Nvidia, Leader of the AI Race
It is no surprise that the AI field is witnessing very significant competition, as Nvidia takes the lead in both the AI chips and tech market, as the company takes the field by a storm.
On Wednesday, Nvidia’s market value surpassed $3 trillion, overtaking Apple to become the second-most valuable company in the tech market.
Apple Lost Its Spot
According to Bloomberg, the chipmaker’s shares rose by about 5%, pushing its market capitalization to $3.01 trillion, surpassing Apple for the first time. The iPhone maker is now ranked as the third most valuable company in the world, with the second ranking company being Microsoft.
In May of 2024, Nvidia reported another set of impressive earnings, with revenues reaching 262% year-over-year (YoY), due to strong sales of its “Hopper” chips.
In May 22 of this year, Nvidia announced a 10-for-one stock split, effective June 7.
Confidence’s Key to Success
This exceptional growth of Nvidia is due to several factors, with the primary attribute being the rise of its stock price in relations to huge investments from big tech giants, such as Google, Meta, and Microsoft who increases their purchase capacity of Nvidia’s AI chips to power their AI models as competition intensified amongst out tech giants.
Another influential tech person also joined the ride, with billionaire Elon Musk, who recently considered shipping thousands of Nvidia chips reserved for his companies, X, Tesla, as well as xAI.
This great confidence shown by investors in the chipmaker’s stocks reveals that the process is not willing to slow down. In this regard, CEO Jensen Huang claims it will lead to a new “industrial revolution,” enhancing productivity across various industries.
Strategic Investments, Partnerships
In the midst of this huge impact, Nvidia continues to extend its influence through strategic investments. On Wednesday, the company announced that it is co-leading a $50 million investment in Twelve Labs Inc., a startup founded by Korean engineers Jae Lee and Aidan Lee, aimed at reshaping video search and analysis.
The funding, which was done along with U.S. venture house New Enterprise Associates and others, endorses Nvidia’s commitment to AI, following similar investments in companies like Hugging Face and Cohere.
San Francisco-based Twelve Labs develops foundational AI models to make video content searchable and understandable, serving a diverse range of clients including social media influencers, sports leagues, and Hollywood studios.
Yet, every success is faced with challenges and competition, considering that AI is invading the world in all industries, explaining the reasons behind the huge amount of AI products released every day.
Competition Prevails
Although Nvidia’s efforts to maintain its position as the leader in the tech market never hinders, competitors such as AMD, Intel, and Qualcomm are following its every step.
Kneron, the Taiwanese AI chip startup backed by Qualcomm is one of the companies competing with Nvidia.
On Wednesday, the Korean startup launched its latest next generation products with the introduction of the KNEO 330, its second-generation “edge GPT” server designed for businesses to run AI applications on-premises rather than relying on cloud services from companies like Microsoft and Amazon.
Albert Liu, CEO of Kneron, told CNBC, “We find a strong market need in big high-tech companies, or medical centers or financial institutions, they care about their privacy.”
In addition to Kneron, Intel and Advanced Micro Devices (AMD) are also main competitors to Nvidia in the market.
On Tuesday, Intel announced during the Computex Conference its new AI chips, Xeon 6 processor known for its enhanced AI performance and advanced security to protect data and ensure privacy, aiming at reclaiming market share from both Nvidia and AMD.
Final Thoughts
The AI field race is going on a fast pace with tech giants doing all what it takes to reach the lead and maintain its position in the market. But it seems that Apple is facing a lot of challenges, so will it be able to catch up after its upcoming Worldwide Developers Conference (WWDC) scheduled for June 10?
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