Shares of major chipmaking and AI companies surged in premarket trading Thursday after Nvidia’s quarterly earnings report surpassed Wall Street expectations on Wednesday evening.
Shares of Nvidia, which reported a third-straight quarter of record profits and sales in its Q4 2023 earnings, surged to $772.65 in premarket trading—up more than 14% from Wednesday.
Shares of AMD, Nvidia’s rival, more than 6.2% in early trading while the shares of ARM—whose chip architecture powers Apple’s silicon, Nvidia’s Grace CPU and nearly all smartphones—were up nearly 9%.
Other Silicon Valley giants like Intel and Qualcomm saw more modest bumps of 2.7% and 1.7%, respectively.
Chip manufacturer TSMC’s NYSE-listed shares were up 3.76% on Thursday while ASML Holdings’—the Dutch company that manufactures advanced chip-making equipment—stock was up 3.7% in afternoon trading in the Euronext Amsterdam exchange.
Nvidia’s record-breaking profits and growth result from its custom-designed chip being used to train and power generative artificial intelligence services operated by the likes of OpenAI, Google, Microsoft and Amazon. Nvidia’s almost singular dominance and high demand, however, has raised some concerns as AI companies have had to deal with chip shortages. This has prompted the likes of Microsoft and Meta to seek out alternatives from the likes of AMD. Last year both companies, along with OpenAI, announced plans to use AMD’s Instinct MI300X chip—as an alternative to Nvidia’s popular H100. Other companies have also been buoyed by the AI boom with TSMC being a key manufacturer of Nvidia’s silicon while ARM’s chip architecture is used to power the CPU on Nvidia’s so-called Grace Hopper super chips.
Nvidia Earnings Mark Another Historic Quarter For AI Titan (Forbes)
