Key Points Nvidia's dominance of the AI chip market has supercharged its stock in the past three years. Smaller Nvidia peer AMD could follow suit in the coming years and witness terrific data center growth following its latest deal. AMD is trading at a significant discount to its bigger rival, Nvidia. 10 stocks we like better than Advanced Micro Devices › Nvidia (NASDAQ: NVDA) has turned out to be one of the hottest investments in the past three years, registering gains of 1,300% during this perio ...

NVIDIA Corporation (NASDAQ:NVDA) is among the Renaissance Technologies Portfolio: 10 Biggest Stocks. On September 22, the company announced to invest up to $100 billion in OpenAI and provide it with data center chips. NVIDIA Corporation (NVDA) To Invest $100 Billion In OpenAI, Linking Two AI Giants This partnership between two major players in the global AI race underscores the growing overlap of interests between tech giants developing advanced systems. As part of the agreement, NVIDIA Corporation (NAS ...

By Amanda Cooper LONDON (Reuters) -What matters in U.S. and global markets today By Amanda Cooper, Editor, Markets Breaking News, Europe Markets are digesting mixed signals this morning: Wall Street cooled after hitting record highs, Asia is riding an AI-driven surge, and gold has smashed through $3,750 an ounce, as investors hedge against uncertainty. Meanwhile, the Fed’s messaging remains split ahead of Powell’s remarks, keeping rate-cut bets alive, but looking more fragile. * The S&P 500 and Nasdaq ...

Market Overview - U.S. stock index futures remained largely unchanged as Wall Street reached record closing highs for three consecutive sessions, driven by a tech rally [1] - The S&P 500 index saw a 3.6% increase in September, a month typically weak for equities, as traders navigated uncertainties around President Donald Trump's policies [4] Federal Reserve Insights - Federal Reserve Chair Jerome Powell's upcoming remarks are anticipated to influence interest rate expectations amid mixed signals from the Fed regarding inflation and labor market pressures [1][2] - Newly appointed Fed Governor Stephen Miran warned against over-tightening, which could negatively impact the labor market [2] Economic Indicators - The September reading of S&P Global's flash manufacturing PMI is expected to be released, with additional comments from Fed officials being closely monitored [3] Technology Sector Performance - The resilience in the market is attributed to strong performance in technology stocks and renewed optimism surrounding artificial intelligence [5] - Nvidia, a leader in AI chips, experienced a 0.7% decline in premarket trading after reaching an intraday record high, following a significant investment agreement with OpenAI [5] Visa Regulations Impact - Investors are cautious about potential disruptions from H-1B visa regulations affecting U.S. technology companies that depend on skilled labor from India and China, although mega-cap stocks have largely remained unaffected [6] Company Specific Movements - Kenvue, the Tylenol maker spun off from Johnson & Johnson, saw a nearly 6% rise in premarket trading after recovering from a previous 7.5% drop, which had made it the worst performer on the S&P 500 [6]

Company Overview - SoundHound AI specializes in conversational AI technologies and has a diverse customer base, including major brands in various industries [2][5] - The company has seen a significant increase in demand for its AI applications, particularly in quick-service restaurants and the automotive sector [5][6][7] Financial Performance - SoundHound's revenue tripled in the most recent quarter, reaching a record $42.6 million, which represents a 217% increase year-over-year [3][9] - The company raised its full-year revenue guidance for 2025 from $167 million to $169 million, indicating a projected 99% increase compared to 2024 [10] - Despite the revenue growth, SoundHound reported a GAAP loss of $74.7 million in the second quarter, which is double the loss from the previous year [11] Strategic Moves - In August, SoundHound acquired another conversational AI company, Amelia, and launched a new platform called Amelia 7, enhancing its product offerings [8] - The company maintains a solid balance sheet with $230 million in cash and no debt, allowing it to sustain current losses [13] Valuation Insights - SoundHound's price-to-sales (P/S) ratio is currently at 48.6, significantly higher than Nvidia's P/S ratio of 29.9, raising questions about its valuation [14][16] - Nvidia sold its stake in SoundHound, which was valued at approximately $27.7 million at the time of sale, suggesting that the high valuation posed risks for potential downside [17]

Group 1 - Nvidia has experienced significant growth, averaging annual gains of 75% over the past five years and 51% over the past 15 years [1][5] - The company currently pays a small dividend of $0.04 per share annually, which is not substantial for generating significant dividend income [3][4] - To achieve $500 in annual dividend income, an investor would need to own 12,500 shares, costing nearly $1.8 million at the current share price of $142 [4] Group 2 - Nvidia has transitioned from being primarily a gaming-chip manufacturer to a leader in data center chips, which are essential for AI operations and cryptocurrency mining [5] - The stock appears reasonably valued, with a forward-looking price-to-earnings (P/E) ratio of 34, below its five-year average of 40, and a price-to-sales ratio of 24, close to its five-year average [6]

Group 1: Nvidia's Market Impact - Nvidia added $2.8 trillion to its market capitalization since the start of 2023 due to soaring demand for its data center chips for AI development [1] - Nvidia sold its entire stake in SoundHound AI toward the end of last year, as noted in its 13-F filing with the SEC [2][17] Group 2: SoundHound's Business and Technology - SoundHound specializes in conversational AI and has a strong customer base across various industries, including hospitality and automotive [2][5] - SoundHound's technology is deployed in approximately 13,000 quick-service restaurants, enabling autonomous order taking and employee assistance [6] - In the automotive sector, SoundHound's Chat AI is utilized by major brands like Hyundai and Kia, and it recently launched a Voice Commerce platform [7] Group 3: Financial Performance - SoundHound reported $29.1 million in total revenue for Q1 2025, a 151% increase year-over-year, boosted by the acquisition of Amelia [9] - The company has a growing order backlog, which was $1.2 billion three months prior, and expects to convert this backlog into revenue over six years [10] - SoundHound reaffirmed its full-year guidance for 2025, projecting a 97% year-over-year revenue increase to $167 million [11] Group 4: Valuation and Risks - SoundHound's current price-to-sales (P/S) ratio is 40.8, significantly higher than Nvidia's, raising concerns about its valuation [12] - When considering future revenue potential, SoundHound's forward P/S ratio is 27.1, still higher than Nvidia's [14] - Despite reporting a profit of $129 million in Q1, this was largely due to a one-time benefit, and on a non-GAAP basis, the company lost $22.3 million [15] - SoundHound had $246 million in cash at the end of the quarter, allowing it to sustain losses for a couple of years, but future cash needs could lead to stock dilution [16]

Core Viewpoint - Advanced Micro Devices (AMD) is expected to report first-quarter 2025 results on May 6, with projected revenues of $7.1 billion, indicating a year-over-year growth of approximately 30% and a sequential decline of about 7% [1] Revenue Estimates - The Zacks Consensus Estimate for AMD's first-quarter revenues is $7.12 billion, suggesting a year-over-year growth of 30.11% [2] - The consensus estimate for first-quarter earnings is 93 cents per share, reflecting a year-over-year growth of 50% [2] Segment Performance - AMD's data center segment is anticipated to see significant revenue growth, driven by strong sales of EPYC processors and demand for AI applications, with first-quarter revenues estimated at $3.4 billion, a year-over-year increase of 47.5% [5] - The client segment is also expected to grow, with revenues projected at $2.04 billion, indicating a year-over-year growth of 49.3% [6] - However, the embedded and gaming segments are expected to decline, with embedded revenues estimated at $570 million (a 0.9% decline) and gaming revenues at $509 million (a 38.1% decline) [7] Stock Performance - AMD shares have decreased by 17.9% year-to-date, underperforming the Zacks Computer and Technology sector's decline of 9% and the Computer – Integrated Systems industry's decline of 7.2% [8] Valuation Metrics - AMD's current valuation is considered stretched, with a forward 12-month price/sales ratio of 4.68X, compared to the industry average of 2.90X [11] Strategic Partnerships - AMD benefits from a strong partner base, including major companies like Microsoft, Oracle, Dell Technologies, and IBM, which enhances its market position [14] - The demand for AI accelerators, particularly the Instinct MI300 series, is expected to continue growing, further boosting data center revenues [15] Conclusion - AMD's expanding portfolio and strategic acquisitions are likely to improve top-line growth despite weaknesses in the embedded and gaming segments and competition from NVIDIA [18]

Core Viewpoint - The article highlights the absence of Marvell Technology, a key player in the AI chip market, from the S&P 500 index, despite its significant growth potential and contributions to the AI sector [1][4]. Company Overview - Marvell Technology specializes in a broad portfolio of chip designs, including network switches, optical communication, and processors, which are essential for AI development [5]. - The company is actively working to increase its market share in networking chips, competing against market leader Broadcom [7]. Market Position and Growth - Marvell is experiencing strong adoption of its custom AI accelerators by major companies like Amazon, Meta, Alphabet, and Microsoft, indicating its growing influence in the AI chip market [8]. - The total addressable market for Marvell's data center chips is projected to grow at an average rate of 29% per year from 2023 to 2028, with expectations to nearly double its market share during this period [9]. Financial Performance - Marvell's data center revenue surged by 78% year over year and 24% sequentially last quarter, driven primarily by AI chip sales [10]. - The company reported a GAAP profit of $200 million last quarter and anticipates remaining GAAP profitable throughout the current year as it scales its data center business [13]. Challenges and Opportunities - Marvell has faced challenges in achieving consistent GAAP profitability since 2018 due to significant intangible asset amortization expenses from acquisitions, which have impacted its inclusion in the S&P 500 [12]. - Non-GAAP earnings are a more favorable indicator of Marvell's financial health, with shares trading at 25 times the consensus estimate for adjusted earnings per share in fiscal 2026, and analysts expect a 135% increase in adjusted earnings over the next two years [14].