geoffodlum

I'm pretty bullish on this given NVIDIA's incredible growth over the past two years and insatiable demand for NVIDIA GPUs, but I will start with what I feel is a conservative 35% forecast. 

I see 4-5 key drivers that will determine the outcome of this question, all of which have been mentioned in colleagues' previous forecasts:   
1.     Dominance in AI Hardware and Software: NVIDIA's current market value is driven by its leading role in AI/ML hardware, particularly GPUs and software platforms like CUDA, which are essential for generative AI applications. With projected growth in AI computing demand, NVIDIA’s revenue streams may continue to expand. However, it faces increasing competition from companies like AMD, Intel, and new entrants in AI-specific processors.
2.    Competitive Market Dynamics and Economic Cycles: The valuation growth needed to surpass Apple, Microsoft, and Saudi Aramco would require sustained high demand for NVIDIA's AI chips across multiple sectors. This outcome may be influenced by economic cycles, which impact high-valuation tech stocks, and will be vulnerable to interest rate fluctuations and whether AI-related expectations taper off in the near term.
3.    Supply Chain Resilience and Capacity Expansion: NVIDIA’s ability to maintain or increase supply in light of global chip shortages and geopolitical tensions (e.g., U.S.-China relations affecting access to production and materials) will be crucial. Successful expansions in supply through partnerships like with TSMC or other fabs will be critical for meeting market demands and sustaining high growth.
4.    Sector Diversification and Vertical Integration: NVIDIA’s expansions into data centers, automotive AI, and cloud solutions have significant revenue potential. Continued successful inroads here could boost its valuation by diversifying revenue sources beyond consumer GPUs, further increasing investor confidence and market stability.
5.    Valuation Multiple and Growth Prospects: NVIDIA currently trades at high multiples based on future growth expectations, much of which hinges on AI adoption rates. Should AI adoption slow, or if new regulatory measures emerge, NVIDIA’s growth may face limitations, reducing the probability of reaching the top valuation spot.

Here are the key signals I am monitoring:
1. NVIDIA’s Quarterly Earnings Reports: Looking for accelerated revenue growth in AI and data center segments, which would indicate sustained market demand.
2. Market Share and Competitor Developments: Tracking developments from AMD, Intel, and other AI-specialized startups for competitive impacts on NVIDIA’s market position.
3. Macro-Economic Indicators: Interest rates, inflation trends, and broader economic conditions could impact high-growth stock valuations significantly.
4. Geopolitical and Supply Chain Stability: Monitoring U.S.-China relations and any new export controls or supply chain interruptions that may affect semiconductor availability or NVIDIA’s production capacities.
5. New Product Launches and Adoption Rates: Any breakthrough product announcements or significant partnerships with cloud providers (e.g., AWS, Google Cloud) would be indicators of NVIDIA solidifying its leadership in AI hardware and potentially boosting its market cap growth trajectory.

I'm persuaded by the excellent analysis from colleagues. As I consider this question and the scenarios that would lead to an affirmative outcome, I am looking at several possible drivers:

Russia’s military capability to invade another country before April 2027:  Russia’s military is currently stretched too thin in Ukraine and in Kursk to launch an invasion of another country, at least absent a massive conscription effort.  Russia’s economy is now on total war footing so its possible that the material and manpower needed to fight two wars would be available in 2025-2026, but I am very skeptical.

 
Putin’s Strategic rationale: As long as NATO does not signal an interest in providing membership to any of these countries (as opposed to “partnership for peace”-type programs which tend to be symbolic), or deploy NATO forces there, I don’t see why Putin would upset the current status quo with a high-risk gambit to invade any of them.

OTOH, I can imagine Georgia and Moldova specific scenarios that might prompt Putin, at a minimum, to try to use hybrid "gray zome" warfare, espionage, coercion, bribes, and threats to try to weaken pro-western sentient in both countries. 

In Georgia, for example, if yesterday’s election results in favor of the pro-Russian Georgian Dream party are found to be fraudulent (i.e. the result of Russian meddling) and are somehow overturned, I can see Putin offering to send “peacekeeping forces” to Georgia to “maintain order.”  Russia invaded Georgia in 2008 and still controls the regions of Abkhazia and South Ossetia and has since tried to “borderize” parts of the country — slowly shifting the boundaries between countries.  If a future anti-Russian government in Georgia presses back forcefully on this, I can imagine Putin launching plausibly deniable hybrid warfare – “little green men" emerging from South Ossetia and Abkhazia and operating in Georogian territory against Georgian police and security forces. against Georgia.

In Moldova, where the ruling pro-EU party just won parliamentary elections and where they have moved to ban Russia media outlets operating in the country to limit Russia’s malign influence, I can imagine Putin relying on his military and security force presence in Transnistria to raise pressure on the Moldovan government and claim ethnic Russians are being badly mistreated, requiring Russian military intervention “to protect them.”  

 
US Presidential Election and Likely US and NATO Response: Another huge wildcard is who will be US President in 2025-2026. If its Kamala Harris, I foresee efforts to provide US and NATO training and assistance to Georgia's and Moldova's militaries to harden their defenses against future Russian incursion. If Trump is elected, unfortunately I can envision him signaling to Putin that Georgia and Moldova fall outside the US sphere of interest, which would encourage Putin to expand his destabilization efforts in both. 

I am thus keeping a close eye on (1) US Presidential elections (2) Status of the election results in Georgia (3) Russian claims of ethnic Russian mistreatment in Moldova (4) Developments on the battlefield in Ukraine and implications for Russian military capabilities.

I'm raising from 12% to 15% because I misread the resolution criteria on my earlier forecast and mistakenly though this forecast would resolve sooner than it actually will.  Between now and 10/25/25, I foresee several plausible scenarios that would result in Khamenei no longer serving as Supreme Leader, including:

-- A strategic decision by Khamanei to orchestrate the handoff of power to his son Mojtaba, forestalling a succession crisis if he were to do without a clear successor;

-- A recurring health condition that kills or incapacitates him and forces a non-violent leadership change;

-- A targeted assassination either from a foreign government (Israel), insider/competitor (IRGC), or outsider/criminal/terrorist groups (ISIS);

-- A violent insider coup or popular uprising leading to regime overthrow.

Th signals and signposts I'm watching are similar to the ones I described earlier.

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On the one hand I am lowering my forecast by 5% (down to 10%) given the passage of time with only 5.5 months remaining until this question resolves; no significant domestic public protests in the past month; no indication of Iran losing the diplomatic protection of Russia or China at the UN; and no recent reporting on Khamanei’s health.   

On the other hand, given Israeli’s successes at decapitating Hamas and Hezbollah leadership in recent months without significant blowback from the US or Israel’s usual supporters, and with Israel still preparing its retaliatory response against Iran, I am raising the forecast by 2% (up to 12%) on the possibility that Israel’s response will include targeting of Khamenei’s whereabouts or his properties where he might be staying.

As signposts or signals I will be watching the US-Israeli ongoing talks about how Israel should respond to Iran, as well as indications that Iran’s deepening economic crisis (all-time low of the Rial against the dollar, stock market collapse, inflation and price of gold surging, etc) are giving rise to new waves of protest.

I'm starting off with a higher initial forecast than most fellow forecasters, putting this at 30%. 

I calculated a 10% baseline rate of a Russian-sourced cyber-attack against a NATO member state’s critical infrastructure over any 18-month period.  In the past decade, Russia has at least several known cyber-attacks against NATO countries, primarily targeting governmental, financial, and energy sectors, including:
-- The 2017 NotPetya attack which started in Ukraine but spread globally, affecting multinational corporations, including some in NATO countries;
-- Russian state-sponsored actors attacked critical infrastructure targets in the U.S. and U.K.in 2018  via malware designed to sabotage energy grids.
-- Ongoing cyber campaigns starting in 2021 and linked to Russia have targeted energy and transportation sectors in like Poland, Estonia, Latvia, Lithuania.  
Few if any of those attacks resulted in kinetic effects like physical damage or human casualties. But Russia definitely has the capability to create kinetic effects against energy infrastructure, and as it becomes more defensive and desperate in the ongoing war in Ukraine, I can imagine Putin ordering plausibly-deniable kinetic cyber sabotage of NATO member state infrastructure.

Key Drivers of this event could include:
-- Deeper NATO support for or involvement in Ukraine war:  If NATO increases its support for Ukraine (e.g., sending more advanced weaponry, loosening Ukraine’s RoI to attack targets deeper in Russia,  or deploying NATO forces in western Ukraine), Russia may escalate its cyber warfare, potentially targeting NATO infrastructure.
-- Perceived Weakness or Division in NATO: Russia may seek to exploit perceived divisions within NATO or between NATO and the EU, aiming to weaken political cohesion or test Article 5 without direct military conflict, especially if Trump is elected.
-- Retaliation for Sanctions or Diplomatic Measures: As Western sanctions on Russia continue to intensify, particularly in response to its energy exports, Russia may retaliate with disruptive attacks against NATO energy or transport systems to demonstrate its ability to retaliate without direct military engagement.
-- Deterrence and Coercion: Russia may attempt to dissuade NATO countries from taking further aggressive stances by demonstrating the vulnerability of their critical infrastructure.
-- Proxy or Hybrid Warfare Strategies: Russia may not launch a direct cyber-attack but use proxy groups to carry out attacks that appear independent.

I think the most likely triggers would be deeper NATO involvement in the Ukraine War, with Russia seeing cyber attacks that inflict small but symbolic kinetic damage as a lower-risk means of retaliation compared to direct military conflict.

Hope for peace springs eternal even in the bloodiest conflicts, especially when a Presidential Administration is rushing to achieve a diplomatic win before it leaves office.

Secretary Blinken heads back to the Middle East today (Oct 21) to restart ceasefire talks that it believes may be slightly more achievable following the death of Yahya Sinwar last week. But its not clear who would even speak for Hamas, as every newly-named Hamas leader becomes an assassination target for Israel;  Hamas fighters at lower levels have vowed to keep fighting; and Iran is bracing for an Israeli counterstrike.  So while its useful for Blinken to talk to Israel about what Gaza's post-conflict political future will look like, I dont see how Hamas (whoever speaks for Hamas) could agree to a lasting ceasefire before December 1.

The only plausible scenario I can imagine where Iran would agree to limit uranium enrichment to 5% or less U-235 (which is the typical level for fuel that a Busheher-type reactor would use) is in exchange for significant concessions from the west including speedily lifting all sanctions on Iran's hydrocarbon and nuclear sectors -- basically JCPOA+.  The time it would take to negotiate that agreement with within the P5+1 would be on the order of many months -- and that timeline does not include Iran's potential responses to Israel's anticipated retaliation against Iran.  If the escalation stops following an Israeli (limited) strike, there is a very small (4%?) chance Iran's leadership will reach out to resume JCPOA talks, and an even smaller chance (2%) that such a deal can be agreed before April 21, 2025. Small, but non-zero.

I give alot of weight to CIA Director Bill Burns (who was the most impressive person I ever interacted with during my 27 years at the State Department) and his Congressional testimony in February, that Chinese President Xi instructed the PLA to “be ready by 2027" to invade Taiwan, and that Xi may be harboring doubts about China's ability to take Taiwan quickly or without significant casualties given given Russia’s experience in its war with Ukraine.