Based on Susquehanna's third-quarter earnings preview, Nvidia (NVDA, Financials) and other artificial intelligence-oriented semiconductor businesses are anticipated to keep doing well despite difficulties the larger semiconductor industry faces. Driven by rising capital expenditures from hyperscalers and data centers, the company notes great demand in the AI field.
To keep current with stock prices, Susquehanna analysts—led by Chris Rolland—warned Nvidia and its rivals could have to increase their forecast. Although the AI segment is still shining, other semiconductor industry sectors—especially automotive and industrial chips—are running into challenges.
Companies like Texas Instruments (TXN, Financials) and Analog Devices (ADI, Financials) have noted continuous industrial semiconductor difficulties. Moreover, the automotive semiconductor sector has been underwhelming; manufacturers have seen higher inventory, declining demand, and slower than predicted penetration of electric automobiles.
Rising demand is projected to help AI-oriented businesses such Nvidia, Advanced Micro Devices (AMD, Financials), Broadcom (AVGO, Financials), and Marvell Technology (MRVL, Financials) despite these obstacles. With demand for AI-powered PCs not driving expected growth, Susquehanna expects a small 2.7% rise in PC notebook builds year over year in 2024.
