by alc_magic
$AMD is set up to take a lot of market share from $NVDA for 2 reasons:
1.Much of of $NVDA ´s moat stems from CUDA, which enables developers to interact with $NVDA GPUs seamlessly when coding.
However, Pytorch has become the dominant framework for deep learning (AI) and now, $AMD GPUs work out of the box on Pytorch.
This opens the veil for $AMD to disrupt $NVDA ´s software moat and levels the playing field.
- $NVDA ´s chips are monolithic, while $AMD ´s chips are chiplet based. Chiplets have enabled $AMD to disrupt $INTC by yielding high performing but cheap chips.
This is because when you make a chip out of chiplets, if one of the components goes wrong you don´t have to throw the entire thing away. Hence, yields are much higher than in monolithic architectures.
I believe the same is going to happen on the GPU side.
Chiplets have lower margins and so pivoting to this would hurt $NVDA ´s financials: a clear case of the Innovator´s Dilemma. $NVDA has a fantastic business and will hardly find the incentives to disrupt itself moving towards chiplets.
In combination, a democratization of deep learning development tools with $AMD coming into the GPU space with its chiplet capabilities bodes well for $AMD to grow its market share.
Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence or consult your financial professional before making any investment decision.