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Nearly half of Nvidia's revenue comes from four mystery whales each buying $3B+
- jmclnx 2y agoGoing to be ugly when the AI bubble busts
- kergonath 2y agoIt feels suspiciously like it’s 1999 all over again.
- olderthandang 2y agoNo it doesn't. The economy then was actually good.
- deepfriedchokes 2y agoAnd housing was cheap and plentiful.
- kergonath 2y agoNot really compared to 1974, though. And I am sure in 25 years time we will be complaining about how good we had it in 2024.
- ThunderSizzle 2y agoIf 2024 is the high point for a quarter century, we really are going to rock bottom as a world.
- mbreese 2y agoMore like the AI winter from the late 80s.
- GaggiX 2y agoIf by "AI winter" you mean a period where AI will continue to be used for semantic search, moderation, translation, captioning, TTS, STT, context-aware grammar checking, LLM, and audio/image classification, then yes, it would be an "AI winter" where AI is used everywhere.
- mbreese 2y agoI meant specifically the time in the late 80s when investment in AI collapsed because it was overhyped and caused the downfall of Lisp Machines. The AI field itself kept moving forward, but investment and grant funding was cut to almost nothing for a long time. It took a long time for the field to get to where it is now, but the hype cycle has been going back and forth for decades in AI. https://en.m.wikipedia.org/wiki/AI_winter https://en.m.wikipedia.org/wiki/AI_winter
- GaggiX 2y agoI know well what the 80's AI winter is, the next one will have AI used everywhere if it's going to happen.
- hn_throwaway_99 2y agoI totally agree, but I feel like some comments are making the mistake of stating "this bubble will pop, which means it was all smoke and mirrors to begin with". The dot com bubble popped, but it's not like the Internet technologies that were launched then (and companies like Amazon and Google) weren't hugely impactful on all of society since then. I think the AI bubble will pop, and while I think there is a lot of nonsense hype about AI I still think AI's societal impact will only grow.
- philistine 2y agoNo one who is saying the bubble will pop thinks there is nothing behind it. That’s the definition of a bubble: you always need soap and water to make it, but soap and water are commodities, not this special unicorn that will change the world.
- gitfan86 2y agoBeanie Babies, Tulips, NFTs, Web3 tokens were all obviously not going to change the world. The bubble was pure emotion and greed. All the cash inflows were speculation. Nvidia made 18 billion in profit last quarter, and expects to make 20 next quarter. That isn't speculation.
- noirbot 2y agoI mean, how much money did the NFT companies and Tulip vendors make? Nvidia isn't OpenAI. They're selling products that the bubble is built on, not the bubble itself. How much money is OpenAI or Anthropic making? Because that's what people are thinking is speculative value. My position has always been that Gemini/ChatGPT/Claude are all pretty great at a cost of Free, and grow increasingly questionable past that. My work is already limiting how many ChatGPT users we can afford with their price increases, and I'm pretty sure OpenAI is still not profitable. If ChatGPT is $50/month as a breakeven cost for them, how many people/companies will buy it then? Most jobs I've been at won't pay for JetBrains licenses that cost way less per head. I feel like the best comparison is something like Uber or AirBnB where it's easy to be excited about it when all the services are crazy discounted by free VC money, but when they have to start turning a profit, they're back to actually competing with other tools.
- Bud 2y ago[dead]
- stoperaticless 2y agoI’s going to be nice to get cheap gpu.
- Ekaros 2y agoThey might even put reasonable amount of RAM on reasonably priced models... Why can I not get 16GB on some 700€ gaming cpu... I can get CPU+Mobo+32GB ram for around same... I just hope this intentional kneecapping ends so I can get something that can be used for a few years.
- HDThoreaun 2y agoMargins on datacenter GPUs will probably always be better than consumer. As long as thats the case they need to segment to stop datacenters from using consumer products so I've got a feeling that you will never be able to buy a consumer nvidia product with a reasonable amount of RAM. Maybe intel will release one to get some hype for their gpu line?
- loa_in_ 2y agoDoes that mean that datacenter hardware might be a cost wise option for making a home lab PC soon?
- HDThoreaun 2y agoProbably better to just throw your workload on the cloud unless you're using it close to 24/7.
- philistine 2y agoA GPU is an accessory to the real product you’re buying: a driver to interface with your software. Datacenter GPUs have drivers that are woefully inadequate for gaming.
- gopher_space 2y agoI’m just thinking that maybe trading a decent used sedan for a slightly shinier ARPG isn’t the wisest move I could be making.
- eli_gottlieb 2y agoIt's going to rock for gamers.
- marcosdumay 2y agoI wouldn't bet in bulk computation not being in high demand for the foreseeable future. If the AI bubble bursts, people will use the available GPUs for something else.
- hn_throwaway_99 2y ago> If the AI bubble bursts, people will use the available GPUs for something else. Yes, of course, but that just means that this bubble would be basically identical to previous capital intensive bubbles. For example, there was a railroad bubble in the 1800s, and a massive telecom bubble in the late 90s. These bubbles popped, resulting in massive corporate bankruptcies and failed companies. But the infrastructure they built (miles and miles of railroad and dark fiber, which has since been lit up) laid the foundation for huge economic development shortly thereafter.
- marcosdumay 2y agoThe relevant part is that no, the steel industry didn't break when the railroad bubble burst. Nvidia is not the train company on that scenario.
- philistine 2y agoThe railroad built during the bubble in the 1800s, like 90% of it is decommissioned. It served no sustainable economic benefit, as most of it was last mile railroad that quickly got consolidated into trunks. If the US had maintained and kept the rail it built, it wouldn’t have the poor infrastructure it has right now.
- bogwog 2y agoI hope the bankruptcies start soon so I can buy me some H200s for cheap on eBay
- 2OEH8eoCRo0 2y agoIt's a shame all this compute is being built and none will trickle down. It would be fun to hack on this stuff as a hobbyist once it's sold for peanuts.
- wmf 2y agoI assume used V100/P100s are on eBay. Go buy them and report back.
- Zamicol 2y agoI'm confused by this sentiment I've seen repeated by some. AI/LLMs are radically expanding my abilities, and as I adapt to this new power, I'm using it more frequently in everyday life. Sure, Nvidia stock may be overpriced, but AI is empowering. I can't imagine not continuing to expand its use. As its abilities expand, I'll use it even more. I will have much further use even as a few bugs are fixed and integrations become more frictionless.
- tail_exchange 2y agoProbably because not everybody is feeing this productivity boost. AI made me a bit more productive, yes, but not by that much. Seeing you call it a "new power" is not relatable, so it may reinforce ideas that it is a bubble.
- VirusNewbie 2y agoRight but I feel similarly about excel/sheets and powerpoint. But they make almost every office worker a bit more productive, so it’s a good market.
- tail_exchange 2y agoI think these can both be true. If AI makes people be 3% more productive overall, cumulatively that's a huge improvement, but on an individual level it may feel undeserving of hype.
- m463 2y agoThat seems like saying "web advertising never shows me what I want to buy" Maybe it is not for you. Maybe it is for people asking AI questions about you. (or chemistry or gold prospecting or legal documents or ...) the eric schmidt talk made it seem like better hardware led to better results and there was a race.
- edanm 2y ago> Seeing you call it a "new power" is not relatable, so it may reinforce ideas that it is a bubble. Whereas what it could be reinforcing instead is that some people are better at "using AI" than others. When I was young, I always saw how my parents never really "got" new technology that I was using all the time, like the internet. Many young people think about it and are sure it won't happen to them. I'm sure many on this technophile site think so. And then a new technology like AI comes along, some people find ways to be incredibly productive with it, but a very widespread sentiment is that they're... lying? Mistaken? Not very good at their job so it helps them more? The number of excuses people have for "keep this new technology that I don't know how to use away for me" is pretty crazy. (And I say this as someone who is probably not on the "cutting edge" of AI usage, compared to others I see.)
- IshKebab 2y agoHow is it going to burst exactly? Are ChatGPT and Google Assistant going to suddenly stop working?
- pas 2y agogrowth stops, investments stop, projects and orderds get cancelled, consolidation happens, unused stock shows up on the secondary market which puts a downward pressure on unit prices of nvidia datacenter GPUs
- cdelsolar 2y agoThere’s no such thing as an AI bubble. That’s like saying, going to be ugly when the car bubble bursts, back in the early 1900s.
- saurik 2y agoSo, I feel like your arguments is "AI is useful, like cars, so there won't be a bubble"; but like, I think we must all agree that the Internet is useful, and yet there certainly was the ".com bubble". We've occasionally had real estate bubbles, and I do in fact believe there was a car bubble in the early 1900s during the 20s?
- m463 2y agois it a bubble? or is the singularity? (only half joking)
- worstspotgain 2y agohttps://archive.is/zHMO5 https://archive.is/zHMO5
- worstspotgain 2y ago> Although the names of the mystery AI whales are not known, they are likely to include Amazon, Meta, Microsoft, Alphabet, OpenAI, or Tesla. I hope they're not saving their best chips for the likes of Tesla/Grok. That'd be a PR nightmare if and when it leaks.
- transcriptase 2y agoYeah, can you imagine a business selling to the bad space man. Don’t they know they’re supposed to hate him?
- kergonath 2y agoWell, he is known for stiffing his contractors and creditors.
- IncreasePosts 2y agoNo, he isn't.
- albumen 2y agoDid he end up paying all these guys? https://arstechnica.com/tech-policy/2023/09/musks-unpaid-bills-dozens-of-lawsuits-try-to-force-twitter-aka-x-to-pay-up/ https://arstechnica.com/tech-policy/2023/09/musks-unpaid-bil...
- IncreasePosts 2y agoWhether he did or not is not the same as saying he is "known for it". If you asked 1000 random people to say what they know about Elon musk, what percent do you think will say "oh. You mean the guy that doesn't pay vendors!" Also. What is the base rate for contract disputes with vendors among large companies? He runs 3 large companies, surely with tens of thousands of contracts for services. There will always be disputes there - is his rate higher than average? Does he lose very dispute in court?
- rsynnott 2y agoOkay, I mean I feel like they’re not that mysterious. Like, there are probably only five or six candidates.
- kergonath 2y agoAnd regardless of who the 4 are, the two others in that list of six candidates are most likely not too far behind.
- gpm 2y agoThe most interesting thing to discover would be if one of them is that far behind, because they're succeeding on their own/someone not-Nvidia's silicon. The public in-house projects that I'm aware of (but as far as I know haven't fully replaced demand for Nvidia GPUs) include: - Google's "TPU" (in production, publicly rentable) - Amazon/AWS's "Trainium" (in production, publicly rentable) - Meta's "MTIA" (in production) - Microsoft's "Maia 100" (I'm unclear on their status) - Tesla's "D1" (I'm unclear on their status)
- HarHarVeryFunny 2y agoxAI 100K H100 cluster would be ~$2B Is this trailing year NVIDIA sales, or order book ?
- jsnell 2y agoThe numbers in the article? They're neither. They're the revenue for just Q2, not the full trailing year.
- jsheard 2y agoAre these distinct architectures, or is it an ARM situation where nearly everyone is gluing the same IP cores together in slightly different configurations?
- taktoa 2y ago
- jmathai 2y agoIt will be interesting to see how AI opportunities evolve and if open source models will play the same role as the public infrastructure of the dotcom boom did. Or if closed models will dominate. For example, by the largest companies leveraging their existing distribution channels and/or acquiring promising startups.
- kuon 2y agoI have a few of my customers using AI and they are asking me to build self owned AI server running open source models. With about $20k you can have your own little AI beast and do a lot with it. They do this because proprietary AI models are not flexible enough and are lacking a lot of API. For example, one app I wrote was to analyze scans of old maps and use generative AI to extrapolate and create animations. I don't know where the market will go. But my feeling is that large proprietary models are very good at a very limited type of work and that open source will provide diversity.
- djaouen 2y agoThe consolidation of progress into the hands of a few should be fought against at (almost any) cost. Run Linux!!
- ant6n 2y agoBut the how will I run MS Teams, office365 and OneDrive? (I’m only partially kidding, sigh…)
- dgfitz 2y agoIf you’re serious, they all have web apps. I use them on my linux box all the time. Ripped the certs off my corp. laptop.
- tomrod 2y agoTeams: several options Office 365: several options OneDrive: several options Check out https://github.com/awesome-selfhosted/awesome-selfhosted https://github.com/awesome-selfhosted/awesome-selfhosted
- matrix2003 2y ago95% of corporate environments: 1-2 options. Windows or macOS for the chosen few. At least the overloads I have worked for don’t allow us access unless the machine is locked down so hard that it’s borderline unusable.
- matrix2003 2y agoI’m past the edit time, but “unless” should be “and”
- tomrod 2y agoWord on the street is that port 53 tends to stay open. YMMV.
- softwaredoug 2y agoThose whales - probably major cloud vendors - likely have the resources to develop their own hardware at some point. Right now it’s “buy GPUs at any cost”. If things slow, there will be a chance for these customers to consider how to optimize this cost. NVIDIA can’t sit on its laurels like Intel did with x86.
- HDThoreaun 2y agoGoogle did this a decade ago. Amazon has a CPU but I think no GPU yet although Im sure its being worked on. The problem for them is the CUDA moat. Their hardware is mostly used for inference because no one trains on non-nvidia hardware.
- JoshTriplett 2y ago> The problem for them is the CUDA moat. Compared to the problem of developing a new cutting-edge GPU, building a CUDA compatibility layer is a much smaller problem. Hire the author of ZLUDA, throw a small team at it, and have a legal department on standby. And separately, there'd also be value in some source-translation projects to help people migrate to some better native framework.
- vidarh 2y agoBoth in terms of hardware and software, they need to be able to support the small set of operations that their training or inference uses, so the problem on both sides is much smaller than both a full GPU and a full CUDA replacement.
- codedokode 2y agoWhy support proprietary libraries? Isn't it better to make an open-source library. Also as for AMD, as I understand, they are unwilling to make ML libraries for consumer-grade GPUs and GPUs built into CPUs.
- JoshTriplett 2y ago
- stevebmark 2y agoPretty good indicator of the nonsense hype bubble of AI!
- dboreham 2y agoI'm AI-positive (now), but yes this sounds like a chip bubble. NVIDIA seem to be good at chasing these bubbles -- first crypto mining, now AI. It wouldn't surprise me to find one of the major buyers is a speculator (hedge fund led by crypto bros, for example).
- findthewords 2y agoI've seen gluts not followed by shortages, but I've never seen a shortage not followed by a glut. - Nassim Nicholas Taleb, Twitter, 2021-09-11 https://x.com/nntaleb/status/1436776641536090117 https://x.com/nntaleb/status/1436776641536090117
- cdchn 2y agoI'm crypto bearish and AI-neutral but it seems less to me like NVIDIA chasing bubbles and more like new and interesting applications for the type of compute that NVIDIA offers keep emerging.
- qwertox 2y agoIt's not like AI hasn't been delivering during these past 3 years, and it's just getting started. There's no one stealing market share from Nvidia at the moment. Groq and Tenstorrent are extremely promising, but both are still private companies. Once Groq goes public, Nvidia will tank a bit for a while while all the "experts" announce the end of Nvidia. I wouldn't be surprised if then Nvidia would then also sell specialized AI accelerators, if they find that segment attractive enough due to losses in general GPU demand created by those companies.
- philistine 2y agoWhat has it been delivering? Who’s making money from this stuff? To quote Steve Jobs when talking to Dropbox: you guys don’t have a product, you have a feature.
- Lammy 2y agoNSA are surely one of them.
- dgfitz 2y agoThe amount of ignorance surrounding that agency on this forums is truly astounding.
- Lammy 2y agoHoid it through the grapevine
- mepian 2y agoThey were one of the first HDTV customers, along with NGIA and NRO.
- jajko 2y agoDon't they outsource work to places like Palantir? Although I can easily imagine bosses of these 3 letter agencies scrambling over each other in another glorious fit of FOMO in their internal race of 'who can model every single human on earth better'
- alephnerd 2y agoTLAs procure indirectly for obfuscation and regulatory reasons. They wouldn't directly make purchases at this size.
- deepsquirrelnet 2y agoI think Meta has been pretty transparent about their GPU purchases[1]. 350k H100s should go pretty far into the billions. https://blogs.nvidia.com/blog/meta-llama3-inference-acceleration/ https://blogs.nvidia.com/blog/meta-llama3-inference-accelera...
- RiverCrochet 2y agoLet's play "Guess the whales!" N _ _ _ B _ _ _ A _ H _
- asah 2y agolow quality discussion, lots of ignorant speculation... I wonder if there's a way to analyze HN discussions to measure "quality" ?
- 2OEH8eoCRo0 2y agoWould it be legal for Jensen to be one of them?
- yieldcrv 2y agoFun note, you can structure options and “RSUs” with allocations of products, RSU in quotes because the S stands for stock and you wont be giving shares One benefit of non-securities underlying assets is that you can play with their pricing a lot more. like, you can have your friends vesting on some shoes you control the issuance of - or GPUs in this case - at a 99% discount and there’s no reporting or regulation to a government over this. Big problem to do that with shares.
- wmf 2y agoThere's zero evidence of this. He's cashing out $1B per year but round-tripping that money back into Nvidia would just cause problems for him.
- potatoman22 2y agoI'm curious, why would he be one of them?
- brcmthrowaway 2y agoIt'd be crazy of one of them is RenTech
- linotype 2y agoI’m kind of shocked that we’re not seeing any new consumer GPU products from them. It’s like they’re content to just give that market away to AMD.
- jsheard 2y agoRumor is that AMDs RDNA4 will only span the low-to-mid range with no new flagship until RDNA5, so if anything they are the ones ceding the (high end) market to Nvidia.
- wmf 2y agoNvidia is on a two-year schedule and the 5090 should launch later this year.
- linotype 2y agoWhat about more affordable cards? Early 2025?
- danjl 2y agoStandard rollout process for the rest of the year as like the last generations
- ruune 2y agoLooking at the release dates from RTX 4000 [0] it's likely, yes [0] https://en.wikipedia.org/wiki/GeForce_40_series https://en.wikipedia.org/wiki/GeForce_40_series
- wmf 2y agoHonestly, I predict none of the cards will be affordable.
- xboxnolifes 2y agoDefine affordable. What minimum specs and what price point?
- nabla9 2y ago
- toruser44 2y ago[flagged]
- greenthrow 2y agoVery sustainable, very cool. Awesome market economy we have guys.
- andsoitis 2y agoAccording to Observer they are: Microsoft, Meta, Google, and Amazon. Other big buyers area: Oracle, CoreWeave, Lambda, Tencent, Baidu, Alibaba, ByteDance, Tesla, xAI. https://observer.com/2024/06/nvidia-largest-ai-chip-customers/ https://observer.com/2024/06/nvidia-largest-ai-chip-customer...
- thereisnospork 2y agoKind of embarrassing for Google to be on that list, no? Shouldn't their in-house TPUs be cost-advantageous for them?
- bayindirh 2y agoNo, because GPUs are not only for AI. They are MATMUL machines, and MATMUL is useful way beyond AI and tensor applications. Some of us use them at double precision mode.
- lolinder 2y agoYes, but demand for these chips went through the roof because of AI. If Google is on this list it's because they're using them for AI, not because they've got a secret project rendering an insane number of 3D images or something.
- bayindirh 2y agoEverything from material simulation to weather forecasts use GPUs very actively and effectively, for a long time. There’s a whole world using GPUs to accelerate things.
- lolinder 2y agoRight, I'm not arguing against that. I'm saying that Meta and Amazon and Microsoft are all buying these chips in insane numbers for AI—their usage for all other types of GPU activity is at least an order of magnitude less. That's why Nvidia skyrocketed to become the most valuable company over just a few years. For Google to be on that short list of whales would either mean that they for some reason have a much larger demand for GPUs for non-AI purposes than any of the others have for AI purposes (doubtful) or that they're using GPUs for AI.
- bluecalm 2y agoFrom what I remember public companies have to disclose any customer responsible for more than 10%+ of their revenue on their 10-K so those won't be "mystery whales" for long.
- ballenf 2y agoSurely an intelligence agency or two would be big buyers. They could lease but that might have security implications they're not comfortable with.
- bfung 2y agoClickbait title. Even the article cites the number from Jensen’s interview. https://youtu.be/NC5NZPrxbHk?si=8uQ4zdMU02f4X1Hc https://youtu.be/NC5NZPrxbHk?si=8uQ4zdMU02f4X1Hc (at 1:41) Hyperscalers & Meta. (Corp speak 101: Hyperscalers = AWS, GCP, Azure)
- uptownfunk 2y agoWhat happens when the new models come out and the data centers are full of old models to be decommissioned. Would love to buy a huge amount of h200 once they have become “obsolete”
- Havoc 2y agoYeah planning to get out of NVIDIA shares after Blackwell. There is also an alarming (as shareholder) rise in custom silicon. Groq sambanova cerebus etc.
- gradus_ad 2y agoTwo questions that need answering: 1. Are chatbots going to get much more effective than they already are? It seems like all the major players are plateauing and the different models are becoming commoditized. That doesn't bode well for sustainable GPU sales. Also if the hallucination problem can't be solved, it's not clear that this generation of AI will ever be deployable at scale. 2. Are there genuine at scale use cases for AI outside of LLM's? Autonomous navigation seems like a major one, but I'm not sure how close that is to production ready. I know drug discovery and other applications are talked about, but not sure how much GPU consumption they can realistically generate. As we leave the novelty phase of the adoption curve, it's clear that a lot of the use of the image generators was unsustainable experimentation. My personal experience has been, a year ago my friends were creating tons of images but now we hardly do at all.
- deleted 2y ago[deleted]
- krasin 2y ago> Are there genuine at scale use cases for AI outside of LLM's Assuming that "outside of LLMs" means "outside of text processing". Yes. Robotics. Imitation learning with LLMs is working surprisingly well. It will require a lot of investments in data and training to get to a practical state, but all the early signs point that new revenue streams will be unlocked in Robotics. One limitation that still stands on the way is the inference speed. My estimate is that we need ~10k tokens/sec prompt processing speed to get these smart robots working reasonably fast. We're getting there for 8B models (Groq & Cerebras silicon), but these 8B models are too dumb (especially, after being finetuned on robotics data), and 70B models are still 20x slower than practical.
- aucisson_masque 2y ago> Nvidia's net income margins are staggeringly high, with $5.60 out of every $10 of revenue Competition when ? Are amd, Intel or other companies in the situation to be able to eat some of nvidia insane margin ?
- bob1029 2y agoGoing after this exact market is potentially a fool's errand. AMD and Intel would probably be better off researching entirely different approaches that they can leverage their existing expertise for - i.e., some architecture that relies heavily on efficient OoO processing pipelines and free (if predicted correctly) control flow changes. Techniques that are antagonistic to GPU processing could represent a competitive moat. Joining an existing rabbit chase right in the middle can quickly evolve into a catastrophic strategic choice when the cost of entry is billions of dollars.
- aucisson_masque 2y agoYour comment relies on the theory that a.i. is a bubble. What if companies still keep buying insane amount of graphic card for the next 20 years ? At some point, other companies will want to eat some of the cake too. What about Chinese? They always want to have Chinese made hardware because of the fear of spying and trade war, they too have extreme need for graphical power and nvidia is a Delaware company. It seems there are multiple reason for competitors to step up.
- deleted 2y ago[deleted]
- JSDevOps 2y agoI mean. It’s no mystery is it. Microsoft. meta, Amazon and even Oracle