Could it be true that the tech giant is deinvesting in the gaming industry? This is what the company is focusing on today, according to FXMAG Spain

FXMAG UK – NVIDIA’s value is up 100% this year, to $770 billion. The market really liked the company’s focus on artificial intelligence (AI).

• The latest release of the Nvidia (NASDAQ: GeForce RTX4070) graphics card has been greeted by gamers expecting cheaper, more intuitive models.
• Despite the mixed results in the gaming segment, Nvidia remains a leader in the field of artificial intelligence, focusing on the development of generative AI and taking advantage of the growing market for artificial intelligence and machine learning.
• The market evaluates Nvidia’s performance positively, its share has increased by more than 100% this year and 90% in the past 12 months.

Nvidia is an American technology company that, along with Intel (NASDAQ:) and AMD (NASDAQ::), is one of the largest producers of graphics processors (GPUs) and integrated circuits used in the computer industry.

In addition, Nvidia is the largest provider of graphics cards for personal computers (PC) with its GeForce series. In addition, the company places a lot of emphasis on the gaming segment, owns the largest cloud gaming website Nvida GeForce Now, and produces the Nvidia Shield series console designed to support the aforementioned cloud service.

European chip stocks soar thanks to a boost from Nvidia and its AI.twitter.com/v5VSYK5Hpw

– Business tv (@negocios_tv) May 25, 2023

The first graphics card was received by gamers on average

Nvidia’s flagship product, the GeForce series graphics cards, are very popular due to their high computing power. Thanks to this, they have found a wide range of applications among gamers, miners or professionals, especially in the computer graphics industry.

On April 13, the premiere of the latest Nvida GeForce RTX4070 graphics card, intended primarily for gamers, took place, which was finally accepted among them on average. Gamers are waiting for cheaper and more accessible cards to appear on the market that will replace outdated models from the previous generation on the market.

The company decided to discontinue production of the RTX4070 to avoid a buildup of unsold inventory at retailers. This situation could force the outlets to lower the price of the latest graphics card, which could result in reduced revenue. Nvidia intends to continue basing its business model on expensive and hard-to-reach graphics cards. Because of this, Nvidia’s results in the gaming segment after Wednesday’s close should be very mixed.

John Vinh, an analyst at KeyBanc Capital Markets, commented on the situation with the following words: “The disappointing launch of the RTX4070 may lead to a slight decline in the gaming segment, but we hope that investors will not view it pessimistically.”

Artificial intelligence is the new apple of my eye

J Vinh wrote on Sunday that despite weak sales of the RTX4070, “Nvidia remains uniquely positioned to take advantage” of the growing market for artificial intelligence and machine learning. In fact, the company has become one of the technological pioneers of the artificial intelligence revolution, focusing a lot on the development of generative artificial intelligence, which is the biggest technology trend this year. This type of technology allows you to creatively create images, videos, and other content using only text.

At the same time, it gives the impression that Nvidia is investing in the development of this sector at the expense of the once important gaming sector. The company’s CEO, Jensen Huang, will appear on May 29 at the Computex 2023 Taiwanese trade fair. According to press releases so far, the CEO doesn’t plan to touch on the topic of gaming at all … although his last year the speech at this fair was generally based Basic to the game. The main topic of Huang’s speech will be advances in accelerated computing and artificial intelligence.

How does the market value Nvidia shares?

Artificial intelligence development activities have attracted both investors and consumers to Nvidia. Analysts expect the company’s revenue in April to be $6.5 billion, with adjusted earnings per share of 92 cents. Revenue for the current quarter is estimated at $7.2 billion.

The actions taken by Nvidia are positively evaluated by Wall Street analysts. According to FactSet (NYSE:), about 74% of them are rated “buy” or the equivalent. Nvidia shares are up more than 100% this year and 90% in the past 12 months.