What happened
Shares of Palantir Technologies (PLTR 0.56%) charged sharply higher Tuesday, joining the general enthusiasm for anything related to artificial intelligence (AI). The stock jumped as much as 10% but was up 7.8% when the market closed.
There was no company-specific news driving the move higher. Rather, the catalyst that helped the machine-learning software and data-mining specialist gain ground was a flurry of news reports from another purveyor of AI technology -- Nvidia (NVDA 3.71%).
So what
Over the weekend, Nvidia CEO Jensen Huang gave the keynote address at the Taipei International Information Technology Show -- also known as Computex. At the event, Huang introduced Nvidia's new DGX GH200 AI Supercomputer. The device features Nvidia's new Grace Hopper Superchips, NVLink interconnect technology, and NVLink Switch System, which combines 256 GH200 superchips, allowing them to perform like a single GPU.
The supercomputer reportedly has 500 times more memory and is 2.2 times faster than its predecessor for training generative AI models.
Nvidia also announced a number of AI-related partnerships. The company is working with advertising agency WPP to develop a content engine using Nvidia's Omniverse and AI technology. The company also announced a collaboration with Softbank Group on a generative AI platform which will be rolled out to a number of "new, distributed AI data centers across Japan," according to The Fly.
Now what
So, what does all this have to do with Palantir Technologies? In a word: nothing. As one of the most recognizable names in the field of AI, however, Palantir is getting a boost from the relative excitement generated by Nvidia's recent results, which suggested that some of the AI-related hype is real. For the current quarter, Nvidia expects revenue growth of about 64% year over year, which it credited to the rapid adoption of AI.
Earlier this month, Palantir CEO Alex Karp stoked excitement when he admitted, "The depth of engagement with and demand for our new Artificial Intelligence Platform (AIP) is without precedent." He also said that Palantir expects to be profitable each and every quarter this year.
The excitement over AI has surged, and Palantir's stock has doubled over the past month, as has its valuation. While the opportunity is vast, the stock will be volatile. Exercise care.
