Title: Nvidia vs. Super Micro: David Shaw's Stock Movements in Q3
Nvidia and Super Micro Computer are two companies driving the boom in artificial intelligence (AI). Nvidia, with its graphics processing units (GPUs), is a critical player in AI tasks like model training and inference. Meanwhile, Super Micro integrates top AI chips into its servers and workstations for data centers, acting as a behind-the-scenes powerhouse.
Both companies have seen remarkable earnings growth over recent quarters, thanks to AI demand, ultimately leading to substantial share gains. For instance, Nvidia and Super Micro have risen 2,600% and 1,700% respectively, since 2017. Early investors, like billionaire David Shaw of D.E. Shaw & Co., have profited significantly, with Nvidia shares held since 2008 and Super Micro shares since 2022.
In the third quarter, Shaw made moves on these two tech giants. Let's dive into what that entailed.
Nvidia
Nvidia has become a powerhouse in AI, holding a dominant market share for AI chips. This is Shaw's largest position, and he bolstered it further by a significant 53% increase – now standing at 17,210,271 shares. While it's impossible to guarantee success, Nvidia's dedication to innovation, annual GPU updates, and game-changing tech such as the Blackwell platform, point to continuous growth.
Blackwell's demand is reportedly off the charts. During the latest earnings call, Nvidia predicted billions of dollars in revenue during its current quarter – the first of commercialization. The platform offers speed, efficiency, and customizable features. This technological edge is driving exponential growth for the AI giant, with revenue surging triple digits in recent periods.
Super Micro
Supermicro partners with Nvidia and other chip innovators, integrating their breakthroughs within its equipment and benefiting from their new releases. In the third quarter, however, Shaw trimmed his position in Super Micro by an eye-opening 89%.
Recent turmoil surrounding Super Micro's financial reporting and the threat of a Nasdaq delisting //has// now pushed many investors, including Shaw, to reduce their holdings.
Supermicro has been plagued by financial reporting delays and suffered the resignation of its auditor, Ernst & Young, citing internal control and accounting concerns. These issues could potentially result in a Nasdaq delisting.
Recently, Super Micro managed to secure a new auditor and pledged to return to normal reporting by February 25, 2025. Once Super Micro addresses its reporting concerns, the company might see a revival depending on AI market demand being strong in its early stages.
In conclusion, Nvidia's commitment to innovation and Blackwell platform, combined with its strong revenue growth, indicate continued success for the AI powerhouse. Super Micro's shrinking position is partly due to its financial reporting delays and heavy volatility, but if it can overcome these challenges, a resurgence is possible.
In view of Nvidia's continued success in the AI market with its innovative technologies like the Blackwell platform, David Shaw increased his investment by 53%, further cementing his position in the company. This strategic move could potentially yield significant returns in the future.
Despite the remarkable performance of Super Micro in AI chip integration, recent financial reporting delays and the threat of a Nasdaq delisting have led to a substantial decrease in Shaw's investment, underscoring the need for the company to address these issues to regain investor confidence.
[In this context, 'money' can be understood as the investment made by David Shaw, 'investing' is the action of buying shares in Nvidia and Super Micro, and 'finance' refers to the financial stability of Super Micro due to its financial reporting delays and potential Nasdaq delisting.]