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Sunday, September 1st, 2024

The thrill of AI is fading — and Wall Street is getting a little more clear-eyed about its actual value

Author:     Allison Morrow
Source:     CNN Business
Publication Date:     Fri August 30, 2024 | 10:39 AM EDT
 Link: The thrill of AI is fading — and Wall Street is getting a little more clear-eyed about its actual value
Stephan:  

Here is the latest assessment about AI. What I found notable, and so typically American, is that the assessment has nothing to do with whether AI promotes or degrades social wellbeing. It is entirely a report about profit. Our media and the journalists who staff it don’t seem to have the capacity anymore to even think about social wellbeing; that is one of the reasons we have become the kind of country we are.

Nvidia has ridden the AI hype wave to become one of the most valuable brands on the planet, achieving a $3 trillion valuation that puts it among giants like Apple and Microsoft. 
Credit: Ann Wang/Reuters

The world’s leading AI chip producer, Nvidia, just delivered a slam dunk earnings report that most businesses would be jealous of. Sales rose 122% in the second quarter. Profits doubled. The outlook for the current quarter? Strong.

In short: The numbers were fantastic.

Yet Nvidia’s shares (NVDA) slumped 7% after its earnings came out Wednesday night, and they stayed down Thursday. For a stock that’s up more than 150% for the year, that’s nothing to fret over.

But the dip says a lot more about Wall Street than it does about Nvidia.

Here’s the deal: Wall Street has been all aboard the AI hype train for the better part of the last 18 months. Wherever investors see potential AI profit, they’re throwing money at it.

Nvidia, once a relatively niche computer chip maker, has been the biggest beneficiary of […]

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