CNBC's Mad Money host Jim Cramer cautioned that while opting for Amazon.com Inc. (NASDAQ:AMZN) and Alphabet Inc.‘s (NASDAQ:GOOG) (NASDAQ:GOOGL) proprietary AI chips looks convenient, rival tech hardware fails to maintain long-term asset worth compared to market leader Nvidia Corp. (NASDAQ:NVDA).
The Depreciation Trap
In a social media post on Thursday morning, the financial commentator broke down the hidden long-term risks of shifting away from Nvidia's dominant ecosystem. While tech buyers might be tempted by alternative hardware options, Cramer highlighted a steep financial downside to proprietary hyperscaler silicon.
“It seems ‘so easy’ to just go buy the Amazon or Alphabet GPU version,” Cramer noted, pointing out the illusion of convenience in opting for internal cloud chips like Google’s TPUs or Amazon’s Trainium and Inferentia.
However, he quickly warned that these alternatives are “hard to get credit against and do not hold their ‘value’ over the years like Nvidia’s do.”
Playing The Long Game
According to Cramer, the true test of these AI infrastructure investments won’t be settled in the immediate future, but rather over years of hardware lifecycle depreciation. Because
Nvidia chips act as a universal industry standard; they retain a robust resale and financing value that custom, single-ecosystem chips simply cannot replicate.
“Doesn’t matter tomorrow or the next day, does matter over the long haul,” Cramer emphasized, underscoring that the compounding costs of rapidly depreciating hardware could impact enterprise balance sheets down the line.
A Tale Of Two Stocks
Despite his stark warning regarding their proprietary AI hardware, Cramer was quick to clarify that his critique of their chips is not a green light to short the tech giants.
He concluded his thoughts by reassuring investors that he remains fundamentally bullish on both companies as overall investments, stating plainly, “And i like AMZN & GOOGL.”
Nvidia Earnings Top Estimates As AI Demand Surges
Nvidia outperformed Wall Street estimates across the board for the first quarter, driven by an 85% year-over-year revenue surge to $81.6 billion—easily beating the $78.8 billion projected by analysts. The chipmaking giant also reported an adjusted profit of $1.87 per share, topping the $1.76 per share anticipated by the market.
Looking ahead, the company issued strong guidance for the second quarter, forecasting revenue between $89.18 billion and $92.82 billion, which sits well ahead of the consensus Wall Street estimate of $86.62 billion.
Despite the stellar numbers, Cramer cautioned investors against overreacting too early after-hours stock volatility, noting that the initial post-market reaction can be deceptive.
How Has NVDA Performed In 2026?
In comparison with the Nasdaq 100’s 16.23% year-to-date advance, shares of NVDA have risen by 19.82% over the same period. It closed 1.30% higher on Wednesday at $223.47 per share after its first-quarter earnings report.
Over the last month, NVDA stock was up 1.60%, and it advanced 23.71% and 66.30% over the last six months and the year, respectively. It was 0.08% higher in premarket on Thursday. Benzinga’s Edge Stock Rankings indicate that NVDA maintains a strong price trend in the medium, short, and long terms, with a poor value ranking.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo courtesy: bluestork / Shutterstock
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