Elliott Says Nvidia is in a 'Bubble' and AI is 'Overhyped'

Hedge fund Elliott Management has told investors that Nvidia is in a "bubble," and the AI technology driving the chipmaking giant's share price is "overhyped." From a report: The Florida-based firm, which manages about $70bn in assets, said in a recent letter to clients seen by the Financial Times that the megacap technology stocks, particularly Nvidia, were in "bubble land." [non-paywalled link] It added that it was "sceptical" that Big Tech companies would keep buying the chipmaker's graphics processing units in such high volumes, and that AI is "overhyped with many applications not ready for prime time." [...] Many of AI's supposed uses are "never going to be cost-efficient, are never going to actually work right, will take up too much energy, or will prove to be untrustworthy," it said. Elliott, which was founded by billionaire Paul Singer in 1977, added in its client letter that, so far, AI had failed to deliver a promised huge uplift in productivity.A "There are few real uses," it said, other than "summarising notes of meetings, generating reports and helping with computer coding." AI, it added, was in effect software that had so far not delivered "value commensurate with the hype."

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