Artificial intelligence has catapulted the microchip industry to the top of the global stock market. The company Nvidia, which designs practically all the ChatGPT chips, surprised the market again yesterday by presenting quarterly results above expectations.
Between the months of April and June, the Silicon Valley group entered 13,500 million dollars, which is double that of the same period of the previous year. But more spectacular were the benefits, which were multiplied by nine to reach 6,180 million dollars. Of course, Wall Street celebrated the results. It pushed the share price up to 8% and confirmed, once again, that Nvidia's capitalization exceeds one trillion euros, a figure that is only within the reach of the big US technology companies.
Following the presentation of results, euphoria spread among the Asian stock markets (the region where microchip manufacturers are concentrated) and the Nasdaq, the benchmark technology index in the US, which places all its hopes on AI after accumulating 18 months of falls due to cuts in the sector.
“Nvidia's results reaffirm that AI is not hype and mark a pivotal moment not only for the company, but for the technology industry as a whole,” Josh Gilbert, eToro markets analyst, said yesterday. In fact, the stock market rises also collected the surprise about the revenue forecasts for the third quarter, located at 16,000 million dollars (above the 12,600 forecast). This figure means multiplying by almost eight the turnover that Nvidia had just three years ago, when it was more focused on the design of chips for the video game industry and autonomous cars.
Yesterday, the founder and chief executive, Jensen Huang, confirmed the company's leap forward: “We are convinced that we are facing a new computing era. The corporate world is making a transition to accelerated computing and generative AI,” he assured. And the company's conviction of the brilliant journey that awaits it is that yesterday it decided to repurchase 25,000 million of its shares, a common operation when the company itself believes that its stock market value could be even higher.
According to the results, Nvidia grows through the sale of microchips to ChatGPT and other AI firms but above all through the sale of its technology to data centers that process all the information. In fact, this last division contributes 75% of the income. And the key to the business is not only in the chip, but in a computer that has up to 35,000 different components.
In fact, the aspect that worried the market was the scarcity of all this hardware: a problem that has already plagued the automotive sector and that could resurface as demand booms – Meta, Apple, Microsoft and Alphabet have also launched AI technology – . However, Nvidia assured yesterday that there is sufficient supply. Although the future of this type of microchip does not only depend on this company: manufacturing is in the hands of the Taiwanese group TSMC.
At the same time, that also means that just two companies in the world share almost all of the AI hardware revenue. That's where so much investment appetite comes from. “These companies have aggressive growth models and that is why they arouse so much interest. However, the future of the sector depends on other companies that are launching more energy-efficient chips,” says Mateo Valero, director of the Barcelona Supercomputing Center, which will use Nvidia microchips to carry out AI tests with the Marenostrum 5 supercomputer.
In fact, the analyst Dylan Patel, from Semianalysis, warned yesterday in the Reuters agency that at some point Nvidia's sales are going to moderate. “Now companies are over-investing in these chips because they don't want to risk being left behind. But at some point, the actual use of this technology will come to light and the landscape may change, ”he warned.
