AI (artificial intelligence) chip giant NVDA has begun to compete with Intel (Nasdaq: INTC), which has long dominated the PC (personal computer) market.
On October 24th local time, it was revealed that Nvidia is using ARM (Nasdaq: ARM) technology under SoftBank to develop chips and has started trying to produce central processing units (CPUs) for PCs to run Microsoft's (Nasdaq: MSFT) Windows operating system, which will be launched as soon as 2025.
This means that NVIDIA will pose a challenge to Intel's leadership position in the PC processor market. Meanwhile, this is also a counterattack launched by Microsoft against Apple (Nasdaq: AAPL), which has an increasing market share in the PC industry.
According to insiders, Intel's main competitor in the PC industry, AMD (Nasdaq: AMD), is currently planning to develop PC processors based on Arm technology, which will be launched as soon as 2025.
On the same day, after the news spread, Intel's stock price fell in response, closing at $33.85, a decrease of 3.06%. NVIDIA's stock price closed at $429.75, up 3.84%. Arm's stock price closed at $50.21, up 4.89%.
If the news is true, it means that NVIDIA and AMD will follow a similar path to Qualcomm (Nasdaq: QCOM), which began working with Microsoft in 2016 to port the Windows operating system to the Arm architecture. It is understood that Microsoft also signed an exclusive agreement with Qualcomm at that time, allowing other companies to enter the market only in 2024.
According to insiders, Qualcomm may announce more details about the matter at the Snapdragon Technology Summit on the 24th, with Microsoft executives attending the event, including Windows and Devices Vice President Pavan Davuluri.
With Microsoft's support, NVIDIA, AMD, and Qualcomm may shake Intel's long-standing dominance in the personal computer industry, while at the same time, the industry is facing increasing pressure from Apple (Nasdaq: AAPL). According to preliminary data released by research firm IDC for the third quarter, since Apple released ARM based chips for its Mac, its market share has almost doubled in three years.
It is understood that Microsoft executives have noticed the excellent efficiency performance of Apple's ARM based chips in areas such as AI processing, and hope to achieve similar results. This may also be one of the reasons why they have approached their old friend Nvidia this time. Microsoft also encourages chip manufacturers to incorporate advanced AI features when designing CPUs to improve the performance of Windows software.
Jay Goldberg, CEO of D2D Advisory, a financial and strategic consulting firm, said, "Microsoft has learned from the experience of the 1990s that they do not want to rely on Intel again, nor do they want to rely on a single supplier. If ARM can really do well in the PC (chip) field, Microsoft will never let Qualcomm become the only supplier
In the AI boom of the past two years, NVIDIA's total market value has soared to $1.06 trillion, while Intel's valuation has been declining in recent years, with the company's current total market value of $141.76 billion.