432
you are viewing a single comment's thread
view the rest of the comments
view the rest of the comments
this post was submitted on 28 Sep 2024
432 points (98.2% liked)
Technology
59414 readers
1158 users here now
This is a most excellent place for technology news and articles.
Our Rules
- Follow the lemmy.world rules.
- Only tech related content.
- Be excellent to each another!
- Mod approved content bots can post up to 10 articles per day.
- Threads asking for personal tech support may be deleted.
- Politics threads may be removed.
- No memes allowed as posts, OK to post as comments.
- Only approved bots from the list below, to ask if your bot can be added please contact us.
- Check for duplicates before posting, duplicates may be removed
Approved Bots
founded 1 year ago
MODERATORS
Nvidia isn't going to be holding any bag. They're selling through what they make, and LLMs are just one of many uses for the massively parallel math they're at the forefront of. At most they have to bring pricing down, but they don't own the fab, so if demand did drop (which isn't really all that likely), their costs will go down too. They have contracts in terms of volume and price, but they're not near long term enough to do them more than a blip, and all their investment in developing architecture/tooling has value well outside of LLM nonsense.
Their stock price will tank. They have a $3B market cap because they're selling shovels in a gold rush. Once the gold rush is over, that valuation will go back to where they were three years ago. Probably lower, because the stock market tends to overcorrect on these things.
Companies base their capital on their stock price, and a drop like that can kill companies. Doesn't mean for sure that Nvidia will die, but they could.
Their fundamentals are too strong. They have market dominance with extremely steady technological progress against really bad competition. LLMs aren't going to disappear when the shitty overpromising bubble pops. Generative AI isn't going anywhere. Any of the thousands of other uses for their raw power are still there. They'll just be at the ground floor of whatever the next math heavy hype cycle is, just like they were with crypto and LLMs, because cuda is the best way to get shit done, whether what you're doing is useful or trash.
Like he said though, being fabless means there's no assets to hold the bag on. It's the fabs that stop getting profitable orders that tank. Worst case is they do layoffs.