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Nvidia’s $589B DeepSeek rout

finance.yahoo.com

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Re: Nvidia’s $589B DeepSeek rout

#431

Post by ozten »

NVIDIA sells shovels to the gold rush. One miner (Liang Wenfeng), who has previously purchased at least 10,000 A100 shovels... has a "side project" where they figured out how to dig really well with a shovel and shared their secrets.

The gold rush, wether real or a bubble is still there! NVIDA will still sell every shovel they can manufacture, as soon as it is available in inventory.

Fortune 100 companies will still want the biggest toolshed to invent the next paradigm or to be the first to get to AGI.

Re: Nvidia’s $589B DeepSeek rout

#432

Post by amazingamazing »

buffington wrote: post #420
danpalmer wrote: post #390

Earlier quoted context omitted.

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.

Didn't DeepSeek train on Nvidia hardware though? I can't see how DeepSeek hurts Nvidia, if Nvidia is what enables DeepSeek.

that's not entirely relevant.

the simplest way to present the counter argument is:

- suppose you could train the best model with a single H100 for an hour. would that hurt or harm nvidia?

- suppose you could serve 1000x users with a 1/1000 the amount of gpus. would that hurt or harm nvidia?

the question is how big you think the market size is, and how fast you get to saturation. once things are saturated efficiency just results in less demand.

Re: Nvidia’s $589B DeepSeek rout

#433

Post by jhickok »

dgemm wrote: post #356
paxys wrote: post #341

IMO 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 think less of that and more of real risks - Nvidia legitimately has the earnings right now. The question is how sustainable that is, when most of it is coming from 5 or so customers that are both motivated and capable of taking back those 90% margins for themselves

Regarding their earnings at the moment, I know it doesn't mean everything, but a ~50 P/E is still fairly high, although not insane. I think Ciscos was over 200 during the dotcom bubble. I think your question about the 5 major customers is really interesting, and we will continue to see those companies peck at custom silicon until they can maybe bridge the gap from just running inference to training as well.

Re: Nvidia’s $589B DeepSeek rout

#434

Post by segasaturn »

nl wrote: post #417
paxys wrote: post #404

Earlier quoted context omitted.

Nvidia's annual revenue in 2024 was $60B. In comparison, Apple made $391B. Microsoft made $245B. Amazon made $575B. Google made $278B. And Nvidia is worth more than all of them. You'd have to go very far down the list to find a company with a comparable ratio of revenue or income to market cap as Nvidia.

Nvidia's revenue growth rate was 94% and income growth rate was 109% for the Oct 2024 quarter. This compares to Apple's 6% and -35%. Nvidia is growing profits faster than income. Nvidia's net profit margin is 55% (vs Apple 15%) and they have an operating income of $21B vs Apple's $29.5 These are some pretty impressive financial results - those growth rates are the reason people are bullish on it.

That's the thing. Nvidia's future growth has been potentially kneecapped by R1's leaps in efficiency.

Re: Nvidia’s $589B DeepSeek rout

#435

Post by flowerlad »

A similar efficiency event has occurred in the recent past. Blackwell is 25x more energy-efficient for generative AI tasks and offer up to 2.5x faster AI training performance overall. When Blackwell was announced nobody said “great we will invest less in GPUs”. Deep Seek is just another efficiency event. Like Blackwell it enables you to do more with less.

Re: Nvidia’s $589B DeepSeek rout

#436

Post by deepsquirrelnet »

zozbot234 wrote: post #405
kiratp wrote: post #370

This is really dumb. Deepseek showing that you can do pure online RL for LLMs means we now have a clear path to just keep throwing more compute at the problem! If anything we made the whole "we are hitting a data wall" problem even smaller. Additionally, its yet another proof point that scaling inference compute is a way forward. Models that think for hours or days are the future. As we move further into the regime o…

Didn't DeepSeek also show that pure RL leads to low-quality results compared to also doing old-fashioned supervised learning on a "problem solving step by step" dataset? I'm not sure why people are getting excited about the pure-RL approach, seems just overly complicated for no real gain.

If I’m understanding their paper correctly (I might not be but I’ve spent a little time trying to understand it), they showed you only need a small amount of supervised fine tuning “SFT” to “seed” the base model, followed by pure RL. Pure RL only was their R1-zero model which worked, but produces weird artifacts like switching languages or excessive repetition.

The SFT training data is hard to produce, while the RL they used was fairly uncomplicated heuristic evaluations and not a secondary critic model. So their RL is a simple approach.

If I’ve said anything wrong, feel free to correct me.

Re: Nvidia’s $589B DeepSeek rout

#437

Post by chgs »

segasaturn wrote: post #430
xiphias2 wrote: post #407

Earlier quoted context omitted.

I believe you that it had to do with the selloff, but I believe that efficiency improvements are good news for NVIDIA: each card just got 20x more useful

That still means that that AI firms don't have to buy as many of Nvidia's chips, which is the whole thing that Nvidia's price was predicated on. FB, Google and Microsoft just had their their billions of dollars in Nvidia GPU capex blown out by $5M side-project. Tech firms are probably not going to be as generous shelling out whatever overinflated price Nvidia was asking for as they were a week ago.

Imagine what you can do with all that Nvidia hardware using the deep mind techniques.

Re: Nvidia’s $589B DeepSeek rout

#438

Post by [deleted] »

hintymad wrote: post #284
maxglute wrote: post #281

Earlier quoted context omitted.

PRC just announced mass producing 28nm litho that cost 1/30 ASML hardware. Easy to extrapolate where this goes especially mature nodes like 28nm still accounts fo over 70% of global wafer use.

I'm increasingly believing that the West has turned their dream of free trade for comparative advantage into a massive deindustrialization. The end result is unfolding in front of everyone and the sentiment I see, even on HN, is we can't outcompete China any more. This is sad. Really sad. And this fits exactly what Liu Cixin said in Three Body Problem: Weakness and ignorance are not barriers to survival, but arroganc…

[deleted]

Re: Nvidia’s $589B DeepSeek rout

#439

Post by jhickok »

zozbot234 wrote: post #400
lvl155 wrote: post #364

But Apple was up…indexing at its finest.

Not surprising there - a maxed out Mac Studio is a great AI homelab, giving you way more bang for the buck than nVidia offerings.

Think that was the cause of their stock increase? I feel like investors use opportunities like this to pile money into safer bets rather than just bail on stocks altogether.

Re: Nvidia’s $589B DeepSeek rout

#440

Post by numba888 »

Looks like panic sell off, but main question is:

do models with DeepSeek architecture still scale up?

If yes, then bigger clusters will outperform in near future. NVidia wins as tide rises all boats, and them first.

If not, then it's still possible to run several models in parallel to do the same, potentially big, job. Just like humans team. All we need is to learn how to do it efficiently. This way bigger clusters win again.

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