I told you these GPUs were good. CEO Jensen (MSEE, Stanford), Nvidia’s dynamic founder and CEO. Under his leadership, Nvidia has raised the GPU to the forefront of computing. Nvidia’s share price tripled in the last 2 years while Intel faltered, giving Nvidia a bigger valuation than Intel. (Picture courtesy of Nvidia)
Intel, most often associated with microprocessors in business and engineering computers, has been passed in market value by Nvidia, most often associated with graphic cards in gaming computers.
Nvidia’s stock has benefited from the pandemic. High end graphics are in “hot demand as people turn to video games for distraction while stuck at home,” says the Wall Street Journal.
Sales were also up for graphics processing units (GPUs) used in data centers for cloud storage, also benefiting from the pandemic, as cloud storage and application hosting has surged with a workforce that needs access away from their office. Apparently, they are not just playing games.
But while the pandemic giveth, it also taketh away. Nvidia produces powerful GPUs and graphic boards for architectural renderings and engineering simulation but those products are not doing so well since architects and engineers left their bulky workstation in their offices to work from home. The pandemic may have spurred the trend towards small computers (tablets and laptops) running off big remote computers, i.e., the cloud. Sales of Nvidia’s “professional visualization” division is down 34% from the previous quarter, according to Nvidia.
Nvidia’s market value (share price X number of shares) is now over $300 billion, its shares having tripled over the last 2 years and currently at just under $500. Intel’s market cap is $209 billion, almost $100 billion less than Nvidia.
Keep in mind that Intel’s quarterly revenue ($75 billion in Q3 2020) is still far greater than Nvidia’s ($3.9 billion in Q2 2020). However, Intel has had a series of setbacks that have seen share prices fall close to 20% in the last year. A delay in the 7 nm chip led to an executive shake-up and the exit of lead engineer Venkata Renduchintala.
Meanwhile, Nvidia posted a record quarter with $3.9 billion in revenue, with a 26% increase in sales over the previous quarter.
CEO Jensen Huang was bullish on the company’s long-term prospects, expressing that the gains were permanent, not a temporary effect of the pandemic and “there’s no turning back.”