Nvidia On Track To Topple Samsung, Intel As Biggest Chipmaker By Revenue; Will The Momentum Continue In 2024?

Nvidia Corp. NVDA has had a stellar year as it benefited immensely from the wide adoption of artificial intelligence technology. The company is well on track to finish 2023 as the biggest chipmaker by revenue, a new report said on Sunday.

What Happened: Nvidia is on the cusp of sneaking past biggies such as Intel Corp. INTC and South Korean chip giant Samsung in terms of revenue, Nikkei said in the report.

Santa Clara, California-based Nvidia reported revenue of $38.82 million for the nine months ending Oct. 29, 2023, up about 85% year-over-year. According to Benzinga Pro data, the consensus estimate for the fourth quarter is $20.04 billion.

Based on the fourth-quarter consensus estimate, Nvidia is on track to record revenue of $58.86 billion for the full year 2023, up 118% from the year-ago period.

In comparison, Intel’s full-year revenue is estimated at $53.95 billion, considering the actual results for the first three quarters and the consensus estimate for the fourth quarter. This would mark a 14.5% decline from the $63.1 billion reported for 2022.

Advanced Micro Devices, Inc. AMD, which has been catching up with Intel, will likely report revenue of $22.63 billion for the year compared to $23.6 billion in 2022.

The Nikkei report said that Samsung’s semiconductor division remains poised to report a revenue decline of 34% to $49 billion for the fiscal year ending December 2023.

Intel was the unrivaled leader in terms of chip revenue from 1992 to 2016, and since 2017, the title swung between Intel and Samsung, the report said, citing data from market researcher Gartner.

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Nvidia’s Road To Chip Stardom: The AI explosion started with the popularity of the ChatGPT chatbot powered by GPT, which is a large language model. Thousands of Nvidia AI accelerator chipsets power most generative models.

Reflecting the strong demand for its AI chips, Nvidia’s revenue more than doubled to $10.3 billion in the second quarter and climbed 206% to $18.12 billion in the third quarter.

The company guided to fourth-quarter revenue of $20 billion, plus or minus 2%. Although China’s chip ban will likely eat away at some of its revenue, the company remains optimistic about making up for the shortfall by launching workaround chips that meet standards due to strong demand elsewhere.

Nvidia Stock: Nvidia shares have surged by 234% year-to-date and are the best-performing S&P 500 stock this year. It has also outperformed the rest of the Magnificent Seven stocks and the major indices.

The average analysts’ one-year price target for Nvidia stock is $661.35, suggesting a roughly 35% upside from current levels.

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