Trying to understand why you would use the revenue growth rate and compare to P/E when the bottom number there is for earnings.
The last four quarters of revenue growth vs EPS growth,
Revenue 101% → 206% → 265% → 262%
EPS 854% → 1,274% → 761% → 629%
Nvidia has become dramatically more profitable in the last year and EPS has grown way faster then revenue.
Even Sam Altman CEO of OpenAI has said it’s too hard to predict even how AI will look one year from now, and in this current past year many things have surprised him with AI.
What Jensen has said though is that he sees a 4-5 cycle period at least before Hopper chips begin to get replaced. It’s crazy to think that Hopper is already obsolete technology because Blackwell is 30x faster.
However, customers want to buy Hopper if they can even if they know it’s far behind Blackwell because they don’t want to get left behind by the competition which is already training their models. One of Open AI’s current advantages is they spent a tremendous amount of compute to train their models, before anybody else was doing it on this scale. Their models are still maybe six months to one year ahead of other AI models.
Now everybody has to play catchup, including Google, Meta, Amazon, and Telsa. That’s in addition to “sovereigns” which are incredibly far behind now. Countries like Saudi Arabia, South Korea, and Japan now need to start spending massively on AI too. Jensen keeps talking about AI being a global phenomena, however last time I saw 95% of “the AI market” is produced by the USA, and Nvidia is the absolute dominant leader here.