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Nvidia and TSMC Lead AI Chip Market
Nvidia (NASDAQ: NVDA) maintains over 90% market share in the GPU data center space, positioning it at the forefront of the AI infrastructure boom, as data center capital expenditures are projected to reach $4 trillion by 2030. The company, while facing competition from custom AI ASICs, continues to leverage its CUDA software platform to capture a significant share of the market.
Taiwan Semiconductor Manufacturing (NYSE: TSM), the largest semiconductor contract manufacturer, is also benefitting significantly from the escalating demand for chips, with 60% of its revenue coming from chips at 5nm nodes or below. TSMC is expanding its manufacturing capacity aggressively, introducing 2nm node technology, with expectations of raising prices next year.
Both Nvidia and TSMC are seen as attractively valued investments; Nvidia is trading at a forward price-to-earnings (P/E) ratio of under 24.5 times, and TSMC at 24 times, making them appealing for investors amid the ongoing AI infrastructure growth.
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