The Tribune

By CHRIS ILLING

CCO @ ActivTrades Corp

The boom in artificial intelligence continues to fuel profits and sales for chipmakers. Nvidia exceeds expectations with its figures, the stock climbs to a record high and makes chief executive, Jensen Huang, $4bn richer.

Nvidia chips and software are particularly well-suited for applications based on artificial intelligence. Among other things, they are used to teach artificial intelligence (AI) programmes such as the chatbot ChatGPT. In the future, AI will not only rhyme, paint and compose, but will also automatically complete a considerable part of many work tasks.

Thanks to the uninterrupted boom in AI, Nvidia has exceeded market expectations with its financial figures and outlook. Sales in the past second quarter amounted to $13.5bn, the most valuable listed chip manufacturer announced on Wednesday, after the US stock market closed. About $11bn had been expected. For the current third quarter, sales should be at $16bn. Nvidia also announced a $25bn share buyback programme.

Last week, the group’s shares rose to an all-time high of $502.66. So far this year, Nvidia stock has tripled in value. Hardly anything else can set the price of a share in motion as much as the magic words ‘artificial intelligence’ (AI).

Nvidia’s competitor, AMD, wants to break the supremacy now. The company is the strongest in its field of pursuers, the only rival to be taken seriously. Many experts agree that the chips from Alphabet, Amazon and Microsoft are hopelessly inferior to the Nvidia material. AMD’s chief executive expects the market for AI accelerator will grow by an average 50 percent to $150bn over the next four years. Because Nvidia dominates the market, the company can command prices five times the cost of production. In AMD’s favour is the fact that nobody wants Nvidia to rule alone - not the cloud giants, and not the global developer community either. The company recently presented the new CPU processor generation under the name MI300A, which is said to be eight times more powerful - and five times more efficient - than the previous model.

The age of artificial intelligence is no longer a vision of the future. The first productivity gains have already been made and are increasing every day. Gains have also been made in the portfolio of investors who are prepared for the new technology age, and where the quantity of technology shares is growing.