AI Summary
5 min readIn October 2024, Business Insider reported that Amazon was spending billions of dollars a month on Nvidia server racks and GPUs but could not immediately install them in its data centers. Some of these racks were sitting in warehouses. An Amazon spokesperson called this routine "best business practice," but the report raised a sharper question: are the hyperscalers buying far more AI chips than they can actually use?
Ed Zittrain, CEO of Easy Primary Research and author of the Where's Your Ed at newsletter, had already been asking that question. In a previous investigation, he estimated that roughly half of AI chips in America were sitting in warehouses. On Prof G Markets, host Ed Elson brought Zittrain on to explain what is really happening with all those GPUs—and why it matters for the entire AI economy.
The Warehouse Problem: Chips Without Homes
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Guests on this episode
Show Notes
Ed Elson is joined by Ed Zitron to break down why AI chips are sitting in warehouses and why it could be a huge problem for the AI industry. Then, Nicolas Owens joins to give his takeaways from SpaceX’s earnings. Later, Thierry Wizman joins to unpack the fiscal crisis unfolding in France and whether he thinks the U.S. could follow in its footsteps. Finally, Ed shares his gratitude to the audience for voting at the Signal Awards.
Ed Zitron is the CEO of EZ Primary Research and author of the Where’s Your Ed At newsletter. Nicolas Owens is an equity analyst at Morningstar. Thierry Wizman is the global FX and rates strategist at Macquarie Group.
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