NVIDIA vs. AMD: Which Is Better?

Which Is the Better AI Stock? Nvidia (NVDA)

NVIDIA (NVDA) and Advanced Micro Devices (AMD) have been rivals in the graphics processor space for quite some time.  Right now, NVIDIA holds more than 70% of discrete desktop GPU market share.  AMD takes the rest.  Desktop graphics processor units sales are an important business for both companies.  Nevertheless, there’s reason to believe that the next stage of their rivalry will be fighting over which has the better #artificial intelligence processors.

NVIDIA believes that its total addressable market for AI is about $40 billion between now and 2025.  And they are already making some big moves into the AI space with its driverless cars technology and data center processors.

The company currently trades at a hefty premium of about 47 times forward earnings.  Nevertheless, investors should keep in mind that NVDA’s AI opportunity has yet to be realized.  That means there’s likely more room for it to grow. 

There’s little proof that AMD can overtake NVIDIA in the AI space.  NVDA is already a self-driving car tech leader, is the go-to GPU maker for many AI servers, and has a clear understanding of its market potential in the AI space.  Meanwhile, AMD is starting too late and hasn’t focused its attention enough on AI to take on NVDA’s growing dominance.

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