Nvidia stock up after Microsoft, AMD quell fears AI buildout too fast

[Pelican Press 0]

This is the hidden content, please

• Sign In
• or
• Sign Up

Nvidia stock up after

This is the hidden content, please

• Sign In
• or
• Sign Up

, AMD quell fears AI buildout too fast

Jensen Huang, co-founder and chief executive officer of Nvidia Corp., displays the new Blackwell GPU chip during the Nvidia GPU Technology Conference on March 18, 2024. 

David Paul Morris/Bloomberg via Getty Images

Nvidia shares popped more than 11% Wednesday after remarks from top customer

This is the hidden content, please

• Sign In
• or
• Sign Up

and rival chipmaker AMD signaled no slowdown in the multi-billion dollar buildout of AI servers based around GPUs.

This is the hidden content, please

• Sign In
• or
• Sign Up

CEO Sayta Nadella and CFO Amy Hood signaled on Wednesday that the company plans to spend even more on Nvidia-based infrastructure next year. It spent $19 billion on capital expenditures during the quarter, with about 60% on hardware.

This is the hidden content, please

• Sign In
• or
• Sign Up

also suggested it’s seeing a return on investment from its expensive GPU-based servers.

The remarks on an earnings call Wednesday eased investor worries that Nvidia’s elevated AI sales were tied to an arms race among cloud providers that could be slowing down.

This is the hidden content, please

• Sign In
• or
• Sign Up

’s earnings report “may encourage most Nvidia/semis investors, as

This is the hidden content, please

• Sign In
• or
• Sign Up

’s capex came in much hotter-than-expected at $19 billion in the quarter,” UBS analyst Karl Keirstead wrote in a note on Wednesday.

Nvidia has been the primary beneficiary of the AI *****. Its stock has doubled so far in 2024 and is up more than 500% since ChatGPT’s release in November 2022 kicked off intense investor interest in artificial intelligence technology.

Morgan Stanley analysts named Nvidia a “top pick” in a note on Wednesday, saying that concerns including competitive dynamics, export controls and supply chain concerns are likely to “fade with time.” 

“Our perception is that the market is taking a very glass half-empty view of some of the hyperscale comments, where there is a clear ******* on the part of customers to continue to commit resources to developing multi modal generative AI,” Morgan Stanley analyst Joseph Moore wrote.

Moore also highlighted that Nvidia’s chips are transitioning from last-generation “Hopper” or H100 series chips to a new generation, called Blackwell, which could spur additional sales.

“Our checks generally show that customers want to deploy GPUs as quickly as possible, and the resilience of the H100 even a few weeks from Blackwell ramping to us makes those spending concerns seem **********,” Moore wrote.

Top rival raises AI forecast

AMD, Nvidia’s primary rival in the market for data center GPUs, reported better-than-expected sales and earnings on Tuesday and told investors that demand for its GPU ******** strong.

AMD CEO Lisa Su said the company expected $4.5 billion in AI chip sales this year, an 11% increase over its previous guidance.

Goldman Sachs analysts suggest

This is the hidden content, please

• Sign In
• or
• Sign Up

and AMD’s data points contradict rising investor anxiety that a handful of cloud providers and big technology companies are overspending on Nvidia chips and building too much infrastructure too quickly.

“We believe AMD’s positive Data Center GPU business

This is the hidden content, please

• Sign In
• or
• Sign Up

and

This is the hidden content, please

• Sign In
• or
• Sign Up

’s comments indicating a sustained increase in capex through FY25 bode well” for Nvidia, Goldman Sachs analyst Toshiya Hari said in a note on Wednesday.

Nvidia is expected to report fiscal second-quarter earnings in August.

This is the hidden content, please

• Sign In
• or
• Sign Up

#Nvidia #stock #

This is the hidden content, please

• Sign In
• or
• Sign Up

#AMD #quell #fears #buildout #fast

This is the hidden content, please

• Sign In
• or
• Sign Up

This is the hidden content, please

• Sign In
• or
• Sign Up