Nvidia analyst forecasts: the AI banana zone
- Apr 22, 2024
- 1 min read
NVDA reported $47.5 billion in data center revenue in FY24, a 217% yoy increase. Assume that growth continues, but be conservative and project a "mere" 100% increase and ka-boom - you have a $95 billion forecast for data center alone, or ~$110 bn in total revenue.
To put that number in perspective, Taiwan Semiconductor (TSM) - which has to manufacture the GPUs - will report less than $80 bn in revenue this year.
Nvidia can book the incremental sale through entities such as CoreWeave and Lambda, which rely on debt to buy the chips. But there's a limit to the gullibility of bank lending departments - they aren't going to finance an extra $47.5 bn in such "sales".
Tencent (TCEHY) has stockpiled enough Nvidia GPUs to last a "couple more generations". Huawei, Broadcom, Microsoft, AMD have thrown their hat in the ring and are competing for AI chip market share.
Former buyers of Nvidia's product are now designing competing products.
I'd be very interested in knowing how the bulls come up with their forecasts. I'm all for linear extrapolation of the past, but at least make the numbers believable.
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Good Trading!
Kashyap