hardware

Nvidia Passes Intel In Market Cap

A clairvoyant call helped Nvidia reach this point
article cover

Francis Scialabba

· less than 3 min read

Keep up with the innovative tech transforming business

Tech Brew keeps business leaders up-to-date on the latest innovations, automation advances, policy shifts, and more, so they can make informed decisions about tech.

On Wednesday, Nvidia passed Intel to become the U.S.’ largest chipmaker by market cap. Nvidia is up 78% this year; Intel is down 4%.

A clairvoyant call by Nvidia—‘hey, this AI thing could be big’—helped the company reach this point.

The new(er) kid on the block

Nvidia (est. 1993) started as a specialized developer of graphics processing units (GPUs). It triumphed over a crowded field and became the favored GPU for the graphic-intensive, potato chip-powered gaming market.

Circa 2010: As my adolescent self built a Nvidia-powered gaming rig, GPUs transformed into the go-to workhorses for deep learning due to their proficiency with parallel computing. Nvidia laid the groundwork to become a dominant AI hardware player.

Now: Nvidia gear can be found in high-performance computers, VR devices, Big Tech data centers, and all sorts of AI applications.

The old guard

Intel (est. 1968) was a 20th century IT powerhouse, and today its largest segment supplies processors for PCs, laptops, and tablets.

On its toes: Intel missed the mobile revolution and waved the white flag last year after spending billions trying to catch up. The company has acquired and heavily invested with the hopes of not missing the AI revolution, too. A bright spot for Intel is its booming server and cloud business, which generated more than $20 billion in revenue last year.

And just for some perspective, Intel pulled in $7.2 billion of data center revenue in Q4. Over the same stretch, Nvidia reported $3.1 billion in total revenue (with “record data center revenue,” per founder and CEO Jensen Huang).

No time for victory laps or complacency

The AI hardware market is rapidly growing, but so is competition. China is turbocharging domestic chipmaking efforts, while Big Tech is pulling some silicon development in-house.

One area to watch: Intel and Nvidia are heavily invested in building parts for cars that think. Intel’s Mobileye says it supplies tech to 70% of today’s automated driving-equipped cars. Meanwhile, Nvidia recently announced it will provide the AI hardware for Mercedes-Benz’s 2024 fleet of self-driving cars.

Autonomy isn’t a two-horse race: Tesla ditched Nvidia in 2018 for its own self-driving chip and Qualcomm is developing its own stack.

Keep up with the innovative tech transforming business

Tech Brew keeps business leaders up-to-date on the latest innovations, automation advances, policy shifts, and more, so they can make informed decisions about tech.