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Nvidia’s $589B DeepSeek rout
381–390 of 1001 posts
Re: Nvidia’s $589B DeepSeek rout
#382Earlier quoted context omitted.
Only if their portcos don't build products people buy. Making a pure-research, foundation model company is silly. Make a product company that sells products.
Google and Microsoft both bundled their AI offering into their office suites because they weren't getting traction as an add-on. Startups don't have that option.
They did that because
1) Their initial AI offerings weren't real products customers would use or pay for
2) They weren't seeing sufficient adoption to justify the expense
3) They have insane levels of distribution in their existing product lines and can incrementally add AI features
This is entirely orthogonal to whether or not other startups can build AI-first products or whether they can position themselves to compete with the giants.
Re: Nvidia’s $589B DeepSeek rout
#383IMO this is less about DeepSeek and more that Nvidia is essentially a bubble/meme stock that is divorced from the reality of finance and business. People/institutions who bought on nothing but hype are now panic selling. DeepSeek provided the spark, but that's all that was needed, just like how a vague rumor is enough to cause bank runs.
This is a cookie cutter comment that appears to have been copy pasted from a thread about Gamestop or something. DeepSeek R1 allegedly being almost 50x more compute efficient isn't just a "vague rumor". You do this community a disservice by commenting before understanding what investors are thinking at the current moment.
Has anyone verified DeepSeek's claims about R1? They have literally published one single paper and it has been out for a week. Nothing about what they did changed Nvidia's fundamentals. In fact there was no additional news over the weekend or today morning. The entire market movement is because of a single statement by DeepSeek's CEO from over a week ago. People sold because other people sold. This is exactly how a panic selloff happens.
Re: Nvidia’s $589B DeepSeek rout
#384The real hidden message is not that bigger compute produces better results, but that the average user probably doesn't need the top results.
In the same way that medium range laptops are now 'good enough' for most people's needs, medium range (e.g. DeepSeek R1x) AI will probably be good enough for most business and user needs.
Up till now everyone assumed that only giga-sized server farms could produce anything decent. Doesn't seem to be true any more. And that's a problem for mega-corps maybe?
Re: Nvidia’s $589B DeepSeek rout
#385If you look at total volume of shares traded, this would be somewhere in the range of 200th highest.
If you look at the total monetary value of those shares traded, this would be in the top 5, all of which have happened in the past 5 years. #1 is probably Tesla on Dec 18 2020 (right before it joined the S&P500). It lost ~6% that day.
Don’t get me wrong, this is definitely a big day. Just not “lose your mind” big. It’s clear that most shareholders just sat things out.
Re: Nvidia’s $589B DeepSeek rout
#386IMO this is less about DeepSeek and more that Nvidia is essentially a bubble/meme stock that is divorced from the reality of finance and business. People/institutions who bought on nothing but hype are now panic selling. DeepSeek provided the spark, but that's all that was needed, just like how a vague rumor is enough to cause bank runs.
Correct, Nvidia has been on this bubble-like tragectory since before the stock was split last year. I would argue that today's drop is a precursor to a much larger crash to come.
Re: Nvidia’s $589B DeepSeek rout
#387So the Chinese graciously gift a paper and model which describes methods that radically increase the efficiency of hardware which will allow US AI firms to create much better models due to having significantly more AI hardware and people are bearish on US AI now?
If people are bullish on Nvidia because the hot new thing requires tons of Nvidia hardware and someone releases a paper showing you need 1/45th of Nvidia's hardware to get the same results, of course there's going to be pullback. Whether its justified or not is outside my wheelhouse. There's too many "it depends" involved that, best case, only people working in the field can answer, worst case, no one can answer righ…
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Re: Nvidia’s $589B DeepSeek rout
#388Earlier quoted context omitted.
Hype buyers are also Hype sellers - anything Nvidia was last week is exactly what it is this week - DeepSeek doesn't really have any impact on Nvidia sales - Some argument could be made that this can shift compute off of cloud and onto end user devices, but that really seems like a stretch given what I've seen running this locally.
I agree hype is a big portion of it, but if DeepSeek really has found a way to train models just as good as frontier ones for a hundredth of the hardware investment, that is a substantial material difference for Nvidia's future earnings.
> if DeepSeek really has found a way to train models just as good as frontier ones for a hundredth of the hardware investment
Frontier models are heavily compute constrained - the leading AI model makers have got way more training data already than they could do anything with. Any improvement in training compute-efficiency is great news for them, no matter where it comes from. Especially since the DeepSeek folks have gone into great detail wrt. documenting their approach.
Re: Nvidia’s $589B DeepSeek rout
#389Earlier quoted context omitted.
I don't think it's fair to say NVDA is meme stock, having reported 35B revenue last quarter.
True but with that revenue number it would mean that before today it was valued at ~100x revenue. That’s pretty bubbly.
Thats 100x quarterly revenue, or 25x annual revenue.
Re: Nvidia’s $589B DeepSeek rout
#390IMO this is less about DeepSeek and more that Nvidia is essentially a bubble/meme stock that is divorced from the reality of finance and business. People/institutions who bought on nothing but hype are now panic selling. DeepSeek provided the spark, but that's all that was needed, just like how a vague rumor is enough to cause bank runs.
I don't think it's fair to say NVDA is meme stock, having reported 35B revenue last quarter.
I'd say it's a meme stock and based on meme revenue. Much of the 35B comes from the fact that companies believe Nvidia make the best chips, and that they have to have the best chips or they'll be out of the game.
DeepSeek supposedly nullifies that last part.