Stratechery Nvidia On the Mountaintop
Aug 28, 2023
Explore NVIDIA's impressive revenue growth, driven by the booming interest in artificial intelligence. Dive into a comparative analysis of NVIDIA and Cisco, revealing their different market trajectories. Discover how NVIDIA is revolutionizing AI technologies and influencing industries with tools like ChatGPT. Learn about the shift towards accelerated computing and generative AI, highlighting the cost efficiencies and performance gains in data centers.
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Nvidia vs. Cisco
- NVIDIA's stock surge draws comparisons to Cisco's rapid growth during the internet boom.
- Cisco tripled its revenue from 1997 to 2000, but its stock plummeted when the boom cooled.
NVIDIA's Unique Trajectory
- Unlike Cisco, NVIDIA experienced a crash before its recent surge due to factors like the decline of Ethereum mining and PC sales.
- This prior downturn makes NVIDIA's current growth trajectory unique.
Disciplined Growth
- NVIDIA's revenue growth currently mirrors its stock price increase, indicating a potentially overvalued stock.
- NVIDIA's net profit growth aligns with revenue, unlike Cisco's during the dot-com era, suggesting more financial discipline.