Cramer Says Microsoft 'Simply Can't Compete' With Nvidia After Software Giant Launches In-House AI Chips
Portfolio Pulse from Shanthi Rexaline
Jim Cramer expressed skepticism about Microsoft's ability to compete with Nvidia in the AI chip market, despite Microsoft's announcement of its in-house AI chips at the Ignite 2023 conference. Microsoft has partnered with Oracle to access Nvidia chips, which Cramer sees as an indication of Microsoft's inability to compete with Nvidia's technology. Microsoft launched the Azure Cobalt CPU and AI accelerator chip Maia, and plans to resell Azure Cobalt to other cloud providers. The Microsoft-Oracle partnership allows Microsoft to use Oracle Cloud AI Infrastructure alongside Azure AI infrastructure. Oracle is also a customer of Nvidia's AI chips. Microsoft's stock saw a marginal increase, while Nvidia's stock ended a winning streak with a slight decline.
November 16, 2023 | 6:04 am
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NEUTRAL IMPACT
Microsoft announced its in-house AI chips at Ignite 2023 and has partnered with Oracle to access Nvidia chips. Skepticism from influential figures like Jim Cramer could temper investor enthusiasm in the short term.
Cramer's comments may lead to some investors questioning Microsoft's ability to compete with Nvidia, potentially impacting investor sentiment. However, the company's stock only saw a marginal increase, indicating that the market may not have fully reacted to the news or Cramer's opinion.
CONFIDENCE 70
IMPORTANCE 60
RELEVANCE 80
POSITIVE IMPACT
Nvidia's position as a leader in AI chips is reinforced by Jim Cramer's comments, despite Microsoft's entry into the market. Nvidia's stock ended a winning streak, but the outlook remains positive.
Cramer's endorsement of Nvidia's superiority in the AI chip market could reinforce investor confidence in Nvidia, despite a slight stock decline after a 10-session winning streak. The decline may be seen as a temporary pause rather than a trend reversal.
CONFIDENCE 75
IMPORTANCE 70
RELEVANCE 90
POSITIVE IMPACT
Oracle's partnership with Microsoft to use Nvidia chips for AI model inferencing could be seen as a strategic move, potentially benefiting Oracle's cloud and AI offerings.
The partnership with Microsoft could be viewed positively for Oracle, as it may enhance the company's cloud and AI capabilities. However, the impact on the stock may be moderate as the partnership is part of a broader strategy rather than a standalone event.
CONFIDENCE 65
IMPORTANCE 50
RELEVANCE 70