CNBC International Live Sep 18, 2026
With Paul Meeks, Head of Technology Research at Freedom Capital Markets
Before Nvidia reported, analysts had the company growing revenue 40% next year. The number is now 70%, and Paul Meeks said Nvidia told them it could ship enough to grow 100% if the supply existed.
The debate about the AI trade this week has been about safety, regulation and public opposition to data centers. Meeks said none of that is what would break it.
"My greatest fear is not this back and forth about human civilization will be wiped out by AI, let's slow it down."
Meeks runs technology research at Freedom Capital Markets and reads each AI infrastructure builder's quarterly report and guidance for one thing: whether the money spent has started earning a return.
The full segment is covered here so you can skip it.
Here are the 5 insights that matter.
Key Takeaways
Nvidia's expected revenue growth for next year went from 40% to 70%, and Meeks said the company could ship enough for 100% if it had the supply
He has extended his call on strong AI infrastructure spending from through 2028 to the end of the decade
Rising US interest rates are his biggest concern, ahead of the safety debate, and they hurt the builders twice over
The test he applies each quarter is whether several trillion dollars of cumulative AI spending earns an adequate return
Cheaper open-weight models would raise usage, and he said the US could lose share to China if it stays on closed models
1. The PR Problem Has a Date
The host opened on the reputational problem the AI companies have created for themselves and asked whether it is big enough to move the trade.
The host asked whether the noise is material
But frankly, the AI space is having a bit of a PR problem right now. But is it material enough to really affect this trade?
A host
Meeks said it has already moved the trade and will keep doing so, and he put an end date on it.
It runs until the midterms and then fades
I think it has affected the trade, and I think it will continue to affect the trade at least through our midterm elections, which will be on November 3rd.
Paul Meeks
His reason for expecting it to fade is that the companies have just reported, and several of them guided years ahead rather than a quarter ahead.
The guidance went out years, not quarters
However, after that, I think it will somewhat subside because we've just gotten through a round of earnings in which companies not only reported their results, but they guided to the future.
Paul Meeks
2. Nvidia's 70% Growth Year
Meeks used Nvidia as the measure of how much the fundamentals have moved, and the point he made about it is the size of the base. Analysts had the company growing revenue 40% next year before it reported, which he called a whopping amount for a company that large. The figure is now 70%.
The company said the ceiling is supply, not demand
And now they're going to grow 70%. And they said they could ship to 100%, but they don't have the supply.
Paul Meeks
So the spending forecast reads as robust
So, all the fundamental signals are telling you that the spending will be robust.
Paul Meeks
That changed the length of his own call. He had been forecasting strong AI infrastructure spending to 2028.
He pushed the forecast out to 2030
I used to say I expected strong AI infrastructure spending through 2028, and now I'm willing to say it's going to keep a pace through the end of the decade.
Paul Meeks
3. Rates Are the Real Fear
The host put the financing question to him: the builders are burning cash and going to the bond market, so a 5% benchmark yield sets a higher cost of borrowing for all of it.
The host asked what a 5% benchmark does
And so, the increasing question has been, if you've got a benchmark that's running at, say, 5%, what is that going to mean for your borrowing costs down the line?
A host
Meeks said that is exactly where his worry sits, and that the first move in that direction had happened that day.
Rising US rates, not the safety debate
My biggest concern is, and we saw the first step towards it today, is rising interest rates in the states.
Paul Meeks
He gave two separate mechanisms. The companies building the infrastructure already carry a lot of debt and have to raise more to fund the growth plans they have published. And because their cash flows sit far out in the future, a higher US base rate discounts those cash flows harder and lowers what the shares are worth.
The builders are already carrying debt
The first is these companies that are building the infrastructure are heavily levered.
Paul Meeks
Which is why the same move hits twice
So, rising interest rates hurt you not one, but two ways, and I think that's my greatest fear.
Paul Meeks
4. Monetization Is the Test
Asked what would actually trigger a rupture in credit markets, Meeks pointed at returns rather than rates. What he reads in every quarterly report is whether the money being spent, cumulatively several trillion dollars, is earning enough back.
He is not dissatisfied yet
Now, I'm not dissatisfied yet as we sit here in September of 2026 with the pace or the lack thereof of monetizable AI.
Paul Meeks
The failure mode he named has a name he uses for it. Revenue growth he says cannot be disputed, and profit that never appears.
Revenue growth that never reaches profit
We can't have what we call profitless prosperity companies that have wonderful revenue growth cuz I don't think that can be refuted, but it never drops down to the bottom line.
Paul Meeks
The reason profit rather than revenue is the binding constraint is the debt already raised.
Interest has to be paid out of cash flow
So, we'll need to see that because you need to have cash flow to pay your interest expense and they have a lot of interest expense to pay over the years.
Paul Meeks
5. China and Open Weights
The host named the Chinese semiconductor companies closing the gap on the American leaders, including SMIC, CXMT and YMTC, which the host said is coming to market soon.
The host said the gap is closing
They are quite clearly narrowing the gap on performance and innovation.
A host
Meeks agreed, and framed the Chinese advance as one about licensing rather than capability: models published with their weights available, against the closed models the large American labs sell. He said Chinese developers will push the American large language model companies toward doing the same.
Cheaper models, and he thinks that is fine
I think it's good for all, but definitely over time, it will bring down pricing.
Paul Meeks
Lower prices raise usage, which helps the sector
However, with any technology, when you bring down pricing, it gets more use and that would probably continue to propel all these AI companies.
Paul Meeks
The risk he attached to it is a market-share risk for the United States rather than a pricing one.
If the US stays closed, it could lose share
But yes, over time, let's see what happens because if the open weight models really do take hold, and the US continues to be focused on the closed models, yeah, we could probably lose.
Paul Meeks
He put the same point in share terms
Or I would expect the US to lose a lot of market share to the Chinese.
Paul Meeks
Bonus Insights
The host said China is a black box
The problem with China is it's opaque, right? We can't really tell what's going on over there.
A host
The host raised President Trump's line that whoever wins AI wins, made ahead of his meeting with Xi Jinping, which Jensen Huang and Sam Altman are due to attend, and asked whether the China question deserves more airtime than it gets.
Meeks called the framing overblown
And some of that stuff is overblown, right?
Paul Meeks
He said the two countries both have an interest in racing, that the political rhetoric is nasty on both sides, and that US policy might change on 20 January 2029 when the current president leaves office. His own preference he stated plainly.
He would rather see both at once
I'd prefer, as a free market guy, to see us sometimes compete and other times cooperate.
Paul Meeks
Meeks' bottom line is that the fundamentals of the AI build-out are stronger than the week's headlines suggest, and that the thing to watch is the cost of the debt funding it and whether the spending ever reaches the profit line.
Products, Companies & Tools Mentioned
Nvidia (The bellwether Meeks used to size the change in fundamentals: growth expectations for next year up from 40% to 70%, with supply rather than demand as the limit)
SMIC and CXMT, with YMTC (The Chinese chipmakers the host named as narrowing the gap on performance and innovation, with YMTC said to be coming to market soon)
Freedom Capital Markets (Meeks' firm, where he runs technology research and reads each builder's quarterly guidance for evidence of monetization)
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