Do you think they can maintain that for another 5 years? Another 20?
I think expecting NVIDIA to fail inside the next five years is a wild reach. You might expect Oracle to take haircut in the next five years, based on their atrocious debt load. But even then, the idea that they’ll miss a credit payment?
Twenty years out, these firms are an even safer bet. Long term demand for compute and hosting services is only going up. And they’re so heavily consolidated. Too Big To Fail in every sense of the word. Are you going to bet against JP Morgan and Goldman Sachs on the eve of the financial crisis, even? Twenty years later, how are they doing?
Are 5 AI companies providing more value than every other tech company in the last 50 years?
It’s not a question of value, it’s a question of earnings growth. Will these top 5 AI companies be seeing stratospheric earnings growth in the next ten years? All signs point to “Yes”. The race to cement these data center footprints is a scramble for limited resources. The Capex budgets won’t be inflated to this degree forever.
Dismissing them for their rapid expansion would be like betting against New York and Chicago real estate markets because you didn’t trust skyscrapers to be profitable in another 20 years. Or betting against U.S. Steel and Standard Oil at the apex of WW2, because the resource demand from the conflict can’t go on forever.
I’m not saying they will fail I’m saying they will not maintain their rate of growth. Very, very different things but i guess you can pretend i said something else and argue against that or whatever idk dude lol
If you will hit a saturation point, at some point the demand will stop outstripping the supply. Once you cannot exapand, the supply will catch up simply because the demand decreases, not considering that the supply could simply increase.
We are not at a saturation point for computer, but if you look at other fields, like smartphone, in 2026 we are set for a -7.4% so it is not impossible or never happened.
This can have a lot of causes, not last the increase in price, but in the case of the smartphones we somewhat hit a saturation point: there are very few people who can afford to have a phone who do not yet have it.
Same with computer and/or compute power: at some point, given that the users are a finite number, we will reach a point where no new people (users) will use it and at that point the demand will stabilize: you have only so much time to do things, both works and free time, so the demand flat out or decreases.
The demand decreases even going from building 10 new datacenter to building only 8 new datacenter.
I think demand is coming only from a small group of people, though; it’s definitely not the rest of the S&P 500, since they’re going bankrupt from it! lol
I think they’ll shrink by half over a few years and revert back to the consumer market by repackaging all the hardware they couldn’t get the power and data centres built for. They’ll probably make a bunch of AI gadgets, then move on to the next thing.
AI is just the NFT version of the GFR, again, in 2026 and much worse. No one will be hype farming it after this crash. All the larping “AI bro” channels will go. Influencers sitting on the beach with their laptops, shilling how it makes them $100,000 a month while they sleep. Those people will go… What I suspect will remain of the industry is a completely niche sector for specialised applications in schools, hospitals, higher education, and film & sound design; it can reduce some of the burden at work if implemented well. But most of the public will remain staunchly opposed to a subscription-based life where AI drives every IoT device in their home or vehicle and generates sloppy, hallucinated content that doesn’t help them but harms them.
NOTE: In a survey, over 60% of Microsoft users say they actively seek ways to bypass online account processes for local accounts and encourage others to do the same. If you can’t sell the idea of mandatory sign-in just for syncing desktops because everyone understands why a PC is exactly that “a Personal Machine”, everything is supposed to stay & run locally if it is indeed “YOUR COMPUTER”… I don’t see the big 5 generating the revenue through online subscriptions to get them out of that debt spiral; local open-source AI models and cheaper hardware are the only way I see plausible mass adoption happening.
When it comes to stock prices and value, I see the same kind of hype marketing surrounding it, not much happening in reality… Just a whopping 80 billion loss in only 6 months? It’s just freaking insane, and CoreWeave being downgraded & losing 54% in 12 months is the sort of thing I would expect from the crypto market, not mainstream big tech companies… The only real “mainstream application” I’ve witnessed thus far is an influx of low-skill hackers pulling off things they couldn’t have done otherwise, and more fake social media accounts than ever before… some things Robots, taxis, and trucks to replace workers, and creepy unwarranted surveillance systems nobody voted on to pay for. I’m sceptical that mainstream businesses implementing these applications will be reporting enough substantial revenue growth to offset their running costs in the end. That only leaves protein folding in medicine to “cure disease”, as if that will ever happen lol!
Enormous amounts of capex spending to build out the hardware to run the machinery of business. What’s incredibly isn’t the losses but the willingness of large financial institutions to extend this kind of credit in the first place.
It’s just freaking insane, and CoreWeave being downgraded & losing 54% in 12 months is the sort of thing I would expect from the crypto market, not mainstream big tech companies…
The crypto market is an excellent parallel, in so far as its a market everyone paying half-attention has insisted would collapse into fine powder at the slightest bit of financial pressure. And yet… It seems like crypto banking has stubbornly endured as the utility of an entirely unregulated and obnoxiously difficult to trace digital currency with direct links to the traditional banking sector becoming more apparent. Hey look! You can straight up dump cash directly into the back pocket of a sitting President and NOTHING stops you.
As to CoreWeave, losing 54% would be bigger blow if the company wasn’t still sitting on a $30B market cap. FFS, they’re still 6% over their 2025 valuation. I can’t help but think doubling your YoY revenue has helped them along.
The only real “mainstream application” I’ve witnessed thus far is an influx of low-skill hackers pulling off things they couldn’t have done otherwise
Well, then - firstly, you haven’t been looking hard enough. AI is getting itself insinuated everywhere, from accounting and legal to engineering and construction to sports betting and big finance. I don’t like it, but I can’t deny how much of the decisions at a mega-institution like JP Morgan or Blackrock are increasingly outsourced to some cloud computing machines in Israel owned by Larry Ellison.
But secondly, low-skill hackers pulling off things they couldn’t otherwise just describes your average small-cap IT department. Everyone touching a computer has experimented with these tools. And we all find something useful in them. Again, I don’t like that this is happening, but you’re a schmuck high on your own supply if you simply ignore it.
I’m sceptical that mainstream businesses implementing these applications will be reporting enough substantial revenue growth to offset their running costs in the end. That only leaves protein folding in medicine to “cure disease”, as if that will ever happen lol!
Protein Folding is one of those “only a computer could do this efficiently” problems that AI is exceptionally suited for. But churning out basic-bitch legal contracts with minor client-specified variations, based on a complex and constantly evolving common law system, is also a problem well-suited to AI. Really, anything that involves a high degree of nuance and complexity across a variety of niche fields with a host of very specialized tools can see a tangible benefit from the big Natural Language Input/Ouput Box.
You can be skeptical as you please. Lord knows I was. But it’s increasingly difficult to deny that these highly sophisticated and centrally hosted digital tools are flooding damned near every white collar field you could name.
I think expecting NVIDIA to fail inside the next five years is a wild reach. You might expect Oracle to take haircut in the next five years, based on their atrocious debt load. But even then, the idea that they’ll miss a credit payment?
Twenty years out, these firms are an even safer bet. Long term demand for compute and hosting services is only going up. And they’re so heavily consolidated. Too Big To Fail in every sense of the word. Are you going to bet against JP Morgan and Goldman Sachs on the eve of the financial crisis, even? Twenty years later, how are they doing?
It’s not a question of value, it’s a question of earnings growth. Will these top 5 AI companies be seeing stratospheric earnings growth in the next ten years? All signs point to “Yes”. The race to cement these data center footprints is a scramble for limited resources. The Capex budgets won’t be inflated to this degree forever.
Dismissing them for their rapid expansion would be like betting against New York and Chicago real estate markets because you didn’t trust skyscrapers to be profitable in another 20 years. Or betting against U.S. Steel and Standard Oil at the apex of WW2, because the resource demand from the conflict can’t go on forever.
I’m not saying they will fail I’m saying they will not maintain their rate of growth. Very, very different things but i guess you can pretend i said something else and argue against that or whatever idk dude lol
They’ll hit a saturation point eventually, sure. But demand for capacity continues to outstrip supply.
If you will hit a saturation point, at some point the demand will stop outstripping the supply. Once you cannot exapand, the supply will catch up simply because the demand decreases, not considering that the supply could simply increase.
Can you point to a five year span in the last century when demand for compute has decreased?
We are not at a saturation point for computer, but if you look at other fields, like smartphone, in 2026 we are set for a -7.4% so it is not impossible or never happened.
This can have a lot of causes, not last the increase in price, but in the case of the smartphones we somewhat hit a saturation point: there are very few people who can afford to have a phone who do not yet have it.
Same with computer and/or compute power: at some point, given that the users are a finite number, we will reach a point where no new people (users) will use it and at that point the demand will stabilize: you have only so much time to do things, both works and free time, so the demand flat out or decreases.
The demand decreases even going from building 10 new datacenter to building only 8 new datacenter.
Consumer electronics and business compute demands are wildly different markets.
That’s not a measure of demand
I think demand is coming only from a small group of people, though; it’s definitely not the rest of the S&P 500, since they’re going bankrupt from it! lol
Who is going bankrupt?
I think they’ll shrink by half over a few years and revert back to the consumer market by repackaging all the hardware they couldn’t get the power and data centres built for. They’ll probably make a bunch of AI gadgets, then move on to the next thing.
AI is just the NFT version of the GFR, again, in 2026 and much worse. No one will be hype farming it after this crash. All the larping “AI bro” channels will go. Influencers sitting on the beach with their laptops, shilling how it makes them $100,000 a month while they sleep. Those people will go… What I suspect will remain of the industry is a completely niche sector for specialised applications in schools, hospitals, higher education, and film & sound design; it can reduce some of the burden at work if implemented well. But most of the public will remain staunchly opposed to a subscription-based life where AI drives every IoT device in their home or vehicle and generates sloppy, hallucinated content that doesn’t help them but harms them.
NOTE: In a survey, over 60% of Microsoft users say they actively seek ways to bypass online account processes for local accounts and encourage others to do the same. If you can’t sell the idea of mandatory sign-in just for syncing desktops because everyone understands why a PC is exactly that “a Personal Machine”, everything is supposed to stay & run locally if it is indeed “YOUR COMPUTER”… I don’t see the big 5 generating the revenue through online subscriptions to get them out of that debt spiral; local open-source AI models and cheaper hardware are the only way I see plausible mass adoption happening.
You’re confusing a cryptocurrency side hustle with mainstream business application suites.
When it comes to stock prices and value, I see the same kind of hype marketing surrounding it, not much happening in reality… Just a whopping 80 billion loss in only 6 months? It’s just freaking insane, and CoreWeave being downgraded & losing 54% in 12 months is the sort of thing I would expect from the crypto market, not mainstream big tech companies… The only real “mainstream application” I’ve witnessed thus far is an influx of low-skill hackers pulling off things they couldn’t have done otherwise, and more fake social media accounts than ever before… some things Robots, taxis, and trucks to replace workers, and creepy unwarranted surveillance systems nobody voted on to pay for. I’m sceptical that mainstream businesses implementing these applications will be reporting enough substantial revenue growth to offset their running costs in the end. That only leaves protein folding in medicine to “cure disease”, as if that will ever happen lol!
Enormous amounts of capex spending to build out the hardware to run the machinery of business. What’s incredibly isn’t the losses but the willingness of large financial institutions to extend this kind of credit in the first place.
The crypto market is an excellent parallel, in so far as its a market everyone paying half-attention has insisted would collapse into fine powder at the slightest bit of financial pressure. And yet… It seems like crypto banking has stubbornly endured as the utility of an entirely unregulated and obnoxiously difficult to trace digital currency with direct links to the traditional banking sector becoming more apparent. Hey look! You can straight up dump cash directly into the back pocket of a sitting President and NOTHING stops you.
As to CoreWeave, losing 54% would be bigger blow if the company wasn’t still sitting on a $30B market cap. FFS, they’re still 6% over their 2025 valuation. I can’t help but think doubling your YoY revenue has helped them along.
Well, then - firstly, you haven’t been looking hard enough. AI is getting itself insinuated everywhere, from accounting and legal to engineering and construction to sports betting and big finance. I don’t like it, but I can’t deny how much of the decisions at a mega-institution like JP Morgan or Blackrock are increasingly outsourced to some cloud computing machines in Israel owned by Larry Ellison.
But secondly, low-skill hackers pulling off things they couldn’t otherwise just describes your average small-cap IT department. Everyone touching a computer has experimented with these tools. And we all find something useful in them. Again, I don’t like that this is happening, but you’re a schmuck high on your own supply if you simply ignore it.
Protein Folding is one of those “only a computer could do this efficiently” problems that AI is exceptionally suited for. But churning out basic-bitch legal contracts with minor client-specified variations, based on a complex and constantly evolving common law system, is also a problem well-suited to AI. Really, anything that involves a high degree of nuance and complexity across a variety of niche fields with a host of very specialized tools can see a tangible benefit from the big Natural Language Input/Ouput Box.
You can be skeptical as you please. Lord knows I was. But it’s increasingly difficult to deny that these highly sophisticated and centrally hosted digital tools are flooding damned near every white collar field you could name.