Currently, Nvidia dominates the artificial intelligence processor market by a margin ranging between 80% and 98%, and it is not expected to change in the near future.
However, the stock price of Nvidia has recently dropped significantly, leading some analysts to doubt the company’s status and question its capabilities in achieving that amidst current competition.
The company faces major challenges in meeting the growing demand for Graphics Processing Units (GPUs) due to the high power consumption of these units, which is enabling its competitors to gain strength.
Korean media reports indicate that some analysts are concerned about Nvidia’s future in artificial intelligence in the long term, and these doubts were not present a few months ago.
The main reason behind these doubts and concerns is the significant drop in Nvidia’s stock price by up to 10%, a notable percentage in the market. Moreover, Nvidia heavily relies on TSMC for manufacturing its GPUs dedicated to artificial intelligence. Despite TSMC’s willingness to meet Nvidia’s demands, it is unable to keep up with the massive chip orders.
Although TSMC is establishing new factories today in Japan, Taiwan, and the United States, it will take several years to commence production, posing a hurdle for Nvidia in artificial intelligence.
According to a report from South Korea, an official from a Korean internet company stated that depending on Nvidia for building platforms will make profitability challenging due to high power consumption and massive financial costs associated with GPUs.
For these reasons, the official said that their company is exploring better options than Intel and Samsung to reduce financial costs. “Wccftech” site suggests analysts predict that a continued rise in power consumption will make the global data centers’ consumption in 2027 equivalent to that of the Netherlands, Argentina, and Sweden combined, a difficult issue to address.
Finally, Nvidia acknowledges that its customers are becoming frustrated due to the long wait for A100 and H100 GPUs, with unconfirmed reports suggesting many companies are seeking alternative options with reasonable costs and lower power consumption.
