Nvidia Earnings Beat, AI Investors Still Unimpressed

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Artificial intelligence chip giant Nvidia once again beat Wall Street's estimates, posting over US$30 billion in sales in its fiscal second quarter. But the company fell short of the loftiest forecasts, leaving AI investors unimpressed and Nvidia's shares down. TaiwanPlus speaks to Olivier Blanchard, research director at tech advisory firm The Futurum Group for more.
Transcript
00:00NVIDIA's earnings has a strong track record of surpassing these consensus estimates.
00:06How do these latest results square up in NVIDIA's streak?
00:09What's been interesting is a lot of investors seem to be punishing companies for doing really
00:17well but not necessarily doing as well as they have in the past.
00:22And I find that interesting because if you take a step back, I'm looking at an NVIDIA's
00:28trajectory, at its momentum, at its pace, at the risks even it's taking.
00:35It's doing all the right things to remain competitive and hold on to its advantage even
00:41though it doesn't really have to.
00:43It doesn't need to outperform itself by that much.
00:47And so when you're getting, as we discovered today with the Q2 results, really good results
00:54that still exceed expectations.
00:57Yes, they haven't outperformed or beaten expectations quite as aggressively as they have in the
01:05past.
01:06I don't see that as a sign of weakness.
01:07I think the outlier was what we saw up until now.
01:11I think this is more normal.
01:12This is what we should expect moving forward.
01:14Right now, customers who want to get in on the latest AI tech and have the gadgets to
01:21reach that level of computing, they still have to go to NVIDIA.
01:25How soon do you expect to see meaningful competitors in this space?
01:31So obviously, there's one track here, which is data center.
01:36And there's another track that's devices.
01:37And with devices, what we're seeing, first of all, NVIDIA is still definitely a place
01:43to go for that.
01:44AMD's GPUs are pretty solid as well.
01:48So they're definitely a vendor to look at.
01:50But I think the bigger structural change there with devices is that a lot of compute
01:55and especially a lot of AI-related or AI-enabling compute is happening on the NPU more so than
02:02the GPU.
02:03We're seeing the NPU take on a lot more of these tasks in mobile phones.
02:08We're seeing that with new AI PCs.
02:11So it's not to say the GPU isn't important and still doesn't play a part in this.
02:16But it's just there's also an NPU piece of this that favors Qualcomm, for instance, more
02:23so than NVIDIA.
02:25So it's this silicon diversity that's driven by the AI proliferation from the cloud into
02:32devices is definitely making things more interesting and is going to be a competitive proof point
02:38for NVIDIA moving forward as they themselves start to diversify.

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