Nvidia co-founder and CEO Jensen Huang demonstrated the new Blackwell GPU chip at the Nvidia GPU Technology Conference on March 18, 2024.
David Paul Morris/Bloomberg via Getty Images
Earnings showed that not all chip companies are benefiting from the artificial intelligence boom, underscoring the complexity of the semiconductor supply chain and the dominance of some companies over others in different parts of the industry.
A number of semiconductor companies reported financial results for the June quarter, with some beating estimates and others disappointing, providing a glimpse into how the excitement about artificial intelligence is affecting their earnings.
The current interest in artificial intelligence mainly revolves around two key terms – large language models (LLM) and generative artificial intelligence. The LL.M. requires vast amounts of computing resources and data to train, which underpins generative artificial intelligence applications such as chatbots Google and OpenAI.
The tech giants training LL.M.s are not cutting back. Yuan Said about Wednesday is expected Capital expenditures will grow “significantly” through 2025 “to support our artificial intelligence research and product development efforts.” Microsoft explain this week Capital spending in the June quarter rose nearly 80% year over year to $19 billion.
As tech giants continue to add computing resources, their spending has become A huge boost for Nvidia Because the company’s graphics processing units (GPUs) are used to train these LL.M.
But Nvidia’s competitors AMD has brought its own chips to market, called MI300X artificial intelligence chip, for artificial intelligence purposes, and are starting to see returns. AMD said on Tuesday it expects data center GPU revenue to exceed $4.5 billion in 2024, up from the $4 billion the company forecast in April. chip Company reports second-quarter profit, revenue This exceeded market expectations.
Chip manufacturing and tooling companies also appear to be benefiting from the AI boom. British SemiconductorThe world’s largest semiconductor manufacturer said last month that its second-quarter net profit rose more than 36% annually. Financial results beat market expectations.
at the same time ASMLThe company makes the specialized tools needed to make the world’s most advanced wafers, the company said last month Second-quarter net bookings jump 24% The year-on-year growth highlights the needs of semiconductor manufacturers such as TSMC. Samsung saidSecond quarter operating profit increased by 1,458.2% year-on-year.
But not all semiconductor companies have been buoyed by the growth in AI investments, as their exposure to the technology is less important at this stage.
Qualcomm and arm Their shares fell on Wednesday Emit light to guide current quarter.
While both companies have been talking about their importance to artificial intelligence applications, the reality is that their exposure to the technology is still very limited.
Arm designs the blueprints for many of the company’s chips, and its semiconductors are used in most of the world’s smartphones. While many electronics manufacturers are talking about artificial intelligence phonewhich does not bring fundamentally higher growth to chip designers.
The British company still gets a large portion of its revenue from consumer electronics, rather than the successful data centers of AMD and Nvidia. Analysts have previously told CNBC Arm could benefit from artificial intelligence as more devices begin to adopt AI technology.
Qualcomm’s chips are used in smartphones, such as those made by Samsung, and the company still makes most of its revenue from mobile phones. Like Arm, Qualcomm’s chips are not used in the type of data centers where LL.M.s are trained.
The company’s chips will be Microsoft’s upcoming artificial intelligence computerBut again, this is a long-term strategy for Qualcomm.
