Yes, the search results indicate that there are several emerging Chinese AI

chip startups that are striving to develop homegrown alternatives to

challenge Nvidia's dominance, especially in the wake of U.S. export
restrictions on advanced chips to China. Here are some key startups
mentioned:

1. Biren

Biren is a Chinese AI chip startup that is working on developing AI chips and

accelerators. It is highlighted as one of the companies trying to get a slice of
the AI chip market in China alongside giants like Huawei and Alibaba.[4]

2. Inflame

Inflame is another AI chip startup from China that is mentioned as an

emerging player aiming to compete in the domestic AI chip market following
the restrictions on Nvidia chips.[4]

3. Hygen

Hygen is a Chinese startup focused on AI chip design and development. It

is listed among the startups trying to capitalize on the opportunity created by
the U.S. export controls on advanced AI chips to China.[4]

4. MetaX

MetaX is a Chinese AI chip startup that is attempting to develop alternatives

to Nvidia's offerings in the wake of the expanded restrictions on Nvidia chip
sales to China.[3]

While these startups are still in relatively early stages, the search results
suggest that they are part of China's broader efforts to build domestic AI chip
capabilities and reduce reliance on U.S. suppliers like Nvidia, especially after
the tightened export controls.[3][4]
It's worth noting that the search results also highlight the significant
challenges these startups face, including access to advanced chip design
tools, manufacturing capabilities, and developing robust software stacks to
support their AI chips.[4] However, with the backing of the Chinese
government and major tech companies, some of these startups could
potentially emerge as formidable competitors to Nvidia in the domestic
Chinese market over time.

Citations:

[1] https://kr-asia.com/nvidias-ai-chip-faces-weak-demand-and-fierce-
competition-in-china

[2] https://www.nature.com/articles/d41586-024-01292-1

[3] https://asia.nikkei.com/Business/Tech/Semiconductors/China-rushes-to-
homegrown-AI-chips-as-Nvidia-cutoff-expands

[4] https://www.youtube.com/watch?v=GDPNDOSZWQM

[5] https://www.lunnews.com/index/detail/index.html?id=590

Based on the search results provided, here are the latest available figures
on the research and development (R&D) budgets for Nvidia and AMD:

## Nvidia R&D Budget

According to the search results, Nvidia spent $8.68 billion on R&D in their
most recent fiscal year [4]. This represents a substantial 73% increase from
the $2.38 billion they spent on R&D just five years ago in 2019 [4].

The significant ramp-up in R&D spending highlights Nvidia's commitment to

maintaining its leadership position in the rapidly growing AI chip market,
where it currently dominates with an estimated 80% market share [4].
## AMD R&D Budget

While the exact R&D budget figure for AMD is not provided in these search
results, some context is given:

- A Reddit discussion from 2017 suggests that at the time, AMD's total
revenue was lower than Intel's R&D budget alone, highlighting the vast
disparity in R&D resources between the companies [3].

- The same discussion estimates that Nvidia may have been outspending
AMD on GPU R&D by an even larger margin compared to Intel's lead over
AMD in CPU R&D spending [3].

- While AMD has made significant strides with products like Zen CPUs and
Instinct GPUs, it has achieved this success despite operating on a relatively
tight R&D budget compared to rivals like Nvidia and Intel [3].

So while an exact current R&D budget number for AMD is not provided, the
search results indicate that Nvidia's R&D spending has significantly
outpaced AMD's in recent years, allowing Nvidia to invest heavily in
advancing its AI chip offerings and maintaining market dominance.

However, AMD's strategic acquisitions like Xilinx and its expertise in custom
chip designs could help it compete more effectively against Nvidia's AI
offerings, despite potentially having a smaller R&D budget [2].

In summary, Nvidia spent $8.68 billion on R&D in their latest fiscal year [4],
while AMD's R&D budget is likely substantially lower, though the exact figure
is not provided in these search results. The disparity in R&D spending
reflects Nvidia's current leadership position in the AI chip market.
Citations:

[1] https://www.fool.com/investing/2024/04/12/better-ai-stock-nvidia-vs-
amd/

[2] https://www.fool.com/investing/2023/07/29/better-ai-chip-stock-amd-vs-
nvidia/

[3]
https://www.reddit.com/r/Amd/comments/6gc43w/david_vs_goliath_amd_in
tel_and_nvidia_rd_budgets/

[4]
https://www.capacitymedia.com/article/2d44i8o2d3oeo87a3bm68/news/nvi
dia-boosts-research-and-development-expenditure-by-73-in-5-years

[5] https://www.linkedin.com/pulse/amd-challenges-nvidia-new-ai-chips-
mike-madole-tnrac?trk=public_post

Better AI Stock: Nvidia vs.

AMD
By Dani Cook – Apr 12, 2024 at 5:05AM

KEY POINTS
· The AI market is projected to hit close to $2 trillion by 2030.
· Nvidia snapped up an estimated 90% market share in AI GPUs last year.
· Earnings-per-share estimates show AMD's stock could nearly double by
2026, boosted by its AI efforts.
· 10 stocks we like better than Nvidia

NASDAQ: NVDA
Nvidia

Market Cap

$2,864B
Today's Change

(1.25%) $14.37
Current Price

$1,164.37
Price as of June 4, 2024, 4:00 p.m. ET

These companies rule AI with their chips and could deliver major gains
for years to come.

The chip market has exploded over the last year as a boom in artificial
intelligence (AI) led to a spike in demand for more powerful hardware.
Increased interest in AI services has meant an increased need for graphics
processing units (GPUs), the chips necessary to train and run AI models.

As a result, the companies at the forefront of this

technology, Nvidia (NVDA 1.25%) and Advanced Micro Devices (AMD -
2.18%), have enjoyed stock gains of 222% and 84%, respectively, since last
April. These companies have exciting outlooks in AI over the long term thanks
to their successful chip businesses, and they could profit from the market's
tailwinds for years.

The AI market hit close to $200 billion last year and is projected to have a
compound annual growth rate of 37% through 2030. That trajectory would see
the sector reach nearly $2 trillion by the decade's end.

So, despite their meteoric rises this year, the shares of Nvidia and AMD likely
still have much to offer new investors over the long term. Let's look closer at
these chipmakers and determine whether Nvidia or AMD is the better AI stock
this April.
Nvidia
It's been hard to avoid coverage of Nvidia over the last year, as it became the
poster child for the boom in AI. In 2023, the company cornered the market on
AI chips, achieving an estimated 90% market share in GPUs, which sent its
earnings skyrocketing.

In its fourth quarter of 2024 (which ended in January), the company's revenue
increased by 265% year over year to $22 billion. Operating income jumped
983% to nearly $14 billion. The impressive growth was primarily thanks to a
409% increase in data center revenue, reflecting a spike from AI.

Collapse

NASDAQ: NVDA
Nvidia
Today's Change

(1.25%) US$14.37
Current Price

US$1,164.37
YTD1W1M3M6M1Y5Y

PRICEVS S&P

NVDA

KEY DATA POINTS

Market Cap

$2,864B

Day's Range

US$1,140.45 - US$1,166.00

52wk Range

US$373.56 - US$1,166.00

Volume

40,291,476
Avg Vol

49,391,233

Gross Margin

75.29%

Dividend Yield

0.01%

The company's free cash flow increased by 430% in the last year to more
than $27 billion, indicating it has the funds to continue investing in AI and
retain its market supremacy.

As a leading chipmaker, Nvidia has a powerful position. Besides its AI

hardware, the company's chips have a wide range of applications, including
cloud platforms, video game consoles, laptops, custom-built PCs, and more.

Consequently, the company is one of the best options for investing in tech,
and even more so for those looking to profit from the future of AI.

Advanced Micro Devices

AMD was slightly late to the AI party, and Nvidia beat it to the market. But
AMD is investing heavily in the industry and has formed some lucrative
partnerships that could take it far in the coming years.

Last December, AMD unveiled its MI300X GPU for AI. The chip was designed
to compete directly with Nvidia and has already led to some of tech's most
prominent players, like Microsoft and Meta Platforms, to sign on as clients.

Collapse

NASDAQ: AMD
Advanced Micro Devices
Today's Change
 (-2.18%) -US$3.56
Current Price

US$159.99
YTD1W1M3M6M1Y5Y

PRICEVS S&P

AMD

KEY DATA POINTS

Market Cap

$259B

Day's Range

US$158.87 - US$164.83

52wk Range

US$92.74 - US$227.30

Volume

48,136,896

Avg Vol

59,488,116

Gross Margin

39.12%

Dividend Yield

N/A

AMD is diversifying by expanding into AI-powered personal computers (PCs).

According to research firm IDC, shipments of PCs are projected to receive a
major boost this year, with AI integration serving as a key catalyst. And a
Canalys report predicts that 60% of all PCs shipped in 2027 will be AI-
enabled.

AMD's earnings have yet to reflect its heavy investment in AI, but the
company's recent quarterly report suggests it's moving in the right direction. In
its fourth quarter of 2023, revenue rose 10% year over year to $6 billion,
beating analysts' expectations by about $60 million. The company's AI-
focused data center segment posted 38% revenue growth.
Is Nvidia or AMD the better AI stock?
Nvidia and AMD are ready to profit from AI growth for decades. Both stocks
would likely strengthen any portfolio over the long term. But earnings-per-
share (EPS) estimates indicate AMD might have more room to run over the
next two years.

DATA BY YCHARTS.

These charts show Nvidia's EPS could reach $36 by fiscal 2026, while AMD's
might hit just over $7. On the surface, it looks like Nvidia is the clear winner.
But multiplying these figures by the companies' forward price-to-earnings
ratios (Nvidia's is 35 and AMD's is 47) yields stock prices of $1,260 for Nvidia
and $329 for AMD.
Using their recent prices, these projections would see Nvidia's stock rise 44%
over the next two fiscal years and AMD's increase by 93%. The significant
difference highlights the fact that AMD is at an earlier stage in its AI journey
and could have more room for growth in the short term. As a result, AMD is a
screaming buy over Nvidia right now.

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