Cathie Wood Sees Competition For Nvidia As ARK Projects Custom Silicon Boom By 2030: Amazon Is The 'Sleep

Earlier this week, Cathie Wood highlighted the intensifying competition for Nvidia Corp (NASDAQ:NVDA) as ARK Investment Management forecasts that custom AI chips could command more than one-third of the compute market by the end of the decade.

ARK Sees Custom Silicon Reshaping AI Compute Market

Frank Downing, ARK's director of research for next-generation internet, said in a post on X that the firm expects "over a third of the compute market will be custom silicon by 2030."

He defined custom as non-GPU chips — effectively alternatives to products from Nvidia and Advanced Micro Devices, Inc. (NASDAQ:AMD) — though he noted that industry lines are "blurring."

"Everyone knows Google's TPU, but Amazon is the sleeping giant that is waking up," Downing wrote.

A chart shared by Downing shows traditional servers rapidly losing share to accelerated computing, with application-specific integrated circuits, or ASICs, gaining ground alongside GPUs through 2030.

Wood amplified the message, sharing the post and adding: "Competition for Nvidia."

Amazon-OpenAI Deal Signals Shift Beyond Nvidia GPUs

The comments follow a multi-year partnership between Amazon.com Inc. (NASDAQ:AMZN) and OpenAI.

Amazon committed up to $50 billion to the ChatGPT maker and expanded an existing compute agreement by $100 billion over eight years.

A key element of the deal centers on OpenAI's use of Amazon's custom Trainium chips, including next-generation versions expected in 2027. OpenAI will consume roughly 2 gigawatts of Trainium capacity, underscoring the scale of the commitment.

Meanwhile, Alphabet Inc.'s (NASDAQ:GOOG) (NASDAQ:GOOGL) Google continues positioning its Tensor Processing Units as an alternative to Nvidia's GPUs, with reports that Meta Platforms, Inc. (NASDAQ:META) has agreed to lease TPUs for advanced AI development.

Nvidia Q4 Revenue Surges 73%, Q1 Outlook Beats Estimates

Meanwhile, Nvidia reported fourth-quarter revenue of $68.13 billion, marking a 73% increase from a year ago and surpassing the Street consensus estimate of $66.0 billion.

For the first quarter, the company projected revenue between $76.44 billion and $79.56 billion, well above analysts' $71.96 billion estimate.

Price Action: Nvidia shares are down 7.41% in the past five days. In the after-hours trading, the shares were up by 0.34%, reaching $177.80.

Nvidia ranks high on quality in Benzinga's Edge Stock Rankings, reflecting a strong long-term uptrend, though its short- and mid-term price trend appears weaker.