We hosted an investor group meeting with Toshiya Hari, VP of IR and Strategic Finance at NVIDIA, with a focus on its Data Center business. Below are the key takeaways from the meeting. Sources for: Style Exposure – J.P. Morgan Global Markets Strategy; all other tables are company data and J.P. Morgan estimates. See page 6 for analyst certification and important disclosures. J.P. Morgan does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that t ...

AMD's path to $1 trillion is closer than many investors have likely assumed. Advanced Micro Devices (AMD 5.44%) has evolved into a semiconductor powerhouse in recent years. Under the leadership of Lisa Su, it overtook longtime rival Intel in the PC market. Although Nvidia's success with the artificial intelligence (AI) accelerator market initially took AMD by surprise, AMD's efforts to catch up have made it an increasingly important company in that market. Such innovations have also made AMD a prime candida ...

Core Viewpoint - David Tepper, a prominent investment manager, is shifting his investment focus from traditional GPU makers like Nvidia and AMD to a different type of chipmaker, specifically Broadcom, which is developing application-specific integrated circuits (ASICs) for AI applications [1][10]. Group 1: Investment Strategy - Tepper's Appaloosa Management has achieved gross annualized returns exceeding 28% since 1993, significantly outperforming the S&P 500's 10.6% annualized return over the past 32 years [1][2]. - Historically, Tepper has been known for investing in distressed debt and taking contrarian positions in the stock market [2][3]. - Recently, Tepper has sold his stakes in Nvidia and AMD, indicating a strategic pivot towards Broadcom, which is seen as a competitor in the AI chip market [10][14]. Group 2: Market Dynamics - GPUs have been essential for AI development, particularly in training large language models, due to their parallel processing capabilities [5][6]. - Nvidia has dominated the GPU market, with its data center revenue increasing by 73% year-over-year last quarter, making it the most valuable company globally, valued at over $4 trillion [7][8]. - AMD is making strides with its upcoming MI400 chips, which could provide competitive pricing against Nvidia's offerings, although AMD's stock has seen a significant decline of over 60% since early 2024 [8][9]. Group 3: ASICs and Competitive Landscape - ASICs are becoming increasingly important as companies like Meta and Google develop custom chips that can perform specific AI tasks more efficiently than traditional GPUs [11][12]. - Broadcom is positioned as a key player in the ASIC market, assisting major tech companies in designing these chips while also being a leading networking chipmaker [13][14]. - Broadcom's stock is currently trading at a forward earnings multiple close to 40, comparable to Nvidia, but it may offer more upside potential if ASICs gain traction in data centers [15][16].

Core Insights - NVIDIA Corporation (NVDA) is a leader in the semiconductor industry, particularly in the AI chip market, with strong financial health and investor confidence reflected in its stock performance [1][10]. Performance Overview - Year-to-date, NVIDIA shares have increased by 14.1%, outperforming the Zacks Computer and Technology sector's 5.6% rise and major semiconductor stocks like Intel (13.9%), AMD (12.6%), and QUALCOMM (3.7%) [2][3]. - The stock closed at $153.30 on July 1, near its 52-week high of $158.71 reached on June 27 [1]. Revenue and Growth Drivers - The Data Center business is the primary growth driver for NVIDIA, generating $39.1 billion in revenues in Q1 FY26, accounting for 89% of total sales, with a year-over-year growth of 73% and a sequential rise of 10% [6][10]. - The adoption of NVIDIA's Hopper 200 and Blackwell GPU platforms is accelerating, particularly among hyperscalers investing in AI infrastructure [7][8]. Financial Performance - Despite geopolitical challenges, NVIDIA's financials remain robust, with Q1 FY26 revenues up 69% year-over-year and non-GAAP earnings per share increasing by 33% [11]. - The company anticipates Q2 revenues of $45 billion, a 50% increase from the same quarter last year, despite an expected $8 billion revenue impact from export restrictions in China [12][13]. Valuation Insights - NVIDIA's current valuation is considered high, with a forward 12-month Price/Earnings (P/E) ratio of 31.91, compared to the sector's 26.7 [16]. - In comparison to other semiconductor companies, NVIDIA's P/E is lower than Intel's (44.84) but higher than AMD's (28.53) and QUALCOMM's (13.52) [19]. Conclusion - NVIDIA's strong position in AI chips, significant growth in the Data Center segment, and solid financials support a hold position for the stock, despite its high valuation [20].

Core Insights - The financial industry is undergoing a transformation due to Big Data and AI, enabling faster and smarter decision-making for investors and institutions [2][4] - The global Big Data market is projected to reach $401.2 billion by 2028, indicating significant growth potential across various sectors [4] Group 1: Technology Utilization - Banks and financial institutions are leveraging Big Data and AI to enhance customer understanding, improve marketing strategies, and detect fraud in real-time [3][4] - Companies like NVIDIA are at the forefront of the Big Data revolution, providing advanced chips and software tools that facilitate AI applications across multiple industries [5][9] Group 2: Company-Specific Developments - NVIDIA has evolved from a graphics card manufacturer to a leader in AI and Big Data, with its Blackwell technology enabling faster and more cost-effective AI model training [8][10] - Moody's Corporation has shifted from traditional ratings to risk analytics, utilizing Big Data and AI to enhance its services and improve client risk management [12][13] - Qualcomm has expanded its role in the AI space, with its Snapdragon processors powering smart devices and enabling advanced AI features without internet connectivity [14][15]