Better Semiconductor Stock: Nvidia or Advanced Micro Devices
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Nvidia has outperformed AMD in the past five years, with a gain of over 3,000% compared to AMD's 433%. Both companies benefit from the demand for GPUs in AI infrastructure. Nvidia's data center segment generated $22.6 billion in Q1 2025, a 427% YoY increase, while AMD's data center segment saw an 80% YoY increase to $2.3 billion. Nvidia has a dominant position in the AI chip space with nearly 10 times the revenue of AMD's data center segment. However, AMD is making inroads and has had serious inquiries about building an AI cluster with over 1 million GPUs. Nvidia's revenue is heavily reliant on its GPU products and data center segment, accounting for 87% of total revenue, while AMD's data center segment only accounts for 43% of its revenue. Both stocks have similar forward P/E valuations. Nvidia has a strong moat with its CUDA platform, while AMD is rapidly pushing innovation with next-generation architecture GPU platforms. The author prefers Nvidia as a long-term investment due to its moat in the AI chip space, but also sees potential in AMD ahead of a gaming console refresh cycle.
https://www.fool.com/investing/2024/06/30/better-semiconductor-stock-nvidia-amd/?source=eptdlflnk0000001&utm_source=AolDailyFinance&utm_medium=feed&utm_campaign=article&referring_guid=8dfa626f-de40-46e2-b99c-9d0897f47f99
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