Nvidia's stock has experienced a remarkable rise of nearly 1,000% since the launch of ChatGPT in November 2022, contributing over $4 trillion to its market value and positioning it as the world's most valuable company. However, the past six months have seen the stock trading sideways, as investors are increasingly looking towards other AI-related stocks.
On Wednesday, shares of Arm surged by 16% after announcing the development of its first in-house chip, marking a departure from its traditional licensing model. This move is anticipated to boost demand for CPUs as the industry shifts focus from AI training to continuous deployment of AI agents.
Intel and AMD, two major players in the CPU market, have informed investors of impending price increases of up to 15% across their product lines. This price hike comes amid reports of a potential CPU shortage, which could amplify existing demand and lead to further stock gains for both companies, which saw increases of 7% in their stock prices following the announcements.
Nvidia is also entering the CPU market, planning to launch its own CPU after a licensing agreement with Groq. CEO Jensen Huang emphasized the importance of AI inference, aiming to expand Nvidia's role in this growing segment.