Comment on Nvidia is now worth $102M per employee
realitista@lemm.ee 6 months agoThe company’s valuation in a public company reflects the price that people pay for shares, so it shows the value of the company on the open market. The employees created this value, so it does indicate how much they each created quite accurately. And you would think that they’d at least get a representative percentage of that at least. I mean if you paint a painting and someone pays $1m for it, you get $1m gross. You make the software and IP that’s sold for $100m and you only get $100k a year, that’s kinda wack.
sonori@beehaw.org 6 months ago
Firstly it shows the value of individual shares multiplied by the number of shares, not the company as a whole. Secondly, in this case Nvidia’s share price is based on what the company may be able to expand to do in the future, not what it currently does. Thirdly, where would this repersentive percentage come from? If it’s, issueing new stock to employees, A Nvida already does that a lot, B, creating new stock is not practically reliant on overall market cap so why is it relevant, and C, would employees also be punished for destroying the valuation if it turns out that every company doesn’t actually need a data center full of several thousand AI accelerators scraping the internet to make unique chat bots and Nvida’s market cap falls back down to what it would be based on how much money the company actually makes?
Again, Nvida primarily makes chip designs for outsourced fabrication, not market cap, that three trillion isn’t like revenue for Nvidia. In your painting example, market cap would be like if two unrelated billionaires bet 10 billion on whether or not that painter would be successful in selling a hundred different 1m paintings in the next six months, the painter might have an easier time say getting a loan for new supplies from a bank if they can point to the billionaire betting so much on them, but you know it’s not like the painter was actually paid that 10 billion that makes up the bet.
realitista@lemm.ee 6 months ago
The share price literally wouldn’t be what it was if people weren’t literally buying pieces of it at that price. So it’s very literally saying what the company is worth on the open market. Even with all your obfuscation, that’s still the case.
sonori@beehaw.org 6 months ago
Please explain to me how any of the child level explanation of the stock market is obfuscation, or again how you think the market cap, a purely theoretical number, could possibly be redistributed to employees outside of things the company already does to some extent, and finally why it applies in this case with a company who’s stock price is based purely on speculation about what it could do in the future and not anything it’s employees are currently doing.
realitista@lemm.ee 6 months ago
The value of anything is what people are willing to pay for it, full stop.