Chip manufacturer Nvidia has had an unprecedented rise. But the tech company will not be able to defend the foundations of its soaring against the competition.
Nvidia is currently valued higher on the stock market than Amazon or Google. But its success has so far been based on a relatively small product line. Google and Amazon are much more broadly positioned. The specialization is risky for Nvidia because it is not unlikely that other companies will successfully attack its AI chip business. The company doesn't earn its dream margins in an inconspicuous niche market. If Nvidia's margins were halved, they would still be outstanding for a chip manufacturer.