| | | AMD 'confident' on GPU among key takeaways from UBS chip meetings
Mar. 04, 2024 10:35 AM ET
By: Chris Ciaccia, SA News Editor
 JHVEPhoto
Investment firm UBS came away in a largely positive mindset after recently meeting with several semiconductor firms, due in part to the opportunities surrounding artificial intelligence.
Nvidia (NASDAQ: NVDA) and AMD (NASDAQ: AMD) both said how fast inference is becoming the "vast majority" of the AI GPU total addressable market, analysts led by Timothy Arcuri said. Nvidia said it sees roughly 70% of its total data center demand coming from inferencing, while AMD said roughly 65% to 70% its $400B AI total addressable market by 2027 is from inference.
"Overall, demand still significantly outstrips supply with AMD suggesting it is still very much 'picking and choosing' where it engages and focused on the best inference opportunities where it can exploit its memory bandwidth advantages rather than focusing on a market share goal," the analysts wrote. "Country level demand is now also developing around the world, particularly in the Middle East (UAE (G42), Saudi Arabia)."
AMD's opportunities go beyond GPUs
AMD reiterated it has more supply than its $3.5B target for 2024 data center GPU revenue and had a "very confident tone with engagements now spanning 'multiple generations,'" the analysts said. The firm estimates that AMD will have roughly 10% of the data center GPU market by the end of the year.
The Dr. Lisa Su-led AMD also had a "slightly better tone" as it pertains to the server CPU market, where it competes with Intel (NASDAQ: INTC), the analysts said, highlighting enterprise share gains and "some some renewed growth in server CPU [total addressable market]."
Memory bulls
The memory market is improving significantly, the analysts said, as high bandwidth memory is aiding the dynamic random access memory portion of it, likely benefiting Micron ( MU).
Western Digital ( WDC) came across as "very bullish" for NAND, particularly as it pertains to pricing and the sustainability of the upturn, with new spending going towards high bandwidth memory and not NAND.
Apple modem coming next year?
Apple (NASDAQ: AAPL) has had issues creating its own modem chip, though UBS' analysts think the launch of a new Spring model in 2025 could be the time frame when the tech giant eventually succeeds.
That could bode well for Skyworks Solutions ( SWKS) to make "some blended content gain opportunities" next year, the analysts said. |
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