Brief news
Nvidia, a global leader in the graphics processing units (GPUs) market, has experienced a remarkable surge in valuation since the end of 2022, with its stock soaring nearly ninefold since the end of 2022. This surge is primarily driven by the soaring demand for GPUs, which play a crucial role in the explosive growth of generative artificial intelligence. Nvidia dominates the market for chips used in training and deploying AI software such as ChatGPT, with a market share of over 80%. However, its rapid rise and limited interaction with consumers have resulted in a significant disparity between its brand recognition on Main Street and its appeal on Wall Street.
According to Greg Silverman, Interbrand’s global director of brand economics, Nvidia has not prioritised enhancing its brand and protecting future revenue. Silverman believes that Nvidia’s potential downside lies in the limitation of its brand strength, which may hinder its overall value despite its impressive market capitalization.
Nvidia has experienced impressive annual revenue growth, surpassing 200% in each of the past three quarters. According to LSEG, revenue for fiscal 2025 is projected to nearly double from the previous year, reaching over $120 billion. The company’s data centre GPUs, which accounted for 85% of sales in the most recent quarter, are deployed in large-scale facilities and usually necessitate a team of highly skilled data science and supercomputing professionals to optimize their configuration for efficient AI software development.
In contrast, Apple, ranked as the top brand by Interbrand, generates the majority of its revenue from selling iPhones and other consumer devices worldwide. Microsoft, ranked second, is a major player in enterprise sales and is widely recognized for its Windows and Office software. Amazon, ranked third, aims to cater to all consumer needs, while Google, ranked fourth, serves as the gateway to the internet for many individuals.
Nvidia’s brand value is gaining ground on its competitors, as seen in the rankings of the 100 most valuable global brands published this month by Kantar BrandZ. Marc Glovsky, a senior brand strategist at Kantar, believes that Nvidia holds the same level of importance for B2B buyers making significant in-house purchases as Apple does for consumers buying iPads or Macs.
Illustrated news
At the end of 2023, consulting firm Interbrand identified Apple, Microsoft, Amazon, and Google as the top four global brands. Additionally, these companies rank among the top five most valuable in the world.
Another company that had a moment of glory this week was Nvidia, as it briefly overtook Microsoft to claim the top spot as the world’s largest company by market capitalization.
However, even with a valuation of $3.1 trillion (which briefly reached $3.3 trillion before a slight decline), Nvidia does not rank among the top 100 most iconic names on Interbrand’s latest list. This list includes renowned companies like McDonald’s, Starbucks, Disney, and Netflix.
Nvidia’s remarkable surge in valuation, with its stock soaring nearly ninefold since the end of 2022, has been primarily fueled by the soaring demand for its graphics processing units (GPUs). These GPUs play a crucial role in powering the explosive growth of generative artificial intelligence and have garnered significant attention due to the widespread excitement surrounding AI. Nvidia dominates the market for chips used in training and deploying AI software such as ChatGPT, with a market share of over 80%. Several large tech companies are the main purchasers of its chips.
Nvidia’s rapid rise and limited interaction with consumers have resulted in a significant disparity between its brand recognition on Main Street and its appeal on Wall Street. Ranked at No. 100 on Interbrand’s 2023 list is Canon, a renowned Japanese camera maker. Just one spot ahead at No. 99 is Heineken, the popular Dutch brewer.
According to Greg Silverman, Interbrand’s global director of brand economics, Nvidia, as a product company expanding globally, has not prioritised enhancing its brand and protecting future revenue. Nvidia’s potential downside, according to Silverman, lies in the limitation of its brand strength, which may hinder its overall value despite its impressive market capitalization.
Nvidia declined to comment, according to a spokesperson.
Nvidia has experienced impressive annual revenue growth, surpassing 200% in each of the past three quarters. According to LSEG, revenue for fiscal 2025 is projected to nearly double from the previous year, reaching over $120 billion.
The company’s data centre GPUs, which accounted for 85% of sales in the most recent quarter, are deployed in large-scale facilities and usually necessitate a team of highly skilled data science and supercomputing professionals to optimise their configuration for efficient AI software development.
In contrast, Apple, ranked as the top brand by Interbrand, generates the majority of its revenue from selling iPhones and other consumer devices worldwide. Microsoft, ranked second, is a major player in enterprise sales and is widely recognised for its Windows and Office software. Amazon, ranked third, aims to cater to all consumer needs, while Google, ranked fourth, serves as the gateway to the internet for many individuals.
Completing Interbrand’s top 10 are Samsung, a South Korean electronics company, as well as three prominent car manufacturers (Toyota, Mercedes-Benz, and BMW), Coca-Cola, and Nike.
Ranked at No. 24, Intel is a formidable competitor to Nvidia. The company is renowned for manufacturing processors that power laptops and PCs, and for its enduring “Intel Inside” advertising campaign. Even Hewlett Packard Enterprise, a company that specialises in building servers, managed to secure a spot on the list at No. 91.
It’s a favourite among gamers.
On the other hand, another survey indicates that Nvidia’s brand value is gaining ground on its competitors.
Nvidia made a significant jump in the rankings of the 100 most valuable global brands published this month by Kantar BrandZ, securing the impressive sixth position. This marks a remarkable improvement of 18 places compared to the previous survey. The brand’s overall value increased by a staggering 178% in just one year, reaching an estimated worth of around $202 billion. Kantar conducts surveys among enterprise buyers to assess the value of brands that primarily cater to other businesses, providing a comprehensive estimate of their brand value.
According to Marc Glovsky, a senior brand strategist at Kantar, Nvidia holds the same level of importance for B2B buyers making significant in-house purchases as Apple does for consumers buying iPads or Macs.
Although Nvidia may not be a household name for everyone, it holds significance in a specific niche of the consumer market. Just ask your friend who is really into gaming.
Back in 1991, when Nvidia was founded, the field of AI was just starting to take shape. The company’s main emphasis was on developing chips with the ability to rapidly render digital triangles, a fundamental capability that greatly contributed to the growth of 3D games.
For years, Nvidia, with its GeForce brand and green logo, has been familiar to those who enjoy optimising their computers for the most cutting-edge games. Nvidia supplies the chips for the highly successful Nintendo Switch console, which has been shipped to more than 140 million customers worldwide.
Unlike Intel, Nvidia has chosen not to heavily market itself to consumers through flashy ad campaigns. And gaming has become a pleasant supplementary venture for the chipmaker. In the most recent quarter, it contributed $2.6 billion in revenue, making up 10% of total sales, showing a growth of 18% compared to the previous year.
For Nvidia’s most crucial products, businesses and organisations seeking its AI chips must navigate a thorough quoting and sales process, typically involving a computer-equipment company such as Dell or HPE. Those vendors offer comprehensive systems that include memory, a central processor, and other necessary components. Even professionals who wish to train AI models are more inclined to utilise Nvidia access through a cloud provider rather than constructing their own server clusters.
However, Nvidia’s level of brand awareness is growing at a rapid pace. Nvidia has become the top choice among retail investors, as revealed by recent data collected and published by Vanda Research.
According to Silverman, the firm’s brand awareness has quadrupled in the past 12 months, which will be beneficial for future rankings, even though it didn’t make Interbrand’s top 100 list for 2023.
Perhaps by then, individuals will have learned how to pronounce its name, a subject that has sparked discussions on niche gaming forums. The company pronounces it en-VID-ia.
Source : CNBC News
