Gerstner notes Baidu lost 50% of value while other Chinese platforms multiplied due to WeChat and ByteDance.
“I mean, Baidu's worth 50% less today than it was six years ago. Notwithstanding the fact that all of the big internet platforms in China are worth multiples today of what they were five years ago because you had the rise of WeChat, you had the rise of ByteDance,”
Gerstner says US TikTok is $3-4 billion of ByteDance's $120 billion revenue and loses money.
“It's also been leaked that in that TikTok is about 14,000,000,000 of that and that US TikTok is 3 to 4,000,000,000. US TikTok, 3 to 4,000,000,000 of 120, and it loses money.”
Gerstner argues AI has become the leading edge of sovereign battles over trade and national security.
“AI, over the course of the last twelve months, has gone from an interesting technology to literally the leading edge of where we're battling with global sovereigns over trade, national security, national economic interest.”
Gerstner states US nuclear deployment costs are limited by regulation, not technology, creating gap with China.
“our cost of deploying new nuclear fission infrastructure is limited by our own regulatory framework, not by the technology.”
Gerstner states China adds six to eight reactors yearly and will surpass US nuclear production by 2030.
“China who's adding six to eight new fission reactors per year, it's gonna add upwards of 25 or 30 over the course of the next, you know, five or six years, is expected to surpass The United States in nuclear power production by 2,030.”
Gerstner notes South Korea and China build reactors using US Westinghouse technology acquired through tech transfer licenses.
“both the South Koreans and the Chinese, right, are building on technology that they procured from The United States, from Westinghouse, under tech transfer licenses over the course of the past, you know, twenty or thirty years.”
Gerstner warns low-cost power enables larger AI infrastructure, creating strategic risk if China leads nuclear.
“Because if you are the low cost power provider in the world, right, then you're going to be able to build bigger data centers that power bigger AI clusters, etcetera.”
Gerstner contrasts China building 350 nuclear reactors versus zero in the US.
“there are 350 nuclear reactors under fission reactors under construction in China. How many in The US?”
Gerstner estimates NVIDIA lost track to $50 billion China business from chip export ban.
“I think if you forecast out two or three years, they were on track to be a $50,000,000,000 business, I think in China.”
Gerstner recalculated tariffs from original $800 billion estimate on Liberation Day to new figure.
“So remember, I came on here on liberation day, and I held up the list of tariffs that that that were on the poster board that Trump showed.”
Gerstner recalculates tariffs at $300 billion under new framework versus $77 billion last year.
“And if you put China at 30% on strategic, at 15% on nonstrategic, and the rest of the world roughly at 10%, you come up with about 300,000,000,000 in tariffs.”
Gerstner cites study showing 40-50% of top US AI researchers are Chinese.
“I saw a study that suggested that 40 to 50% of the AI researchers in The United States, our best researchers are Chinese.”
Gerstner warns chip ban increases risk China moves on Taiwan given AGI timeline claims.
“I think it dramatically increases the chances that China is forced to move on Taiwan. Right? We're out there telling everybody in the world that AI is totally existential.”
Gerstner warns chip export ban increases risk China invades Taiwan over existential AI needs.
“If we keep the chip ban in place, here's my biggest concern. I think it dramatically increases the chances that China is forced to move on Taiwan.”
Gerstner argues NVIDIA's $40 billion China business keeps them on CUDA and export bans risk forcing Taiwan conflict.
“It's $40,000,000,000 business NVIDIA in China to keep them on the CUDA ecosystem rather than allowing them to have a monopoly on the Huawei ecosystem.”
Gerstner reports Saudi minister said Huawei went from 0% to 40% market share, nearly winning full adoption.
“One of the ministers in Saudi Arabia said to me that Huawei had gone from 0% market share to 40% market share and they were months away from making the decision to go with the Huawei stack right? Because they can't be left behind.”
Gerstner reports Saudi minister said Huawei went from 0% to 40% market share, nearly winning the contract.
“One of the ministers in Saudi Arabia said to me that Huawei had gone from 0% market share to 40% market share and they were months away from making the decision to go with the Huawei stack right? Because they can't be left behind. They have to do something.”
Gerstner proposes trading AI chip access to China for rare earth materials access.
“On point three, it gets us right? If we do this trade, and I don't know that China would do this trade, but if we did this trade, then it would get us access to those rare earths right now, which is absolutely critical, and it buys us time to stand up our own rare earth supply.”
Gerstner says NVIDIA had 80% China market share with developers in CUDA ecosystem, generating billions in US taxes.
“NVIDIA has you know, it went from 80% market share in China where all the developers, second largest developer market in the world, were were developing in CUDA.”
Gerstner reports Huawei went from 0% to 50% market share in Saudi Arabia.
“when I was in Saudi Arabia, right, Huawei has gone from 0% market share in Saudi Arabia to 50% market share in Saudi Arabia.”
Gerstner predicts a major US-China deal will be completed before end of 2025.
“I think that there's gonna be a big Chinese deal done before the year's out.”
Gerstner forecasts major China deal after Trump visit planned for September through November timeframe.
“They've invited the president to China. The president has suggested he's going to go to China the first week of September, sometime between September and November.”
Gerstner quotes Trump proposing to cut defense budgets in half for US, China, and Russia.
“He said, You know, if I could wave a magic wand, I would cut the defense budget in half for The United States, for China, and for Russia.”
Gerstner notes Alibaba's Qwen model has passed 400 million downloads under Apache 2.0 license.
“Of course, that's released like these other models under the Apache 2.0 open source license, so very open, as Bill's talked about.”
Gerstner predicts Trump will pursue the biggest-ever China deal, calling himself a deal junkie at AI summit.
“He said at the AI summit last week, I'm a deal junkie. I like to do deals. You can't be the biggest deal maker in the world without doing a big deal with China.”
Gerstner predicts president wants biggest-ever China deal and is not ideologically rigid on China.
“I think this president wants to do the biggest deal ever done with China. I don't think he's dogmatic at all. I don't think he's some big China hawk.”
Gerstner notes US is only 14% of China's exports and 3% of China's GDP.
“The US only represents about 14% of China's exports. The US only represents about 3% of China's GDP.”
Gerstner warns believing China only wins through theft or subsidies prevents US self-improvement.
“if we have this view that the only reason China's competitive or winning is because they're they're stealing or they're subsidized, I think what that view does is it allows us to dilute ourselves into believing we don't need to get better ourselves.”
Gerstner cites Jensen Huang saying half of world's AI researchers are in China and innovating.
“Jensen Huang reminded us recently that 50% of the world's AI researchers are in China, and they're indeed innovating and not copying.”
Gerstner argues focusing on slowing China distracts from accelerating US competitiveness.
“And I think by if we focus too much on how do we slow down China, we take the eye off the ball on how to accelerate our own race.”
Gerstner believes there's over 50% probability NVIDIA can sell Blackwell chips in China, a $50 billion market.
“China is a $50,000,000,000 market for NVIDIA unto itself. So I believe that the probability they're gonna be able to sell chips China is north of 50%.”
Gerstner contrasts Google's unrestricted global expansion with current AI restrictions, wants same for AI companies.
“They just went and competed around the world, and now the world runs on the democratic principles that are embedded within Google. I wanna see the same thing happen in the age of AI.”
Gerstner compares AI buildout to Manhattan Project, calling it both national and economic security imperative against China.
“We are in a global AI race with China. This is like the Manhattan Project. We have to build out compute. It it's a it's not only a national security imperative.”
Gerstner argues US should focus on running fastest race rather than restricting China's chip access.
“The US wins when the world runs on American technology, and I think we need to focus on running the fastest race we can possibly run.”
Gerstner says the US is financing nearly a trillion dollars in annual AI capex privately, unlike China's government subsidies.
“I think it's extraordinary that we're financing almost a trillion dollars of capex a year to build out the the entire AI infrastructure without any money from the US government.”