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People said the same thing 2 years ago about NVIDIA, that their stock price didn't make any sense given their revenue, that is was an obvious bubble. Now their

People said the same thing 2 years ago about NVIDIA, that their stock price didn't make any sense given their revenue, that is was an obvious bubble. Now their revenue is 10x higher, justifying the stock price from 2 years ago. People today still say NVIDIA is overvalued, that the stock price doesn't make sense given their revenue today.

marcusb 1y ago
"The market can remain irrational longer than you can remain solvent." I wouldn't bet against these valuations with my own money -- at least to the extent you can -- but that doesn't mean it isn't a bubble.
lovecg 1y ago
These things can go on longer than 2 years > Tulip mania (Dutch: tulpenmanie) was a period during the Dutch Golden Age when contract prices for some bulbs of the recently introduced and fashionable tulip reached extraordinarily high levels. The major acceleration started in 1634 and then dramatically collapsed in February 1637. > At the peak of tulip mania, in February 1637, some single tulip bulbs sold for more than 10 times the annual income of a skilled artisan.
- yieldcrv 1y ago
  Despite being oft cited, that’s probably the worst poster child of bubbles by the way It was a spot commodities futures contract bubble due to government regulation change in the futures market alongside border crisis in a neighboring country, so rational supply constriction It ended due the bubonic plague ending the speculators so we don’t know what would have happened
  - tim333 1y ago
    Also it may not have been as silly as people make out. The Dutch still have a tulip industry with 2,600 varieties grown over 60,000 acres. It may have been worth spending ~$1m on a bulb if it was superior and you could breed from it and sell a lot.
    - yieldcrv 1y ago
      Another reason it wasn’t silly at all I don’t think any commodities bubbles were irrational bubbles or good examples of irrational exuberance. Even the beanie babies one was rational until a seemingly permanent supply constriction was alleviated to the surprise of everyone. So far I’ve narrowed it down to credit bubbles as being actually irrational, like the railroad bonds, and south china sea bubble, over leveraging in real estate market and derivatives with poor accounting of underlying assets And yet tulips and beanie babies are the ones most cited
      - forkeep 1y ago
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  - forkeep 1y ago
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ethbr1 1y ago
> NVIDIA, that their stock price didn't make any sense given their revenue, that is was an obvious bubble. Now their revenue is 10x higher, justifying the stock price from 2 years ago. Nvidia sells (among other things) performance leading hardware products with a locked-in software ecosystem surrounding them. OpenAi... doesn't.
fooblaster 1y ago
the spending on gpus is completely unsustainable. It looks great for them, but not everyone is going to get a return on that investment.
colinmorelli 1y ago
To be fair, if those people are right, then NVIDIA's stock price (and revenue) is part of that bubble, so its not really evidence that this isn't a bubble. Time will tell if they're right or not. But it wouldn't be the first time it has happened.
chollida1 1y ago
> People said the same thing 2 years ago about NVIDIA, that their stock price didn't make any sense given their revenue, that is was an obvious bubble. Now their revenue is 10x higher, justifying the stock price from 2 years ago. Your point is generally correct but revenue isn't 10x higher for the past 2 years, that would indicate they had about $260B in revenue this year instead of $130B. NVIDIA annual revenue for 2025 was $130.497B, a 114.2% increase from 2024. NVIDIA annual revenue for 2024 was $60.922B, a 125.85% increase from 2023. NVIDIA annual revenue for 2023 was $26.974B, a 0.22% increase from 2022.

marcusb 1y ago

"The market can remain irrational longer than you can remain solvent." I wouldn't bet against these valuations with my own money -- at least to the extent you can -- but that doesn't mean it isn't a bubble.

lovecg 1y ago

These things can go on longer than 2 years > Tulip mania (Dutch: tulpenmanie) was a period during the Dutch Golden Age when contract prices for some bulbs of the recently introduced and fashionable tulip reached extraordinarily high levels. The major acceleration started in 1634 and then dramatically collapsed in February 1637. > At the peak of tulip mania, in February 1637, some single tulip bulbs sold for more than 10 times the annual income of a skilled artisan.

yieldcrv 1y ago
Despite being oft cited, that’s probably the worst poster child of bubbles by the way It was a spot commodities futures contract bubble due to government regulation change in the futures market alongside border crisis in a neighboring country, so rational supply constriction It ended due the bubonic plague ending the speculators so we don’t know what would have happened
- tim333 1y ago
  Also it may not have been as silly as people make out. The Dutch still have a tulip industry with 2,600 varieties grown over 60,000 acres. It may have been worth spending ~$1m on a bulb if it was superior and you could breed from it and sell a lot.
  - yieldcrv 1y ago
    Another reason it wasn’t silly at all I don’t think any commodities bubbles were irrational bubbles or good examples of irrational exuberance. Even the beanie babies one was rational until a seemingly permanent supply constriction was alleviated to the surprise of everyone. So far I’ve narrowed it down to credit bubbles as being actually irrational, like the railroad bonds, and south china sea bubble, over leveraging in real estate market and derivatives with poor accounting of underlying assets And yet tulips and beanie babies are the ones most cited
    - forkeep 1y ago
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- forkeep 1y ago
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deleted 1y ago

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ethbr1 1y ago

> NVIDIA, that their stock price didn't make any sense given their revenue, that is was an obvious bubble. Now their revenue is 10x higher, justifying the stock price from 2 years ago. Nvidia sells (among other things) performance leading hardware products with a locked-in software ecosystem surrounding them. OpenAi... doesn't.

fooblaster 1y ago

the spending on gpus is completely unsustainable. It looks great for them, but not everyone is going to get a return on that investment.

colinmorelli 1y ago

To be fair, if those people are right, then NVIDIA's stock price (and revenue) is part of that bubble, so its not really evidence that this isn't a bubble. Time will tell if they're right or not. But it wouldn't be the first time it has happened.

chollida1 1y ago

> People said the same thing 2 years ago about NVIDIA, that their stock price didn't make any sense given their revenue, that is was an obvious bubble. Now their revenue is 10x higher, justifying the stock price from 2 years ago. Your point is generally correct but revenue isn't 10x higher for the past 2 years, that would indicate they had about $260B in revenue this year instead of $130B. NVIDIA annual revenue for 2025 was $130.497B, a 114.2% increase from 2024. NVIDIA annual revenue for 2024 was $60.922B, a 125.85% increase from 2023. NVIDIA annual revenue for 2023 was $26.974B, a 0.22% increase from 2022.