As I have opined in other threads, I see nothing but down side for nVidia's GPU business. The best they can do is to not slip too far. In the AI business, nVidia has no equal. I see good things out of AMD and a couple of others but nVidia gets 100% of data centre wins. What's more, the cost of AI is energy, not initial investment. It appears nVidia will be able to charge a premium for some time to come. If we were talking about GPUs, I would bet on AMD. Not to take the lead but to substantially shrink the gap. With AI, the only sensible bet seems to be nVidia. Meanwhile, in China, they have some reasonably powerful chips. They are off the performance mark but that might still be OK. The problem is they require way more power to do the same thing. They cannot win AI until they have a competitive semiconductor process. The Chinese gap will continue to widen.
Here's my short take: Ever since HD 5870, AMD has not been a leader in GPU anything for those who can pay. If you wanted the best, Nvidia it is. If you have a productivity load, Nvidia and CUDA it is. If you want the best driver support, Nvidia it is. Best software stack? Nvidia by a mile. Best game features? Nvidia. Every gamer forum I go through, AMD is looked at as either a value for money for certain SKUs or a perpetual second best when an Nvidia SKU is out of stock. Nvidia spends serious money on their software ecosystem. AMD? Not so much. They go the open source route, and that has not been a winning formula for success. Looking forward, AMD is going to have to come out as a value leader by a large margin if they want to peel away more from Nvidia. They are going to have to sacrifice margin for market share. And they are going to have to sink a lot of money on their software stack. That's an absolute necessity. CUDA didn't come cheap or easily. With that in mind, it's not going to help them financially, but mindshare costs a lot to gain. For gamers, it's a drivers and cost per frame thing. For creators, AMD has a LOT of work to do. Ever since AMD acquired ATI they have struggled to make a dent in Nvidia's dominance. If it was just about any other company besides Nvidia, AMD would be on top because of Lisa Su, but Jensen Huang is a damn brilliant CEO. It's hard to outmaneuver a market leader with someone like him at the helm. The fact that both of them are related? Chef's kiss. Now with all that out of the way, let's get to "I see nothing but down side for nVidia's GPU business". AMD already dominates the iGPU side. Game consoles? Check. You think that continued dominance will yield more than it already is? What are you seeing that I am not?
Reading more about DeepSeek, this is quite the wrench in many peoples' plans. Of course NVDA and TSMC are affected due to a potential sea change of AI GPU orders from the big players... BUT... this might also have the effect of smaller players snapping up cancelled orders. I am not sure I see this as a crap your pants NVDA sell off moment. This is perhaps a watershed moment for a sort of democratization of AI training. The world still needs computational power. NVIDA is the best, at least for the near future. To me, the fact that this is Chinese software is very interesting. It might play to our current administration's AI aspirations. We might have greatly accelerated this AI arms race with this one piece of code. It's going to be extremely interesting to see how this all plays out. I would LOVE to be a fly on the wall near the Sam Altman's of the world right now!
The new Trump/Altman AI project with a half trillion dollars of funding should be a massive boost to nVidia. It will involve nearly no R&D. It's just build and sell. Epic.
As an investor, I am literally banging my head against the wall with how badly NVDA is botching the RTX 5 series roll out. A new chapter in the saga: The door is wide open for you, AMD. Don't screw it all up like you have a tendency to with your GPUs!
