Semiconductor world – CPU/GPU Wars

Hey! Long time.
Decided to update here because the whole game has been split open by chatgpt + what is going on in ARM world.

• The latest nvda (blowout) earnings + earnings call is a must for anyone interested in this space. NVIDIA Announces Financial Results for First Quarter Fiscal 2024 | NVIDIA Newsroom.

• Not to mention the guidance. Nvidia guidance shocks Wall Street with A.I. boom in sight | Fortune.

• They are selling H100 by tonnes it appears. Everyone is lining up to buy from them.

• TSMC is seeing spike in utilization just by this demand. Yes, that is what the gold rush is looking like. https://www.marketwatch.com/story/tsmc-stock-outpaces-chips-on-report-nvidia-ai-order-boosted-capacity-use-81f76f26

What is happening in the market?

1. Datacenter spending is being restructured to make way for compute GPUs (specifically nvidia GPUs since there is no competition right now). TODO: add reference
2. Point 1) has reduced the CPU DC TAM at least in the short term. Ballpark 2 CPUs for 8 GPUs in AI boards.
3. I am not convinced there is an AI bubble since companies are showing the money. Bubble may be just forming now in stocks.
4. Nvidia is like the only ‘arms supplier’ for large models training.
5. ARM is making inroads like never before – we are seeing good arm earnings as mentioned in last quarter softbank earnings – Looks like large license wins. This affects AMD. https://group.softbank/system/files/pdf/ir/financials/financial_reports/financial-report_q4fy2022_01_en.pdf
6. Waiting on AMD AI show tonight to see if AI can take some market in AI training space with MI300. https://www.amd.com/en/solutions/data-center/data-center-ai-premiere.html

I was never good at valuation. The only valuation I ever knew was AMD was undervalued when I started this thread in comparison to other companies. I cannot value anything standalone.

Not yet sold out my shares in AMD.

• In my book, AMD is the only company that is in a position to take some training market. Even 10% would make a big difference to their revenue.
• They are working on their software a lot. I see active commits to their rocm repository in github etc etc. GitHub – RadeonOpenCompute/ROCm: AMD ROCm™ Platform – GitHub Home.
• They released a new documentation site last week AMD ROCm™ Documentation — ROCm Documentation Home.
• They have formed a new vertical under Victor Peng (ceo of former xilinx) for the AI market.
• Nvidia is a solid case for accumulation/SIP long term