Ai bubble

[Lord_Wanaruona]

History keep on repeating itself… Same way as the dotcom bubble which lead to recession.
Feet of clay: Why Nvidia can’t dispel AI bubble concerns

The much-anticipated Nvidia earnings report aims to calm investors unnerved by AI bubble fears—but the devil is always in the details.

Let’s take a closer look

Nvidia earnings report has been seen as a litmus test for the AI industry: the chip maker’s failure to meet investors’ expectations would have proven their AI bubble concerns

Nvidia fiscal results in the third quarter showed a record revenue of $57.0 billion, up 22% from the Q2 and up 62% from a year ago. All seems well on the surface — but is it really?

Deceptive growth

Market experts point out that most of Nvidia’s boom of 61% in Q2 relied on four unnamed customers – most likely including Microsoft, Meta and Oracle. In the previous quarter, 56% of Nvidia’s profits came from four unnamed customers

Red flags:

massive reliance on a few customers
reports of questionable ‘circular’ deals between them
neither of the companies has reported massive profits from AI so far

“A lot of this growth is coming from loss-making startups or loss-making projects, so most likely the cycle ends badly,” Elazar Advisors analyst Chaim Siegel told Reuters

Is Big Tech cheating to boost earnings?

‘Big Short’ investor Michael Burry hints at Nvidia’s manipulations with shares and claims that tech giants including Oracle and Meta are deliberately overstating earnings – “a common fraud of the modern era”. By 2028, Oracle will overstate earnings by 27% and Meta by 21%, Burry says

How do they do it? According to Burry, tech giants are stretching the life of Nvidia servers to understate depreciation, artificially boosting profits. He projects they will understate depreciation by $176b between 2026 and 2028

Burry warns the AI bubble is about to burst, followed by a market crash and recession. He promises new revelations on November 25

AI race

Nvidia’s dominance may be soon eroded by Google and Amazon, who are pushing their own AI chips

China is making its own AI chips and chatbots – more affordable and less energy-consuming than US rivals

Nvidia’s ‘tipping point’ could become a harbinger of decline.

[sitaki]

hi story ya AI bubble na comparison za dotcom bubble dont align - looking at the current environment apart from nvidia sioni any other meaningful company whose earnings will be affected to a large extent by an AI bubble bursting, I dont even think there will be anything of note at least not like the dotcom bubble, hapa nvidia will just go back to making gaming chips

[Lord_Wanaruona]

@sitaki

…hi story ya AI bubble na comparison za dotcom bubble dont align - looking at the current environment apart from nvidia sioni any other meaningful company whose earnings will be affected to a large extent by an AI bubble bursting, I dont even think there will be anything of note at least not like the dotcom bubble, hapa nvidia will just go back to making gaming chips

Nvidia shares zao ziko overpriced.

[sitaki]

@Lord_Wanaruona

…story ya AI bubble na comparison za dotcom bubble dont align - looking at the current environment apart from nvidia sioni any other meaningful company whose earnings will be affected to a large extent by an AI bubble bursting, I dont even think there will be anything of note at least not like the dotcom bubble, hapa nvidia will just go back to making gaming chips

Nvidia shares zao ziko overpriced.

true, I think they are vastly overpriced based on a future projection that most likely will not come to pass, but even if the bubble bursts it only affect a small segment and I think the repercussions will be positive, companies will re-employ thus spur more growth

[Maize_Combuster]

@Lord_Wanaruona

…story ya AI bubble na comparison za dotcom bubble dont align - looking at the current environment apart from nvidia sioni any other meaningful company whose earnings will be affected to a large extent by an AI bubble bursting, I dont even think there will be anything of note at least not like the dotcom bubble, hapa nvidia will just go back to making gaming chips

Nvidia shares zao ziko overpriced.

I don’t like how casually you are making it seem like share prices are determined in busaa and chang’aa dens without discussing the underlying factors to the pricing.

[Jack_Black]

Have you guys actually tried to use AI for it’s intended purposes? That is, to discover new, useful information? This stuff is actually a big deal out there. Or is IBM a new totally new term in this cesspit?