang would prove to be a costly mistake. It is time to pause and consult your shareholders.

BREAKING: Elon Musk says SpaceXAI will be renamed to "SpaceXSI" after President Trump changed the name of "Artificial Intelligence (AI)" to "Super Intelligence (SI)." "No more AI. SI. It’s better," Elon Musk says.

If Nvidia, $NVDA, actually reports $108 billion in revenue for Q3 as they are guiding, that would mark +1,730% growth in 4 years. Never in history has a company of this size grown at such a fast pace. Once again, we are witnessing history.

Absolutely insane. Nvidia, $NVDA, just guided $108 BILLION in revenue for Q3 alone. And, this guidance assumes ZERO data center compute revenue from China. This builds on the record $96.2 billion in revenue posted for last quarter for a projected total of $204.2 billion in 6 months. We now have a $5+ trillion company is seeing +106% year-over-year revenue growth. There has never been anything like what we are seeing right now with AI. This is arguably the biggest technological revolution of all time.

Money supply is significantly outpacing economic growth across major economies: Canada's M2 money supply has grown +368% since January 2004, the largest increase among G7 economies. By comparison, the Canadian economy has expanded +159% over the same period. The US follows, with M2 growth of +279% versus a +171% increase in nominal GDP. Meanwhile, M2 in France has surged +258% and +211% in the Euro Area, both outpacing nominal GDP growth of +84% and +102%, respectively. In Japan, M2 has grown +90% since 2004, while its economy expanded just +25%, the slowest pace among G7 economies. The gap between money creation and economic growth is widening.

The AI boom is creating a generational divide in software jobs: US software developer employment for those aged 22-25 has declined -23% since November 2022, when ChatGPT was launched. At the same time, the 26-30 age group has seen a decrease of -5%. By comparison, employment among software developers aged 41-49 has risen +18% over the same period. This creates a 41 percentage point gap between the youngest and one of the most experienced groups within the same profession. Meanwhile, early-career workers in the most AI-exposed jobs have experienced a -16% decline in employment relative to less-exposed occupations and more experienced peers since November 2022, even after adjusting for firm-specific shocks. By contrast, employment among workers in less AI-exposed fields, as well as more experienced workers within the same occupations, has remained steady or continued to grow. The AI revolution is wiping out entry-level tech jobs.

The AI infrastructure buildout is entering a new phase: US tech companies are committing to spend a record $850 billion on data center leases over the next several years. This marks a +$570 billion YoY increase, or +204%, and +$200 billion QoQ increase, or +31%. Meta, $META, added the most in Q1 2026, committing +$79 billion in new leases, a +76% QoQ increase, bringing its total to ~$183 billion. At the same time, Microsoft, $MSFT, added +$41 billion, a +26% QoQ increase, bringing its total to ~$197 billion. Oracle leads with the largest total commitments at ~$250 billion, having already secured many of the key sites needed to fulfill its contract with OpenAI. Tech companies are doubling down on AI.

What is happening in Hong Kong? Chinese semiconductor exports to Hong Kong rose to a record $15 billion in May. This figure has soared over +200% since early 2025. At the same time, Chinese chip exports to the world surged to a record $35 billion, tripling over the same period. As a result, Hong Kong accounted for 43% of China’s semiconductor exports in May. Over the first 5 months of 2026, China exported $239 billion of chips globally, with Hong Kong absorbing over 50% of this total, a record proportion and up from ~33% a decade ago. Hong Kong has become a dominant logistics hub for China’s chip trade.

China’s is seeing unprecedented money supply growth: China's M2 money supply is up to a record ~240% of GDP, the highest among any major economy in the world. This metric has surged +100 percentage points since the 2008 Financial Crisis. Over this period, China’s M2 money supply has surged +500% in Dollar terms. By comparison, the country's gold reserves and total FX reserves have risen +100% and +60%, respectively. To put this into perspective, Japan's M2-to-GDP ratio, the next highest, stands at ~185%, while the US sits at ~70%. China's monetary expansion is unlike anything seen among major economies.

BREAKING: Microsoft, $MSFT, announces price hikes for Xbox devices due to memory chip costs just hours after Apple hiked prices on MacBooks and iPads. Among the price increases: 1. Xbox Series S 1TB increased +$150 to $599 2. Xbox Series X 1TB increased +$150 to $799 3. Xbox Series S 512GB increased +$100 to $499 4. Xbox Series X 1TB Digital increased +$150 to $749 AI-induced price hikes have begun.

What just happened? In just 27 minutes, the Nasdaq 100 just fell -1,000 points and the S&P 500 erased -$1 TRILLION without any major headlines. The Nasdaq opened +1% higher then fell -3% between 9:30 AM and 9:57 AM ET. What does it all mean? Let us explain. (a thread)

BREAKING: Apple, $AAPL, has raised the prices of its Macs and iPads due to soaring chip costs. Among the price increases: 1. MacBook Air increased +$200 to $1,299 2. Base MacBook Pro increased +$300 to $1,999 3. Base MacBook Neo increased +$100 to $699 4. iPad Air increased +$150 to $749 5. iPad Pro increased +$200 to $1,199 Tim Cook said soaring chip costs made the price hike "unavoidable."

BREAKING: The Fed’s balance sheet rose +$11 billion in the week ending June 17th, to $6.74 trillion, the highest since March 2025. Total assets have risen +$162.8 billion since the start of the year. This has been driven by Treasury holdings, which have surged +$251.8 billion over this period, to $4.49 trillion, the highest since June 2024. At the same time, holdings of Mortgage-Backed Securities have declined -$74.2 billion, to $1.96 trillion, the lowest since September 2020. The Fed's balance sheet is now 76% above pre-pandemic levels. The Fed's balance sheet continues to expand.