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The Future of Compute: Nvidia's Crown Is Slipping

mohitdagarwal.substack.com

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Re: The Future of Compute: Nvidia's Crown Is Slipping

#51

Post by voidspark »

kadushka wrote: post #46
voidspark wrote: post #40

Earlier quoted context omitted.

You linked to an article about Google renting an insignificant amount of additional capacity. Google runs AI / HPC workloads on their own hardware and has been doing that for more than a decade. Google Gemini was trained on TPUs developed in house. It does not run on Nvidia hardware.

Google, last month: “we’re doubling down on our partnership with NVIDIA” https://blog.google/technology/ai/google-nvidia-gtc-ai/

That's Google Cloud Platform. Of course they will provide Nvidia hardware as demanded by external customers.

But their internal workloads and their frontier model (Gemini) runs on TPUs.

Re: The Future of Compute: Nvidia's Crown Is Slipping

#52

Post by aleph_minus_one »

chneu wrote: post #48
aleph_minus_one wrote: post #29

Earlier quoted context omitted.

> Gosh, I have a coworker who acts like gaming GPUs are the only hardware that matters. > I've tried explaining that one or two AI data center clients for Nvidia dwarfs the entire gaming GPU market, but he just doesn't get it. I have a feeling that the different judgements come from the fact that the coworker thinks that the AI bubble will soon burst - thus, in his judgement, the AI data center sector of Nvidia is in…

Data centers and enterprise will always dwarf consumer hardware. AI has nothing to do with it. You're silly if you think otherwise.

> Data centers and enterprise will always dwarf consumer hardware.

Before the current AI hype, except for some rather specialized applications, people had rather little use for GPU acceleration (GPGPU) in data centers.

Re: The Future of Compute: Nvidia's Crown Is Slipping

#53

Post by makeitdouble »

voidspark wrote: post #28
01100011 wrote: post #27

Seems like another article based on the assumption that Nvidia just sits there doing nothing while everyone who has so far proven unable to compete suddenly figures it out and steals their lunch. At some point one of these Nvidia doomers will be right but there is a long line of them who failed miserably.

> everyone who has so far proven unable to compete The article explains that Nvidia's biggest customers (50% of datacenter revenue) are switching to their own hardware.

But then they're not boosting NVidia's competitors either, so wouldn't NVidia stay in the top position in their market ?

The article seems focused more on stock price and where to bet, than the market for GPUs or generic hardware vendors.

Re: The Future of Compute: Nvidia's Crown Is Slipping

#54

Post by hector_vasquez »

KerrAvon wrote: post #26
ivape wrote: post #5

Interesting, Marvell is actually down over 50% this year. I just don't understand the bear case at all. I'm a nobody and I'm still willing to buy a $1500 gpu, and that GPU still can't do what the cloud does. The next $1500 gpu probably can't either. It feels like we're over thinking this. The hardware roll-out is all there is imho. Jensen has mentioned he sees Nvidia being a 10 trillion-dollar company, and I'm willin…

I agree the concern here about Nvidia's long term viability seems overblown. WRT your edit: The answer to all of this is that it's very hard and requires a huge amount of investment to produce good vertical solutions in each of these spaces. You cannot build a good AI phone without first building a good phone. You cannot build a self-driving car without starting with a good car, etc. For robots, I'll point you to som…

> You cannot build a good AI phone without first building a good phone. You cannot build a self-driving car without starting with a good car, etc.

More like you cannot build a self-driving car without starting with a good phone. See Huawei.

Re: The Future of Compute: Nvidia's Crown Is Slipping

#55

Post by mycall »

makeitdouble wrote: post #53
voidspark wrote: post #28

Earlier quoted context omitted.

> everyone who has so far proven unable to compete The article explains that Nvidia's biggest customers (50% of datacenter revenue) are switching to their own hardware.

But then they're not boosting NVidia's competitors either, so wouldn't NVidia stay in the top position in their market ? The article seems focused more on stock price and where to bet, than the market for GPUs or generic hardware vendors.

By switching to their own hardware, they become NVidia's competitors.

Re: The Future of Compute: Nvidia's Crown Is Slipping

#56

Post by mycall »

alephnerd wrote: post #12
ivape wrote: post #5

Interesting, Marvell is actually down over 50% this year. I just don't understand the bear case at all. I'm a nobody and I'm still willing to buy a $1500 gpu, and that GPU still can't do what the cloud does. The next $1500 gpu probably can't either. It feels like we're over thinking this. The hardware roll-out is all there is imho. Jensen has mentioned he sees Nvidia being a 10 trillion-dollar company, and I'm willin…

> I wonder what's stopping Nvida from releasing an AI phone B2C is a hellish headache that has marginal returns if you are not B2C first, and the amount of investment needed to be B2C competent just isn't worth it when there are alternative options to invest in > A LLM competitor service (Hey, how about you guys make your own chips Already exists. AI Foundary > They are already releasing an AI PC It's just an OEM reh…

NVidia is perfect tech for Software Defined Vehicles. Maybe if they made a car to kick start the industry, it might go places.

Re: The Future of Compute: Nvidia's Crown Is Slipping

#57

Post by solardev »

monocasa wrote: post #37
voidspark wrote: post #28

Earlier quoted context omitted.

> everyone who has so far proven unable to compete The article explains that Nvidia's biggest customers (50% of datacenter revenue) are switching to their own hardware.

And something like 90% of Nvidia's revenue at this point is from the datacenter market.

As a gamer, I selfishly wish that Nvidia would go back to being a gaming company instead of a crypto and AI compute company. I miss MSRP graphics cards :(

Re: The Future of Compute: Nvidia's Crown Is Slipping

#59

Post by Fade_Dance »

ivape wrote: post #5

Interesting, Marvell is actually down over 50% this year. I just don't understand the bear case at all. I'm a nobody and I'm still willing to buy a $1500 gpu, and that GPU still can't do what the cloud does. The next $1500 gpu probably can't either. It feels like we're over thinking this. The hardware roll-out is all there is imho. Jensen has mentioned he sees Nvidia being a 10 trillion-dollar company, and I'm willin…

>I wonder what's stopping Nvida from releasing an AI phone

It's a low margin business and would hurt the balance sheet more than the completely irrelevant revenue from a project like that.

I've been investing in semi for decades and what strikes me about this recent cycle is that so many don't seem to understand that semi is a highly cyclical business that is prone to commoditization waves and inventory/capacity overbuild.

And speaking as a trader, instead of reinforcing your firmly held base case, I'd strongly consider painting out the bear cases. Look at the roadmaps of the hyperscalers that are designing their own chips for internal use, etc. And never use the word faith when it comes to markets.

You could easily see NVIDIAs margins get chopped down, and see the multiple re-rate lower from here. Actually, I'd argue the name is well on the way down this path already.

It's almost guaranteed to happen sooner or later. Semi down cycles are usually brutal for semi equities.

That's not to say it isn't a great company. It's certainly not a Buffett name though.

Re: The Future of Compute: Nvidia's Crown Is Slipping

#60

Post by thot_experiment »

echelon wrote: post #22

> While the H100 generation likely represents peak pricing power (new B200s have lower margins and higher COGS), an immediate lack of alternatives means they’ll continue to print cash. That's not a trend yet. We're about to enter an era where most media is generated. Demand is only going to go up, and margins may not matter if volume goes up. > The open question is long-term (>6yrs) durability1. Hyperscalers (Google,…

Most media might be generated, but it remains to be seen whether most media that people will pay for will be generated.
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