Nvidia announces financial results for first quarter fiscal 2025
nvidianews.nvidia.com
nvidianews.nvidia.com
I saw pallets of h100s shipping that were worth 100s of millions each pallet (each card is $40k and you can fit a lot on a pallet) as someone working for a company buying these and knowing that many other companies were doing the same (we have 12+ months of back orders with nvidia alone).
I invested last year at ~$250 when redditors we're posting that "Nvidia is the best shorting opportunity" without any of the knowledge of the market.
It looks like it's now going above $1000 and still going up.
Invest in things you know intimately folks. Also do the opposite of Reddit.
For a complete exit I would need to see a genuine competitor emerge. I have not seen that yet.
Has demand saturated while downstream AI engineers tinker on actually profitable use cases or is it going to keep growing exponentially.
Probably most stock price models assume at minimum linear growth for the next 5-10 years. But if the future reality is that it nearly plateauing and will likely drop off...
So, plan accordingly into what the future demand may look like.
It's like the folks who were saying "the internet is growing rapidly, Cisco powers the internet, therefore Cisco will grow as rapidly as the internet" in the late 90s. Oops.
I assume all 3 will rapidly improve.
It's a fuzzy distinction and you're better safe than sorry. "We bought a bunch of cards" vs "we're going to buy a bunch of cards" type thing.
https://www.sec.gov/Archives/edgar/data/1164964/000101968715...
"""
An “insider” is an officer, director, 10% stockholder and anyone who possesses inside information because of his or her relationship with the Company or with an officer, director or principal stockholder of the Company. Rule 10b-5’s application goes considerably beyond just officers, directors and principal stockholders. This rule also covers any employee who has obtained material non-public corporate information, as well as any person who has received a “tip” from an Insider of the Company concerning information about the Company that is material and nonpublic, and trades (i.e. purchase or sells) the Company’s stock or other securities.
This policy also applies to your family members who reside with you, anyone else who lives in your household, and family members who do not live in your household but whose securities transactions are directed by you or are subject to your influence or control, as well as trusts or other entities for which you make investment decisions.
"""
I heard about similar NVDA order backlogs when doing a 'I did this build with your salesman and the card doesn't fix, please let me get one that does' of a video card at Micro center during one of the crypto pumps.
The employee claimed a 6-12 month backorder on high end cards.
I didn't do anything with that info, but I'd I had, would not be insider trading.
No different from using satellite images of Costco parking lot.
Arguably insider trader then
> No different from using satellite images of Costco parking lot.
Not even similar...
“A thing I observed at work about another company’s product” is not insider trading.
That’s no different than you as an individual deciding not to renew Netflix and shorting Netflix stock in advance of it.
Just to be absolutely clear, it can be insider trading if you don't work at NVIDIA.
Simply knowing that demand for a product has increased - even increased massively - surely can't tell you that the stock of the company that makes that product is going to increase in value, without also knowing whether or not that increase in demand is already reflected in the current price of the stock
Luck and survivor bias.
_If_ this is the bullwhip scenario, then it's basically a gamble about how many million cards nVidia can ship before their own short supply bubble bursts. Or the AI bubble more generally.
nvidia's p/e is also insanely high. "Wow they sure sell a shitload of product" isn't necessarily enough to justify the price. There are highly profitable companies that nevertheless see their stock price turn around.
It's tongue in cheek, but he's correct. Suppose you have a great idea for investing. It doesn't matter how good it is... don't put your life savings into it.
If you do this you will make money. Investing is mostly about not losing money.
Counterintuitively, when I focus hard on not losing money, I become too risk averse, I fail to take appropriate risk, and my returns are stuck in the low single digits.
I can't count the times I sold great companies like Apple and Netflix and Tesla years too early because I was afraid to lose money and wanted to "lock in" a 50% gain.
By focusing on potential for high returns instead of not losing money, with a diverse portfolio of assets that don't correlate perfectly with each other, total returns are much greater even though individual bets can show big losses for months or years.
If one was to be able to simply select the 50% of companies which perform better than the rest of the field. You would be in good shape.
Stock investors do not have the luxury of control, thus they must diversify.
And generally that's what the wealthy do. They go all-in on their own company, grow it to incredible returns, then use those returns to be invested in a diversified manner to grow further. Other stocks, realestate, angel investing, etc.
Most of the billionaires are like this. Or if you're Warren Buffet, you invested in a diversified manner, because he didn't control the companies he owned.
you should check out Buffet's portfolio - he's not very diversified at all... If that was your portfolio someone would tell you you are nuts/gambler/...
Sure, but not diversifying is also one of the most efficient ways to go broke. Which is something that diversifying will make much more difficult.
Also, full baloney. I was not diversifying for many years and it indeed made me great money (thanks MSFT). But when I started getting spooked and diversified, guess what?
I still ended up doing pretty well, even if it wasn’t on the same level as before (look up MSFT share price change between the start of 2017 and 2021). But it was so much safer and reliable, going broke wasn’t as much of a concern, and I knew I was much more secure in case of a downturn. Winning on risky triple digit percentage gains feel great, but I would rather take much safer diversified 50-60% gains over a 3 year period instead.
Not saying that those 50-60% gains are even close to what I would expect from truly safe plays. But safety and risk is a spectrum, and you have more choices than just “fully diversified super safe index funds” and “all-in on one single ticker.” You can adjust and make things diversified and safer than all-inning on a single ticker, while still maintaining some amount of risk that would allow for outsized gains.
To me diversification goes against all logic because the rule #1 of investing should be that you as a investor KNOW what you are investing in. You can't tell me anyone investing in say S&P 500 has done extensive research on each every of the 500 companies. All they are hoping for is "hey, these are 500 biggest companies in the World, imma just put my chips here and hope for the best - history tells me that is probably safe bet."
On the other hand, you can do full-on research into a single or handful of companies and then put your chips there. You can't tell me that putting money in Magnificent-7 say 5 years ago was any riskier than putting money into S&P 500... and yet you could have gotten REALLY wealthy with the former and quite rich with the latter...
I largely agree with what you say. However, diversification has degrees, and it doesn’t necessarily mean that you gotta spray and pray across the whole range of S&P500 to be more diversified than the “all-in on a single stock ticker” strategy. Examples:
* All in one single stock ticker - no diversification
* All in a few different stock tickers that are in the same industry sector (that you are knowledgeable about) - diversified businesses, but not diversified across industries
* S&P500 spray and pray - largely diversified
Option #2 is imo the solid middle ground, and it gels perfectly fine with your idea that you gotta know what you invest in. Yes, it is riskier than option #3, because it doesn’t account for the scenario where the entire industry sector experiences a downturn. But it is still diversified, still has the potential to make you wealthy, and is not nearly as risky as option #1 (but also not as capped as option #3).
> I can't count the times I sold great companies like Apple and Netflix and Tesla years too early because I was afraid to lose money and wanted to "lock in" a 50% gain.
Ah the sunk cost fallacy. Having an exit strategy is important. Never beat yourself up for an appropriate exit strategy.
Another piece of information is that CUDA software was provide free or cheaply to Universities doing LLM research I think. And the software is easy to use.
I know that it's touted as the key competitive advantage, but it seems to stem from the fact it actually works, unlike others.
Still great advantage, but not a lock in. If competitors get their act together, couldn't they just replace CUDA with another API, all hidden somewhere in the sw stack?
Its competitors are only way behind when it comes to software support. The hardware coming out of Intel and amd is, especially for its price, very capable. Given how much money is being invested in AI right now, I don’t see Nvidia’s moat lasting more than a few more years.
Either you're the type of company that does that, or you aren't.
Getting good AI talent now is very costly. HW engineers are cheaper.
Nvidia has more SW than HW engineers for a reason and the transformation for that started slowly almost 2 decades ago and accelerated 2012 with AlexNet, the first public showcase of a NN running on GPUs. Jensen saw what that meant and transformed the company from that moment focusing on DeepLearning.
Nvidia isn't waiting for a market to develop but prefers to create markets by tackling hard and complex problems. It seems that Nvidia got lucky with AI but it was a long lasting preparation for Jensen.
Tell me though, what Fortune 500 do you know that is willing to put all their eggs in one basket? It is MBA 101 to not do that.
There needs to be alternatives in the space. Why not let them try?
I only dabble in AI stuff but have decades of experience doing quick surface-level quality checks of open source projects. I looked at some of AMD's ROCm repos late last year. Even basic stuff like the documentation for their RNG libraries didn't inspire confidence. READMEs had blatant typos in, everything gave off a feeling of immense lack of effort or care. Looking again today the ROCrand docs do seem improved, at least on the surface, I haven't tried it out for real.
But if we cast the net a little wider again, the same problems rear their ugly head. Flash Attention is a pretty important kernel to have if working with LLMs, maybe I'd like one of those for AMD hardware?
https://github.com/ROCm/flash-attention
We're in luck! An official AMD repo with flash attention in it, great! Except.... the README says at the top:
Requirements: CUDA 11.4 and above. We recommend the Pytorch container from Nvidia, which has all the required tools to install FlashAttention.
Really? Ah, if we scroll down all the way to the bottom we can find a new section that says "AMD/ROCm: Prerequisite: MI200 & MI300 GPUs". Guys, why not just rewrite the README, literally the first thing you see, to put the most important information up front? Why not ensure it makes sense? It takes 10 seconds and is the kind of attention to detail that makes me think the rest of your work will be high quality too.
Checking the issue tracker we see people reporting that the fork is very out of date, and that some models just mysteriously don't work with it due to bugs. These issue reports go unanswered for months. And let's not even go there on the hardware compatibility front, everyone already knows what "AMD support" really means (not the AMD cards you might actually own) vs what "NVIDIA support" means (any device that supports the needed CUDA version, of any size).
I would never try to defend AMD with regards to them needing to catch up. Even talking with executives at AMD, neither would they. Nobody is trying to pull a fast one on this.
What has changed for certain, is their attitude and attention. I just got back from Dell Tech World. Dell was caught off-guard with this AI thing too. It is obvious the only thing that anyone is talking about now is "ai ai ai ai ai ai".
Give them a bit of time and I think they will start to become competitive over the next few years. It won't happen over night. You won't see README's fixed right away. But one thing that is for certain, they are all at least trying now, instead of pretending it doesn't exist.
Whether they will be successful or not, is yet to be seen. I wouldn't even know how to define successful. I don't think anyone is kidding themselves about Nvidia being dominant. But, I'm personally willing to bet on them selling a lot of hardware and working on their software story.
You might not, and that is fine too.
Not only that, but it is all being done in the open, unlike their competition. Hotz demanded some documentation, they provided it and he still complained. Some people just can't find happiness.
Now, whether or not I am pushing them forward is yet to be seen, but at least I'm trying. By positioning myself as a new startup who's trying to help... that will easily garner all their support as well. As I said in another comment, why not let them try too?
First off, it’s a HW/SW solution and things like CUDA/NCCL/etc make a HUGE difference.
Second, the token/watt ratio of every other option is nearly an order of magnitude difference in real world tests. When you add in custom silicon like moronic Grok/Dojo and you see that there aren’t really any close competitors when using custom spins. That is money down the drain IMO. Best bet for most enterprises is to buy 25% AMD and 75% H100 if they can get it.
I think Blackwell is potentially a long term generational problem due to power limitations in most data centers for now.
If I can save 20% of my data center costs and cut a price-gouging vendor while bringing the solution in-house at a big tech org I am a hero.
Consumers won’t buy a Surface because Microsoft isn’t cool.
B2C will first ask about security and stability.
Do you think AWS, Azure and GCP are the cheapest cloud offerings? Of course not, but why do they dominate cloud computing in B2C while price gouging everyone?
Because they offer something beyond price and that is security and stability as well as a reliable partner. They also offer support and capacity on a level which a startup CSP will never be able to offer.
This is also the reason why all AI accelerator competitors won't be a competition for Nvidia.
To beat Nvidia it's not only about beating CUDA, it's about beating Nvidia Enterprise AI suite with it's security offerings and support options. But enterprise business level SW is a level where AMD and others will never go to and will have to rely on Big Tech like MS, Amazon and so on to do that for them. But why should they if they have in-house solutions? Big CSPs developing their own AI accelerators shows you that they understand Nvidia's business model and are trying to compete head on because they understand that Nvidia is attacking them at enterprise level with AI enterprise solutions. And of course any enterprise using Nvidia enterprise SW will automatically use Nvidia HW.
Once SW is more spread than HW then it dictates where the direction goes. If MS releases Windows 12 only for ARM then Intel and AMD are immediately screwed and they can't do nothing about that. No enterprise in the world cares if their CAD system runs on x86 or ARM as long as it can be used for the intended use.
If I am in charge of a data center I had better understand the impact of security and stability as well as the qualities of vendor relationships on my costs or I probably won’t be in that role very long.
You, on the other hand, apparently have never managed an enterprise ISA transition, or even cross-compiled software. The idea that Microsoft would just do that and that it would work is naive in the extreme. CAD software is compiled first for an architecture, and then generally within an operating system. It is all interconnected and interdependent.
Do people basically say we shouldn’t bother buying anything with a crazy P/E more than 20?
Despite the fact that these high P/E companies are now making people lots of money? Wtf?
For me personally, it’s a turn off.
Unless you mean that the share price may appreciate. That's absolutely a thing, but it's a dangerous game. Of course plenty of people have made fortunes this way; people have also lost fortunes; I think the advice to steer away from such companies is basically a statement about risk.
this has already happened because the P/E is high! Betting that it will continue to grow in price (aka, reach an even higher P/E) is risky.
We’re all in here arguing about PE ratios of tech companies reaching 100x. Is that too much? Who knows. For the best tech company in the world? What is the limit?
But for other companies like Tesla, their PE was once 1000x. That’s crazy town.
PE is the first number you should use for comparing two stocks to determine value vs risk.
This happened with a local sports drink maker. It was branded for kids, more healthy, less sugar then Gatorade and energy drinks. Company took off, went public, stock went through the roof for about two years.
Blue skies, everything coming up roses, lots of articles in the local business mags and websites.
Then their supply chain dried up - a precursor to the pandemic and the founder even said in a startup presentation they were the canary in the coal mine and one of the first businesses in the state to suddenly have their product, packaging, and materials all just evaporate in a matter of weeks. Suddenly they couldn't get product into stores, stores eventually pulled their placement and within three months they were bleeding money horrendously while scrambling to find replacements. Something they were already working on, but soon enough every supplier they'd call had the same answer, they too had no means to ship stuff out and they too were dead in the water.
Then two months later the pandemic hit in full force and it was the death knell for the company. Delisted, and bankrupted, they closed up shop about 3 years after being a "can't lose" stock and company.
My family have all invested heavily in Nvidia and they're making good gains now, but I'm seeing the same thing you are - this can go bust very fast if Nvidia doesn't manage this really well.
So has Cisco: how has their stock price been doing since the late 1990s?
It's not like the Internet has stopped being a thing, and people are still buying Cisco gear, and yet people aren't excited about it anymore.
It's possible for AI/ML to be a thing, for Nvidia to sell gear, and for the stock to go down. There are numerous examples throughout history:
* https://en.wikipedia.org/wiki/Technological_Revolutions_and_...
Nobody knows if Nvidia is in the late 1990s or the early 1990s. Based on valuation on P/E they are cheaper than Cisco in late 1990s.
Unlike the OP who used insider knowledge (for being a customer of Nvidia) I went against the HN crowd more than twice with buying META at $89 [0] and GOOG at an average of down to $93 [1]
Turns out who never owned a car and never invested in any stocks got it right.
TBH no one can predict the market.
Your anecdote is just survivorship bias and you are one of the survivors.
Was there really anything "intimate" about the knowledge you possessed? You were on the other side of a large market with apparent high demand and a supply chain that can most easily be described as "extremely monopolized."
> when redditors we're posting that "Nvidia is the best shorting opportunity" without any of the knowledge of the market.
It looks to me like it was done with real knowledge of the overall market outside of single pallet moves and understanding of the risky position Nvidia put themselves into to capitalize on this. The bet either paid off completely or it severely tanked the company while crippling their consumer product division.
Nvidia took a top heavy position and bet the farm that TSMC could and would keep up with their demand. Was that the bet you understood yourself to be taking when investing in them?
They never needed to massively increase production from tsmc. They just needed to go from 5% to 75% margin on the cards they sell which is exactly what they did. https://www.reddit.com/r/wallstreetbets/comments/14zhy7f/com...
i lost 50% on palantir cause i listened to wall street bets lmao
And corollary, if just a thousand dollars can be made from influencing people on Reddit, then thinking how many people you can pay to create fake interest on Reddit. Now do the calculation for $10k and $100k.
I think most employers wouldn't care at all.
The actual policy wording:
> No Third-Party Trading or Tipping. Do not trade in the securities of another company when aware of material nonpublic information about that company in connection with your work at ******. This includes trading in the stock of ****** suppliers, manufacturers, vendors, or customers, such as cellular network carriers or other channel partners. You must also not tip material nonpublic information about another company.
It might be a violation of your company’s policy, but unless your company has been given explicit access to material non-public info of nvidia (e.g. you work for their accounting firm), there is no SEC risk here.
I don't know that the specific information collected in this qualifies as material information but it seems like it might.
All of the cases where people have been busted (e.g. the capital one credit card transactions) are because the SEC has an exact quote from the employee agreement that says something like “don’t use this mega database to do trading”.
If your employee agreement doesn’t have something explicitly barring you from noticing racks of incoming inventory and using that information, then it’s not insider trading.
Should the SEC come after someone then, if they stood outside major retail outlets across a city, surveyed buyers, and made profitable buying schemes that way?
How about analyzing satellite images of warehouse shipments? (which is a thing that is being done today)
Not everyone has access to either of those things, yet as far as I am aware, the SEC does not consider that illegal.
Why would aggregating credit card transactions be any different, honestly? Capital One already uses that information to direct its own business, much the same way.
I wish this SEC would have made it clear why this was a problem.
Would you buy a lemon for 2.336T? No? Probably not. What do you specifically value Nvidia at? Not the share price. Your own calculation. You, AnotherGoodName, are going to buy Nvidia outright. You're basically Elon Musk, and you think you can create better AI chips.
You don't know what that number is? Then you don't intimately know the value of the company.
Knowing tech intimately means nothing.
You know how much a banana costs, right? You probably wouldn't buy one for $10.
Unless he's an insider. (Which he admitted)
> Knowing tech intimately means nothing.
Exactly. Everyone's an expert in a bull market or when the stock runs without a down turn.
HN is an indicator to be bearish when euphoric posts like this are around. We'll start to see the short term dumping of $NVDA when we hit higher prices and the increased geo-political risk with China and Taiwan or a surprise declaration of war.
I have strong knowledge of this is space and don't invest in it exactly for that reason. LLMs are great, but the hype is greater, and I personally don't want to have my income and my investments correlated.
NVIDIA may be selling a lot, but their P/E ratio is nearly 80, so that price isn't fundamentals alone. All we need is this ages equivalent to "perceptrons can't XOR" and there will be a fast correction.
This could go on a long time and I wouldn't be surprised if NVIDIA doubled over the next few years. After all crypto is still doing well despite everyone more or less agreeing it's a scam. I can also imagine world were something is revealed in a few months and everyone flees from "AI".
The only thing I know about the stock market is arbitrage theory still holds, and the future value of any stock tends to be it's current price + risk free rate over time.
It doesn't take that much growth being priced in for the stock to suddenly seem reasonably priced.
Now all serious investing money just goes into index funds and I don't have to worry.
Since literally everyone and their dog now knows AI is the next big thing and NVDA is selling all the shovels to the miners, the contrarian in me (don't believe reddit OR HN) suggests its a good time to stay away.
There should be growth stocks buried in the Russell 5000 somewhere that would be much better bets at this point.
When I read that undeniably impressive anecdote, what really stands out is not the shares or the money - it's the incredible childhood you had, the smart and organised parents who raised you in a way that you'd even understand those notions at a young age, and be in a position to enable them.
The way I was raised, I could top my schoolmates academically no problem, but the concepts and methods for creating monetary wealth - beyond "I need to somehow scrape together enough to pay for the next week's needs" - weren't even part of my (or my family's) universe, until I gradually learned them by accretion from decades of my own adulthood.
The most valuable thing he taught me though was not buying individual shares, but low fee index funds. Ie. the Boglehead approach.
I think you made a good bet, but it's important to recognize it was a bet. Believing something is true, and then turning out to be correct, isn't the same as knowing something. The future is not knowable - it's only varying degrees of predictable.
[1] https://web.archive.org/web/20010405091710/http://www.3dfx.c...
The problem then becomes getting out before the rest of the market and before the good times stop.
Like a party, perhaps one should sell while everyone is still having a good time.
The reality is that your gamble was just as much gambling as their gamble. You just happened to win.
Everyone only has a fraction of all the information. And you have to be satisfied with big returns in which you wonder, "how much of that was luck?" And, the occasional big losers. I can say I don't have 'the formula', but I'm returning 15% for over 20 years... knowing there is a ton I don't know. Which is something you find out when you are a patent attorney, and innovations come out of nowhere while MOST 'innovations' also lead nowhere.
Just. Have to be. OK. With. Not knowing.
Exactly. I invested in NVDA when it was $21.85, after I saw a demo of Deep Learning for the first time. This was long before LLMs and generative AI. I was blown away by how you can upload any random image and it would tell you what is in the image. Then I learned about NVDA and CUDA and how DNNs leverage them and decided it would be a good investment.
Even if the stock falls 3/4 I've had an incredible return and I just don't see the ai hype dying down soon, though im always trying to feel out that inflection point. I'm not super stoked about the ability of AI to really be monetized that well in its current form, but I'm happy to be invested in the picks and shovel business behind it.
The en-vogue group think on Reddit now is to show total disdain towards all AI, and insist that the 'AI PC' is solely a marketing tactic for Intel, Dell and Microsoft to sell more computers, mostly because it really seems most people on reddit don't do any work to appreciate the benefits AI can provide to productive people.
"I had a great luck company called Hanes. They test marketed a product called L'Eggs in Boston and I think in Columbus, Ohio, maybe three or four markets. And Carolyn, ah, brought this product home and she was buying and she said, "It's great." And she almost got a black belt in shopping. She's a very good shopper. If we hadn't had these three kids, she now -- when Beth finally goes off to college, I think we'll be able to resume her training. But she's a very good shopper and she would buy these things. She said, "They're really great."
And I did a little bit of research. I found out the average woman goes to the supermarket or a drugstore once a week. And they go a woman's specialty store or department store once every six weeks. And all the good hosiery, all the good pantyhose is being sold in department stores. They were selling junk in the supermarkets. They were selling junk in the drugstores. So this company came up with a product. They rack-jobbed it, they had all the sizes, all the fits, a down they never advertised price. They just advertised "This fits. You'll enjoy it." And it was a huge success and it became my biggest position and I always worried somebody'd come out with a competitive product, and about a year-and-a-half they were on the market another large company called Kaiser-Roth came out with a product called No Nonsense.
They put it right next to L'eggs in the supermarket, right next to L'eggs in the drugstore. I said, "Wow, I gotta figure this one out." So I remember buying -- I bought 48 different pairs at the supermarket, colors, shapes, and sizes. They must have wondered what kind of house I had at home when I got to the register. They just let me buy it. So I brought it into the office. I gave it to everybody. I said, "Try this out and come back and see what's the story with No Nonsense." And people came back to me in a couple weeks and said, "It's not as good." That's what fundamental research is. So I held onto Hanes and it was a huge stock and it was bought out by Consolidated Foods, which is now called Sara Lee, and it's been a great division of that company. It might have been a thirty bagger instead of a ten bagger, if it hadn't been bought out."
https://www.pbs.org/wgbh/pages/frontline/shows/betting/pros/...
He talks about this more in One Up On Wallstreet about how an observant retail investor who goes to the supermarket or department store or fast food chains, or in your example a loading dock, every week is actually more in touch with what's happening in some businesses than some institutional investors.
The service here has really gone down over the years, product sucks everyone is switching to the competitor, friends can't stop raving about this new product.
I don't know how well that advice holds up in today's market but it's a fun idea, maybe just for the play-money account.
I'd think, it's as important to understand people than it is to understand businesses when it comes to the stock market.
Said that, don't take financial advise from me, I haven't had much luck with my bets.
Studies in behavioral finance are clear that ordinary investors should not invest in individual stocks over indexes. There are too many pitfalls.
Even hedge funds with teams of sector analysts rarely beat the market consistently.
1. The AI boom goes bust. Nvidia sales and/or margins crater. The stock craters with it.
2. The AI boom is the real deal. Companies aren’t stupid and won’t keep paying Nvidia these prices forever. Pretty soon hardware and software architectures are standardized enough that anyone who can get onboard with TSMC, Samsung, or Intel can churn out hardware optimized for the right few functions and sell for a faction of the price. Nvidia can still be an innovator but they won’t be able to sell “bread and butter” products at these prices. Sales and/or margins crater, as does the stock.
100 shares of NVDA at 453 pared down to just profits from 869 sale would mean holding about 48 shares and selling 52 shares. After today’s after hours movement your invested profit would be worth about $48k, or about $6300 more than when you cashed out your initial investment ($41712).
You take that same $41712 and buy INTC between March and now. If it was bought in March then you’re in for something like $43/share or 970 shares. Intel has been sliding since April and is now at $31. Your profit from NVDA has shrunk by nearly 30%. In the worst case (you bought in March rather than April), you’ve given up near $19k in profit by following your convictions. Your gains have gone from 115% (had you held) to potentially as low as 70%. I guess it’s all house money anyways though, right?
In the end I'd probably just take the easy way out and go buy VTSAX and chill.
High growth is fragile. The value of Nvidia has dropped 50% multiple times in the past. Recression, or temporary oversupply, anything can mess it.
Saying it won't last should not be profound because that fact should be self-evident. The only reason it becomes profound is because a lot of people are just that stupid.
And there is nobody else they can buy from on their timelines.
My company uses Azure for years. I don't expect them to change that anytime soon, I mean we're a SAP customer for 40+ years and SAP is Germany's No. 1 price gouging company. We use MS products for decades as well despite them being more expensive every year and I still do more or less the same in Excel today as I did years ago.
I think you have a misunderstanding of how B2C works and especially when we talk about enterprise level SW solutions. No CEO in their mind is switching business operation SW if a competitor is on sale lol.
400% earnings growth and
242% revenue growth.
461% earnings growth (629% GAAP)
262% revenue growth.
Nvidia did it again.
Speaking about how high is the specific moat here - NVDA had great foresight starting to develop their CUDA almost 20 years ago. I at the time was thinking - the HPC market couldn't be that big to support that investment. Well, when 10 year ago the GPU deep learning arrived with AlexNet the CUDA was ready for that Valkyrie ride we've been seeing since then while all the other players are only starting to wake up at best.
That is on supply side. On the demand side - if any projections about AI even in nanobots in your blood come even partially true - we have decades of AI technology growth ahead, and like with other foundational technologies of our civilization - electricity and the internet and the space (guess who is going to mine He3 on the Moon?) - it will be everywhere. NVDA probably like any other company will stagnate and become MBA heaven like say IBM or even rot and perish and/or somebody will come up with completely different technology for AI leaving NVDA in the dust, yet it is hard to see how it can take less than coupe of decades (i.e. hardly can happen until Jensen leaves). (i'm long if any asks :)
Minor correction. They stole the technology.
When British invented textile mills they had strict law against exporting the designs. Cotton was bought from the US to Britain and made into textiles.
Samuel Slater is considered the Father of the American Industrial Revolution was called "Slater the Traitor" in Britain. He memorized the textile factory machinery designs when he worked as an apprentice, then moved to the US.
Americans, Japanese, Chinese industrialization follows the same proud tradition. You steal when you can't get it any other way.
Google announced 2 weeks ago that its Q1 capex for datacenters and servers was $12B. This was up 100% y/y. Goog also expects for this capex spend to be ongoing... A healthy chunk of that is all going to Nvda
All that for a measly 4% after hours bump? It's like "the street" is tired of this trick/doesn't have much more to give.
I predict that the price can go up 8 - 10% tomorrow.
edit: "Intel CEO Pat Gelsinger raised a few eyebrows by attributing Nvidia's current dominance of the AI market to luck" - https://www.extremetech.com/computing/nvidia-engineer-respon....
What Intel really needs to do is get competitive with TSMC. Gelsinger started the process instantly when he became the CEO, but it takes time.
Intel is the cheapest tech company by a huge margin if look at book value.
Those fabs are expensive, but even if nobody wants Intel processors anymore, they could even manufacture Ryzen's.
The downside is that it takes 3-5 years to make profit on a fab, it's easier to be NVidia in that sense, but I wonder if it's sustainable in the long run.
...so yeah some casual R&D isn't gonna cut it...they need to pull a rabbit out of a hat urgently.
It’s good that there is precedent proving it can be done, but duplicating it is another matter
(Microsoft announcing a few days ago that they have taken the lead in a new computing paradigm with their AI-infested devices was genuinely fascinating to me in that respect. The actual AI stuff that got added, I was like, (a) perhaps marginally useful for certain folks but (b) I don’t want any of it, and (c) it’s just literally the same stuff pushed for the past two years, only now with the same breathlessness as when people were genuinely wondering if ChatGPT was sentient (lol). Like, the huge pushback iTerm2’s creator got over adding an AI facility to its latest release puzzled some folks, but it really does feel like people are sick of the AI hype. AI evangelists are going to induce another AI winter if they don’t pump the brakes and start managing expectations better.)
What I fear is that Nvidia sees no value in its basic graphics cards any more or wants a lot more for them because they could sell that wafer space to businesses for more $. Its been getting crazy expensive for decent GPUs for a while for gaming and I can't see the next generation doing anything but being much higher due to the AI boom.
True, but currently, no one can match the offering of NVidia, they are the sole pioneer in this market. AMD is yet to show any viable option (both on the HW and SW layers).
The actually applications of it (they do exist and they are valuable) pale in comparison and value to what it's valuation is based on, it's future promise.
When the people who say things like "AI is going to replace all accountants!" stop speaking the the future tense, it's value will be justified. For now, it's OpenAI spending billions developing a product they hope will make trillions and Nvidia is happy to sit in the background selling billions of dollars in compute.
I foresee Nvidia stock playing out like a softer version of iomega that will still have consumer demand, but not as much temporary demand from the megacorps.
https://finance.yahoo.com/news/day-market-history-iomegas-in...
I tell you where, from Nvidia direclty or from a CSP renting it to them. Oh wait, aren't MS, Amazon and Google such CSP? Oh right! Could that mean that Nvidia sells GPUs to CSPs which then rent it to customers or rather companies which aren't CSPs? So how do these other companies use Nvidia's GPUs from renting? Let me guess, maybe Nvidia Enterprise AI SW suite? Bingo!
And how does Nvidia benefit from these other companies? Or right, Nvidia gets $4500 license fee per GPU if a company uses Nvidia Enterprise AI solution. Oh wait, does that mean that Nvidia might be into building a SaaS business? Correct, but psst... nobody listens to Nvidia management so only few have a clue. Clearly, Nvidia is earning money only from HW to use it for hobbies like Clara, Isaac, DriveSim, Omniverse and many more... GTC was way more about SW development than HW but that was just show to keep people entertained. Nvidia also is a nice HW company employing more SW engineers than HW engineers so that SW engineers also get a chance for work.
If you adjust for inflation I imagine they'd have some competition from the robber barons, but it's hard to imagine.
If it's production capacity, then if in a year they're able to get TSMC to make them twice as many chips, they could likely increase their growth rate?
I'd be sweating if I were any of TSMCs other customers right now and trying to renew my contract. Idk what the ratio is in size between an H100 and an M3, but I doubt it's anywhere near proportional to how much nvidia is willing to offer TSMC.
How many TSMC's customers need the latest tech?
Are you aware that meteors only go down, never up?
TSMC fab capacity and packaging are the bottlenecks for revenue growth.
For the first quarters after AI exploded, I thought it was just that contracts were already signed, but what's stopping them now ?
They are making 78% of margin on those chips - I would think that that leaves a lot of bargaining power to TSMC. They would loose much less than Nvidia.
Prices are defined by the profit margins of Nvidia's closest competitor (AMD 4.89%.)
Nvidia may be working with Samsung, but they don't have any alternative for now.
So my understanding is, that TSMC currently has the monopoly on producing Nvidia chips, and Nvidia obviously has the monopoly on selling those chips.
And somehow, Nvidia is extracting 99% of profits from that situation, while TSMC is getting close to nothing. My understanding of game theory is that it should be way closer to an even split.
Could you elaborate on why the prices are defined by AMD margins ? I'm obviously missing something, but can't see what.
Except Nvidia is shaking down its best, second best, and all the rest of their customers!
So TSMC would have to increase prices for everyone, but then for some it would be too expensive and so they would lose those customers.
Nvidia engineers work shoulder to shoulder with TSMC to squeeze everything from the architecture even before the fab is build. TSMC makes custom job for their best customers.
For old established process it's possible to send design and get functioning chips without a huge R&D hassle and loss of performance.
After Apple, Nvidia pays more than anyone else for the latest nodes. They reserved capacity for a price and they get it for that price.
https://analyticsindiamag.com/is-cuda-nvidias-competitive-mo...
AMD actually commissioned a drop-in CUDA emulator and we found out 'cause they stopped financing it and they open-sourced it as parts of the contract.
I would speculate that no one actually wants a "clone wars" situation since it would commodify the GPU and reduce everyone's profit rate.
The underlying technology is the same.
They were right.
This is the hardware equivalent of that.
Only until CUDA is replaceable though: and who is gonna do that? Intel better carry through their promises in this regard.
However I do notice that big players (GOOG, Meta, etc), seem more concerned with power cost right now than they do per-unit video cards.
It's quite amazing to me how the stock splits tends to boost the price, or at least it's the perception. What's the underlying mecanism ?
Yes you can.
$1140 strike is <$200
(before markets closed today obviously)
Or maybe the actual number is x10 - since we don't want to buy just 1 share, and the real minimum is 10 shares ?
Many individual investors are people who only have like 100-200 USD per month to invest through Robinhood. Or they do have some 401k plan where they get like $400 monthly.
In poor economic theory, there shouldn't be any change, but if you consider behavioral economics, and regulations that introduct inefficiencies it explains the change in price.
It also communicates to investors (through action) the plan, apetite for risk, and investment opportunities (for the company) moving forward.
An n-way stock split in theory should reduce the price by a factor of n (that is, a 2:1 split ought to halve the price) but what we're seeing now is likely just price discovery based on the bullish earnings report.
If you set aside 15% of a gross salary of $100k for 6 months, that's $7500. When the stock is at $1000, you get 7 shares. If the stock is $100, you get 75 shares. The lower your income, the more you miss out on ESPP that way.
It's not a huge deal if the stock is flat (you only get a 15% discount), but for a fast appreciating stock, those additional 5 shares can be real money.
Only some trading platforms allow for buying of fractional shares.
The underlying logic is that lower per share price would increase volume and maybe a bit the price.
Before partial shares and odd lots, it also let less money buy the stock.
Already priced in. Look at comps of PE ratios in tech focused companies and you'll see what I mean.
Sure, tomorrow it can get to 15% but all I can compare it with right now is the past price action post earnings.
This time around, the stock has been up slightly over the past week, and now popping 5.5% during AH trading.
Not saying it's not going to beat the market in years to come but it is slowing.
Frankly, it's shocking how bad they are at it.
April 15th, 2023. It has been more than a year now.
Shipping rocm releases that don't run on a bunch of their GPUs is just an absurd choice, there's no way to defend that one.
400% earnings growth and
242% revenue growth.
461% earnings growth (629% GAAP)
262% revenue growth.
Gaming is where Nvidia is least unique; they run standards-compliant software by supporting well-documented APIs in-hardware (eg. DX12/Vulkan). AMD does the same thing, and even Intel is able to scale up a simple dGPU setup.
The hard part is software. Nvidia "won" because they spent 10 years developing CUDA when everyone else was smothering their OpenCL implementations in the crib. Now it doesn't matter what Nvidia ships, as long as it's fast and supports CUDA. The Blackwell/Grace systems seem like a good example of this.
TPUs have a slim shot at disrupting things; NPUs are pretty much dead-on-arrival. TPUs are hopeful because they genuinely represent a yak-shaving project that can ignore CUDA semantics to simply infer or train faster. It will be hard to make TPUs as efficient as TSMC-manufactured Nvidia chips, but there's room for disruption given how expensive a single GH200 is.
NPUs... I hate to be a pessimist, but they don't have a very bright feature. In the best of scenarios, an NPU is redundant silicon idling or in-usage to alleviate pressure from the more-powerful main GPU and CPU. Seems great on paper; until you start scaling to LLM/Stable Diffusion size. Now you're bottlenecked by such a low-power component, and have to switch to the GPU which was more powerful all-along. In the worst of cases, the NPU is an expensive waste of space on your SOC. Unlike TPU pods, I think there is no hope for NPUs to compete directly with CUDA. If anything it increases the demand for high-performance training compute, which Nvidia monopolizes.
Fiscal years are about when you'll pay tax. This is Q1 of four quarters to be reported before Nvidia pays tax in 2025.
To demonstrate: The earnings Microsoft reported for this same quarter (calendar Q1 2024) a month ago were reported as their Q3 2024 fiscal year results. Apple's were fiscal Q2 2024. Google's were fiscal Q1 2024.
> Financial reports, external audits, and federal tax filings are based on a company's fiscal year.
And while the fiscal year affects when the company needs to file a tax return, that's not when the company pays taxes which is what the GP claimed. They make estimated payments continuously, once per quarter.
For example, there are easy to read sites with explanations like https://www.thebalancemoney.com/how-do-i-determine-my-compan..., and less easy to read things like Form 1128.
The fiscal year is a pretty standard finance concept, so anything in that area isn't going to bother with an explainer; you're just expected to know.
From the outside looking in, it just seems nuts. If I ever found a company I'm going to do my best to get my fiscal year to == calendar, if I can. It also annoys me when companies needlessly use it internally. Mine does, I have no idea when the quarter ends anymore.
¹ish. I think the IRS has a few rules.
If you believe AGI/ASI is imminent, the demand curve for compute will far exceed supply for the foreseeable future.
(Disclaimer: I am heavily biased, as a longtime investor in Nvidia + semiconductors, since 2014+).