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The NVDIA stock has had a huge AI-related run over the past year while Apple has barely moved. This basically says that only a tiny bit of the AI will done on

The NVDIA stock has had a huge AI-related run over the past year while Apple has barely moved. This basically says that only a tiny bit of the AI will done on NVDIA hardware for the billions of Apple users. The market is not pricing that in.

shdh 2y ago
That's assuming Apple isn't training their models on Nvidia hardware. Inference is on Apples own silicon though.
- mupuff1234 2y ago
  Looks liked they used Google TPUs https://www.reuters.com/technology/artificial-intelligence/how-apple-used-googles-help-train-its-ai-models-2024-06-11/ https://www.reuters.com/technology/artificial-intelligence/h...
andruby 2y ago
My opinion is that the market is treating Nvidia as the shovel sellers during a gold rush. If almost every business that wants to do AI needs to buy Nvidia hardware, their sales will go through the roof. That’s what the market is pricing into the Nvidia stock. It is very unlikely that Apple will sell their “server” hardware to other businesses in that way. Their advantage is the vertical integration, for themselves. While I am bullish on AAPL, I don’t expect it to have a run like Nvidia.
- zarzavat 2y ago
  NVIDIA are not selling shovels, they are selling shovel-making machines to the shovel-sellers (the companies making foundation models). When the market is saturated with shovel-making machines, what then?
  - esmy 2y ago
    The last time I remember this happening, the shovel-making machines lost a lot of value and got amortised out to the second hand market. When the prevailing coin still mined on GPUs switched algorithms the bottom of GPU prices fell out on eBay. I expect at some point a) the training and the inference will move to even more specialised hardware and the current existing silicon go to either hobbyists or some other market that requires the current cards b) the way in which we do AI may fundamentally change in ways we can't predict, causing the required hardware to also change (move to FPGA or favouring some other aspect than VRAM) In both scenarios NVIDIA isn't the one who win, because the sudden influx lifts a secondary market nv don't profit from directly. I personally don't think they'll be able to sustain their current valuation past the current AI rush, and will compact back down to somewhere their levels pre-chatgpt. That said I'm just a guy on the Internet who wouldn't mind some beefy ex-datacentre gear if I could make it work for video editing workloads.
    - pbronez 2y ago
      Heh I am so ready to put an A100 in my homelab. Gonna take some intelligent power management though…
      - xattt 2y ago
        Have you considered running busbars from your closest pole transformer?
        pbronez 2y ago
        haha no fire hazards there! The official specs [0] say the A100 80GB has a 300W TDP. That's pretty doable on standard domestic power... harder if you want to run multiples. [0] https://www.nvidia.com/content/dam/en-zz/Solutions/Data-Center/a100/pdf/nvidia-a100-datasheet-us-nvidia-1758950-r4-web.pdf https://www.nvidia.com/content/dam/en-zz/Solutions/Data-Cent...
      - Gracana 2y ago
        Same here. My eBay watchlist always has a few in it, but the prices just aren't where I need them to be. For now I am focused on inference with a dual 3090 rig, and my next step will be to fit another pair of 3090s, which is the max I can easily support with my AM5 motherboard. What's slowing me down is the fact that I can't run server hardware due to noise, and I can't run an open-air setup because my cats would get into it, so I need to buy or build a case to hold everything.
  - ants_everywhere 2y ago
    This is totally not a space I understand. But it seems like there are possible threats to NVIDIA, such as (1) MLIR, ROCm, or some other tooling that reduces CUDA's moat, (2) AMD attracting investment to go after NVIDA (3) ARM-based GPUs or accelerators gaining traction among cloud companies that have huge fleets of AI devices and also have the money to devote to custom chips Can anyone who understands the industry explain why those threats (or similar ones) aren't a major issue for NVIDIA?
    - gmays 2y ago
      Not an expert, but can give it a shot: (1) Much development is already moving from CUDA to the LLM, so less of an issue. Nvidia is also doing more work to increase interoperability. Could be an issue I guess, but doesn't seem like it since there's nothing close to CUDA or the ecosystem. (2) AMD has attracted significant investment looking at appreciation in its market cap, with a PE ration 3X Nvidia's. However, AMD is so far behind in so many ways, I don't believe it is an investment problem, but structural. Nvidia has just been preparing for this for so long it has a temendous head start, not to mention being more focused on this. Remember AMD also competes with Intel, etc. (3) Hyperscalers already are building their own chips. It seems even Apple used its own chips for Apple Intelligence. It's relatively (which is doing a lot of lifting in this sentence because it's all HARD) not too hard to make custom chips for AI. The hard (near impossible) thing is making the cutting edge chips. And the cutting edge chips are what the OpenAIs of the world demand for training, but releasing the newest best model 1-3 months ahead of a competitors is worth so much. If anything, I'd say the biggest threat to Nvidia in the next 1-3 years is an issue with TSMC or some new paradigm that makes Nvidia's approach suboptimal.
      - ants_everywhere 2y ago
        Thanks, that was extremely helpful. I don't think I understand your point in (1) that it's less of an issue because development is moving to the LLM. I can infer that maybe CUDA isn't a big part of the moat given your other points that the hard part is making cutting edge chips.
- szvsw 2y ago
  The one area that I think Apple might be setting themself up well for is the longer term edge device AI race. It’s reasonable to think that AI will become more and more embedded in all aspects of computation and communication, and with that, it seems plausible to think that running and executing inference at the edge on devices with low power and compute capabilities relative to what’s available in the cloud will be a desirable deployment methodology - cost, bandwidth, robustness, etc etc. Obviously there’s nothing of the sort in the works now, but it’s not totally implausible to think that the expertise and infrastructure apple is developing now might be setting themselves up to also handle inference for things like home automation systems, industrial sensors and actuators, etc which may all need edge inference capabilities. Chips like the M Series or on the other side the NPU will presumably be coming to many devices outside of the mobile/pc market and it doesn’t seem totally insane to me to think that Apple might want to get into that world. Again, this is all just speculation about long term pathways that might be unlikely after all.
- itsoktocry 2y ago
  >If almost every business that wants to do AI needs to buy Nvidia hardware, their sales will go through the roof. This will undoubtably prove to be temporary. >It is very unlikely that Apple will sell their “server” hardware to other businesses in that way. The point is Nvidia isn't required.
  - fennecbutt 2y ago
    At this point, yeah for inference maybe they aren't, but we already knew this. Training is still a different story, imo.
- novok 2y ago
  IMO the fact that apple just made rack mountable apple silicon for this private cloud, their GPU / AI compute is equal to nvidia on a power/W basis, they are looking for their next revenue expansion territory from flat lining hardware growth and the fact that nvidia is worth more than them is enough of an indication that will probably make apple silicon server hardware in the near future just on a pure money making basis, even if it's not how they typically focus. They kind of lucked out with apple silicon and their unified memory architecture.
  - andruby 2y ago
    > and the fact that nvidia is worth more than them You scared me. I know the market is hyping up Nvidia hard, but if it was really worth more than Apple then things would really be crazy. AAPL market cap is still 10x NVDA’s (3.2T vs 330B), so not yet too crazy. Update: Nvda is at 3.24T. ddg “nvda market cap” shows the wrong amount. It probably doesn’t take the stock split into account. Djeez. That’s. Well, time to short.
    - fennecbutt 2y ago
      The market is hyping Nvidia because Apple doesn't have any silicon with more performance than nvidia for training... Apple silicon isn't magic.
  - fennecbutt 2y ago
    Their server hardware only does inference, not training...
iLoveOncall 2y ago
I'm sorry but that does not make any sense at all. Nvidia's stock is surging because they sell GPUs and big companies by a lot of their GPUs to train AI models. Apple's stock has not surged following the AI boom because they... don't sell GPUs used to train AI models. AI is a profit center for Nvidia and a cost center for Apple (yes, people that weren't buying iPhone won't suddenly buy an iPhone because it has an AI assistant embedded). There's absolutely no link between the two.
- jb1991 2y ago
  > people that weren't buying iPhone won't suddenly buy an iPhone because it has an AI assistant embedded > There's absolutely no link between the two. These are remarkable levels of speculation. Already I've heard from Android friends who are intrigued by the recent AI announcements that they think it would be really cool to have that in their phones. I don't know if they will necessarily switch, but they certainly indicated they were very interested in the iPhone AI announcements.
  - iLoveOncall 2y ago
    And you would need extreme short sight to not trust that GenAI on Android will be out in a year if not much earlier than that. Hell, it may come out BEFORE iOS 18. That is of course without mentioning that the only two devices compatible right now (both versions of the iPhone 15 Pro) represent a total market share of 3.1% of smartphones. AI in iPhones is essentially a distraction from the fact that Apple hasn't brought any software innovation to its devices in probably close to a decade (note I say this as someone who has only had iPhones since the 4).
    - jb1991 2y ago
      > That is of course without mentioning that the only two devices compatible right now But if you were switching platforms to iOS, you’d be getting a new phone, wouldn’t you?
  - realusername 2y ago
    > Already I've heard from Android friends who are intrigued by the recent AI announcements that they think it would be really cool to have that in their phones. Most of it has been there for Samsung already and some of them like the emoji generator look suspiciously similar. On Android, usually some large manufacturer (here Samsung) push the platform further and then some of it is integrated in stock later.
realusername 2y ago
Because nobody is going to buy iPhones in bulk just for this new AI unlike GPUs for Nvidia, it's a nice to have upgrade, not a game changer for the company.
- whiplash451 2y ago
  In the short term, you’re right. But in the long term, it totally could be a game changer.
  - Grazester 2y ago
    Apple isn't interested in anything outside their core interests. Even if they did make very specialized hardware for AI training they would not offer this to the public.
- twoodfin 2y ago
  I don’t think we’ve seen the whole story on how Apple plans to monetize what is effectively a massive, distributed AI platform. Think of all the AI startups paying OpenAI per token for consumer app capabilities. Or having to rely on suboptimal local foundation models. The value Apple can offer here is considerable. I’d expect Google is headed towards a similar architecture, and both platforms will include API monetization for third parties. I wonder if Apple’s deal with OpenAI precludes the latter from attempting to build their own hybrid platform on Apple devices…
saberience 2y ago
The reason is because people have stopped buying iPhones every year. Apple has been priced like a growth stock for a very long time but their revenues have stopped growing! (Seriously, look at their earnings reports) Now compare to Nvidia, their stock has been on an AI related run because their revenues have been MASSIVELY increasing over the past year, because they sell the most advanced chips for training and inferencing the most complex models. Apple may be “doing AI” now, but it’s for consumer products, they’re not selling enterprise AI services nor are they selling the actual chips needed to train and inference. Also, I have major doubts as to whether any of the Apple AI announcements are going to drive higher iPhone sales. There will be tech evangelists who buy a new iPhone for the AI features but the bulk of users are folk like my parents, who use their phone for calling, messaging, and taking photos. The only thing they ever noticed with new phones was either it was: 1: better camera 2: better/bigger screen 3: really obviously faster The last few phones have been indistinguishable in terms of screen, performance, or camera, and my own personal iPhone cycle went from every year or every other year, to now roughly every 3/4 years (and I’m an engineer).
- pbronez 2y ago
  Yeah. I’ve been planning to upgrade from my 12pro this fall, and I’m mostly excited to get better optical zoom and trash my lightning cables. I do think that Siri’s Generative AI upgrade (which is how I think of this whole Apple Intelligence thing) might be significant enough to change the smart phone as a segment. There are so many things that I feel Siri should be able to do, but it just can’t. Maybe this unlocks those use cases. If it does, that’s a major incentive for me to increase my investment/reliance on the Apple ecosystem. I’ll use the calendar and mail apps if it means Siri has all that context. I’ll upgrade devices to get the same answers with less perceptual lag. If we’re focused on hardware sales, I’d be interested in an Apple version of the Rabbit R1. That thing is almost a modernized iPod Touch - great device for kids you don’t trust with an unsupervised connection to the mobile internet. I would be delighted to get a Real One from Apple. The HomePod Mini is close to this already. It’s. Not clear to me how much Apple Intelligence will be available through those. Again, if it actually works I will buy more of them.
  - 2y ago

shdh 2y ago

That's assuming Apple isn't training their models on Nvidia hardware. Inference is on Apples own silicon though.

mupuff1234 2y ago
Looks liked they used Google TPUs https://www.reuters.com/technology/artificial-intelligence/how-apple-used-googles-help-train-its-ai-models-2024-06-11/ https://www.reuters.com/technology/artificial-intelligence/h...

andruby 2y ago

My opinion is that the market is treating Nvidia as the shovel sellers during a gold rush. If almost every business that wants to do AI needs to buy Nvidia hardware, their sales will go through the roof. That’s what the market is pricing into the Nvidia stock. It is very unlikely that Apple will sell their “server” hardware to other businesses in that way. Their advantage is the vertical integration, for themselves. While I am bullish on AAPL, I don’t expect it to have a run like Nvidia.

zarzavat 2y ago
NVIDIA are not selling shovels, they are selling shovel-making machines to the shovel-sellers (the companies making foundation models). When the market is saturated with shovel-making machines, what then?
- esmy 2y ago
  The last time I remember this happening, the shovel-making machines lost a lot of value and got amortised out to the second hand market. When the prevailing coin still mined on GPUs switched algorithms the bottom of GPU prices fell out on eBay. I expect at some point a) the training and the inference will move to even more specialised hardware and the current existing silicon go to either hobbyists or some other market that requires the current cards b) the way in which we do AI may fundamentally change in ways we can't predict, causing the required hardware to also change (move to FPGA or favouring some other aspect than VRAM) In both scenarios NVIDIA isn't the one who win, because the sudden influx lifts a secondary market nv don't profit from directly. I personally don't think they'll be able to sustain their current valuation past the current AI rush, and will compact back down to somewhere their levels pre-chatgpt. That said I'm just a guy on the Internet who wouldn't mind some beefy ex-datacentre gear if I could make it work for video editing workloads.
  - pbronez 2y ago
    Heh I am so ready to put an A100 in my homelab. Gonna take some intelligent power management though…
    - xattt 2y ago
      Have you considered running busbars from your closest pole transformer?
      - pbronez 2y ago
        haha no fire hazards there! The official specs [0] say the A100 80GB has a 300W TDP. That's pretty doable on standard domestic power... harder if you want to run multiples. [0] https://www.nvidia.com/content/dam/en-zz/Solutions/Data-Center/a100/pdf/nvidia-a100-datasheet-us-nvidia-1758950-r4-web.pdf https://www.nvidia.com/content/dam/en-zz/Solutions/Data-Cent...
    - Gracana 2y ago
      Same here. My eBay watchlist always has a few in it, but the prices just aren't where I need them to be. For now I am focused on inference with a dual 3090 rig, and my next step will be to fit another pair of 3090s, which is the max I can easily support with my AM5 motherboard. What's slowing me down is the fact that I can't run server hardware due to noise, and I can't run an open-air setup because my cats would get into it, so I need to buy or build a case to hold everything.
- ants_everywhere 2y ago
  This is totally not a space I understand. But it seems like there are possible threats to NVIDIA, such as (1) MLIR, ROCm, or some other tooling that reduces CUDA's moat, (2) AMD attracting investment to go after NVIDA (3) ARM-based GPUs or accelerators gaining traction among cloud companies that have huge fleets of AI devices and also have the money to devote to custom chips Can anyone who understands the industry explain why those threats (or similar ones) aren't a major issue for NVIDIA?
  - gmays 2y ago
    Not an expert, but can give it a shot: (1) Much development is already moving from CUDA to the LLM, so less of an issue. Nvidia is also doing more work to increase interoperability. Could be an issue I guess, but doesn't seem like it since there's nothing close to CUDA or the ecosystem. (2) AMD has attracted significant investment looking at appreciation in its market cap, with a PE ration 3X Nvidia's. However, AMD is so far behind in so many ways, I don't believe it is an investment problem, but structural. Nvidia has just been preparing for this for so long it has a temendous head start, not to mention being more focused on this. Remember AMD also competes with Intel, etc. (3) Hyperscalers already are building their own chips. It seems even Apple used its own chips for Apple Intelligence. It's relatively (which is doing a lot of lifting in this sentence because it's all HARD) not too hard to make custom chips for AI. The hard (near impossible) thing is making the cutting edge chips. And the cutting edge chips are what the OpenAIs of the world demand for training, but releasing the newest best model 1-3 months ahead of a competitors is worth so much. If anything, I'd say the biggest threat to Nvidia in the next 1-3 years is an issue with TSMC or some new paradigm that makes Nvidia's approach suboptimal.
    - ants_everywhere 2y ago
      Thanks, that was extremely helpful. I don't think I understand your point in (1) that it's less of an issue because development is moving to the LLM. I can infer that maybe CUDA isn't a big part of the moat given your other points that the hard part is making cutting edge chips.
szvsw 2y ago
The one area that I think Apple might be setting themself up well for is the longer term edge device AI race. It’s reasonable to think that AI will become more and more embedded in all aspects of computation and communication, and with that, it seems plausible to think that running and executing inference at the edge on devices with low power and compute capabilities relative to what’s available in the cloud will be a desirable deployment methodology - cost, bandwidth, robustness, etc etc. Obviously there’s nothing of the sort in the works now, but it’s not totally implausible to think that the expertise and infrastructure apple is developing now might be setting themselves up to also handle inference for things like home automation systems, industrial sensors and actuators, etc which may all need edge inference capabilities. Chips like the M Series or on the other side the NPU will presumably be coming to many devices outside of the mobile/pc market and it doesn’t seem totally insane to me to think that Apple might want to get into that world. Again, this is all just speculation about long term pathways that might be unlikely after all.
itsoktocry 2y ago
>If almost every business that wants to do AI needs to buy Nvidia hardware, their sales will go through the roof. This will undoubtably prove to be temporary. >It is very unlikely that Apple will sell their “server” hardware to other businesses in that way. The point is Nvidia isn't required.
- fennecbutt 2y ago
  At this point, yeah for inference maybe they aren't, but we already knew this. Training is still a different story, imo.
novok 2y ago
IMO the fact that apple just made rack mountable apple silicon for this private cloud, their GPU / AI compute is equal to nvidia on a power/W basis, they are looking for their next revenue expansion territory from flat lining hardware growth and the fact that nvidia is worth more than them is enough of an indication that will probably make apple silicon server hardware in the near future just on a pure money making basis, even if it's not how they typically focus. They kind of lucked out with apple silicon and their unified memory architecture.
- andruby 2y ago
  > and the fact that nvidia is worth more than them You scared me. I know the market is hyping up Nvidia hard, but if it was really worth more than Apple then things would really be crazy. AAPL market cap is still 10x NVDA’s (3.2T vs 330B), so not yet too crazy. Update: Nvda is at 3.24T. ddg “nvda market cap” shows the wrong amount. It probably doesn’t take the stock split into account. Djeez. That’s. Well, time to short.
  - fennecbutt 2y ago
    The market is hyping Nvidia because Apple doesn't have any silicon with more performance than nvidia for training... Apple silicon isn't magic.
- fennecbutt 2y ago
  Their server hardware only does inference, not training...

iLoveOncall 2y ago

I'm sorry but that does not make any sense at all. Nvidia's stock is surging because they sell GPUs and big companies by a lot of their GPUs to train AI models. Apple's stock has not surged following the AI boom because they... don't sell GPUs used to train AI models. AI is a profit center for Nvidia and a cost center for Apple (yes, people that weren't buying iPhone won't suddenly buy an iPhone because it has an AI assistant embedded). There's absolutely no link between the two.

jb1991 2y ago
> people that weren't buying iPhone won't suddenly buy an iPhone because it has an AI assistant embedded > There's absolutely no link between the two. These are remarkable levels of speculation. Already I've heard from Android friends who are intrigued by the recent AI announcements that they think it would be really cool to have that in their phones. I don't know if they will necessarily switch, but they certainly indicated they were very interested in the iPhone AI announcements.
- iLoveOncall 2y ago
  And you would need extreme short sight to not trust that GenAI on Android will be out in a year if not much earlier than that. Hell, it may come out BEFORE iOS 18. That is of course without mentioning that the only two devices compatible right now (both versions of the iPhone 15 Pro) represent a total market share of 3.1% of smartphones. AI in iPhones is essentially a distraction from the fact that Apple hasn't brought any software innovation to its devices in probably close to a decade (note I say this as someone who has only had iPhones since the 4).
  - jb1991 2y ago
    > That is of course without mentioning that the only two devices compatible right now But if you were switching platforms to iOS, you’d be getting a new phone, wouldn’t you?
- realusername 2y ago
  > Already I've heard from Android friends who are intrigued by the recent AI announcements that they think it would be really cool to have that in their phones. Most of it has been there for Samsung already and some of them like the emoji generator look suspiciously similar. On Android, usually some large manufacturer (here Samsung) push the platform further and then some of it is integrated in stock later.

realusername 2y ago

Because nobody is going to buy iPhones in bulk just for this new AI unlike GPUs for Nvidia, it's a nice to have upgrade, not a game changer for the company.

whiplash451 2y ago
In the short term, you’re right. But in the long term, it totally could be a game changer.
- Grazester 2y ago
  Apple isn't interested in anything outside their core interests. Even if they did make very specialized hardware for AI training they would not offer this to the public.
twoodfin 2y ago
I don’t think we’ve seen the whole story on how Apple plans to monetize what is effectively a massive, distributed AI platform. Think of all the AI startups paying OpenAI per token for consumer app capabilities. Or having to rely on suboptimal local foundation models. The value Apple can offer here is considerable. I’d expect Google is headed towards a similar architecture, and both platforms will include API monetization for third parties. I wonder if Apple’s deal with OpenAI precludes the latter from attempting to build their own hybrid platform on Apple devices…

saberience 2y ago

The reason is because people have stopped buying iPhones every year. Apple has been priced like a growth stock for a very long time but their revenues have stopped growing! (Seriously, look at their earnings reports) Now compare to Nvidia, their stock has been on an AI related run because their revenues have been MASSIVELY increasing over the past year, because they sell the most advanced chips for training and inferencing the most complex models. Apple may be “doing AI” now, but it’s for consumer products, they’re not selling enterprise AI services nor are they selling the actual chips needed to train and inference. Also, I have major doubts as to whether any of the Apple AI announcements are going to drive higher iPhone sales. There will be tech evangelists who buy a new iPhone for the AI features but the bulk of users are folk like my parents, who use their phone for calling, messaging, and taking photos. The only thing they ever noticed with new phones was either it was: 1: better camera 2: better/bigger screen 3: really obviously faster The last few phones have been indistinguishable in terms of screen, performance, or camera, and my own personal iPhone cycle went from every year or every other year, to now roughly every 3/4 years (and I’m an engineer).

pbronez 2y ago
Yeah. I’ve been planning to upgrade from my 12pro this fall, and I’m mostly excited to get better optical zoom and trash my lightning cables. I do think that Siri’s Generative AI upgrade (which is how I think of this whole Apple Intelligence thing) might be significant enough to change the smart phone as a segment. There are so many things that I feel Siri should be able to do, but it just can’t. Maybe this unlocks those use cases. If it does, that’s a major incentive for me to increase my investment/reliance on the Apple ecosystem. I’ll use the calendar and mail apps if it means Siri has all that context. I’ll upgrade devices to get the same answers with less perceptual lag. If we’re focused on hardware sales, I’d be interested in an Apple version of the Rabbit R1. That thing is almost a modernized iPod Touch - great device for kids you don’t trust with an unsupervised connection to the mobile internet. I would be delighted to get a Real One from Apple. The HomePod Mini is close to this already. It’s. Not clear to me how much Apple Intelligence will be available through those. Again, if it actually works I will buy more of them.
- 2y ago