Unseen Engine Powers AI, Gaming, and the Market

NVDA’s earnings beat will bump the market a few points today. [The Rude Awakening] February 22, 2024 [WEBSITE]( | [UNSUBSCRIBE]( Unseen Engine Powers AI, Gaming, and the Market Click here to learn more [Sean Ring] SEAN RING I don’t usually write about single stocks, but I had to make an exception this time. The entire planet breathed a sigh of relief when Nvidia (NVDA) beat earnings estimates yesterday. From NVIDIA’s press release: NVIDIA (NASDAQ: NVDA) today reported revenue for the fourth quarter ended January 28, 2024, of $22.1 billion, up 22% from the previous quarter and up 265% from a year ago. For the quarter, GAAP earnings per diluted share was $4.93, up 33% from the previous quarter and up 765% from a year ago. Non-GAAP earnings per diluted share was $5.16, up 28% from the previous quarter and up 486% from a year ago. For fiscal 2024, revenue was up 126% to $60.9 billion. GAAP earnings per diluted share was $11.93, up 586% from a year ago. Non-GAAP earnings per diluted share was $12.96, up 288% from a year ago. “Accelerated computing and generative AI have hit the tipping point. Demand is surging worldwide across companies, industries, and nations,” said Jensen Huang, founder and CEO of NVIDIA. You don’t have to be a financial wizard to be impressed with those excellent numbers. And those numbers have manifested themselves in NVDA’s performance. Over the last year, NVDA stock has outperformed the SPX by 200%. [Click here to learn more] NVDA is now worth nearly $2 trillion. But why is this company so important? If you don’t know why, we’ll fix that right now. Because after you read the rest of this piece, you’ll be up to speed. The Unseen Engine In the digital age, where information technology permeates every facet of our lives, a handful of companies hold immense power. Among them, NVIDIA stands out as a potential contender for the title "the most important company on the planet." There are reasons behind this bold claim. We’ll explore NVIDIA's unique position in the technological landscape, its impact on various industries, and its role in the semiconductor industry's geopolitical tensions. The Powerhouse of Graphics and AI Founded in 1993 and headquartered in Santa Clara, California, NVIDIA has established itself as a global leader in graphics processing units (GPUs). These specialized chips are designed to handle complex visual calculations, making them essential for high-performance gaming, video editing, and scientific simulations. Under the leadership of CEO Jensen Huang, NVIDIA has consistently pushed the boundaries of GPU technology, creating increasingly powerful and versatile products. Some of us more seasoned folks remember Intel’s dominance of the CPU market. There’s a big difference between the two. The Central Processing Unit (CPU) acts as the brain of a computer, responsible for handling various tasks simultaneously. It excels at sequential processing, tackling instructions one after another at high speeds. CPUs typically have fewer cores, each with larger caches and complex logic units, allowing them to efficiently handle diverse and unpredictable workloads. The Graphics Processing Unit (GPU), on the other hand, specializes in parallel processing. It boasts many smaller cores designed to handle simpler tasks concurrently. This architecture makes GPUs ideal for applications requiring massive amounts of repetitive calculations, such as rendering graphics, performing complex simulations, and accelerating AI algorithms. Beyond graphics, NVIDIA has emerged as a pioneer in artificial intelligence (AI). Its GPUs, initially designed for rendering graphics, have proven remarkably adept at handling the massive computational demands of AI algorithms. NVIDIA has developed specialized AI processors (AI chips), further solidifying its position as a key player in the AI revolution. NVDA and Bitcoin Mining NVDA isn’t a new company, being founded in ‘94. It was in the doldrums for a long time. However, once Bitcoin miners realized GPUs were much better than CPUs for mining, they started to buy NVDA’s chips in bulk. I’m not suggesting there’s a correlation between the prices of Bitcoin and NVDA. But you’ll notice that NVDA’s “second act” began before Bitcoin increased to $20,000. And then, its next big rally was just before Bitcoin’s $67,567 all-time high. [SJN] Particularly during the cryptocurrency boom of 2017-2018, cryptocurrency miners heavily relied on NVDA's GPUs for their computational power. Originally designed for high-end graphics processing, these GPUs proved efficient in the complex calculations required for mining Bitcoin and other cryptocurrencies. This unexpected demand significantly boosted NVIDIA's sales and increased its stock price. The company introduced dedicated Cryptocurrency Mining Processors (CMPs) in 2021, specifically designed for mining efficiency. But now, BTC mining plays only a small role in NVDA’s business. [Your Credit Card: Declined?]( Take a moment and picture this scenario: The line at the gas pump is getting longer as you insert your credit card for the second time. You decide to head in and ask the cashier what’s going on. There’s a long line inside. The woman in front of you looks frustrated. Everyone does. “There’s nothing I can do. You’re declined,” the cashier says to the man at the front of the line. It’s not just you. Everyone is declined. Something doesn’t seem right. A sinking feeling sets in as you realize something has gone terribly wrong. [Click here now for an urgent new prediction from a former advisor to the CIA and Pentagon.]( [Click Here To Learn More]( From Gaming to the Metaverse The influence of NVIDIA extends far beyond the realm of gamers and tech enthusiasts. Its GPUs power the servers that drive various cloud-based services, from streaming platforms like Netflix to AI-powered applications like facial recognition and language translation. NVIDIA's technology also plays a crucial role in autonomous vehicles, robotics, and scientific research, enabling groundbreaking advancements in these sectors. With the rise of the metaverse, a virtual world envisioned as the next internet iteration, NVIDIA's expertise in graphics and AI becomes even more critical. The company's technology is already used to create realistic and immersive virtual environments, and its future innovations are expected to shape the development of the metaverse, potentially impacting how we interact, work, and even socialize in the digital realm. Because it’s so critical, NVDA has drawn the attention of competing governments. As my friend and Rude contributor Byron King says, “Chips are the new ships.” Our navy used to be the most crucial way to project power. Now, it’s our ability to make advanced GPUs. The Taiwan Factor and the Geopolitical Landscape NVIDIA's significance transcends the realm of technology and enters the complex world of geopolitics. The company relies heavily on Taiwan Semiconductor Manufacturing Company (TSMC), a Taiwanese corporation, to fabricate its chips. TSMC is the world's leading contract chip manufacturer, and its dominance in this sector makes it a crucial player in the global supply chain. However, the political tensions between China and Taiwan overshadow this critical partnership. China claims Taiwan as part of its territory, and the potential for military conflict in the region poses a significant threat to the global semiconductor industry. If access to TSMC's manufacturing capabilities were disrupted, companies like NVIDIA would face severe challenges in meeting their production needs, potentially causing widespread disruptions in various sectors. This is one reason why the USG is so belligerent regarding Taiwan. Wrap Up While declaring any single company as the "most important" is entirely subjective, NVIDIA's unique combination of technological prowess, diverse applications, and critical role in the global supply chain makes it a strong contender for the title. Its influence extends far beyond the world of entertainment, shaping the future of AI and the metaverse and even potentially impacting geopolitical dynamics. As the world embraces increasingly sophisticated technologies, NVIDIA's role becomes ever more crucial. Its ability to innovate and navigate the complex geopolitical landscape will be instrumental in shaping the future of technology and its impact on various aspects of our lives. While challenges remain, NVIDIA's position at the forefront of technological advancements positions it as a key player in defining the trajectory of the digital age. And now you’re up-to-speed on NVDA. All the best, [Sean Ring] Sean Ring Editor, Rude Awakening X (formerly Twitter): [@seaniechaos]( In Case You Missed It… On Fatherhood [Fatherhood] [Sean Ring] SEAN RING Our generation was told a lie. Stay single. Live it up. And then have a family. It’s pure silliness. Sure, you may have a bit more money in your late 30s than your late 20s, but the wait isn’t worth it. I turned 49 only two months ago. My son, Micah, turns seven today. Forty-two years is a big gap in terms of time and energy. What have I learned? Fatherhood is a journey that extends far beyond the act of bringing a child into the world. It's a role that, when embraced fully, leads to profound personal growth, enrichment, and intelligence. In fact, I have more wealth as a married man and parent than I ever did as a single man. This Rude piece explores how fatherhood enhances a man's life, making him better, richer, and smarter, by weaving together insights from psychology, economics, and personal anecdotes. Better: The Moral and Emotional Growth My high school history teacher, Mr. Conway, once told me I’d never get married because I’d never love anyone more than I loved myself. He was right for another 18 years before I married Pam. But even then, I had trouble sharing. As an only child, I never really had to share. But then Micah came along. Suddenly, I was sharing my popcorn and my ice cream. I always bought my girlfriends (and wife) separate ones. But not Micah. He could have mine. Small beer, you think? Not for me. It was a seismic shift that tickled my funny bone. Fatherhood inherently demands a shift from self-centeredness to selflessness. Caring for a child introduces a new dimension of moral and emotional development. Fathers learn patience, empathy, and unconditional love, all fundamental to personal improvement. Psychologists have found that fatherhood is associated with increased emotional maturity. Men report feeling more grounded and connected to what truly matters in life. This is not just about the daily parenting tasks but a more profound understanding of the human experience. Fathers learn to navigate the complexities of emotions—not just their own but their child's—fostering a nurturing environment essential for their child's development. This emotional intelligence is a cornerstone of becoming a better person, as it enhances one's ability to relate to others, resolve conflicts, and make thoughtful decisions. [The 2 AI investing traps revealed [must read]]( Investor and entrepreneur James Altucher made millions during the crypto boom. Many “experts” are now saying… [Artificial Intelligence opportunities could be even bigger.]( But don’t believe the hype. Before you invest one penny in AI… See James reveal the [2 AI investing TRAPS]( that will doom many investors… Yes, making money from AI SHOULD be easy… But most AI investors will fall flat on their faces. Because they don’t know the 2 AI investing TRAPS. [See the 2 AI investing traps here now]( [Click Here To Learn More]( Richer: The Expansion of Wealth Beyond the Monetary While fatherhood often comes with financial pressures, it also redefines the concept of wealth. Richness is no longer solely measured in monetary terms but in the wealth of experiences, relationships, and the legacy a father builds. Economically, fathers are motivated to achieve greater financial stability, but the richness of fatherhood also comes from the joy and fulfillment that money can’t buy. The first steps, the unsolicited hugs, the heartfelt "I love yous" — these moments are priceless treasures that enrich a father's life immeasurably. Moreover, fatherhood encourages men to think long-term, not just about their future but that of their offspring. This forward-thinking perspective often leads to more intelligent financial planning, investments in education, and a focus on sustainable living practices. These actions contribute to a richer life experience, emphasizing the quality of life over the quantity of possessions. The motivation of never letting the kid down is the greatest I’ve ever known. Smarter: The Cognitive and Social Learning Fatherhood challenges men to learn and adapt constantly. From the practical skills of childcare to the nuanced understanding of educational systems, fathers acquire a vast range of knowledge. This learning process stimulates cognitive growth, making men brighter in various aspects. Engaged fathers often seek information on child development, parenting techniques, and educational strategies. This pursuit of knowledge does not only apply to child-rearing but extends to personal interests and professional development. Fathers are inspired to stay informed and relevant, not just for their own sake but to set an example for their children. Socially, fatherhood expands a man's network. Through their children, fathers meet other parents, teachers, and professionals, broadening their social circle and diversifying their perspectives. This exposure to different viewpoints and experiences enhances a father's understanding of the world, making him more knowledgeable and well-rounded. This is true for me, as Micah is responsible for most of my social circle here in Asti. Furthermore, teaching and explaining the world to a child forces a father to simplify complex ideas, a skill that is invaluable both professionally and personally. This ability to distill and communicate concepts is a hallmark of intelligence, demonstrating that fatherhood doesn't just make a man smarter in accumulating knowledge and applying it effectively. The Synergy of Fatherhood The beauty of fatherhood lies in its synergy. The emotional growth feeds into the richness of experiences, stimulating intellectual curiosity and cognitive development. This holistic enhancement benefits not just the father but his family and community. Fathers who are emotionally intelligent foster a safe and loving environment for their children, leading to healthier, happier families. The richness that comes from a life focused on meaningful experiences rather than material accumulation creates a legacy of values that lasts generations. The intellectual growth that arises from the challenges and learning opportunities of fatherhood ensures a father adapts, innovates, and contributes meaningfully to the community. Wrap Up Fatherhood is a journey that molds men in profound ways. It teaches patience, empathy, and resilience; it redefines wealth and success and demands constant learning and adaptation. These transformations make a father better, richer, and smarter—not just in the eyes of his child but in all facets of life. With all its challenges and rewards, the fatherhood journey is one of the most potent catalysts for personal growth, enriching a man's life in ways he could never have imagined. So, if you’ve found your life partner, be impatient. Get married, stay married, and have kids. It’ll make you better, richer, and smarter. All the best, [Sean Ring] Sean Ring Editor, Rude Awakening Twitter: [@seaniechaos]( [Paradigm]( ☰ ⊗ [ARCHIVE]( [ABOUT]( [Contact Us]( © 2024 Paradigm Press, LLC. 1001 Cathedral Street, Baltimore, MD 21201. By submitting your email address, you consent to Paradigm Press, LLC. delivering daily email issues and advertisements. To end your Rude Awakening e-mail subscription and associated external offers sent from Rude Awakening, feel free to [click here.]( Please note: the mailbox associated with this email address is not monitored, so do not reply to this message. We welcome comments or suggestions at feedback@rudeawakening.info. This address is for feedback only. For questions about your account or to speak with customer service, [contact us here]( or call (844)-731-0984. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized financial advice. We allow the editors of our publications to recommend securities that they own themselves. However, our policy prohibits editors from exiting a personal trade while the recommendation to subscribers is open. In no circumstance may an editor sell a security before subscribers have a fair opportunity to exit. The length of time an editor must wait after subscribers have been advised to exit a play depends on the type of publication. All other employees and agents must wait 24 hours after on-line publication or 72 hours after the mailing of a printed-only publication prior to following an initial recommendation. Any investments recommended in this letter should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company. Rude Awakening is committed to protecting and respecting your privacy. We do not rent or share your email address. Please read our [Privacy Statement.]( If you are having trouble receiving your Rude Awakening subscription, you can ensure its arrival in your mailbox by [whitelisting Rude Awakening.](