Dear readers and friends, the semiconductor industry has changed dramatically, and the myth is only at the snap of a finger!
Just a few days ago, the artificial intelligence chip giant Nvidia was still in full swing, and its market value once surpassed Buffett's Berkshire. However, last night there was a thunderbolt from the blue: Nvidia announced in a high-profile manner that its revenue in the first quarter would decline sharply, and it was expected to decline by 17% year-on-year! As soon as the news came out, its stock price plummeted, and its market value evaporated by nearly $200 billion in two days. Foreign media bluntly said that Nvidia's good days are over, and it is too late.
What's going on? Let this tech giant fall off the altar in the clouds and cause an earthquake in the industry?
In fact, the haze of crisis has long hung over Nvidia. First, the collapse of the cryptocurrency market led to a cliff-like drop in demand for graphics cards. Immediately after, the global economy downturned, and consumer electronics were hit hard. Cloud giants have also begun to shrink spending, and the construction of new data centers has been delayed. This series of blows has made Nvidia even worse.
What is even more deadly is the encirclement and suppression from the supervision of various countries. Out of concern about the technology outflow, the United States took the lead in throwing the stick of export controls against Nvidia. This means that Nvidia's most advanced AI chips will not be sold overseas, especially in China, the world's largest market. Industry insiders estimate that the controls could wipe out 30-50% of Nvidia's potential Chinese revenue.
What's even more ironic is that while Nvidia is suffering from the enemy, its competitors are emerging from the crowd. With its flexible product line, AMD is catching up in the server chip space. And Intel is also stepping up the layout of the GPU market, trying to fight a way out of the AI wave. In the face of a wolf-like opponent, can Nvidia still reduce the dimensionality of the attack?
In fact, NVIDIA's highlight moment is largely due to the pursuit and hype of the capital market. When concepts such as artificial intelligence and the metaverse are blown into the sky, NVIDIA naturally becomes the brightest star. However, when the bubble of the concept is punctured, when the sword of regulation hangs high, the former darling cannot escape the fate of abandonment. As one analyst put it, "Investors are starting to realize that there is only a thin line between the semiconductor industry and a tech bubble."
It is true that NVIDIA is still a leader in the field of AI chips, and its accumulated technical advantages cannot be underestimated. But on the ever-changing track, no one can sit back and relax. From Nokia to Kodak, in the history of business, the halo of idols was extinguished only in an instant. For NVIDIA, only by being down-to-earth and focusing on innovation can we continue to write a legend in the storm.
In this regard, Nvidia CEO Jensen Huang seems to have a clear understanding. In his latest statement, he admitted that the situation is grim and that it will take time for revenue to recover. At the same time, it was emphasized that the management is actively taking action to optimize the cost structure and strengthen communication with Chinese customers, in an effort to turn the crisis into an opportunity and regain momentum.
Dear readers, do the drastic changes in the semiconductor industry also make you feel the grandeur of the times? In the face of change, how should tech giants respond? Feel free to leave your insights in the comment section.
The mountain rain is coming, and in the face of the crisis, there is no eternal winner. Let us witness the bloody storm of the chip rivers and lakes with awe, and think about the game of technology, capital and regulation. As a philosopher said: After experiencing the big waves and sands, you know what is most cherished.