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Oracle hit hard in Wall Street's tech sell-off over its AI bet

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Re: Oracle hit hard in Wall Street's tech sell-off over its AI bet

#101

Post by cowpig »

neom wrote: post #19
chollida1 wrote: post #17

Its worse for some other "ai" related companies. Coreweave for instance, now has its CDS trade around 600bp, which is a 1/3 rise in 2 months, which implies that the probability of a default in 5 years is 40% at a 40 cent recovery rate. That makes Coreweave's credit rating the equivalent of CCC-, which aint good.

Yeah, and then the Canadian government handed hundreds of millions to the kids at Cohere who have now gone spent it on Coreweave. When it was all announced I was very very vocal that using an inexperienced startup for the sovereign compute capabilities seemed a very poor choice. I'm so curious to see how this all plays out.

What should they have done instead?

I have a lot of opinions on this but curious about yours :)

Re: Oracle hit hard in Wall Street's tech sell-off over its AI bet

#102

Post by Spivak »

francisofascii wrote: post #30

Oracle stock down 25% for the past month, but still up 35% for the year and 300% for 5 years.

This is every hopium "Stock in Thing You Don't Like Plummeting" article where it's the tiniest little dip at the top of a peak that makes Everest jealous once you zoom out.

Re: Oracle hit hard in Wall Street's tech sell-off over its AI bet

#103

Post by cjbgkagh »

jiscariot wrote: post #82
foofoo12 wrote: post #69

Earlier quoted context omitted.

Unfair. Oracle excels at some things, like extortion, blackmailing and litigation.

Just think about what they could accomplish if they had more engineers than lawyers.

What if the engineers then made a lawyer AI?

Re: Oracle hit hard in Wall Street's tech sell-off over its AI bet

#104

Post by mr_toad »

re-thc wrote: post #64
dmoy wrote: post #2

So debt financing (Oracle) vs fund-it-more-on-your-own (other big tech?) vs fund-it-with-equity (startups?)... I guess that makes some kind of sense? Oracle raises 4x the debt of e.g. Google?

> I guess that makes some kind of sense? Oracle raises 4x the debt of e.g. Google? The problem is why is Oracle raising this debt? It's to do the buildout for OpenAI. So Oracle buys GPUs from Nvidia. Nvidia invests in OpenAI. OpenAI then pays Oracle for the GPUs. i.e. we're going around in circles.

Maybe they think that the AGI will buy stuff itself and they won’t need paying customers.

Re: Oracle hit hard in Wall Street's tech sell-off over its AI bet

#105

Post by maximilianburke »

htrp wrote: post #62
helloooooooo wrote: post #27

Earlier quoted context omitted.

Cohere is doing a lot of enterprise AI business, and a lot of business directly with the federal government. They are also not juiced up in these financial games that OpenAI or Oracle are playing. Additionally, Cohere is no less “kids” than Anthropic or OpenAI. Aidan was literally one of the co-authors of “Attention is all you need”.

aidan was an intern on AIAYN >While an intern at Google Brain, Aidan Gomez co-authored the paper "Attention Is All You Need" with other researchers.

https://en.wikipedia.org/wiki/Attention_Is_All_You_Need#Auth...

>The authors of the paper are: Ashish Vaswani, Noam Shazeer, Niki Parmar, Jakob Uszkoreit, Llion Jones, Aidan Gomez, Łukasz Kaiser, and Illia Polosukhin. All eight authors were "equal contributors" to the paper; the listed order was randomized.

Intern or not, it still sounds like he contributed substantially.

Re: Oracle hit hard in Wall Street's tech sell-off over its AI bet

#106

Post by Scene_Cast2 »

cowpig wrote: post #101
neom wrote: post #19

Earlier quoted context omitted.

Yeah, and then the Canadian government handed hundreds of millions to the kids at Cohere who have now gone spent it on Coreweave. When it was all announced I was very very vocal that using an inexperienced startup for the sovereign compute capabilities seemed a very poor choice. I'm so curious to see how this all plays out.

What should they have done instead? I have a lot of opinions on this but curious about yours :)

I would love to hear your (and others) opinions.

I don't have a good idea of what happened inside or what they could have done differently, but I do remember them going from a world-leading LLM AI lab to selling embeddings to enterprise.

Re: Oracle hit hard in Wall Street's tech sell-off over its AI bet

#107

Post by re-thc »

daveguy wrote: post #95
re-thc wrote: post #60

Earlier quoted context omitted.

> When it was all announced I was very very vocal that using an inexperienced startup for the sovereign compute capabilities seemed a very poor choice. Cohere raised from Nvidia. Cohere spends on Coreweave. Coreweave raised from Nvidia and buys Nvidia chips. This is why they buy from Coreweave.

You're not implying there is corruption in the form of circular deal making in the AI/Tech industry, are you?

No, it's not "corruption". It's that very little real money changes hands. The smaller investors and debt providers get sucked into funding it but that's about it.

You get GPU rentals. Not the actual billions raised they claim. So it's just creative accounting to count the same money 2-4x.

Re: Oracle hit hard in Wall Street's tech sell-off over its AI bet

#108

Post by mr_toad »

tracker1 wrote: post #73
JCM9 wrote: post #3

I’m bullish on AI as tech but folks are starting to sniff out that the financials of everything going on at the moment aren’t sustainable for much longer. I hope we have more of a “reality correction” than full blown bubble bursting, but the data is increasingly looking like we’re about to have a massive implosion that wipes out a generation of startups and sets the VC ecosystem back a decade.

I don't know about a decade... the dotcom bubble bursting was pretty close to normal within 5 years or so. Still a long time, and from personal experience the 50% pay cut from before and a year later was anything but fun.

The market as a whole always recovers. But individual companies, or even entire industries can vanish without a trace. So betting on the entire market is a fairly safe bet, long-term. Betting on OpenAI is much more risky.

Re: Oracle hit hard in Wall Street's tech sell-off over its AI bet

#109

Post by mjr00 »

maeln wrote: post #58
mjr00 wrote: post #36

Earlier quoted context omitted.

The most sobering statistic I've seen is that the entire combined amount of consumer spending on AI products is currently less than the revenue of Genshin Impact.

Well, Genshin Impact is at the forefront of predatory B2C business practice. It is a gacha game, engineered to extract as much money from its prey as possible. On the other end, most AI company can afford to be generous with their user/consumer right now because they are being bankrolled by magic money. The real test will be when they have to start the enshitification. Will the product still be enough to convince con…

Regardless of your feelings on Genshin/gacha (which I agree is predatory), the point is that the revenue of a single game developed by a few hundred people is currently making more money than an entire industry which is "worth" trillions of dollars, according to the stock market, and is, according to Sam Altman, so fundamentally important to the US economy that the US government is an insurer of last resort who will bail out AI companies if their stock price falls too much.

Re: Oracle hit hard in Wall Street's tech sell-off over its AI bet

#110

Post by cjbgkagh »

andrepd wrote: post #37
fullshark wrote: post #22

Earlier quoted context omitted.

Market is rallying cause there is too much money chasing too few assets. PE ratios will not drop significantly baring catastrophe and then financial contagion. After that happens the money printer is turned back on and then...

I don't see a way out besides massive reconfiguration. We've been living in this world since 2008 and the train shows no signs of stopping, only speeding up.

There is no natural limit to insanity
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