If this is a bubble, it’s not a very impressive one. The dot-com bubble was built on companies with little or no revenue, and the Nasdaq eventually fell about 78%. Today the S&P 500 trades on a forward P/E of 18.7, below its 5 and 10 year averages, with Q3 earnings growth at 29.5%. Nvidia, for example, arguably the epicenter of the bubble, just made $63.7bn of operating income on $96.2bn of revenue at a 75% gross margin. So this bubble is built on organic growth and insane real demand. Google Cloud grew 103%. Azure 48%. AWS 39%.
Also, neither OpenAI nor Anthropic are publicly traded. They can implode and it’ll leave barely a ripple in the stock market.
None of the AI companies are making money, Nvidia is making some, but large amounts of it’s worth much like the other tech companies involved is fictional. All based on circular finance and buying through third parties to cover actual costs. It’s as corrupt as you can get.
Nvidia booked $63.7bn operating income last quarter, and the equity gains you’re thinking of are a separate $7.8bn line underneath that. AWS made $17.8bn operating profit and Google Cloud $11.1bn in the same period, off customers who actually paid.
There’s nothing illegal or corrupt about Anthropic purchasing compute from SpaceX.
If this is a bubble, it’s not a very impressive one. The dot-com bubble was built on companies with little or no revenue, and the Nasdaq eventually fell about 78%. Today the S&P 500 trades on a forward P/E of 18.7, below its 5 and 10 year averages, with Q3 earnings growth at 29.5%. Nvidia, for example, arguably the epicenter of the bubble, just made $63.7bn of operating income on $96.2bn of revenue at a 75% gross margin. So this bubble is built on organic growth and insane real demand. Google Cloud grew 103%. Azure 48%. AWS 39%.
Also, neither OpenAI nor Anthropic are publicly traded. They can implode and it’ll leave barely a ripple in the stock market.
None of the AI companies are making money, Nvidia is making some, but large amounts of it’s worth much like the other tech companies involved is fictional. All based on circular finance and buying through third parties to cover actual costs. It’s as corrupt as you can get.
Nvidia booked $63.7bn operating income last quarter, and the equity gains you’re thinking of are a separate $7.8bn line underneath that. AWS made $17.8bn operating profit and Google Cloud $11.1bn in the same period, off customers who actually paid.
There’s nothing illegal or corrupt about Anthropic purchasing compute from SpaceX.