Mad Money w/ Jim Cramer 8/27/26
Mad Money w/ Jim Cramer
Jim Cramer dissects the dramatic stock movements of Salesforce and NVIDIA on August 27, 2026, revealing how misleading narratives—such as th
Key takeaways
- Misleading narratives like 'SaaSpocalypse' and fear of AI disruption were used by short sellers to suppress Salesforce's stock price, despite the company's strong performance.
- Salesforce's partnership with Anthropic demonstrates synergy rather than competition, reinforcing its value in data integration and AI infrastructure.
Main topics
- Salesforce's AI-driven transformation with AgentForce
- NVIDIA's resilience amid AI hype and market skepticism
Notable quotes
"There are three kinds of lies, lies, damn lies and statistics."
"Sasspocalypse? How about shortpocalypse?"
Conclusion
Cramer emphasizes that investors should trust fundamentals over sensational
Transcript preview
Speaker 6 (0:00) It's all about the money. I Speaker 5 (0:01) want to be the person in my family that creates generational wealth. Speaker 6 (0:04) How they earn it, spend it, and make dreams come true. I'm Speaker 5 (0:08) not going to sugarcoat it. It's hard, but it's so worth it. Speaker 6 (0:11) Millennial Money. All new Saturdays, 3 Eastern, CNBC. Speaker 4 (0:15) My mission Speaker 6 (0:16) is simple. Speaker 3 (0:17) To make you money. I'm here to level the playing field for all investors. Speaker 2 (0:22) There's always a bone working somewhere. And I promise to help you find it. Mad Money starts now. Speaker 2 (0:33) I'm Kramer. Welcome to Mad Money. Welcome to Kramerica. I do make friends. I'm just trying to make a Speaker 3 (0:39) little bit of money here. My job is not just to entertain, but do some teaching. So call me at 1-800-743-CNBC. Tweet me at Jim Kramer. To borrow a phrase from Mark Twain, there are three kinds of lies, lies, damn lies and statistics. Nothing's more misleading than a series of bogus numbers coupled with a novelistic negative narrative. So after a day when the Dow gained 106 points, has to be advanced 0.72 percent and then as I jump 1.57 percent, I want to pull the curtain back here. Explaining why stocks like Salesforce up $46 or 22 % and NVIDIA, which valued $18 or 8.7%, could have such huge single session moves. Very simply, we were in the grip of some lies and damn lies backed by chimerical statistics. And now both bear stories have backfired. leading to humongous gains for those who hung in. Today was a day where a lot of wrongs were rectified. In particular, I'm talking about the canards coloring the action in these two stocks. Oh, by the way, and a third, CrowdStrike, which we will talk to later in the show. Both Mark Benioff, the founder and CEO of Salesforce, and Jen Simong, the co-founder and CEO of NVIDIA, came on our show last night after they reported roughly just stupendous quarters to drill home that their companies are in great shape and their businesses are on fire. Both came on. proud, justifiably so, especially as they just triumphed over a course of lies, exaggerations, and fear-mongering. For months, these stocks have been held back by the bears, the short sellers who argued that Salesforce's enterprise software couldn't survive in a world of AI competition, and NVIDIA would soon be overcome by hyperscalers that are desperate to develop their own chips, use them, and sell them to other clients that they could poach from NVIDIA. At least that was the narrative. How did these bearish narrators take over in the conversation in the first place? Okay, first thing you talk about is, how about my involvement or lack of involvement with hedge fund managers? See, I don't like talking to them because I have to presume they're always talking their book. And for the most part, I don't think it's worthwhile. In fact, it can be poisonous. Many others do talk to them, though. I'm not saying they're inherently dishonest, but they've got a financial interest in promoting their positions, which gives them a reason to twist the facts if they want to. I don't want to get swept up in that because at the end of the day, You know who my boss is? You. And I don't want to lead you astray. Which brings me first to Salesforce. Mark Benioff has what's known as, it's called a seat model, meaning you pay Salesforce per user. It's been a terrific business for a very long time, and Mark's been wildly successful, at least until recently, when a cohort of short sellers decided that Salesforce and its ilk would be eaten alive by AI competition. They believed that it would become obvious to everyone that the whole software-as-a-service space was a dying model. Because they charge per seat. And with AI, you simply won't need as many people to work at your company. So Salesforce had to charge less. The Bears also argued that the large language model companies, and here I'm thinking about Anthropocene or OpenAI, would be able to write their own code to duplicate what Salesforce does. Simple to do, the hedge fund managers told us. That's what they said to everybody. They called it the SaaSpocalypse. Speaker 3 (3:54) Ha ha! People kept pushing this catchy little narrative and worked on the stocks, held them down, took them lower. Now, Salesforce had a couple of suboptimal quarters, but Mark told us he was installing something called AgentForce, which he introduced on our show two years ago at Dreamforce. It uses AI agents to help boost sales and make workers more productive. During this transition, though, the SaaSpocalypse drumbeat grew louder and louder. We heard that the growth was declining rapidly, that you'd see the annual Speaker 2 (4:22) order value plummet, that seats would go down, that customers were disappearing, that attrition was huge, big discounts were being given, and contracts Speaker 3 (4:30) were shortened as people feared that something like Claude would obviate Salesforce entirely. That was the narrative. Yet when Salesforce reported last night, they delivered their strongest net new annual order value growth in four years. All seats grew year over year. Pricing was strong. Attrition was near its lowest level ever. Bookings for Salesforce's highest price bundles doubled. Every worry quelled. Every lie defrocked. Oh, and if Anthropic were trying to destroy Salesforce, boy, they had a funny way of showing it. Last night, Salesforce announced a major expansion of their partnership with Anthropic. They're basically embedding their platform in Claude. Here's how Anthropic CEO Dario Amadei told us. Speaker 7 (5:12) We're not interested in destroying anyone. You know, we think of this as a very positive something, right? That's the way markets work. We're creating new value here. And the question is just, you know, it's not about destroying anyone. It's about how much of these enormous gains go to various people and various companies. And our philosophy always has been that we want to work with our Speaker 3 (5:37) customers. Speaker 7 (5:39) I Speaker 3 (5:39) like that attitude. New value. Sounds good to me. Hey, what about this aspocalypse that was supposed to destroy Salesforce? Speaker 7 (5:47) We have to remember Salesforce is first and foremost in the data business. We're helping our customers to build data lakes, to integrate their data, federate their data, harmonize their data. These AI models need this level of intelligence, security, the controls for users, we call user models, sharing models. And then we put the agent model on top of that. And then this new UI, you mentioned it, Cloudforce. it can bring all of that together and release all this trapped value that enterprises have had in their systems. All can get revealed in this next generation AI user interface. Speaker 3 (6:24) And that's how you get a stock to rally more than 22 % in a single session. Salesforce started the year at $265 and changed. It dropped to $146 at the height of the AI disappointment displacement hysteria. Today it's back at $252. I don't think it's done going higher. Sasspocalypse? How about shortpocalypse? As misleading as the Sasspocalypse tale may have been, I honestly think the rumor about NVIDIA might have been worse. Here's a company that practically invented AI. Chet Simong, the pioneer behind the NVIDIA revolution, the man called Da Vinci, took his company from a couple billion dollars when it was chiefly a maker of graphics chips for PCs to $5 trillion, largest company on Earth, as it created devices that power artificial intelligence. Accelerated. Lately, though, the stock's lagged. And a lagging stock operates a lot of negative chatter. I mean, it just does. It creates it. Since May, the long knives have been out for NVIDIA, as I've said many times to you. As someone who owns both Salesforce and NVIDIA from my travel trust for what seems like forever, I heard the rumors sales were slowing. The hyperscalers, the concentrated customer base, had turned against them. The politics of data centers had turned caustic. The big builders of them bereft. Their chips were losing value, not holding on to it. And the products, including the brand new Vera Rubin semiconductor, were late. Gross margins were shrinking. And they were doing circular deals where they'd invest in their customers. in order to finance purchases, well, at least more purchases of NVIDIA chips. That was the wrap on this one. Incredibly negative people. Incredible. And what happened? What really worked? What really was the litany? Well, I'll tell you, what you just heard was entirely wrong. They know Speaker 2 (8:02) nothing! Speaker 3 (8:04) Bit of it. Hyperscalers, once so much of NVIDIA's bulk of business, are now down to 50 % of it. Sovereign buyers, neocloud infrastructure builders getting the other 50%, far less dependence on a handful of titanic clients. The chips are lasting far longer than anyone thought, maybe as long as seven years, because software updates keep them refreshed. Vera Rubin on time. Yes, the gross margins took a hit, but only because NVIDIA decided to eat some losses from Speaker 2 (8:25) skyrocketing memory prices, not their clients. Far from running away from NVIDIA by building their own chips, the hyperscalers are still embracing the king they may be doing. some stuff away from it. But Amazon Web Services plans to deploy 2 million GPUs, Speaker 3 (8:37) the kind of semi-in-media it specializes in, as well as plenty of Nvidia CPUs. Those supply deals, the circular ones, so many of them are working out because the investments held up, or more likely, increased in value. Jensen told us he wishes he'd made even bigger deals. But you gotta love him. Profits expanding Speaker 2 (8:57) for his company and perhaps just as important, also expanding for the customers. The era of profitless chip buying is over. The era of humongous profits has begun. Speaker 2 (9:07) Worst case scenario, you can just rent out all Speaker 3 (9:09) that NVIDIA computing power and make big money like Elon Musk did when he leased SpaceX's NVIDIA compute to Google and Anthropic. Most of all, it was the thing that took the stock from being down six after the close as people parsed through the earnings release to being up 10 almost the moment the call began. Speaker 2 (9:27) NVIDIA projects that they can put up 70 percent revenue growth the next fiscal year. The stream is only looking for 45 percent. And it could have been 100 percent Speaker 3 (9:34) if not for supply constraints. Remember, this is the largest company in the world by market cap, and they're expecting it to grow at a 70 percent clip. That is nothing short of astounding. Speaker 2 (9:44) Oh, and the mess over the data centers. Jensen reminds us he's not all that concerned. Speaker 4 (9:52) Taking a step back. This is America's great opportunity. This is an extraordinary opportunity. AI data centers, AI factories are generating so many jobs all across America, hundreds of thousands of jobs. They're improving communities because they're bringing a lot of tax dollars. They're bringing a lot of economy into communities. And so I hope that people take a step back and realize that this is creating jobs. It's going to re-industrialize the United States, the manufacturing sector that we've lost. over the last 50 years has an opportunity to come back. Speaker 3 (10:27) America, listen to that man, please. It's amazing to me how negative people can be right down to the last minute yesterday when the stock was selling off big until we heard that 70 % growth figure. More on that later in the show. Now, we can lament what short sellers do. I don't care. Not at all. Let them jibber jabber. Truth pull out. Here's the bottom line. The shortpocalypse hedge funds got annihilated by Salesforce and Nvidia's common stocks. If you listen to me and just own these stocks and you didn't trade them. What can I say? You had a phenomenal day. Let's take Speaker 2 (11:00) calls. Let's start with Adam in Illinois. Adam. Hi, Jim. How are you doing today? Here's a booyah for you. Oh, booyah back at you. What's going on? Speaker 8 (11:10) Well, Speaker 2 (11:11) I've been a Speaker 8 (11:12) believer in the importance of corporate leadership, just like you. And I've been very patient. But since February, what I think was a very poorly managed Paramount offer. And now with Reed Hastings no longer at the helm, I'm starting to wonder if this is really the same company I invested in. So is it time to hold, add or sell Netflix? What do