Analyst: AI will bring Nvidia $40 billion, AMD $3.5 billion, Intel $500 million

AI (and this time we’re talking about powerful accelerators, not processor-level support or gaming GPUs) will be a particularly big topic this year. It is expected to box office Nvidia pour in $40 billion. Let’s recall that for the fiscal year 2020, Nvidia’s complete revenues amounted to approximately $11 billion, a year later $17 billion. So this is a huge growth that the company managed to capture well enough in advance to already have functional hardware and software solutions on the market at the beginning of this era and to be an established brand that is perceived as the primary choice when the AI ​​wave rises.

AMD revenues from the sale of accelerators should bring in approximately $3.5 billion this year, which will (go) to the detriment of the Instinct MI300X series and its half-generation improvement, the Instinct MI350X, which, according to some sources, should, in addition to faster memories (HBM3E), also slightly innovate production process (5nm → 4nm). However, the estimate does not yet seem to account for the latest news of a partnership with Samsung that should see AMD supply the HBM3E, which alone will be worth around $3 billion. It is HBM memories that are one of the main limiting factors in the production volume of AI accelerators.

Intel Ponte Vecchio (Intel)

Intel is in a significantly weaker position, its accelerator Ponte Vecchio ended up as a fiasco (so much delayed that at the time of launch it could not compete either in terms of energy efficiency or price/performance ratio). This year’s income will therefore not be affected in any way. Successor Rialto Bridge was canceled completely, the next generation in the form of a “computing APU” (i.e. a solution with integrated CPU cores) was trimmed to the accelerator level (i.e. without CPU cores) and postponed. This year, Intel will only bring the new generation of Gaudi accelerators to the market, which will actually be on sale sometime in the second half of the year, and Intel (together with the existing one, which is rather a marginal product) will ensure revenues of around $500 million (i.e. 7x less than AMD, 80x less than Nvidia).

These estimates were presented by an analyst during a Bloomberg interview with Intel CEO Pat Gelsinger, who was asked about the newly published financial results for the first quarter of this year. Intel’s revenues reached $12.7 billion, which is better than the first quarter of 2023, but a significant drop compared to the rest of last year. Intel shares fell ~10% after these results were announced.

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Gelsinger explained that the problem is not in the products, but in the factories, which he illustrated with the newly separated financial results of the factories (they were supposed to be in the red for $7 billion last year). However, the reality is that $7 billion is an annual loss, while the income of $12.7 billion (which is, for example, $7 billion less than in 2021) is a figure for one (first) quarter. It’s kind of an open secret that a large part of these declines is due to the loss of part of the server market and the decline in margins on classic x86 server processors. This was indirectly admitted by Gelsinger, who expects the release of the new generation of Xeons (Xeon 6) to significantly improve the situation.

Intel Granite Rapids, third tile generation of Xeons (Intel)

There could really be a noticeable improvement, because this series (Granite Rapids) thanks to the 3nm process (Intel 3) will jump in energy efficiency and the number of cores (60 → 128), although it will stand on large cores Redwood Covewhich in the case of processors Meteor Lake she didn’t excel too much. However, the possibility cannot be ruled out that the unconvincing IPC v Meteor Lake was caused by bugs that Intel will be able to fix before the release of the server version. Gelsinger also expects a significant improvement in the factories’ financial results this year.

So the outlook seems quite optimistic, on the other hand (as you may have noticed in the chart above), the CEO has already identified the results for the summer of 2022 ($15.3 billion revenue) as the financial bottom from which the company will bounce back. In real terms, revenue declines have been even lower, with Intel only exceeding $15.3 billion since then, in the fourth quarter of 2023, and that temporarily, as a sequential decline of $2.7 billion followed.