NVIDIA's dominance in the AI markets is here to stay in 2024, as the market researcher Omdia declares Team Green as the "kingmaker" of the industry.
NVIDIA's Dominance in The AI Markets Won't Break Just Yet Since The Firm Is Projected To Wipe Out Competition Going Into 2024
We all are pretty well aware of the fact that, as of now, NVIDIA is leading the charts in every manner, whether it is in the company's presence in the markets, share pricing, or even the figures disclosed in the firm's financial performances.
They don't seem to stop rapidly growing in the markets, and each day, they are coming closer to building an absolute monopoly. The market researcher Omdia believes that 2024 will be another year of success for Team Green, as they have managed to win the market's confidence, with next-gen solutions expecting to ramp things up.
Omdia has described NVIDIA's performance in FY23, detailing revenue from both AI GPUs and servers, and as expected, a quarterly uptrend has been witnessed since the beginning of last year, with tremendous growth seen in the firm's overall server revenue.
Starting in Q1, server revenues stood at 30% and rose to 45% in Q4, which shows that data centers are the firm's hot-selling products in the markets. In parallel, NVIDIA saw a rise in server BOM (Bill of Materials), indicating that the firm has allocated a decent portion of its finances into catering to data center demand, which is justified given the return they are getting from it.
Moving on to the more exciting part, Omdia has made some vast predictions going into 2024, initially believing that the firm is expected to make $87 billion this year from its data center GPUs, which is a whopping 150% YoY increment, and indeed shocking to witness because such growth was never seen in this segment previously.
Apart from that, Omdia expects significant AI GPU demand going into Q3 and Q4 of 2024, which will amount to a large portion of FY24 revenue. AI has indeed proven to be a gold mine for NVIDIA, as this wouldn't stop here since Omdia expects an increase in demand due to advancements in AI inferencing capabilities.
Such figures and reports on NVIDIA's market performance are exciting since the firm's rapid progression means a cumulative development in the industry. The AI hype won't fade away just yet, as NVIDIA expects to generate a whopping $300 billion from it by 2027, and judging by the current trends, it does seem an achievable target. Not to mention that Team Green is expected to unveil its next-generation "Blackwell" B100 AI GPUs and various other server offerings soon, which will ultimately catalyze their growth in the markets.
While everyone is looking forward to this "radical" growth, I see NVIDIA creating a monopoly over the markets soon, and if we examine the bigger picture, a monopoly established by a company doesn't do justice to others involved in the markets. We do see firms like AMD and Intel making rapid advancements to gain ground in the AI markets, but what we are seeing right now, NVIDIA isn't looking to give a margin to anyone, which could prove to be something not healthy for the markets in the longer run.
News Source: Omdia
