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AI might be a bubble, but Nvidia seems like they are in a decent spot going forward? Programmers have gotten pretty good at hiding latency nowadays and Nvidia

AI might be a bubble, but Nvidia seems like they are in a decent spot going forward? Programmers have gotten pretty good at hiding latency nowadays and Nvidia makes the most popular high-throughput devices, and has an utterly dominant software ecosystem for those types of devices. Meanwhile Intel continues to fumble. AMD actually doing pretty ok on the hardware side, but their software ecosystem is not great. Who’s going to compete with Nvidia? Apple, lol?

Jensson 2y ago
The total GPU producer valuation ballooned 10x the past few years, even if NVIDIA captures the entire market the valuation still isn't warranted unless the market massively grows going forward.
- paulmd 2y ago
  Narrator: the market grew massively going forward. Again, that’s why you see these periodic mining bubbles, AI bubbles, etc, as various fields discover their killer app for gpgpus. You should stop calling them mining bubbles or whatever and just call them what they really are: “dense compute surge demand”.
  - bee_rider 2y ago
    Yeah, it seems extremely rare that someone will say, “finally, we’ve discovered a way to run this previously GPGPU-centric algorithm on a CPU!”
constantcrying 2y ago
If an AI bubble exists and it bursts, Nvidia will loose a massive amount of customers. I have no doubt that they can survive, but they will still suffer from a massive financial hit. >Who’s going to compete with Nvidia? You know what is the surest way for a market leading company to go bankrupt? Pretending that the current situation is inevitable and no competitor will ever try to challenge them.
boringg 2y ago
I mean it depends what you mean by decent spot going forward. If you mean that their equity will continue to grow and trade at its current valuations I find that one tough to swallow (i.e. I wouldn't buy it right now). Right now the P/E isn't terrible but its under the assumption that their chipsets continue to be the dominant chipset and that all the major tech companies keep buying them at the volumes that they currently do - seems unlikely to me. Now a good place to work for a company that will be around for a long time -- sure safe bet there.
latchkey 2y ago
AMD is working hard on the software side of things. A great example of this is how when llama3 was released it was day zero was optimized for mi300x. Another example is the cadence / value of ROCm releases.
HDThoreaun 2y ago
At the end of the day compute is a commodity. The cloud hyperscalers will buy whatever product 1. meets their needs, and 2. is cheapest. As soon as a competitor releases a product that meets their needs its a race to the bottom in terms of pricing. I just cant see a world where Nvidia never sees meaningful competition.
paulmd 2y ago
Apple, and I think the other dark horse is Sony. The problem has always been ecosystem and these are the only 3 platforms that anyone is in organically because they actually want to be there. Being a compiler target for someone else’s ecosystem is not a moat. Being a compatible clone of someone else’s ecosystem is not a most. Nvidia has spent 15 years building out cuda and seeding it into key places, at enormous expense. Apple has the best laptop hardware on the planet and a significantly underappreciated degree of traction among tech enthusiasts and makers that is going to pay long-term dividends if apple can simply avoid rocking the boat. Sony, similarly, has a successful history and culture of proprietary ecosystem and API usage, and studios are onboard with using it. PS5 Pro might as well come with an RTX sticker given the headline focus on RT and AI upscaling, and I think people are underestimating the degree to which this is going to give Sony an early-mover advantage in shaking out applications of AI in the gaming space. You know the nemesis system patents… they’re well-positioned for squatting patents on key ideas that shake out early.

Jensson 2y ago

The total GPU producer valuation ballooned 10x the past few years, even if NVIDIA captures the entire market the valuation still isn't warranted unless the market massively grows going forward.

paulmd 2y ago
Narrator: the market grew massively going forward. Again, that’s why you see these periodic mining bubbles, AI bubbles, etc, as various fields discover their killer app for gpgpus. You should stop calling them mining bubbles or whatever and just call them what they really are: “dense compute surge demand”.
- bee_rider 2y ago
  Yeah, it seems extremely rare that someone will say, “finally, we’ve discovered a way to run this previously GPGPU-centric algorithm on a CPU!”

constantcrying 2y ago

If an AI bubble exists and it bursts, Nvidia will loose a massive amount of customers. I have no doubt that they can survive, but they will still suffer from a massive financial hit. >Who’s going to compete with Nvidia? You know what is the surest way for a market leading company to go bankrupt? Pretending that the current situation is inevitable and no competitor will ever try to challenge them.

boringg 2y ago

I mean it depends what you mean by decent spot going forward. If you mean that their equity will continue to grow and trade at its current valuations I find that one tough to swallow (i.e. I wouldn't buy it right now). Right now the P/E isn't terrible but its under the assumption that their chipsets continue to be the dominant chipset and that all the major tech companies keep buying them at the volumes that they currently do - seems unlikely to me. Now a good place to work for a company that will be around for a long time -- sure safe bet there.

latchkey 2y ago

AMD is working hard on the software side of things. A great example of this is how when llama3 was released it was day zero was optimized for mi300x. Another example is the cadence / value of ROCm releases.

HDThoreaun 2y ago

At the end of the day compute is a commodity. The cloud hyperscalers will buy whatever product 1. meets their needs, and 2. is cheapest. As soon as a competitor releases a product that meets their needs its a race to the bottom in terms of pricing. I just cant see a world where Nvidia never sees meaningful competition.

paulmd 2y ago

Apple, and I think the other dark horse is Sony. The problem has always been ecosystem and these are the only 3 platforms that anyone is in organically because they actually want to be there. Being a compiler target for someone else’s ecosystem is not a moat. Being a compatible clone of someone else’s ecosystem is not a most. Nvidia has spent 15 years building out cuda and seeding it into key places, at enormous expense. Apple has the best laptop hardware on the planet and a significantly underappreciated degree of traction among tech enthusiasts and makers that is going to pay long-term dividends if apple can simply avoid rocking the boat. Sony, similarly, has a successful history and culture of proprietary ecosystem and API usage, and studios are onboard with using it. PS5 Pro might as well come with an RTX sticker given the headline focus on RT and AI upscaling, and I think people are underestimating the degree to which this is going to give Sony an early-mover advantage in shaking out applications of AI in the gaming space. You know the nemesis system patents… they’re well-positioned for squatting patents on key ideas that shake out early.