nvidia presented its economic balance for the first quarter on May 25, which shows a market capitalization of nearly $190 billion. Added to the success in the semiconductor sector is now the firm commitment of the company to the artificial intelligenceapplied to different areas, including video games to give more realism to the characters.
In fact, at the presentation held in Taiwan by Jensen HuangCEO of Nvidia, disclosed a new batch of products and services linked to artificial intelligence, which seeks to attract new customers in the same way that it has happened with semiconductors. Its new offering includes a new robotics design, gaming capabilities, advertising services and network technology, as well as AI-powered GPU chips.
Nvidia’s biggest announcement was the groundbreaking AI supercomputer platform dubbed DGX GH200, which will help tech companies create successors to ChatGPT. In fact, it is estimated that the first users will be Microsoft, Goal and Google of alphabet.
Nvidia’s commitment to AI dates back to 1999, when they decided to develop GPU to improve the display of images in video games. Years later they discovered that these could speed up math operations more efficiently than conventional processing chips.
Economic analysis
The group dominates the market for design of semiconductors for data centers and to train AI systemssomething that has caused its value to be 940,000 million dollars, more than double that at the beginning of the year. It is curious, and at least contradictory, that in the midst of a wave of unprecedented technological crisis, inflation and economic recession, Nvidia has continued to grow and become the 6th best valued company worldwideand that is thanks to its commitment to AI.
In just one day, on May 26, Nvidia reported growth on Wall Street of 24%, representing one of the largest single-day equity gains in the US. All this has led to that the company’s contribution is 165% so far in 2023.
Currently the least valued company on the podium is Google with Alphabet, which is worth more than 1.5 trillion, closely followed by the oil company Aramco which is worth 2 billion. Then we have Microsoft with 2.4 billion and above Manzana, which governs with almost 2.6 billion. It is estimated that it will soon go from being the sixth to the fifth, surpassing Amazon in the world ranking.
During the first quarter of 2023 Nvidia’s profits increased by 26% up to 2,000 million dollars and sales by 19%, being 7,200 million dollars. In fact, the quarterly results beat predictions by 50%.
After reaping an upward economic line of more than 20% per year for the last two decades, Nvidia is now expected to be able to maintain that pace until 2030, attracting new investors to its business fabric. In fact, they announced that they expect their revenue in the second quarter to be 60% more than those harvested during the same period of 2022. Wall Street analysts reckon Nvidia’s share value will hit $500, closing out the week with a price tag of $388.52.
GPU demand will tend to create a great value market for Nvidia, both for the gaming business and data centers, as well as for autonomous vehicles and other technologies. All this will lead to maintain a market share above 90% in the near futuresince it currently has about 95% of the GPU market for machine learning.
The key to Nvidia’s success
Part of the success experienced by Nvidia stems from the H-100 graphics processor launched last year, which gave generative AI a boost by allowing ChatGPT to officially launch in November 2022. The company can boast of having the best chip on the market to enhance AI capabilities, but it also has the right software and silicon. In fact, his CUDA-software It is well above its main competitor.
If CPU development takes hold, Nvidia will become a one-stop provider of everything companies need to power their AI actions. It is something similar to what happens with Apple through the iPhone and its iOS system.
However, Nvidia is aware that can’t let your guard downsince Google has its own tensor processing units (TPU) used for machine learning tasks. Amazon has a custom chip for training AI models, and Microsoft and Meta continue to develop their own AI chips. A long-distance race that they intend to continue leading.
