Stock market driven by rise of artificial intelligence, potential for $15.7 trillion global economy growth

From Nasdaq: 2024-08-24 04:41:00

Since the beginning of 2023, the stock market has been driven by the rise of artificial intelligence (AI), with the potential to add $15.7 trillion to the global economy by 2030. Nvidia, a semiconductor giant, has seen significant success with its AI-driven products, leading the way in business innovation and commanding higher prices for its GPUs.

Nvidia’s H100 GPU has become the go-to chip for generative AI solutions, leading to a substantial increase in profit margins. The company is investing in future technologies like the Blackwell platform and Rubin GPU architecture. However, a potential decline in adjusted gross margin could signal challenges ahead for Nvidia and the AI industry as a whole.

Despite strong demand for Nvidia’s products, competition from companies like AMD and internal AI-GPU development by major clients like Microsoft and Amazon pose a threat to Nvidia’s market share. Reports of delays in production further raise concerns about the company’s future. The potential erosion of Nvidia’s pricing power indicates the impending burst of the AI bubble.

When the AI bubble bursts, no company may be impacted more than Nvidia, as history shows that overestimation often leads to disappointment in new technologies. The lack of clear plans for AI utilization by businesses suggests that the industry may still need time to mature. Nvidia’s adjusted gross margin report could confirm the beginning of a bubble-bursting event in the AI sector.



Read more at Nasdaq: Prediction: On Aug. 28, This Figure From Nvidia Will Confirm an Artificial Intelligence (AI) Bubble That’s in the Early Stages of Bursting