Billionaire investor Peter Thiel once said that he won't choose between Elon Musk, Sam Altman or Mark Zuckerberg in the AI race, but argued that Jensen Huang-led Nvidia Corporation (NASDAQ:NVDA) was dominating the hardware layer—a feat made possible because, ironically, only a few talented founders pursued semiconductors after the early 1990s.
Thiel Refuses To Pick An AI Leader
Speaking at the All-In Summit in September 2024, Thiel sidestepped a question about which tech mogul among Altman, Musk and Zuckerberg would win the AI race.
Instead, he joked that his opinion changes depending on who he talks to last.
"Whoever I talk to last … I find very convincing in the moment," Thiel said, recounting conversations where he was convinced by Musk when he slammed ChatGPT-parent OpenAI's pivot to a for-profit structure but later thought otherwise.
“I thought to myself, ‘but you know, actually, man, it’s been such a horrifically mismanaged place at OpenAI with this preposterous nonprofit board they had nobody would do this again’ and so there actually isn’t much of a moral hazard from it,” he recalled.
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Nvidia's Chip Monopoly Is the Real Story
Thiel argued that attention should shift away from AI model leaders like Meta Platforms Inc. (NASDAQ:META), OpenAI and Musk's xAI, toward Nvidia's dominance in GPUs.
"It's Nvidia, it's the hardware, the chips layer," Thiel said, adding that they're making all the money while everybody else is collectively losing money.
He noted that Nvidia's dominance stems from a generational shift in talent that left semiconductors overlooked.
"Nvidia got started in 1993," Thiel said. "I believe that was the last year anybody in their right mind would have studied electrical engineering over computer science."
He added, "No talented people started semiconductor companies after 1993 because they all went into you know into software."
But, Thiel Still Had AI Bubble Concerns
The Palantir Technologies (NASDAQ:PLTR) co-founder also compared the AI hype cycle to the dot-com bubble, saying it feels "uncomfortably close to 1999."
Despite this caution, he acknowledged Nvidia's success as the standout story of the AI boom.
Maybe a year ago or two years ago, Nvidia would have been a good buy, he said, adding that now everyone knows they're making too much money and everyone's trying to copy them.
Nvidia Reports Blockbuster Q2, But Shares Slide 3.14% After Earnings
Nvidia posted second-quarter revenue of $46.74 billion, marking a 56% jump year-over-year and surpassing Wall Street's forecast of $46.02 billion.
The company reported no H20 sales to Chinese customers during the quarter but noted a $180 million boost from H20 inventory sold to a client outside China.
Revenue from its Blackwell Data Center segment climbed 17% compared to the previous quarter.
For the third quarter, Nvidia projects revenue between $52.92 billion and $55.08 billion, slightly above the Street estimate of $52.96 billion. The forecast excludes any H20 deliveries to China.
The company's market capitalization stands at $4.43 trillion, though its stock slipped 3.14% in after-hours following Wednesday's earnings release, per Benzinga Pro.
Benzinga’s Edge Stock Rankings show that NVDA maintains a solid upward trend across short, medium and long-term periods, with additional performance details available here.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
