Nvidia's fast-paced sale is a reminder of how much speculation went into its earlier start-up, as the company fully immersed in the hype of artificial intelligence. Researchers flocked to the company's GPUs to accelerate the training of their complex models, and Nvidia attempted to capitalize on mania.
Leaders started talking more about AI and the company added that AI has direct access to silicon. Cloud providers offered Nvidia GPUs that developers could rent. In 2016, Google announced custom-built chips that can train AI models, just like Nvidia's GPUs. But Nvidia brushed any potential threat from Google, because chipmaker's processors would still be more available.
In its high, Nvidia sold nearly 54 times the future revenue, well over four times the current price-to-earnings for the semiconductor sector, according to FactSet. Sales and profits continue to grow ̵
Now, shareholders are leaving. On December 11, Bloomberg reported that SoftBank could sell its Nvidia efforts early next year, referring to people familiar with the case. The stock has fallen in seven of the nine trading days since that story was released.
WATCH: Nvidia in the penalty box for now