Home Markets Nvidia and AMD Stock Hit All-Time Highs on Rise of AI Chips

Nvidia and AMD Stock Hit All-Time Highs on Rise of AI Chips

by SuperiorInvest

Nvidia Corp CEO Jensen Huang holds one of the company’s new RTX 4090 chips for computer gaming in this undated photo provided on Sept. 20, 2022.

Nvidia Corp | via Reuters

amd and NVIDIA hit all-time highs on Thursday as investors continue to clamor for shares of companies building chips that power artificial intelligence.

AMD shares rose more than 1% during trading Thursday to reach their highest closing price ever, $162.67, while Nvidia rose just under 2% to $571.07. Both companies have posted double-digit percentage gains to start the year after an explosive 2023 that saw AMD shares rise 127.6% and Nvidia shares soar 238.8%.

The record valuations reflect continued investor interest and hunger for companies that design and sell graphics processors for artificial intelligence. GPUs were originally designed for playing computer games. But they are also essential for training and deploying complex AI models like OpenAI’s GPT, driving a massive increase in chip sales.

Nvidia has been the top supplier of GPUs to AI companies for the past two years and was the best-performing stock in the S&P 500 last year.

Investors are increasingly bullish on AMD, the second-largest independent GPU maker. The company last year announced a new chip that could compete with Nvidia’s H100, which is currently the standard for AI applications.

Analysts also see AMD improving its AI software, eliminating one of the main reasons Nvidia chips were preferred over AMD.

Thursday, Taiwan Semiconductor Manufacturing Company, which makes Nvidia and AMD chips, posted better-than-expected sales. CEO CC Wei said there is strong demand for AI chips, which use the most advanced manufacturing techniques.

TSMC management believes AI chip manufacturing could account for a “high” percentage of its revenue in five years, which has positive implications for both Nvidia and AMD, Goldman Sachs analysts led by Toshiya Hari wrote in a note on Thursday.

Separately, Goal CEO Mark Zuckerberg, one of the biggest buyers of GPUs, on Thursday announced plans to buy billions of dollars worth of Nvidia and other GPUs this year.

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