Nvidia’s business is booming. Here’s what could slow it down.
Live MintNvidia is riding high after another quarter of blockbuster sales and earnings, even as threats are emerging that could weaken the company’s position at the center of the artificial-intelligence boom. Sequoia Capital estimated in March that the industry put $50 billion into Nvidia’s chips to train large language models, but generative AI startups had only made $3 billion in revenue. Microsoft also recently said it would offer cloud-computing customers access to AMD’s AI chips, giving them an alternative to Nvidia. Hans Mosesman, an analyst at Rosenblatt Securities, said in a note that Nvidia was expected to lose market share in the percentage of the world’s AI chips that it makes because of the competitive pressure. For much of the first year of the AI boom, the focus of investment has been on building, or training, generative AI models, requiring enormous computing ability that is well suited to Nvidia’s chips.