Nvidia's AI Chip Dominance Under Threat

Nvidia faces threats to its growth and dominance in AI chips from big tech customers like Microsoft and Meta, who are among its biggest spenders but are also developing their own AI chips to reduce reliance on Nvidia.

Summary

• Nvidia's stock has surged recently due to growth in generative AI and demand for its AI chips.
• Microsoft and Meta are biggest spenders on Nvidia's $30,000 H100 chip that powers generative AI models. Together spend $9 billion on chips from Nvidia.
• However, Microsoft, Meta, Google, Amazon building their own AI chips to slash costs. Reduces reliance on Nvidia.
• Nvidia faces growing competition from other chipmakers like AMD and Intel.
• Questions around whether Nvidia can sustain revenue growth if big customers cut spending on its chips while building their own. Must rely on other customers making up any shortfall.