The competition in the semiconductor market is heating up as Intel (INTC) becomes the latest chipmaker to announce a new AI chip. This move comes after Nvidia (NVDA) and AMD (AMD) recently announced their own AI chip offerings for the market.
Yahoo Finance’s Akiko Fujita dives into the details of the global chip industry and the projected investments and revenue to come from this sector in the years ahead.
For more expert insight and the latest market action, click here to watch this full episode of Catalysts.
This post was written by Angel Smith
Video Transcript
Well, Intel is the latest chip maker to announce new artificial intelligence chips for data centers.
Intel is currently lagging behind the other big us names in the space NVIDIA and A MD.
And when you take a look at the global semiconductor industry picture who is winning and who is losing this chip war.
Big question in our very own Akiko Fujita here with some answers and insight.
Good morning to you, Brad.
You know, you talk about the A I picture here, tough to argue with anybody uh being a big winner except NVIDIA so far, when you consider the sheer scale of what they’ve been able to accomplish, you talk about data center revenue alone, the category that’s seen the biggest bump from the A I boom rose 427% from a year ago in its most recent quarter.
But as you noted, we’ve seen those competitors making aggressive inroads at Computex over in Taiwan.
You heard from A MD announcing their own next generation A I chips for laptops company vowing to announce a new A I chip every year that came after NVIDIA Jensen Huang made the same vow the previous day.
Moving forward though, the stat points to the battle that is playing out globally, private sector investment, the chip space is expected to top $2 trillion over the next eight years.
That’s according to data from BC G and the Semiconductor Industry Association, you compare that to $720 billion in the last 10 years.
So that’s a big bump here and the biggest investments have been coming through from three key regions.
We’re talking about the US, South Korea and Taiwan.
Uh Much of those investments certainly have been accelerated as a result of the chips act in the US, as we’ve noted before, that has spurred a global race for subsidies with Europe and other regions trying to match the funding that the US is providing to establish a home grown manufacturing hub and wrestle market share away from the global leader which has been Taiwan.
All the players in this space are chasing a roughly $1 trillion opportunity.
That is what the global semiconductor revenue is expected to top in the next decade according to consulting firm international business strategies.
But it’s important to remember that this isn’t all about A I.
Well, that gets all of the attention, the foundational chips, those that are used in cars, smartphones, even military equipment that still makes up the bulk of this market.
So we’re talking about legacy chips that are 28 nanometers or larger.
And guys when you think about that, the chip designers like NVIDIA get all of the attention.
But this is an industry that is still very much built on manufacturing TS MC.
The big name we talk about, we’re talking about chip making or chip equipment makers like a SML.
The list goes on so very diversified market, even though NVIDIA A MD and Intel get all the attention right.
It’s a really good point and I know that you’ve been following the space closely, lots of different names that could potentially take up a little bit of that market share from the big dog in the room.
Thank you so much for joining us.
Really appreciate it.
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