Not all chip firms benefit equally from AI boom like Nvidia due to varying exposures

From CNBC: 2024-08-02 01:08:06

Nvidia CEO Jensen Huang showcases the new Blackwell GPU chip at Nvidia GPU Technology Conference. Semiconductor firms experience mixed earnings amid the AI boom, reflecting the sector’s complexities. Tech giants like Meta and Microsoft increase capital expenditure significantly to fuel AI research, benefiting Nvidia. AMD introduces the MI300X AI chip and projects exceeding data center GPU revenue.

Leading semiconductor companies like TSMC and ASML report strong earnings as demand for chips rises due to AI. Samsung’s second-quarter operating profit surges 1,458.2% year-on-year. However, not all semiconductor firms benefit equally from AI growth due to limited exposure at this development stage. Qualcomm and Arm see share price drops after issuing light guidance for the current quarter.

Arm’s revenue heavily comes from consumer electronics rather than data centers where AI chips thrive. Qualcomm, known for its smartphone chips, also lacks significant presence in AI markets. Analysts suggest Arm and Qualcomm could see growth when AI technology becomes more widespread. Qualcomm’s chips will be featured in Microsoft’s upcoming AI PCs in a long-term strategy pivot.



Read more at CNBC:: Why not all chip firms are benefitting from the AI boom like Nvidia