Alphabet (GOOG), Nvidia (NVDA) & Intel (INTC) – Semiconductor Market News – April 13, 2024
Alphabet’s Chip Announcement
This week, Google announced its latest chipset called Axion. Axion is based on Arm Holdings architecture and is a CPU product. Google has been hard at work on custom chipsets for about a decade, and Axion is the latest result of that work.
Importantly, Axion will be used for general compute (GP) purposes. This isn’t like Amazon’s Trainium and Inferentia chips that will be for high-performance compute (HPC) apps. That makes this new release more of a competitive threat for Intel and AMD than for Nvidia. HPC applications, powered largely by Nvidia’s GPUs today, have unlocked more data center flexibility, utility and potential. But? GP is not going to go away according to Google. Google sees it as “remaining a critical portion of cloud-based workloads” and Axion is meant to claim a piece of that specific market. Axion can greatly help with overall cloud cost optimization; HPC is very expensive and it doesn’t make sense to use it unless you need to.
In the release, Google wrote about GP CPU innovation slowing and falling too far behind HPC. If the gap widens too much, GP becomes a performance and efficiency bottleneck and cannot be effectively utilized. Axion is Google’s strategy for ensuring that the gap doesn’t widen too much, while also creating new revenue opportunities.
Per Google’s internal data, Axion delivers 30% better performance than the next-best Arm-based GPU workloads and 50% better performance than other current generation competition. It’s also 60% more energy efficient than those competitors. Amazon says similar things about its Graviton CPUs. Meta, which delivered more AI semiconductor releases covered the next section, and other chipmakers do too. As these claims are largely internally-derived, take them with a grain of salt.
Axion was built to work seamlessly with Arm’s infrastructure and workloads. This will make it easier for Arm’s “tens of thousands of cloud customers” to deploy their assets in Google Cloud. Early on, CrowdStrike, Datadog and Elastic have been named as early users.
Competition Heating Up
Intel released its latest AI chip called Gaudi 3. It will directly compete with Nvidia’s Hopper, Grace and Blackwell systems. Per Intel, it’s 2x more energy efficient and can run models 50% faster than the Hopper 100 (H1000) GPU. Nvidia has already released two higher-performing chips for these use cases since the H100, but this is still considered a large leap forward for Intel.
