Semiconductors, Ai, and Cloud Computing

William Haung - JSC | Investments

NVIDIA Corporation has transformed from a gaming graphics company into a dominant force in the technology sector since its 1993 founding and 1999 IPO at $12 per share. What started as a focus on revolutionary gaming GPUs has evolved into a comprehensive technology empire spanning data centers, artificial intelligence, and autonomous vehicles. This strategic expansion into emerging tech sectors, combined with explosive demand for advanced computing solutions, has driven extraordinary growth in NVIDIA's value and market presence.The company's remarkable rise stems from its ability to adapt its GPU expertise to power the AI revolution and modern cloud infrastructure. This pivot has proven incredibly prescient as demand for AI and machine learning capabilities has skyrocketed. Through careful cultivation of partnerships with industry giants like Microsoft and Tesla, along with strategic moves like the Mellanox acquisition and attempted ARM purchase, NVIDIA has positioned itself at the intersection of gaming, AI, and cloud computing.

NVIDIA's stock performance reflects this successful evolution, with share prices climbing dramatically on the back of consistent revenue growth and increasing market dominance. The company's 4-for-1 stock split in 2021 made shares more accessible to retail investors while its market cap has since surged past $1 trillion, placing it among the most valuable semiconductor companies globally. This growth trajectory has been sustained by the company's continued innovation in AI chip technology and its central role in powering next-generation computing infrastructure, making it a cornerstone investment for those betting on the future of technology.

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1. Texas Instruments (est. 1951) began as a company focused on military electronics before pivoting to semiconductor production. Their early growth was primarily supported by military contracts and equity raised through the stock market.

2. Fairchild Semiconductor (est. 1957) leveraged venture capital investments to help catalyze the semiconductor revolution in Silicon Valley.

3. Intel's (est. 1968) backed by venture capital funding. The company later utilized public market financing to become one of the world's premier chip manufacturers.

4. AMD (est. 1969) , building its foundation through private investment before conducting its initial public offering in 1972, establishing itself as a significant Intel competitor.

5. Micron Technology (est. 1978) began with private backing and transitioned to public ownership in 1984 to support its memory chip operations.

6. Qualcomm (est. 1985) utilized private equity funding before going public to develop its wireless semiconductor technology business.

7. TSMC's (est. 1987) combining Taiwanese government support with private investment to create what would become the world's leading chip manufacturing foundry.

8. Broadcom's (est. 1991) Venture capital provided funding , followed by public market funding and strategic acquisitions to drive growth.

9. NVIDIA(est. 1993) relied on venture funding before successfully entering public markets in 1999 to fuel its expansion.

10. ON Semiconductor (est. 1999 )emerged from Motorola using a combination of private investment and public.

The semiconductor industry is represented on the New York Stock Exchange (NYSE) and NASDAQ, with several indexes tracking its performance. The most relevant index is the Semiconductor Index.

Semiconductor Index:

The semiconductor industry is represented on the New York Stock Exchange (NYSE) and NASDAQ, with several indexes tracking its performance. The most relevant index is the Semiconductor Index.

● History: The index was introduced in 1993 by the Philadelphia Stock Exchange (now part of NASDAQ) to track the performance of leading semiconductor companies. The index is modified market capitalization-weighted and includes key industry players.

● Current Companies: Major companies in the index include Intel (INTC), NVIDIA (NVDA), AMD (AMD), Texas Instruments (TXN), Qualcomm (QCOM), Broadcom (AVGO), and Micron Technology (MU).

● Significance: Serves as a benchmark for the semiconductor industry’s performance, reflecting global trends in computing, artificial intelligence, and consumer electronics. Due to the sector’s high growth potential, the index is closely monitored by investors seeking opportunities in semiconductor stocks.