Chipmakers driving the AI revolution are currently thriving in the stock market, with NVIDIA leading the race. However, Broadcom, another American semiconductor maker, recently announced a stock split and exceeded earnings expectations in its second-quarter report. The company projected $51 billion in sales for fiscal 2024, prompting a significant increase in its stock price. Bank of America raised its price target for Broadcom shares, predicting a 16% year-over-year sales gain for fiscal 2025. If these projections are met, Broadcom’s market capitalization could surpass $1 trillion, joining an elite group of companies.
Nvidia, currently valued at nearly $3.25 trillion, remains the only chipmaker with a market capitalization exceeding $1 trillion. The company’s dominance in the market can be attributed to its essential chips that are integral to various sectors of the economy. Over the past 15 years, Nvidia has established itself as a key player in the industry, making it challenging for competitors to challenge its position. Efforts have been made to develop open-source software to lessen the dependence on Nvidia’s CUDA architecture, with significant investments and the formation of the Unified Acceleration Foundation.
The rivalry between Nvidia and Broadcom highlights the intense competition in the semiconductor industry, driven by the growing demand for AI-related technologies. Both companies are positioned as top AI picks, with Nvidia leading in market capitalization but facing potential threats from emerging competitors like Broadcom. As the AI revolution continues to shape various industries, chipmakers play a crucial role in developing innovative solutions to meet the increasing demand for advanced technologies.
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https://fortune.com/2024/06/14/bank-of-america-broadcom-nvidia-chips-chipmakers-artificial-intelligence/