because of discounted cash flow/valuation models. you invest in a 100x machine expecting a revenue of X, but now you can only charge X/100 because R1 shows tha

because of discounted cash flow/valuation models. you invest in a 100x machine expecting a revenue of X, but now you can only charge X/100 because R1 shows that AI inference can be done much more efficiently. see the price decrease of ChatGPT and addition of free O3 etc. this reduction of future cash flows, ceteris paribus, implies that the present value of these cash flows decrease. this then results in massive repricing to the downside as market participants update their forecasts. what you are missing is that to assume as you do, you must make the additional assumption that demand for additional compute is infinite. Which may very well be the case, but it is not guaranteed compared to the present realized fact that R1 means lower revenues for AI inference providers -> changes the capex justification for even more hardware -> NVDA receives less revenue.