1stjackpot| Nvidia plunged 10%: its market value evaporated by more than US$210 billion, accused of being a sign of the AI bubble

Source Ray delivery Network

The share price of Deep-Fried Chicken Yingweida in the field of AI "flashed" today.

As of today's close, Nvidia shares were trading at $762, down 10% from the previous day.1stjackpotBased on the closing price, the market capitalization of the company is 11stjackpot$.9 trillion; Nvidia lost more than $210 billion in market value overnight.

As of this month, artificial intelligence stocks were still soaring on the back of blowout growth and excitement about breakthrough technology, with Nvidia's market capitalization exceeding $2 trillion at one point.

Like this sell-off, these gains were mainly driven by market sentiment and fear of missing out on the artificial intelligence boom (FOMO). A piece of negative news can lead to a small sell-off, which leads to a large sell-off as investors scramble to lock in profits before a potential bubble bursts.

The reason for the sharp fall in Nvidia's share price is caused by ultramicro computers.

Ultra-micro computers are also the best AI shares.

As of today's close, ultramicro shares were down 23% from the previous day to $713.65, a new low for more than two months. At today's closing price, the company still has a market capitalization of $41.785 billion.

Ultramicro computers were one of the brightest technology stocks in 2022 and 2023, with the company rising 87% in 2022 and 246% in 2023. Ultra-minicomputers joined the S & P 500 last month.

Shares of ultramicrocomputers have soared in recent years, mainly due to strong demand for their servers, the infrastructure for AI chips.

On January 19, 2024, Ultra Micro announced its results. Revenue in the fourth quarter of 2023 was $3.665 billion, up 104% from $1.8 billion a year earlier, and gross profit was $564 million, compared with $337 million a year earlier, according to the results.

Operating profit of ultramicro computers was $371 million in the fourth quarter of 2023, compared with $2.15 billion in the same period last year, and net profit was $296 million, compared with $176 million in the same period last year.

After the company reported preliminary results in its second-quarter earnings report, the company's shares surged 35.9% to close at $423.36, triggering a rally that peaked at $1229 on march 8th.

Specializing in high-performance servers, products range from servers, storage systems, network switches to software for website servers, data storage and AI training. It is one of the top three server manufacturers in the world, and Nvidia is its main customer.

As the share price of ultramicro computers has continued to soar over the past two years, the reputation of "the best AI shares" has begun. Both ultramicro computers and Nvidia are located in Silicon Valley, with their headquarters about 16 kilometers apart and only a 15-minute drive away.

With the popularity of AI, ultramicrocomputer founder Liang became a billionaire and, together with Huang Renxun and Su Zifeng, became the three Chinese who led the current round of AI craze.

Liang has a close relationship with Huang Renxun after meeting.

Liang, like Huang Renxun, founder of Nvidia, was born in southern Taiwan, with a difference of five years.

The difference is that Liang is a native of Taiwan, who graduated from Taipei Institute of Technology in electrical engineering (the predecessor of Taipei University of Science and Technology).

After graduating from technical college, Liang went to the United States for further study and obtained a master's degree in electrical engineering from the University of Texas at Arlington. Huang Renxun emigrated to the United States from an early age and grew up in the United States.

There is also a lot of cooperation between ultramicro computers and Nvidia. Huang Renxun publicly thanked Liang for his support in the early days of Yingweida's start-up, saying that the two had been friends for more than 15 years and built servers together as early as the development of cloud computing. "at that time, apart from Liang, no one believed in accelerated computing."

Nvidia has also been working with ultramicrocomputers.

With the advent of ChatGPT and the huge demand for computing power of generative AI, Nvidia has become a hot AI stock, and Nvidia still praises ultra-microcomputer products many times in public.

When attending the 2023 Taipei International computer Show (Computex), Huang Renxun met the platform behind Liang, and the two interacted closely on the stage. Liang touched his head to confirm whether he was real or not, and asked Huang Renxun for the chip, which showed that the two had a very close relationship.

It is accused of being an AI technology bubble scam.

The collapse was triggered by the fact that ultramicrocomputer will report third-quarter results on April 30, but it broke with the previous practice of providing preliminary results, prompting investors to worry about frantically reducing their holdings in the stock.

This time, not only did Nvidia suffer a big drop, Arm also fell 16.9%, Arm fell 5.44%, and Meta fell 4.13%, Intel fell 2.4%, and Microsoft, Apple and other heavyweights also fell more than 1%.

Some commentators believe that the slump is an AI technology bubble scam. The math story is over, and many big model companies have a big bubble. Of course, there is also a view that Nvidia is not a bubble because Nvidia's card is a real hard currency and its performance is still growing at a high speed.

Nvidia's performance is still strong

The financial report shows that in the fiscal year ended January 28, 2024, Nvidia had revenue of $60.922 billion, up 126% from $26.974 billion in the same period last year.

For the fiscal year ended January 28, 2024, Nvidia's operating profit was $32.972 billion, up 681% from $4.224 billion a year earlier, and net profit was $29.76 billion, up 581% from $4.368 billion a year earlier.

For the fiscal year ended January 28, 2024, Nvidia Non-GAAP 's operating profit was $37.134 billion, up 311% from $9.04 billion in the same period last year. Nonmuri GAAP's net profit was $32.312 billion, up 286% from $8.366 billion in the same period last year.

In the quarter ended January 28, 2024, Nvidia's revenue was $22.1 billion, up 265% from $6.051 billion a year earlier and 22% from $18.12 billion in the previous quarter.

However, there is still a hidden worry about Nvidia's performance, that is, whether such rapid growth can be sustained.

Tesla's share price has also been falling recently. so far, the company's share price is $147.05, with a market capitalization of $468.3 billion. At the beginning of the year, Tesla's share price reached $265, which means that the market capitalization has lost more than 40% in just a few months, and Tesla CEO Musk has lost his position as the richest man in the world.