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NVIDIA’s T4 GPUs & Software Upgrade Bring AI Into Turing


NVIDIA NVDA recently announced the new Tesla T4 graphics chips that are specially designed to boost artificial intelligence (AI) – driven inferencing capabilities in data centers.

Additionally, the company launched an upgraded version of its TensorRT software for data center inferencing, optimizing deep learning models. This upgraded version will feature the Turing technology and will be based on the new T4 Graphics Processing Units (GPUs).

Turing Technology is a hybrid rendering model, enabling realism in gaming through ray tracing. NVIDIA recently announced a string of new products based on this architecture.

Among the most significant ones are the GeForce RTX series, the first gaming GPUto be introduced for the platform and the Quadro RTX 5000, 6000 and 8000 for film and video content creation, automotive and architectural design plus scientific visualization, which will be up for sale in the fourth quarter.

NVIDIA’s GPUs in the Best Bracket

NVIDIA is reinventing industries with its GPU-based deep learning and AI technologies. Its High Performance Computing (HPC) and data centers are expected to witness tremendous growth over the long haul.

Last year, the company introduced a new HPC technology, Tesla P100 GPU Accelerator. It also recently unveiled the Tesla M10 GPU.

NVIDIA Corporation Price and Consensus

NVIDIA Corporation Price and Consensus | NVIDIA Corporation Quote

The strong line-up of advanced graphics cards has made NVIDIA a favorite graphics card provider among PC makers. The predecessors of the Tesla T4 GPUs, the P4 GPUs are currently used by most major cloud computing providers.

Per NVIDIA, Alphabet’s GOOGL Google division will be the first customers of the T4 GPUs, which will be incorporated in its Cloud Platform.

We believe that strong demand for PC gaming is a tailwind for the company’s financial performance. It has always generated substantial revenues from its cards because of the significantly higher functionality.

Moreover, with computing becoming increasingly more visual, given the new-age tablets that are seeing tremendous demand, NVIDIA’s GPUs in the datacenter market are gaining traction at a brisk pace.

Attractive Prospects Intensify Competition

While growing demand for PC gaming and the expanding cloud computing market bode well for the company’s prospects in the chip market, we cannot overlook the severe competition thrown in by aggressive players.

The contest between NVIDIA and Advanced Micro Devices has taken a meaningful turn. AMD is now making an effort to strengthen its position in the commodity graphics segment and CPUs for console gaming systems.

We believe that competitive pressure from two CPU vendors, Intel and AMD, which are planning to integrate graphics cores into respective chips, can negatively impact NVIDIA’s revenues, going forward.

Zacks Rank & Stocks to Consider

NVIDIA currently has a Zacks Rank #3 (Hold). Two better-ranked stocks in the broader Computer and Technology sector are Fortinet, Inc. FTNT and Vishay Intertechnology, Inc. VSH, both sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term earnings growth for Fortinet and Vishay is projected to be 16.8% and 9.16%, respectively.

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