Yesterday, a piece of breaking news sent technology stocks into a tail spin. The Chinese Startup Dippec developed an AI Chat Boat that allegedly kept the models of industry leaders like Open, Entropic, and industry. Alphabet On a part of the cost. Claims to achieve competitive performance, using less powerful chips in just 6 million of Startups, have given rise to widespread anxiety in the market about US tech costs.
The market reaction proved to be particularly strict nvidia (Nvda 8.93 %JesAt the time of this writing, falling into the shares and erasing and erasing the market cap in half a trillion. This amazing figures in the context of this, this amount is equal to a half times more of market capitalization Holder. This is a mirror on the achievements of Chinese tech in the past market, which eventually proved to be premature.
Image Source: Getty Images.
With this hysteria, let’s dive into the factors that this semiconductor Power House now plays “Buy-Dip”.
DPSEC test
Like many other people, I immediately listened to the news and tried to go through the pace. After several failed attempts due to server cracks, I finally accessed the platform to test the capabilities.
I launched a series of standard indicators to evaluate accuracy and precision, followed by complex tasks such as data compilation – an area where the alphabet is usually better. My searches showed the basic information and struggling with the DPSC with statistical regeneration.
When asked to analyze the numerical data, the model yielded contradictory results and often failed to maintain accuracy in several efforts in the same work. In straight terms, the difference between the real -world performance between Dippec and the leading AI models of the United States is not even closer to my experience.
AI misunderstanding of the market
Wall Street’s anxiety on the efficient approach to deep sack is missing a big picture. Although the company claims to develop AI model using low expensive chips, it has ignored large -scale infrastructure and research investment that is needed for the development of the latest AI.
The development cost of $ 6 million using DiPsic’s NVIDIA’s H800 chips may be impressive at first glance, but it represents only a portion of the basic AI research and infrastructure.
In addition, the performance difference between DPC and leading US AI platforms is likely to further expand as NVIDIA has changed its advanced black well architecture and American data centers continue to expand.
Another key problem to keep in mind is that modern AI development not only requires powerful chips, but also requires sophisticated software correction, modern cooling system, and special data center design-these features. Which requires billions of capital costs to be implemented and maintained.
The ongoing expansion recently received a huge promotion when US technology and government leaders announced a historic investment of $ 500 billion in AI infrastructure called Star Gate. This unprecedented national affiliation shows both the strategic importance of advanced AI capabilities and the permanent demand for high -performance chips.
Although companies like DiPsic may be successful in some parts of the market, they face a great war against the benefit of the large -scale capital. In other words, it claims that the demand for premium chips of NVIDIA will end, they will not only be compatible with market facts and the development of AI.
Opportunity to buy a strategic
Yesterday’s market rise has created a great entry point for NVIDIA investors. Before the sale, the Tech Company shares were trading 47 times the expected income. NVIDIA premium diagnosis reflects the expansion of US AI infrastructure ongoing dollars, as well as severe computation demands for the acquisition of artificial general intelligence (AGI). This basic story has not changed with the arrival of Deep Sak.
Market analysts pointed to numerous factors that support permanent growth in advanced chip demand, which increases the complexity of the AI model, the appearance of new AI applications in industries, And big economies also include the growing emphasis on AI’s sovereignty. The development of the next generation AI system not only requires additional improvement in computing power, but also quantums in the processing capabilities that can only provide modern chips.
Given these basic development drivers and NVIDIA’s dominant market position, the current bridge backback represents an attractive opportunity to achieve shares on discount. The company’s main business paper is intact, which causes the recent price weakness to be disconnected from the long -term basic principles.
Suzanne Free, Alphabet Executive, is a member of the Board of Directors of Motley Fool. George Budwell has positions in NVIDIA and Fazer. Motley Fool has positions and recommends alphabet, NVIDIA, and Fazer. Motley Fool has a diagnosis policy.
