This week Nvidia has feet in essentially two places — gaming (its traditional area) and AI (its newest).
This week is the BIG consumer electronics show of the year — Consumer Electronics Show.
What Nvidia introduced this week caused a magnificent pop in the price of its stock.
The key thing to understanding gaming is that it’s HUGE — much larger than Hollywood (i.e. movies).
According to Google, As of September 2023, the global movie production and distribution industry is worth $92.5 billion.
But, according to Google, The global video game market size is USD 224.9 billion in 2022 and is projected to hit around USD 610.6 billion by 2032, growing at a CAGR of 10.5%.
That means that gaming is 2.4 times as large as movies.
And this week Nvidia introduced a vast array of new computing products and software that blew the stocks off the gaming industry. Watch this:
Now, shift to AI.
According to Google (again) the global AI business is nearly 100 billion U.S. dollars today and is expected to grow twentyfold by 2030, up to nearly two trillion U.S. dollars. The AI market covers a vast number of industries. More below.
And Nvidia is the king of AI. It makes the chips, the systems that go into PCs and big servers. One device for PCs is the RTX 4080 Super shown above). Nvidia also makes the software you can program to take advantage of the new Nvidia’s new incredible computing speeds (which have left companies like Intel in the dust).
CUDA is a word you’re gong to hear more of. It’s essentially brand new Nvidia glue. Here’s a decent explanation from a company called Labellerr:
What are Nvidia GPU and CUDA?
Nvidia GPUs are used in almost every laptop and PC to run computations. CUDA refers to (Compute Unified Device Architecture) is a software developed by Nvidia that helps users accelerate the computation power of GPUs using parallel computing.
CUDA is based on C and C++, and it allows us to accelerate GPU and their computing tasks by parallelizing them. This means we can divide a program into smaller tasks that can be executed independently on the GPU. This can significantly improve the performance of the program.
Here’s an explanation Google gave me of CUDA:
I don’t profess to understand the technical niceties. But i do understand three things:
1. All this is a huge leap in technology.
2. Everyone and their uncle is flocking to Nvidia for AI tools and hardware.
3. Nvidia is light years ahead of its competition — what little there is..
Hence all this is the reason Nvidia is my largest stock holding, and then some.
I read the learned journals/ they all say: “AI is transforming how people live and work.”
Let me give you one simple example. Follow my logic.
I’m a sucker for being loved.
As we got off the Delta plane from Lisbon to Boston recently, the chief purser (or whatever he’s called) handed us this postcard:
Pretty impressive?
Now compare it to this miserable response I got one night from Santander bank when I tried to find out how much money I had in their bank.
This is egregious. Not too unusual. We’ve all enjoyed the “benefits of dealing with a ChatBot, who doesn’t know the answers to any of our questions, and can’t transfer us to a live operator — even if one exists!
We’re all familiar with ChatGPT. What it did was to scour the entire web and then layer on top of its scouring incredibly powerful software and hardware that could understand questions — like how much money does Harry have in your bank? Can you show me the last month’s transactions?
Imagine more. You want to know the specs of a piece of equipment. You want to know if that equipment will work with your equipment in your factory, etc.
Imagine you have your special ChatGPT on your web site that has read all your company’s product information and customer experience. And it could answer all your customers’ questions and make your customers as happy as I was when I got off the Delta plane with that nice hand-written “Thank you” note.
In today’s language, this is called “feeding the bot.”
Those companies that feed their bots will enjoy immeasurably higher customer satisfaction — and higher sales.
Amazon is as close to it as anybody.
Will I ever fly anyone else to Europe?
Boeing’s Dumb luck
My motto has always been CHECK. CHECK. CHECK.
Pity it isn’t David Calhoun’s motto. He’s Boeing’s CEO.
For his brilliant leadership, Boeing paid him $22.5 million for 2022.
Go figure.
Dumb luck that three or four people weren’t sucked out of the Alaska plane when Boeing’s door panel fell off.
Lesson: Keep your seatbelt fastened if you are forced to fly in a Boeing aircraft. Pee in your pants before you get up to go to the bathroom.
It’s truly hard to know why Mr. Calhoun still has his job. But you now know why I’ve never owned a share of Boeing. Ever. And I never will.
Staying healthy in 2024
+ Everyone is getting covid. Wearing a mask in crowded places makes huge sense.
+ Getting over my cough and my walking pneumonia took two seven day doses of an antibiotic called clarithromycin 500 mg tablets.
+ I gave up salt eons ago. This week I gave up sugar.
+ I’m back to playing tennis every day.
The boom market continues
The boom market in our magnificent seven continues.
The world is awash with money to invest. And never more desperate to invest that money.
There’s never been a better time to start a new business….
Actually Nvidia also plays in robotics, self-driving cars, biotech (drug discovery), weather prediction, etc.
Nvidia announced AI laptops at CES this week.
Yesterday I tried to buy one. Lenovo’s is not available until March. Shucks.
I’ll have one in March. Promise.
See you soon — Harry Newton
