Welcome to AI Day & the Chip Market (Patreon)

Today will be do or die w AI - all eyes will be on NVDA earnings. Bad earnings could torch Tech Sector, a good report could ignite it. 

The graphic above is stunning -

• $BIDU dumping more into Capex on AI than Google????
• Tencent more than $META
• $BABA more than $IBM

Elon and every tom dick and harry said they would buy as much NVDA chips as they can get their hands on.... we shall find out if this is true in about 5 hours.

• Global server shipments are expected to decrease by 6% in 2023.
• The market is expected to return to only modest growth of 2-3% in 2024.
• Meta Platforms is slashing server purchases by more than 10% to channel investment towards AI hardware.
• Microsoft is delaying upgrades to its general purpose servers to free up funds for AI server expansion.
• Nvidia chip shortages are a major factor in the decline in server shipments.
• Other bottlenecks in the supply chain, such as the shortage of advanced packaging and high-bandwidth memory (HBM), are also delaying the AI harvest for the hardware sector.
• TSMC plans to double its capacity for CoWoS, an advanced packaging technology needed to make Nvidia's H100 processor, but warned the bottleneck would not be resolved until at least the end of 2024.
• The two main suppliers of HBM are South Korea's SK Hynix and Samsung.
• The Chinese market faces an additional hurdle due to Washington's export controls on Nvidia's H100. Chinese companies are therefore using the less powerful H800 chip, which carries a significantly lower price tag.

PS it is AI day today on the Face off - NVDA vs TSLA and will be less about financial ratios but more about growth rates and sustained profitability