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Nvidia’s $589B DeepSeek rout

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Re: Nvidia’s $589B DeepSeek rout

#471

Post by sho_hn »

culi wrote: post #443
ozten wrote: post #431

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…

Yeah but NVIDIA's amazing digging technique that could only be accomplished with NVIDIA shovels is now irrelevant. Meaning there are more people selling shovels for the gold rush

DeepSeek's stuff is actually more dependent on nVidia shovels. They implemented a bunch of assembly-level optimizations below the CUDA stack that allowed them to efficiently use the H800s they have, which are memory-bandwidth-gimped vs. the H100s they can't easily buy on the open market. That's cool, but doesn't run on any other GPUs.

Cue all of China rushing to Jensen to buy all the H800s they can before the embargo gets tightened, now that their peers have demonstrated that they're useful for something.

At least briefly, Jensen's customer audience increased.

Re: Nvidia’s $589B DeepSeek rout

#472

Post by paxys »

numba888 wrote: post #429
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.

P/E ratio is better indicator. Price/Earnings. NVidia: 46, Microsoft: 35, Apple: 34, Amazon: 50. As you see NVidia doesn't stand out much, it's even lower than Amazon.

You are sharing numbers after the drop. The p/e was 60 yesterday.

Re: Nvidia’s $589B DeepSeek rout

#473

Post by segasaturn »

alfalfasprout wrote: post #463
segasaturn wrote: post #430

Earlier quoted context omitted.

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.

Wrong conclusion, IMO. This makes inference more cost effective which means self-hosting suddenly becomes more attractive to a wider share of the market. GPUs will continue to be bought up as fast as fabs can spit them out.

The number of people interested in doing self-hosting for AI at the moment is a tiny, tiny percentage of enthusiast computer users, who indeed get to play with self-hosted LLMs on consumer hardware now.. but the promise of these AI companies is that LLMs will be the "next internet", or even the "next electricity" according to Sam Altman, all of which will run exclusively on Nvidia chips running in mega-datacenters, the promise of which was priced into Nvidia's share price as of last Friday. That appears on shaky ground now.

Re: Nvidia’s $589B DeepSeek rout

#474

Post by TheAlchemist »

Nvidia valuation = $3000B

Nvidia profits during AI madness last year = $65B (last 4 quarters)

Nvidia profits during normal year = $5B

This stock could drop 90% from here, and still be expensive. The numbers are absolutely crazy and make no sense at all.

Stargate project is aiming to invest $500B over 4 years. Those $500B are a pipe dream, but let's suppose for a second that all of that $500B will be Nvidia profits and that we will have another Stargate project in 4 years, again resulting in a direct profits of $500B for Nvidia.

And you know what ? In that scenario Nvidia would STILL be overvalued by historical standards !

EDIT: Changed $30B from the fiscal year, to $65B for last 4 quarters.

Re: Nvidia’s $589B DeepSeek rout

#475

Post by snailmailstare »

httpz wrote: post #413
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.

Nvida has a P/E of 47. While it may be a bit high for a semiconductor company, it's definitely not a meme stock figure.

Yes and no, going from 47 to 50 would buy a few of the most popular meme stocks so there simply aren't enough people to make it a true meme stock with that market cap.

Re: Nvidia’s $589B DeepSeek rout

#477

Post by mullingitover »

bilbo0s wrote: post #347
h1h1hh1h1h1 wrote: post #334

So 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?

I think it's probably more accurate to say that people are now a bit more bullish on what the Chinese will be able to accomplish even in the face of trade restrictions. Now whether or not it makes sense to be bearish on US AI is a totally different issue. Personally I think being bearish on US AI makes zero sense. I'm almost positive there will be restrictions on using Chinese models forthcoming in the near to medium…

> I'm almost positive there will be restrictions on using Chinese models forthcoming in the near to medium term.

If the models are open source, there are constitutional issues that would prevent restricting them unless we're going down the ridiculous path of classifying integers representing algorithms as munitions, like we tried with crypto.

Re: Nvidia’s $589B DeepSeek rout

#478

Post by donsupreme »

KiwiJohnno wrote: post #399
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.

Not quite, I believe this sell off was caused by DeepSeek showing with their new model that the hardware demands of AI are not necessarily as high as everyone has assumed (as required by competing models). I've tried their 7b model, running locally on a 6gb laptop GPU. Its not fast, but the results I've had have rivaled GPT4. Its impressive.

> I've tried their 7b model

Anything other than their 671b model are just distilled models on top of Qwen and Llama using their 671b reasoning data output, right?

Re: Nvidia’s $589B DeepSeek rout

#479

Post by maram »

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.

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