Microchip and Nvidia logo displayed on a phone screen are seen in this multiple exposure … [+]
This week, Nvidia finally poked its head briefly above the stock value of the dominant Apple empire, before settling back down to market value of $3.47 trillion with Apple’s value at $3.52 trillion.
AP reporting shows how close this is, with a chart showing Nvidia’s rise against Apple and Microsoft, the other two dominant tech companies.
“The Silicon Valley chipmaker is the dominant supplier of processors used in AI computing, and the company has become the biggest winner in a race between Microsoft, Alphabet, Meta Platforms and other heavyweights, to dominate the emerging technology,” write AP reporters Sruthi Shankar and Noel Randewich. “Known since the 1990s as a designer of processors for videogames, Nvidia’s stock has risen about 18% so far in October, with a string of gains coming after OpenAI, the company behind ChatGPT, announced a funding round of $6.6 billion.”
Microsoft now rests slightly below the other two, with around $3.18 trillion in value.
Nvidia’s Past Stock Activity
A look back shows that Nvidia also won out temporarily over the same competitors back in June of this year; prior to that, the firm’s stock price was under $100 per share, until it finally spiked early this year and continued to rise.
Sticking at around $140 per share, this giant is now poised to earn its crown as the most valuable company in the world.
The Difference Between Nvidia and Apple
What this represents for the market is a major change from one kind of technology to another.
You could express this three different ways:
You could say that Apple makes consumer-facing technology, while Nvidia makes ‘back end’ server/hardware technology.
You could say that Apple makes endpoint technology, where Nvidia makes supply technology.
Or you could say that Apple makes devices that you can use, where Nvidia makes hardware that allows AI to think.
With items likes A100 GPU, Nvidia is a dominant producer of AI hardware. And everybody wants a piece of this, from Microsoft and Blackrock, to all kinds of other stakeholders who are getting in on the AI revolution.
The Threat of ASICs
While Nvidia’s own chips are powerhouses in their own right, analysts show that many companies are investing in their own hardware in the form of custom chips known in the industry as application-specific integrated circuits or ASICs.
Some of those closest to the phenomenon cite companies like Broadcom (AVGO) and others as competitor companies that may rise as their clients look for ASIC technology.
However, Nvidia is also making its own play in the ASIC market, and will apparently open sores this technology.
“There has been speculation that fixed function application-specific circuits (ASICs) might one day eclipse NVIDIA’s GPU-centric approach,” writes Karl Fruend at Moor Insights and Strategy. “Now NVIDIA itself seems to have embraced this approach, albeit in a limited fashion, announcing its own ASIC technology for Deep Learning acceleration. In a surprising and bold move, the company also announced that it will open source this technology to enable others to build chips using this technology.”
Maybe that pivot will help them address one of the major threats to their dominance in the market.
In any case, it’s a timely piece of news, because what it shows is that AI is ascendant. We’re watching this technology blossom right before our eyes, in real time, and after a few years of relative obscurity, Nvidia seems to have won out – at least for now.
