NVIDIA (NVDA) and Advanced Micro Devices (AMD) announced their latest generation of AI chips, NVIDIA's Ruben and AMD's MI325X accelerators, as the chip giants accelerate their new product cycles. Beth Kindig, principal technology analyst at I/O Fund, joins The Morning Brief to comment on the market share these chip giants stand to gain as they roll out more products in the increasingly fierce AI race.
“What we're seeing in this AI battle, the AI race between AMD and Nvidia, is something that's never been done at the data center level before,” Kindig told Yahoo Finance. “They're going to be releasing these basically every year. Like you said, at the end of this year we'll have Blackwell, Blackwell Ultra, Ruben, Ruben Ultra, and then there will be further variations within those.”
Check out Yahoo Finance's full interview with Nvidia CEO Jensen Huang.
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This post Luke Carberry Morgan.
Video Transcript
Well, the chip wars are heating up again this time. AMD and NVIDIA are boosting their stock prices after unveiling their next-generation AI chips over the weekend. Nvidia CEO Jensen Wong is hyping a new chip called Ruben that will be released in 2026. AMD unveiled its next-generation AI chip for laptops and CEO Lisa Su said AI is a top priority for the company. To learn more about what this means for the sector and some of the investment opportunities we want to cover, I'm joining Beth Kendig. I owe Beth, a technology analyst at Fund Lead, and it's great to be here with you.
Firstly, we are seeing this excitement again in market action this morning, with both A MD and NVIDIA stock prices trending higher.
What do you think about the announcements we got this weekend, which speak to the fact that we're still very early in the cycle.
Yes, early in the cycle is a great way to put it.
Thank you for inviting me two weeks ago.
In their analysis, Forbes wrote that it is very important to understand that the product roadmap is the first line of defense, and that shortening product release cycles from two years to one year has meant that companies that were previously very cyclical but had to be very careful about timing are now becoming more secular.
So this AI battle is an AI competition between A MD and NVIDIA.
Well, what we're seeing is something that's never been done before.
At the data center level, releases are scheduled on an annual basis.
Like you said, by the end of this year we have Blackwell, Blackwell Ultra Reuben Reuben Ultra coming out.
Additionally, Blackwell has variants such as AB 100, AB 200, A GB 200, NVL 72, and more.
This means that new variations emerge even within each year's product release cycle.
What investors need to understand is that previously cyclical companies are becoming more secular.
And then when you add that software layer, you can actually address the long-term interests of the country.
Yeah.
And that certainly echoes the tone struck by NVIDIA CEO Jensen Huang at Computex when he spoke about making everything faster.
So, from your perspective, how does the mindset and operation of accelerating everything translate to the market cap and valuation of the company and how does that actually increase where this can continue to go?
And as this incredible growth continues, NVIDIA has set a goal of a market cap of $10 trillion by 2030.
To be honest, I think that's too low.
The reason is that there are currently approximately 60,000 GP US in the data center already.
Jensen Wang said on stage that we aim to have a 1 million GP U data center one day.
Therefore, 10 trillion yen may even be too low.
And that’s why the Hopper generation gave us 1.5 trillion in thrust.
That means four more generations are on the way over the next four to five years.
Now, you have to add in the software, add in something like the Omniverse platform, which is how all of their robotics are developed almost exclusively because they're a simulation company that came from the gaming route.
They essentially have an engine and software platform that enables robotics that is so advanced that other companies and others will have a hard time competing with it. This is already coming out of the simulation route.
So if you combine the software you have to think about now, the automobiles you have to think about, the robotics you have to think about, you know, it's going to be well over $10 trillion by 2030, but just briefly here, what kind of market share are we talking about?
Because there's a competitive environment where you have to imagine other chipmakers aren't going to fall into the ditch.
I estimate A MD could capture 10% to as much as 20% of the market.
This is based on a gaming competition.
These two have been going up against Intel for a while now, well over 20%, and Intel is an easier competitor than NVIDIA.
I think NVIDIA will obviously be a tougher competitor for MD.
So, Beth, at least looking at the current valuation of Nvidia, the massive upside we've seen in the short term, I think A MD for GP US will be 10-20%.
You know, I know you obviously see a big opportunity here over the next few years, but do you think in the short term there could be some upside in valuations?
This is perhaps the most important question: where will NVIDIA be in 2030?
But would you buy now?
And this isn't really a question of valuation, because we're talking about a company whose bottom line has gone up 6,700%.
So the valuation is actually quite reasonable because with all these funding rounds and launches, what NVIDIA needs is broad market participation.
Looking at the market as a whole, things seem a bit weak.
So, in our opinion, the best time to buy shares is when the broad market is participating. So, is NVIDIA able to hold off on the broad market or can it hold off on the selloff?
Can it be sustained?
And what tech investors need to understand is that sometimes it has nothing to do with the stock, it has nothing to do with individual management teams, it has nothing to do with these great fundamentals, or it has nothing to do with what we call creepily low valuations.
It has to do with broader markets and sentiment.
Yes, Beth Kay, I'm glad you're here.
We look forward to welcoming you back to Yahoo Finance soon.
Find a Lead Technical Analyst.
Thank you so much, Beth.
thank you.
