this post was submitted on 08 Jun 2024
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"...For Nvidia, after this latest run-up took it north of the $3T milestone, the company is being valued at more than $100M for each of its 29,600 employees (per its filing that counted up to the end of Jan 2024).

That’s more than 5x any of its big tech peers, and hundreds of times higher than more labor-intensive companies like Walmart and Amazon. It is worth noting that Nvidia has very likely done some hiring since the end of January — I think the company might be in growth mode — but even if the HR department has been working non-stop, Nvidia will still be a major outlier on this simple measure.

We are running out of ways to describe Nvidia’s recent run... but a nine-figure valuation per employee is a new one."

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[–] [email protected] 39 points 5 months ago* (last edited 5 months ago) (13 children)

Well, they technically will see SOME cents of this because I'm pretty sure Nvidia gives employees stocks too.

But yeah, I also posted this because it's a clear illustration of how most salaries will never reflect the value your labour brings to an organization.

[–] [email protected] 11 points 5 months ago (11 children)

I don’t think many people would claim overall valuation has much of anything to do with the value labor brings to an organization.

In this case I think all it indicates is just how much the company’s stock price is driven by speculation about possible demand for generative AI, and even then I’m not sure that current price per share times number of shares divided by number of employees is a clear indication of that.

[–] [email protected] 4 points 5 months ago (10 children)

I don’t think many people would claim overall valuation has much of anything to do with the value labor brings to an organization.

Apologies, can you clarify what exactly you mean by this? Because when I say their labour is not being valued, I do extend that to the Wall Street orgs that are doing the evaluations. They look at the "product" on offer, not the people actually working and developing it.

Are you saying because stock prices aren't steady, we can't correlate that to salaries?

[–] [email protected] 3 points 5 months ago (1 children)

With options trading, a lot of stock movement is reflective of speculation rather than true value.

[–] [email protected] 7 points 5 months ago

Stock movement is always speculative with or without options. The difference that derivatives makes is the ability to price in speculative value at some point in the future as well. The price of a share is reflective of what traders think a company is worth today; but an option is a reflection of what traders think the shares will be worth at some point in the future, which people can then look at and use to re-adjust their estimation of what they think the underlying share price is worth today. It's a recursive feedback loop that (theoretically) results in share prices closer approximating a true value. A sort of predictive smoothing function.

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