Gerstner says NVIDIA holds 90% plus market share and trades at historical average multiples.
“So if you wanna express that bet, right, which is AI leadership at 25 to 30 times earnings, which is consistent with historical averages for NVIDIA.”
Gerstner notes consensus forecasts assume Nvidia's share of global compute buildout drops from 55% today to 26% by 2028.
“The line running through the center that starts at 55% and goes down to 26%. That is Nvidia's share of that global compute build out based on current consensus numbers for Nvidia.”
Gerstner argues consensus Nvidia forecast assumes market share drops from 55% to 26% by 2028.
“Okay, so the consensus forecast that has the stock at $700 a share assumes, if you believe this TAM to be accurate, assumes that their share will go from 55% today to 26% in 2028.”
Gerstner says NVIDIA had 80% China market share with developers in CUDA ecosystem, generating billions in US taxes.
“NVIDIA has you know, it went from 80% market share in China where all the developers, second largest developer market in the world, were were developing in CUDA.”
Gerstner warns Huawei went from 0% to 50% Saudi market share, arguing US must export AI technology.
“Huawei has gone from 0% market share in Saudi Arabia to 50% market share in Saudi Arabia.”
Gerstner reports Google page views drop 8-11% peak to trough after users subscribe to ChatGPT.
“And you can see peak to trough is down 8% year over year. Peak to trough is, let's say, down 11.”
Open-source models are gaining market share in token usage while both open and closed models continue rapid overall growth.
“@Jason Agree. Grt competition! Share of tokens increasing at open source models (tho both still early in growth curve & growing rapidly).”