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The impact of competition and DeepSeek on Nvidia

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Re: The impact of competition and DeepSeek on Nvidia

#31

Post by toisanji »

breadwinner wrote: post #26

Great article but it seems to have a fatal flaw. As pointed out in the article, Nvidia has several advantages including: - Better Linux drivers than AMD - CUDA - pytorch is optimized for Nvidia - High-speed interconnect Each of the advantages is under attack: - George Hotz is making better drivers for AMD - MLX, Triton, JAX: Higher level abstractions that compile down to CUDA - Cerbras and Groq solve the interconnect…

I want the NVIDIA monopoly to end, but there is no real competition still. * George Hotz has basically given up on AMD: https://x.com/__tinygrad__/status/1770151484363354195

* Groq can't produce more hardware past their "demo". It seems like they haven't grown capacity in the years since they announced, and they switched to a complete SaaS model and don't even sell hardware anymore.

* I dont know enough about MLX, Triton, and JAX,

Re: The impact of competition and DeepSeek on Nvidia

#32

Post by dutchbookmaker »

jjeaff wrote: post #12
OutOfHere wrote: post #11

It seems like a pointless discussion since DeepSeek uses Nvidia GPUs after all.

it uses a fractional amount of GPUs though.

"wait" I suspect we are all in a bit of denial.

When was the last time the US got their lunch ate in technology?

Sputnik might be a bit hyperbolic but after using the model all day and as someone who had been thinking of a pro subscription, it is hard to grasp the ramifications.

There is just no good reference point that I can think of.

Re: The impact of competition and DeepSeek on Nvidia

#33

Post by Herring »

breadwinner wrote: post #26

Great article but it seems to have a fatal flaw. As pointed out in the article, Nvidia has several advantages including: - Better Linux drivers than AMD - CUDA - pytorch is optimized for Nvidia - High-speed interconnect Each of the advantages is under attack: - George Hotz is making better drivers for AMD - MLX, Triton, JAX: Higher level abstractions that compile down to CUDA - Cerbras and Groq solve the interconnect…

He's setting up a case for shorting the stock, ie if the growth or margins drop a little from any of these (often well-funded) threats. The accuracy of the article is a function of the current valuation.

Re: The impact of competition and DeepSeek on Nvidia

#34

Post by dralley »

breadwinner wrote: post #26

Great article but it seems to have a fatal flaw. As pointed out in the article, Nvidia has several advantages including: - Better Linux drivers than AMD - CUDA - pytorch is optimized for Nvidia - High-speed interconnect Each of the advantages is under attack: - George Hotz is making better drivers for AMD - MLX, Triton, JAX: Higher level abstractions that compile down to CUDA - Cerbras and Groq solve the interconnect…

>So how is this possible? Well, the main reasons have to do with software— better drivers that "just work" on Linux and which are highly battle-tested and reliable (unlike AMD, which is notorious for the low quality and instability of their Linux drivers)

This does not match my experience from the past ~6 years of using AMD graphics on Linux. Maybe things are different with AI/Compute, I've never messed with that, but in terms of normal consumer stuff the experience of using AMD is vastly superior than trying to deal with Nvidia's out-of-tree drivers.

Re: The impact of competition and DeepSeek on Nvidia

#35

Post by scsilver »

eigenvalue wrote: post #2

Yesterday I wrote up all my thoughts on whether NVDA stock is finally a decent short (or at least not a good thing to own at this point). I’m a huge bull when it comes to the power and potential of AI, but there are just too many forces arrayed against them to sustain supernormal profits. Anyway, I hope people here find it interesting to read, and I welcome any debate or discussion about my arguments.

Wanted to add a preface: Thank you for your time on this article, I appreciate your perspective and experience, hoping you can help refine and reign in my bull case.

Where do you expect NVDA's forward and current eps to land? What revenue drop off are you expecting in late 2025/2026. Part of my bull case for NVDA, continuing, is it's very reasonable multiple on insane revenue. An leveling off can be expected, but I still feel bullish on it hitting $200+ (5 Trillion market cap? on ~195B revenue for Fiscal year 2026 (calendar 2025) at 33 EPS) based on this years revenue according to their guidance and the guidance of the hyperscalers spending. Finding a sell point is a whole different matter to being actively short. I can see the case to take some profits, hard for me to go short, especially in an inflationary environment (tariffs, electric energy, bullying for lower US interest rates).

The scale of production of Grace Hopper and Blackwell amaze me, 800k units of Blackwell coming out this quarter, is there even production room for AMD to get their chips made? (Looking at the new chip factories in Arizona)

R1 might be nice for reducing llm inferencing costs, unsure about the local llama one's accuracy (couldnt get it to correctly spit out the NFL teams and their associated conferences, kept mixing NFL with Euro Football) but I still want to train YOLO vision models on faster chips like A100's vs T4 (4-5x multiples in speed for me).

Lastly, if the Robot/Autonomous vehicle ML wave hits within the next year, (First drones and cars -> factories -> humanoids) I think this compute demand can sustain NVDA compute demand.

The real mystery is how we power all this within 2 years...

* This is not financial advice and some of my numbers might be a little off, still refining my model and verifying sources and numbers

Re: The impact of competition and DeepSeek on Nvidia

#36

Post by eigenvalue »

Herring wrote: post #33
breadwinner wrote: post #26

Great article but it seems to have a fatal flaw. As pointed out in the article, Nvidia has several advantages including: - Better Linux drivers than AMD - CUDA - pytorch is optimized for Nvidia - High-speed interconnect Each of the advantages is under attack: - George Hotz is making better drivers for AMD - MLX, Triton, JAX: Higher level abstractions that compile down to CUDA - Cerbras and Groq solve the interconnect…

He's setting up a case for shorting the stock, ie if the growth or margins drop a little from any of these (often well-funded) threats. The accuracy of the article is a function of the current valuation.

Exactly. You just need to see a slight deceleration in projected revenue growth (which has been running 120%+ YoY recently) and some downward pressure on gross margins, and maybe even just some market share loss, and the stock could easily fall 25% from that.

Re: The impact of competition and DeepSeek on Nvidia

#37

Post by breadwinner »

eigenvalue wrote: post #36
Herring wrote: post #33

Earlier quoted context omitted.

He's setting up a case for shorting the stock, ie if the growth or margins drop a little from any of these (often well-funded) threats. The accuracy of the article is a function of the current valuation.

Exactly. You just need to see a slight deceleration in projected revenue growth (which has been running 120%+ YoY recently) and some downward pressure on gross margins, and maybe even just some market share loss, and the stock could easily fall 25% from that.

AMD P/E ratio is 109, NVDA is 56. Which stock is overvalued?

Re: The impact of competition and DeepSeek on Nvidia

#38

Post by thousand_nights »

breadwinner wrote: post #26

Great article but it seems to have a fatal flaw. As pointed out in the article, Nvidia has several advantages including: - Better Linux drivers than AMD - CUDA - pytorch is optimized for Nvidia - High-speed interconnect Each of the advantages is under attack: - George Hotz is making better drivers for AMD - MLX, Triton, JAX: Higher level abstractions that compile down to CUDA - Cerbras and Groq solve the interconnect…

> George Hotz is making better drivers for AMD

lol

Re: The impact of competition and DeepSeek on Nvidia

#39

Post by grajaganDev »

breadwinner wrote: post #26

Great article but it seems to have a fatal flaw. As pointed out in the article, Nvidia has several advantages including: - Better Linux drivers than AMD - CUDA - pytorch is optimized for Nvidia - High-speed interconnect Each of the advantages is under attack: - George Hotz is making better drivers for AMD - MLX, Triton, JAX: Higher level abstractions that compile down to CUDA - Cerbras and Groq solve the interconnect…

There is not enough water (to cool data centers) to justify NVDA's current valuation.

The same is true of electricity - neither nuclear power nor fusion will not be online anytime soon.

Re: The impact of competition and DeepSeek on Nvidia

#40

Post by idonotknowwhy »

blackeyeblitzar wrote: post #25
OutOfHere wrote: post #11

It seems like a pointless discussion since DeepSeek uses Nvidia GPUs after all.

Yep some CEO said they have 50K GPUs of the prior generation. They probably accumulated them through intermediaries that are basically helping nvidia sell to sanctioned parties by proxy

Deepseek was there side project. They had a lot of GPUs from their crypto mining project.

Then Ethereum turned off PoW mining, so they looked into other things to do with their GPUs, and started DeepSeek.

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