Again, since revenue is the denominator in sales ratio, you are conflating what the OP said...
The difference here and between the .com bubble is these companies have high earnings. They are literally walking cash cows and are printing money... AKA the earnings, with revenue not being important here because that's what CAUSED the .com crash. (High revenues, but absolutely burning money).
NVIDIA is in the business of selling shovels to the gold miners in this scenario, not the gold miners themselves.
One exception i will grant you, is they started giving away some of their tools on equity (investments in openAI, stargate, etc. are very circular), and then will turn around and sell that back to them at their prefered COGS+Profit.
> The difference here and between the .com bubble is these companies have high earnings. They are literally walking cash cows and are printing money...
The difference between you and me is that I know that Sun Microsystems was not burning money and had a price to earnings ratio similar to Nvidia now.
What are “these companies” by the way? Do you mean Tesla?
Sun microsystems was mainly selling to startups, who could go bankrupt. Nvidia is selling to Oracle, Microsoft, Apple, Tesla, Xai and to some extent Google. Excluding potential bubbles here which are coreweave, OpenAI, Antrhopic, etc.
And by "these companies" I mean all the companies i just listed excluding the potential bubbles.
They are all making heaps of cash, buying from a company who is also making heaps of cash on each sale. You also have to price in the geopolitical influence of controling such a important piece of tech.
> Sun microsystems was mainly selling to startups, who could go bankrupt. Nvidia is selling to Oracle, Microsoft, Apple, Tesla, Xai and to some extent Google.
Excuse my ignorance, but who are Oracle, Microsoft, Apple, Tesla, Xai, Meta, and Google getting their revenue from?
Oracle, Microsoft: Fortune 500, governments and big cos everywhere in the west.
Apple: their loyal fanbase everywhere.
Google, Meta: advertisers everywhere.
Tesla, Xai: not sure, but definitely not just startups.
Implying these will go under and therefore NVIDIA is in trouble is a stretch. Far more likely they wean off its hw and use inhouse, or OpenAI and Anthropic go under, or AMD catches up, or there is WW3.
Ok, if Tesla is literally a walking cash cow so are Ford or GM to name just a couple of companies in the same sector. (Both together are valued at less than one tenth of Tesla and print five times as much cash.)
I agree that it's better that your customers do not go out of business. One should not forget though that they may have other reasons to buy less of the thing you sell or they may prefer to get it from someone else.
Enlighten me, what’s Nvidia’s price to sales ratio?