CNBC Mad Money host Jim Cramer reiterated his positive attitude Nvidia Corp. NVDA amid rumors that the chipmaker will soon have a serious challenger Microsoft Corp. MSFT.
What happened: Microsoft is working on unveiling its first in-house artificial intelligence chip at its annual developer conference next month, the information said, citing a source. The proposed move will likely help the software giant reduce its reliance on AI chips developed by Nvidia, the report said.
The report also states that Microsoft has been working on the chip for years. The chip, according to the report, is designed for data center servers that train and run large language models, the software behind conversational AI features like OpenAI’s ChatGPT.
Microsoft’s data center servers currently rely on Nvidia’s AI chips to power their LLMs and AI features in their productivity apps.
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Cramer isn’t worried: Following the report, Nvidia shares fell 0.54% to $455.14 in after-hours trading, according to Benzinga Pro.
Cramer, an avowed fan of Nvidia, its cutting-edge technology and its CEO, responded to the rumor Jensen Huang, said: “I would not sell Nvidia stock based on some MISINFORMATION about Microsoft and AI chips.”
“It sounds like misinformation to me,” he added.
Nvidia was the frontrunner in the AI race. The company’s H-100 enabled “a leap in training, inference, basically generative AI” and enabled ChatGPT to make its big debut last November, said Baird analyst Ted Mortonson, Business Insider reported.
“They have the entire AI silicon stack. And that’s basically three components. They have the most advanced GPU, they have advanced networking built into the silicon, advanced onboard memory and they are now developing a new CPU,” he added.
Demand for Nvidia chips has grown so much that the company is struggling to balance supply with booming demand. Nvidia’s second-quarter results, released in August, reflected this strength, with revenue and earnings well ahead of expectations and future guidance above expectations.
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