Sometimes in PR, the spin really is on the money.
That is true of the spin I spun on Nvidia back in 2021. I was pitching the potential benefits of investing in Nvidia on behalf of a client, a global asset manager, which held the stock as the biggest holding in its video gaming fund.
The story I pitched to reporters and editors was that if investors wanted to diversify out of the FAANG stocks, Nvidia was a good bet. The company would potentially grow more quickly than the FAANGs in the years to come, given its importance as a key producer of a particular type of computer chip, graphics processing units (GPUs). Demand for GPUs was racing ahead in 2020-21 with pandemic-heightened gaming and the surge in crypto mining.
Even better, Nvidia’s market share and that of other US chip producers was being protected as US and European regulators were hell-bent on keeping the latest chip technology out of China, as they still are, limiting China’s access to the latest chip technology needed to develop chips to handle AI processes.
Good spin or common sense?
While reporters and editors were far more interested in cryptocurrency than computer chips, I myself was so convinced by the spin that I bought into it. Even the client thought I was a bit fixated on Nvidia. Luckily, I was.
I bought up through 2022 as Nvidia shares fell. And I have held on to this day.
So, good spin can pay. Or was it common sense?
The logic is clear enough: we’ll need more and more computer chips as we move to an increasingly digital world. It’s common sense, which I think underscored the spin I spun in 2021 on Nvidia.
The US is determined to keep the latest chip technology out of China (With Biden going even harder further than Trump).
I introduced the term ‘FAANNGs’ to reporters earlier this year. Many, still, had not heard of the company, clearly not gamers, and despite the fact it was moving the world’s biggest equity market to become the fifth largest company in the US, overtaking Tesla and Berkshire Hathaway this year and Meta last year.
Many commentators are asking which company can take Nvidia’s dominance as a producer of GPUs which can handle AI computing. As we all now know , Nvidia has shot ahead in 2023 since ChatGPT went mainstream late last year. While talk of a correction in tech shares may get in the way of the momentum, and certainly rising bond yields already have, nevertheless, demand for GPUs will likely be sustained over the long term, wherever bond yields end up.
So, for all those experts who see Nvidia as crashing, claiming its price is unsustainable, I’m not backing that view. I’m holding on, as the newly arrived FAANNG company has no clear competitor, just yet. And it is making lots of money. Not as much as its market cap would suggest, but its profit margins are growing quickly. AMD is on its tail, apparently the closest competitor, and Google is trying with its cloud-based processor, a Tensor Processing Unit (TPU), but for now, Nvidia chips are largely powering AI apps.
So the ‘spin’ that I spun on the client’s behalf back in 2021 was on the money.
Be proud and loud
For organisations that have a good story to tell, don’t hold back. You might need to tell it a few times, before markets back your views, but combine your wisdom with common sense and you could have a winning combination, with the help of a PR hack that just keeps on going with a good story.
Do you want to attract more media coverage with messaging that’s on the money?
Call Nicki Bourlioufas on +61 411 786 933 or email at nicki@spotoncpr.com