Cold stocks are some of the hottest on the market right now
11th April 2024
Welcome to AI Collision 💥,
In today’s collision between AI and our world:
Cat on a hot mini roof
Meta’s making a run to the finish
Gen Z Granny
If that’s enough to get the liquid pumping, read on…
AI Collision 💥 That’s one hot cat!
On Tuesday I introduced you to the idea that for Moore’s Law to continue we need to think bigger, not smaller when it comes to chips.
That’s because the way I see it, it’s this idea of the data centre-as-a-chip (DCaaC) that I think is going to take the AI boom to the next level and see Moore’s Law continue to be relevant until and beyond when we eventually hit that 1 trillion transistor mark.
And on Tuesday (check it out here if you missed it) I said,
… when you start to think of the importance of a data centre and what goes into making that thing “chip like” then you start to figure out that the rising demand for ancillary industries and companies to make next gen “chips” opens up a world of investment potential.
We’re going to dive deeper into that potential over the coming months as we’ve done since we launched AI Collision 💥 in October last year.
To kick off exactly what kinds of things we’ll dive into, I thought what better place to start than not just figuratively diving into something, but perhaps literally too…
Right now, sitting next to me is a cat – my cat, Lewis.
There’s a reason he’s lying there, specifically there and nowhere else in my office.
And it’s due to something you can’t see because he’s lying directly on top of it.
It’s my computer. It’s directly under his head and chest. It’s a Mac Mini, and for my day-to-day activity it’s a great little computer to use.
But it does get a bit hot from time to time, especially when I’ve got a bunch of applications running and really pushing the processing power to its limits.
And Macs, specifically this little Mac Mini, aren’t exactly renowned for their thermal reduction capabilities.
What I mean by that is that when a computer is running at full tilt, it gets hot. And unless it’s appropriately cooled or throttled back it will stay hot, and eventually become inefficient and fail.
Not great for my computer, but great for my cat. He bloody loves the heat and I’m too much of a softie with him to move him on. It very well may “cook” my Mac Mini, but I’m probably due for an upgrade soon anyway, so that will be a good excuse.
“Excuse me sir, can I help you?”
“Yes, I need a new Mac Mini, my old one died.”
“What happened, sir?
“My cat cooked it.”
Anyway, what’s really needed for my Mac Mini is more efficient thermal management. That’s a fancy way of saying I need stuff to keep it cool.
Computers work better when they’re cooler. And the business of keeping computers cool is not as simple as it might seem. It requires advance knowledge of materials and thermal properties. It requires development of systems, pumps, liquids, metals, power sources, all things needed to effectively and efficiently cool these high-tech machines.
And remember, typically liquid and computers are not exactly what you’d call the best of friends.
If you’ve ever built your own computer and installed a couple of GPUs, you’ll know that some of the higher end ones have the connectivity to add liquid cooling.
Take for instance the GeForce RTX 4090 Suprim Liquid 24G which you can see below.
This is packaged up as an MSI product, but it’s Nvidia’s GeForce GPU architecture inside. But this thing, which retails for about £2,000, uses liquid cooling to help manage the thermal output of the GPU.
It does this using several fans, which help to pump the liquid through the device (keeping clear of electrical bits of course) through to a copper base (we’ll dive more into the copper play in the coming weeks too!) which helps to disperse and transfer the heat away from the GPU.
Now this is a consumer-grade (albeit high-end) solution for someone who might build a custom PC rig.
And it’s using advanced thermal cooling technology.
So what do you think is needed when a company like Nvidia is creating entire server racks with multiple B200 AI “Superchips” connected as we head towards this idea of data centre-as-a-chip?
That’s right, cooling – and a lot of it.
In fact for our AI future to function in the way it promises, one of the most important technologies that we will need is something to manage the thermal aspects of all that processing power.
It’s a big part of why Nvidia has said it’ll be using liquid cooling in its new servers for the first time.
It’s also why newer kinds of technologies like immersion cooling (where you literally dunk the computers/servers into a special liquid) are starting to really rise in importance.
It’s also why one of the best-performing stocks in the last year is likely a company you’ve never heard of before, but is a market leader in cooling: Vertiv Holdings (NYSE:VRT).
Vertiv is now a multi-faceted IT services and critical infrastructure company, but its origins go back to 1965 when the (then) Liebert Corporation launched the industry’s first computer room air conditioning to kelp keep computers cool.
Part of its business today includes cooling solutions for AI infrastructure and high-performance computing. It’s even in partnership with Nvidia to help develop “the latest liquid cooling technologies to enable cutting-edge chips to run effectively.”
And then there’s the stock price…
Vertiv has gone from around $11.95 a year ago to a high of $88.69 just last week! That’s a 642% gain in a year.
And yes that’s mainly driven by the AI boom and the realisation that its ancillary companies like Vertiv are going to be critical to the rollout of more advanced AI infrastructure and services in the coming future.
The company is now worth $31 billion. I wonder if that makes it expensive now or cheap? I’m not sure yet, but it’s certainly one of the more interesting companies in this realm.
It is of course not the only one. There’s several private companies that I’m keeping an eye on. I suspect that a few of them like Vertiv may find their way onto the market in the next year as valuations fly, the idea of listing on the market via a special purpose acquisition company (SPAC) looks attractive again and the market realises that companies like these are important to AI.
AI gone wild 🤪
In another publication that I write for, a couple of weeks back I was continuing with my idea around the tech wars being back in full force.
It’s an idea I have covered here at AI Collision when I asked you to pick your AI wars side, Apple or Microsoft.
It’s an idea I’ve been throwing around for a while. I believe that by the time we end up in full-scale commercial “wars” when it comes to tech, the battle is already won.
Just like those Apple vs. PC ads in the early “noughties”.
In this other publication I wrote the following,
… maybe the AI wars are CoPilot vs Chat with RTX?
I’m not convinced this is the way for Nvidia. And I think that there’s a good chance another entrant steps up to the plate by the time we see out 2024.
I suspect that may come from Meta who we know is building out its AI infrastructure, but it’s strangely quiet about anything else in this realm.
Remember this was only a week ago.
Well, maybe I do have the proverbial crystal ball scurried away somewhere…
Only yesterday reports started to emerge that Meta was close to releasing its “Llama 3” large language model that is expected to rival (if not, be better than) OpenAI’s (and Microsoft’s) GPT-4.
And when I say close, I mean the reports suggest it could be this month or the next at the latest.
It’s funny, when a company like Meta is kind of quiet about something as big as its AI ambitions, you know that something must be brewing.
When Apple’s Vision Pro came out, Mark Zuckerberg and Meta went full offensive doing videos comparing Vision Pro to the Meta Quest and how Meta’s was soooo much better.
That’s why I think when it’s ready – so within weeks – it’s going to go on the full offensive with Llama 3 as well.
Is it going to be the AI announcement of 2024? Maybe, the hype is already building fast. Will it be the moment that we get our two “AI wars” fighters, Microsoft vs Meta? GPT-4 vs Llama 3?
Maybe. We’ll see how it all works. But it does at least look like further hype to get behind Meta’s stock and probably another fancy way to show us more ads and sell us more stuff we don’t necessarily want or need.
Boomers & Busters 💰
AI and AI-related stocks moving and shaking up the markets this week. (All performance data below over the rolling week).
Boom 📈
iRobot (NASDAQ:IRBT) up 21%
Appen Ltd (ASX:APX) up 16%
Vicarious Surgical (NYSE:RBOT) up 15%
Bust 📉
Lantern Pharma (NASDAQ:LTRN) down 13%
Gorilla Technology (NASDAQ:GRRR) down 11%
Predictive Oncology (NASDAQ:POAI) down 16%
From the hive mind 🧠
Clearly Elon thinks himself as smart. And I’m sure he is about many things. But when it’s about you, he thinks you’re dumb. And that robots or “superhuman AI” will be smarter than you… next year.
The market is in a buzz because Intel dropped a new AI chip it says is a competitor to Nvidia. But let’s be honest here, no one is near Nvidia. But everyone is also looking for the “next Nvidia”. Truth is, there may be one, but not anytime soon. Still, it’s good to see the others aren’t standing still.
Also remember that for all these chips, regardless of how powerful they are or will be, someone still must make them. And that’s why TSMC is absolutely killing it right now.
Artificial Polltelligence 🗳️
We’re getting back onto our regular schedule of polling with a new poll below that will run to next week.
We had two polls in Tuesday’s AI Collision, which I’m not going to answer here – you can see the results if you want here.
Today’s new poll is the following…
If you think “Other”, leave a comment as to who you think will hold the title of “tech god of the 2020s” below.
Weirdest AI image of the day
Granny got a Gen Z makeover – r/Weirddallee
ChatGPT’s random quote of the day
“The art challenges the technology, and the technology inspires the art.” – John Lasseter
Thanks for reading, and don’t forget to leave comments and questions below,
Sam Volkering
Editor-in-Chief
AI Collision
I bought VRT at $53 on a hunch it would go higher, didn't know what this AI company did. Now it's $84.77.
Plenty of scope here for heating systems as a byproduct of powering and cooling electronics. A collaboration between the Icelandic geezer hot water heat distribution engineers and data centre designers might yield some sensible mutually beneficial solutions. Cu has a great future I feel both for cooling and electrification. Regards