The earlier drop in Nvidia shares is looking curious after this news:
- Intel unveils chip called Gaudi 3, an AI accelerator chip
- Outperforms Nvidia's H100 chip (according to Intel at least)
- To be 'widely available' in Q3
Intel just announced that it "Introduced the Intel Gaudi 3 AI accelerator, delivering 50% on average better inference and 40% on average better power efficiency than Nvidia H100 – at a fraction of the cost."
Obviously, the smart thing to do here is to take these claims with a grain of salt. That said, this could be significant for both INTC and NVDA.
The H100 chip is among the most high-demand products every produced by anyone. Elon Musk today said training the next generation of Grok 3 would need 100,000 H100 chips. There is similar -- if not more -- demand from every corner of the world for AI chips. Right now, all that's going to NVDA and the buyers are virtually price-insensitive.
If Intel could deliver a chip that can take market share at a lower price, then suddenly price matters. What's particularly impressive is the claim that it will be 'widely available' by Q3. If that's true and the software with it works anywhere near as well as Nvidia's Cuda, then the order book will fill up fast.
The market is going to want to see this proven out but I believe the US government wants Intel to be a winner and is massively funding its fabs. It's a great American company that's fallen of hard times but everyone loves a turnaround and they're certainly in the right space.
Plus, Jim Cramer sounded ready to give up on the company and CEO Pat Gelsinger last week in a breakdown somewhat reminiscent of his puking out META at the bottom.
