YF Reports: AI Chip Wars: Nvidia, Intel, Qualcomm, & AMD

All this week, business leaders in the chip industry gathered at the COMPUTEX Conference in Tapei, Taiwan; all with the stated purpose of showing off their companies latest products and developments. Current industry front runner Nvidia (NVDA) unveiled its most impressive next-generation AI chip, nicknamed Rubin. Meanwhile AMD (AMD) announced their AMD Instict MI325X accelerator, showing how the company plans on leading the AI space in performance and memory. Intel (INTC) plans on finding their own niche in the heavily sought after market, announcing their new Gaudi 3 AI Chips; a more affordable option for cost-conscious customers. As the AI revolution heats up, who will come out on top of the AI Chip Wars. Here is what you need to know: Nvidia is the undisputed heavy-weight in the AI space. Yahoo Finance's Akiko Fujita explains: "Tough to argue with anybody being the big winner except Nvidia so far when you consider the sheer scale of they've been able to accomplish. When you talk about data center revenue alone, the category that has seen the biggest bump from the AI boom, rose 427% from a year ago in it's most recent quarter." Nvidia may have won the battle, but they have not yet won the war. Competitors like AMD & Intel are making aggressive inroads. I/O Fund Lead Analyst Beth Kindig breaks it down: "In this AI battle, this AI competition between AMD and Nvidia, I estimate that AMD is capable of taking somewhere between 10% to maximum 20% of the market. This is based on the gaming competition these two companies have had for some time. Intel, they are moving well past 20%. Intel is an easier competitor than Nvidia. I think Nvidia is going to be a tougher competitor for AMD." Even though Nvidia dominates the AI space, no market wants to rely on only one company. KeyBlanc Capital Markets Analyst John Vinh discusses why Nvidia's monopoly in the microchip industry is a cause for concern, and a clear sign of opportunity for other companies to wrestle back some of the lion share from the Santa Clara-based tech giant. "The market is really badly looking for a credible second source to Nvidia. Nvidia is making 90% gross margins on its AI chips and the industry badly, badly wants are credible second source on the emergence side." One company that is setting their target on the emergence side is Intel. At COMPUTEX they unveiled the new Gaudi 3 AI Chip, a more affordable option for companies who want to dip their toes in the emerging generative-AI market, but who may be scared off by the high price point of Nvida or AMD. Yahoo Finance's tech editor Dan Howley discusses: "Now Intel, they announced their Gaudi Chip pricing, which they say is going to come in less than what you would see from Nvidia. The hyperscalers: the Microsoft's the Google's, they're all in on Nvidia at this point. This will allow for other companies outside of hyperscalers to get into generative-AI at a potentially lower price. It's healthcare, it's individual research institutes, it's automotive industries. That is where Intel could really shine." Another dark horse in these AI Chip wars is Qualcomm (QCOM). They have set their sights on making powerful computer processors able to handle artificial intelligence features. Microsoft took notice, partnering with the San Diego based company on the release of their new Surface Laptops and Surface Pro Tablets. Dan Howley continues: "If you look at what Microsoft did, they used Qualcomm chips to launch this new category of computers, and that's a big deal. That means they have full faith in what Qualcomm can do." This post was written by Noah Chadwick