Nvidia's latest earnings report has breathed new life into investors' hopes that the AI bubble isn't about to burst, despite growing concerns over lofty valuations. The company reported better-than-expected revenue of $57 billion for the August-October quarter, with EPS of $1.30 beating analysts' forecasts by a penny. This was accompanied by guidance that sales for the current quarter are expected to reach around $65 billion, above Wall Street's consensus.
Analysts are hailing Nvidia as a symbol of an AI revolution that is far from over. "The pure Nvidia numbers/guidance and strategic vision show the AI Revolution is NOT a Bubble…instead it’s Year 3 of a 10-year build out of this 4th Industrial Revolution in our view," said Wedbush analyst Dan Ives.
However, even as Nvidia's strong results are being lauded, notable investors such as Peter Thiel and SoftBank have sold their stakes. The selling is seen by some as profit-taking rather than a sign that an AI bubble is ready to burst. Michael Burry, a famed short-seller, has a $187 million short position against Nvidia, but his warnings of inflated earnings from Oracle, Meta, Amazon, and Google seem unfounded.
Industry experts are urging caution but remain bullish on the long-term fundamentals of AI. "The market is rotating, consolidating and digesting huge gains," said Joseph Schuster, CEO and founder of ETF operator IPOX Schuster. "It doesn’t mean that something will burst or fall apart. It’s a normal part of the cycle."
Jane Edmondson, head of thematic strategy at ETF research firm VettaFI, shares similar sentiments. While she acknowledges that AI is in its early days and only just now starting to see groundbreaking use cases, she rejects views that Nvidia's price-to-sales ratio is unsustainable.
As the market matures, the winners and losers will become clearer, Edmondson expects firms with their own growth capital – such as Google, Meta, and Alphabet – to emerge stronger than those that rely heavily on leverage.
Analysts are hailing Nvidia as a symbol of an AI revolution that is far from over. "The pure Nvidia numbers/guidance and strategic vision show the AI Revolution is NOT a Bubble…instead it’s Year 3 of a 10-year build out of this 4th Industrial Revolution in our view," said Wedbush analyst Dan Ives.
However, even as Nvidia's strong results are being lauded, notable investors such as Peter Thiel and SoftBank have sold their stakes. The selling is seen by some as profit-taking rather than a sign that an AI bubble is ready to burst. Michael Burry, a famed short-seller, has a $187 million short position against Nvidia, but his warnings of inflated earnings from Oracle, Meta, Amazon, and Google seem unfounded.
Industry experts are urging caution but remain bullish on the long-term fundamentals of AI. "The market is rotating, consolidating and digesting huge gains," said Joseph Schuster, CEO and founder of ETF operator IPOX Schuster. "It doesn’t mean that something will burst or fall apart. It’s a normal part of the cycle."
Jane Edmondson, head of thematic strategy at ETF research firm VettaFI, shares similar sentiments. While she acknowledges that AI is in its early days and only just now starting to see groundbreaking use cases, she rejects views that Nvidia's price-to-sales ratio is unsustainable.
As the market matures, the winners and losers will become clearer, Edmondson expects firms with their own growth capital – such as Google, Meta, and Alphabet – to emerge stronger than those that rely heavily on leverage.
still on track 
! Nvidia's numbers 
are fire 
, but some investors 
are cashing out 
. Thiel 
& SoftBank 
selling up? Maybe just waiting for the right time 
to swoop in. Burry 
needs to calm down 
. Everyone gets excited about gains 
, but at some point, reality check 
is needed.
Not yet 
! Industry experts 
see long-term potential 
. Google & co. 
. IPOX Schuster 
. VettaFI Jane Edmondson 
agrees 
.
... AI is here to stay 
!
. But at the same time, I'm a bit skeptical about all this hype... Peter Thiel selling his stake? That's gotta count for something 
. And Michael Burry's short position is like 187 million dollars short 
what's he trying to say?
... wait, no I'm not 
I'm so confused! One minute I think it's a no-brainer that it's not a bubble, and the next I'm like, totally unsure 
. Can we just take a deep breath and enjoy the ride for now? 
. Meanwhile, experts like Dan Ives are sticking by their guns, saying the AI revolution is far from over 
#AIAgainstTheNaysayers.
#GrowthCapitalMatters.
. All these analysts saying AI is far from over just because they've got stock to sell or short positions to make... meanwhile, investors like Thiel and SoftBank are selling out for profit 
. I mean, what's sustainable about a price-to-sales ratio that's just going through the roof? It smells like a bubble to me...
. It just feels like everyone's trying to time the market or make a quick buck off AI hype. I'm still bullish on AI itself, but I think we need to take a step back and reassess what's really going on here... 
they really did crush it $57 billion in revenue is huge! but at the same time, its kinda weird that some big investors like peter thiel are selling off their stakes... idk if thats just profit-taking or what. analysts are still super bullish on ai tho, and im kinda with them - its a whole new world we're entering here 
. The big picture is, Nvidia is leading the charge in a revolution that's still got a long way to go 
. Nvidia's got its work cut out for it, but I think they can keep up 
. Can't have too much of a good thing, right? 
. So yeah, maybe Nvidia's gonna be fine... or maybe not 
, but it's hard to see how Nvidia's price-to-sales ratio is anything other than inflated. I mean, those numbers are crazy 
It was mind-blowing back then, and I can only imagine how mind-blowing it'll be when we get to that point with AI. Anyway, I guess what's got me thinking is how quickly things have changed... or not