Preeti
Nvidia became the first hardware stock to reach a $3 trillion valuation on the U.S. stock market due to the success of its semiconductor chips for artificial intelligence functions. However, ARK Investment head Cathie Wood cautioned that for Nvidia to maintain its valuation, AI needs to prove its value beyond just chip demand. The article explores the potential profitability of AI for companies like OpenAI, Microsoft, and Alphabet, and the cost implications of using ChatGPT, an AI language model.
The cost of using ChatGPT is priced in tokens, with the model GPT-3.5 Turbo costing $1.50 per million tokens. Despite the low cost to users, questions remain about the profitability of AI companies like OpenAI, especially considering energy costs. OpenAI CEO Sam Altman previously suggested costs could be high, but recent estimates from ChatGPT indicate a much lower energy cost per query.
The article discusses the broader costs involved in providing AI services, including training large language models and purchasing AI chips from companies like Nvidia. Competition from rivals like Intel and Advanced Micro Devices could help lower upfront costs and potentially lead to profitability for AI companies at scale. Overall, there is optimism that companies involved in the AI revolution, including Nvidia, have the potential to make money in the long run.
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Source link: https://www.fool.com/investing/2024/06/15/the-economics-of-chatgpt-can-microsoft-and-alphabe/
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