Competition Intensifies in the GPU Accelerator Market: Unveiling New Trends and Forecasts

In an ever-changing landscape of GPU accelerators, recent developments have ignited fierce competition among prominent players in the industry. Analyst Vivek Arya from BofA Securities has issued bullish recommendations for Nvidia Corp with a target price of $925 and for Advanced Micro Devices, Inc with a target price of $195, reflecting the dynamic nature of the market.

Instead of direct quotations, it’s apparent that Nvidia’s dominance in the accelerator market, with a valuation exceeding $85 billion, is predominantly fueled by its stronghold in the data center sector. This strategic advantage continues to be the primary driver behind Nvidia’s impressive sales growth.

Nvidia’s revenue from data centers is anticipated to surpass the 85% mark, showcasing a substantial increase from previous years. Concurrently, AMD has also witnessed revenue growth from GPU sales to data centers, driven by significant contracts like the one secured for the El Capitan supercomputer.

Critical insights indicate that Nvidia commands a market share of nearly 95% in GPU units, surpassing 900 thousand units in the fourth quarter alone, signifying a remarkable year-over-year surge of over 100%.

Looking towards the future, Arya foresees significant expansion in the $85-90 billion accelerator market. This market segment is expected to capture only a fraction of the broader estimated $180 billion market, aligning with positive projections from industry players such as AMD.

Upcoming catalysts include Nvidia’s GTC event on March 18, focusing on generative AI, in addition to updates on Nvidia accelerators and network development. Broadcom Inc’s Analyst Day is set to provide insights into ASIC order offerings and Ethernet network advancements in AI.