Nvidia is a victim of the compute marketplace it created

Nvidia has experienced a 15% stock price decline since its May peak, even as projected revenue continues to grow. The company is now cheaper than the S&P average relative to expected earnings. Meanwhile, memory companies like Micron have nearly tripled in value, as memory has become the new bottleneck for data centers. The GPU shortage that appeared alarming last year has eased, while demand for memory chips continues to surge. The article contrasts Nvidia's situation with memory companies. While Nvidia's success is built on genuinely impressive technology like CUDA and pushing GPU development, memory companies like Micron build high-bandwidth memory chips that have been improving incrementally for 20 years. The spot price for DRAM has risen dramatically since 2023 due to underestimated demand, while the spot price for Nvidia H100 GPU compute time has been falling since a peak in May. Ornn co-founder Wayne Nelms framed the disparity as a simple issue of supply and demand, noting that major tech companies have launched their own custom processors to lessen dependence on Nvidia.