The reason that AMD was not able to meet the whisper numbers is that even though AMD chips for AI are excellent, AMD does not have the software and the whole system like NVIDIA Corp (NASDAQ:NVDA). This limits AMD's market even though AMD is offering cheaper price points compared to Nvidia. AMD has recently bought a systems company in an attempt to catch up to NVDA. However, in The Arora Report analysis, it will take a long time for AMD to catch up with NVDA. Nvidia's CUDA is a parallel computing platform and programming model. Thousands of developers have been using CUDA to harness the power of AI for years.
Alphabet Inc Class C (NASDAQ:GOOG) reported earnings yesterday after the close. Alphabet earnings show data center growth. Data center growth means AI growth. However, in The Arora Report analysis, there is risk in GOOG stock because Google has over 90% of the search market. It is hard to see Google gaining share from here. Even a drop of a few percentage points will substantially hit earnings.
AMD reported earnings inline with the consensus and provided decent guidance. Why did the stock fall? The reason is that the whisper numbers for AI GPU guidance were approaching $6B. AMD guided above $5B for 2024 – this was inline with consensus. As we have been sharing with you, stocks move based on the difference between reported numbers and whisper numbers.
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