5 ms·

I don't think it's fair to say NVDA is meme stock, having reported 35B revenue last quarter.

by belevme 2y ago

master_crab 2y ago
True but with that revenue number it would mean that before today it was valued at ~100x revenue. That’s pretty bubbly.
- acchow 2y ago
  Thats 100x quarterly revenue, or 25x annual revenue.
danpalmer 2y ago
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.
- buffington 2y ago
  Didn't DeepSeek train on Nvidia hardware though? I can't see how DeepSeek hurts Nvidia, if Nvidia is what enables DeepSeek.
  - amazingamazing 2y ago
    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.
  - danpalmer 2y ago
    Supposedly DeepSeek trained on Nvidia hardware that is not current generation. This suggests that you don't need the current generation to make the best model, which a) makes it harder for Nvidia to sell each generation if it's more like traditional compute (how's Intel's share price today?), and b) opens the door to more competition, because if you can get an AMD chip that's 80% as good for 70% of the price, that's worth it. I'm skipping over some details of course, but the current Nvidia valuation, or rather the valuation a few days ago, was based on them being the only company capable of producing chips that can train the best models. That wasn't true for those in the know before, but is now very much more clearly not true.
paxys 2y ago
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.
- nl 2y ago
  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.
  - paxys 2y ago
    Yes revenue has grown xx% in the last quarter and year, but the stock is valued as if it will keep growing at that rate for years to come and no one will challenge them. That is the definition of a bubble. How sound is the investment thesis when a bunch of online discussions about a technical paper on a new model can cause a 20% overnight selloff? Does Apple drop 20% when Samsung announces a new phone?
    - hyperpape 2y ago
      > the stock is valued as if it will keep growing at that rate for years to come and no one will challenge them. If it were valued that way, the P/E would be over 100. Feel free to say Nvidia is overvalued, but you have to get the financials right.
  - amazingamazing 2y ago
    to be fair, there's no way these rates will be sustained for a decade.
    - nl 2y ago
edm0nd 2y ago
Would now be a good time to buy into NVDA if you are long on it?

I don't think it's fair to say NVDA is meme stock, having reported 35B revenue last quarter.

master_crab 2y ago

True but with that revenue number it would mean that before today it was valued at ~100x revenue. That’s pretty bubbly.

acchow 2y ago
Thats 100x quarterly revenue, or 25x annual revenue.

danpalmer 2y ago

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.

buffington 2y ago
Didn't DeepSeek train on Nvidia hardware though? I can't see how DeepSeek hurts Nvidia, if Nvidia is what enables DeepSeek.
- amazingamazing 2y ago
  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.
- danpalmer 2y ago
  Supposedly DeepSeek trained on Nvidia hardware that is not current generation. This suggests that you don't need the current generation to make the best model, which a) makes it harder for Nvidia to sell each generation if it's more like traditional compute (how's Intel's share price today?), and b) opens the door to more competition, because if you can get an AMD chip that's 80% as good for 70% of the price, that's worth it. I'm skipping over some details of course, but the current Nvidia valuation, or rather the valuation a few days ago, was based on them being the only company capable of producing chips that can train the best models. That wasn't true for those in the know before, but is now very much more clearly not true.

paxys 2y ago

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.

nl 2y ago
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.
- paxys 2y ago
  Yes revenue has grown xx% in the last quarter and year, but the stock is valued as if it will keep growing at that rate for years to come and no one will challenge them. That is the definition of a bubble. How sound is the investment thesis when a bunch of online discussions about a technical paper on a new model can cause a 20% overnight selloff? Does Apple drop 20% when Samsung announces a new phone?
  - hyperpape 2y ago
    > the stock is valued as if it will keep growing at that rate for years to come and no one will challenge them. If it were valued that way, the P/E would be over 100. Feel free to say Nvidia is overvalued, but you have to get the financials right.
- amazingamazing 2y ago
  to be fair, there's no way these rates will be sustained for a decade.
  - nl 2y ago

edm0nd 2y ago

Would now be a good time to buy into NVDA if you are long on it?