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AI Hype Train Ain't Slowing Down, But Who's Really Cashing In?
So, Palantir's CEO Alex Karp is out there shouting from the rooftops about how Nvidia is gonna keep printing money, blah blah blah. Okay, we get it. AI is the new black. But let's be real, are we actually seeing innovation or just a massive circle jerk of tech giants patting each other on the back?
The Illusion of Progress
This whole AI revolution feels less like a genuine leap forward and more like a carefully orchestrated marketing campaign. Amazon stock jumps on $38 billion deal with OpenAI to use hundreds of thousands of Nvidia chips Amazon's throwing $38 billion at OpenAI for Nvidia chips? OpenAI's got a $300 billion handshake deal with Oracle? It’s like watching a bunch of toddlers playing with Monopoly money, except the stakes are the future of, well, everything.
And don't even get me started on these "blockbuster results" from Palantir. Revenue up 63%? Adjusted EPS soaring 110%? Give me a break. It's all smoke and mirrors. They're selling shovels in a gold rush, and we're supposed to believe everyone's striking it rich.
Palantir's U.S. commercial segment is supposedly on fire, with revenue up 121%. Okay, cool. But what are these new "users" actually doing with AIP? Are they curing cancer? Solving world hunger? Or just automating more ways to sell us overpriced garbage we don't need? I'm betting on the latter.
Nvidia: The Real Winner?
Offcourse, Nvidia's laughing all the way to the bank. Their GPUs are the "gold standard" for AI, apparently. CEO Jensen Huang claims a backlog of half a trillion dollars for their chips. Half a trillion? Is that even a real number? It sounds like something Dr. Evil would demand after taking over the world.
Amazon, Microsoft, Alphabet, and Meta are supposedly dropping $380 billion this year alone on data centers to fuel the AI boom. And they say spending will "ramp even higher" in 2026. I’m starting to think they are just burning money to keep the stock price high. Where is the real innovation? Where is the value?
Speaking of value, Nvidia's stock has gone "parabolic," soaring 1,320% since the AI craze kicked off in early 2023. It trades at 31 times next year's expected earnings. Some analyst says it's a "reasonable price to pay". Reasonable for who? For the hedge fund managers who are already rich enough to buy their own islands? What about the rest of us?
The Bubble Bursts... Eventually
The circular nature of these AI deals is giving me serious dot-com bubble flashbacks. OpenAI's costs are supposedly going to surpass $1 trillion by the end of the decade, while their revenue is still a tiny fraction of that. How are they planning to pay for all this? Magic beans?
And the whispers of an OpenAI IPO valuing them at $1 trillion? Seriously? It's like they're deliberately trying to create the biggest, most spectacular market crash in history. They expect us to believe this nonsense, and honestly...
Then again, maybe I'm just a grumpy old cynic who doesn't understand the amazing potential of AI. Maybe I'm missing out on the greatest technological revolution since the invention of the wheel. Maybe. But I still think this whole thing smells fishy.
