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This is probably a massive overreaction. No one is cancelling orders and the future of AI is still going to heavily involve GPUs. If not for LLMs, then for imag

This is probably a massive overreaction. No one is cancelling orders and the future of AI is still going to heavily involve GPUs. If not for LLMs, then for image and video generation. Of course, if the stock was overly inflated from false expectations, this could certainly be a resetting to the normal. Also, I can't help but feel like DeepSeek is a red herring for the market overall. The stock market's overall dip didn't happen until after the slew of Executive Orders hit. The federal spending cuts are certainly going to affect the bottom line of businesses, and they add to the seriousness of some of the other anti-economic threats like tariffs.

nadermx 2y ago
Trying to convince us or you?
PolandKid 2y ago
I hope it pushes Nvidia to hobble less of the consumer grade offerings for AI/inference. Part of this recent selloff is going to be the bubble popping effect, but it's clear that inference will be the main demand driver, and that's something where ddr5 is competitive.
belter 2y ago
This a reaction to well sourced rumors, the US Administration will impose additional restrictions on the sales of Nvidia chips. This is in addition to the TSMC tariffs.
giancarlostoro 2y ago
I assume its just a market correction. I don't think AI is a reason, I just think some people come up with really bizarre conclusions and then the rest regurgitate it. Now had a major Nvidia competitor announced some highly competitive GPU or some AI that uses drastically less resources and can run on any GPU or CPU type of thing, maybe then I'd understand. Nvidia is still the key GPU in AI though.
bachmeier 2y ago
Their PE ratio is nearly down to 50, leaving it only about 10% higher than the S&P 500 on the eve of its crash in 2001.
- miohtama 2y ago
  How this will be called in the future? Dot ai bubble?
- dwaltrip 2y ago
  The total income of the s&p 500 has never grown by > 100% annually. Not saying Nvidia isn’t overvalued, but your comparison a bit apples to oranges.
chollida1 2y ago
> This is probably a massive overreaction. You may be rights but here is the other side. The AI/software/hardware/data center/energy trade got very crowed by levered money(Hedge funds). 1) That trade has had a huge run up lead by NVidia with alot of funds hedging their gains till the new year for tax reasons. They were al looking for a reason to sell and now could continue to lighten even more. 2) Nvidia is a large portion of the market right now. If you are a hedge fund that is measured against a US index then you probably have bitten the bullet and bought some NVidia exposure so you don't underperform if it continues its growth and the AI story fulfills its promise. Now that NVidia is falling and you can make a story that it may under perform the market t his year you may see even more fast money dumping it as they no longer need to worry as much about it skewing market returns as much now. 3) if its true that you now need atleast an order of magnitude less power and chips to train a model then Nvidia was due to have a multiple decrease. This knocks onto the data center and power trades that also will have a multiple decrease on their pricing. You may be right that this is an undeserved sell off, but given the recent growth it also seems like you can make the case that the whole trade got ahead of themselves and we were due a pull back to more properly value these companies earnings prospects. One thing that is always useful to remember about the markets is that when you are priced for perfection like NVidia was, its signs that your long term growth may be slowing will affect your share price more than short term signs that your are doing what was expected of you.
DiscourseFan 2y ago
>This is probably a massive overreaction. No. I know people working on even tighter optimizations of LLMs. The magic is not in compute, its in design, and its feasible that once all the kinks are ironed out something akin to O1 could be run effectively on a Raspberry Pi; a whole GPU would yield much better results but it probably won't be necessary to buy 3, or 4, or a whole rack of them. Nvidia's stock prices soared on the expectation (from those who weren't in the know) that if massive amounts of capital were simply moved to the right places it continuously improve. The thing that drives tech forward is people, however, not capital.
- BorisMelnik 2y ago
  if o1's can be run from a rasp pi, do you see farms of ARMs in the future?
  - hakfoo 2y ago
    Are farms the future? I could see an "AI appliance" like the old Google Search Appliance: A single rack unit with a single $1000 GPU would probably be enough to run a pretty-robust DeepSeek style product, sold as "100% self-contained and on-prem, so you can trust it with propriatery data".
alecco 2y ago
I'm pretty sure Middle-Eastern investors are having second thoughts on sending more money to OpenAI, Anthropic, xAI, etc. And plenty of AI companies are priced out of the market. And a week ago Google priced their new models along the lines of Deepseek. Sure, in a while demand will get back up. But by then maybe Nvidia will not be the only game in town anymore.
rfw300 2y ago
Yeah, I think NVDA could fall another 20% and its stock price would still imply "massively profitable company primed for continued explosive growth." Its previous valuation was a premium even above that story.
senectus1 2y ago
>This is probably a massive overreaction. yeah for sure, but its an over reaction to an over reaction (the AI bubble and Nvidia's role in it)

nadermx 2y ago

Trying to convince us or you?

PolandKid 2y ago

I hope it pushes Nvidia to hobble less of the consumer grade offerings for AI/inference. Part of this recent selloff is going to be the bubble popping effect, but it's clear that inference will be the main demand driver, and that's something where ddr5 is competitive.

belter 2y ago

This a reaction to well sourced rumors, the US Administration will impose additional restrictions on the sales of Nvidia chips. This is in addition to the TSMC tariffs.

giancarlostoro 2y ago

I assume its just a market correction. I don't think AI is a reason, I just think some people come up with really bizarre conclusions and then the rest regurgitate it. Now had a major Nvidia competitor announced some highly competitive GPU or some AI that uses drastically less resources and can run on any GPU or CPU type of thing, maybe then I'd understand. Nvidia is still the key GPU in AI though.

bachmeier 2y ago

Their PE ratio is nearly down to 50, leaving it only about 10% higher than the S&P 500 on the eve of its crash in 2001.

miohtama 2y ago
How this will be called in the future? Dot ai bubble?
dwaltrip 2y ago
The total income of the s&p 500 has never grown by > 100% annually. Not saying Nvidia isn’t overvalued, but your comparison a bit apples to oranges.

chollida1 2y ago

> This is probably a massive overreaction. You may be rights but here is the other side. The AI/software/hardware/data center/energy trade got very crowed by levered money(Hedge funds). 1) That trade has had a huge run up lead by NVidia with alot of funds hedging their gains till the new year for tax reasons. They were al looking for a reason to sell and now could continue to lighten even more. 2) Nvidia is a large portion of the market right now. If you are a hedge fund that is measured against a US index then you probably have bitten the bullet and bought some NVidia exposure so you don't underperform if it continues its growth and the AI story fulfills its promise. Now that NVidia is falling and you can make a story that it may under perform the market t his year you may see even more fast money dumping it as they no longer need to worry as much about it skewing market returns as much now. 3) if its true that you now need atleast an order of magnitude less power and chips to train a model then Nvidia was due to have a multiple decrease. This knocks onto the data center and power trades that also will have a multiple decrease on their pricing. You may be right that this is an undeserved sell off, but given the recent growth it also seems like you can make the case that the whole trade got ahead of themselves and we were due a pull back to more properly value these companies earnings prospects. One thing that is always useful to remember about the markets is that when you are priced for perfection like NVidia was, its signs that your long term growth may be slowing will affect your share price more than short term signs that your are doing what was expected of you.

DiscourseFan 2y ago

>This is probably a massive overreaction. No. I know people working on even tighter optimizations of LLMs. The magic is not in compute, its in design, and its feasible that once all the kinks are ironed out something akin to O1 could be run effectively on a Raspberry Pi; a whole GPU would yield much better results but it probably won't be necessary to buy 3, or 4, or a whole rack of them. Nvidia's stock prices soared on the expectation (from those who weren't in the know) that if massive amounts of capital were simply moved to the right places it continuously improve. The thing that drives tech forward is people, however, not capital.

BorisMelnik 2y ago
if o1's can be run from a rasp pi, do you see farms of ARMs in the future?
- hakfoo 2y ago
  Are farms the future? I could see an "AI appliance" like the old Google Search Appliance: A single rack unit with a single $1000 GPU would probably be enough to run a pretty-robust DeepSeek style product, sold as "100% self-contained and on-prem, so you can trust it with propriatery data".

alecco 2y ago

I'm pretty sure Middle-Eastern investors are having second thoughts on sending more money to OpenAI, Anthropic, xAI, etc. And plenty of AI companies are priced out of the market. And a week ago Google priced their new models along the lines of Deepseek. Sure, in a while demand will get back up. But by then maybe Nvidia will not be the only game in town anymore.

rfw300 2y ago

Yeah, I think NVDA could fall another 20% and its stock price would still imply "massively profitable company primed for continued explosive growth." Its previous valuation was a premium even above that story.

senectus1 2y ago

>This is probably a massive overreaction. yeah for sure, but its an over reaction to an over reaction (the AI bubble and Nvidia's role in it)