AI Chip Stocks to Watch: Nvidia, AMD, and Intel in the $3 Trillion Opportunity

Big Tech's $4 trillion AI spending spree is expected to drive growth for chipmakers, with Nvidia, AMD, and other companies set to benefit. Nvidia has a strong position in the market with its GPUs and networking portfolio, while AMD has won significant business in the inference market and is working with others to build an open interconnect standard to rival Nvidia's NVLink.

Big Tech's aggressive spending on artificial intelligence (AI) is expected to boost growth for chipmakers, with Nvidia, AMD, and other companies poised to benefit significantly. The AI market is projected to reach $190.61 billion by 2025, with a compound annual growth rate (CAGR) of 33.6% [1]. This surge in spending is anticipated to drive demand for high-performance computing (HPC) and AI hardware.

Nvidia, a market leader in AI computing hardware, is well-positioned to capitalize on this growth. With its robust portfolio of GPUs and networking solutions, Nvidia has a strong foothold in the AI market. The company's data center and AI sales grew by 21% year-over-year in the second quarter of 2025, driven by increased demand for AI workloads [1].

AMD, on the other hand, has been making significant strides in the inference market and is working on an open interconnect standard to rival Nvidia's NVLink. Truist Securities recently upgraded AMD to a "Buy" rating, citing elevated data center and AI demand, and increased its price target to $213 from $173 [2]. AMD's MI355 GPU, launched earlier this summer, is expected to serve as a growth driver in the quarters ahead. Additionally, AMD is partnering with IBM to develop next-generation computing architectures based on quantum-centric supercomputing, aiming to scale AI workloads efficiently [2].

Other chipmakers are also benefiting from the AI spending spree. Alibaba, for instance, has expanded its AI capabilities with a next-gen inference chip, which it offers through its cloud platform rather than direct sales. This chip-as-a-service model allows enterprises to rent processing power, reflecting a broader industry trend in China. Alibaba's latest release is part of a larger domestic movement to ensure supply chain resilience and maintain competitiveness in AI deployment [3].

In conclusion, the AI spending spree by Big Tech companies is expected to drive significant growth for chipmakers. Nvidia and AMD are particularly well-positioned to benefit from this trend, with Nvidia's strong market position and AMD's growing presence in the inference market. Other players, such as Alibaba, are also contributing to the growth of the AI chip market.

References:
[1] https://coincentral.com/abu-dhabis-g42-eyes-amd-qualcomm-to-diversify-beyond-nvidia-for-ai-campus/
[2] https://seekingalpha.com/news/4489151-amd-upgraded-to-buy-as-it-attempts-to-chip-into-nvidias-data-center-ai-market-share-truist
[3] https://coolest-gadgets.com/alibaba-expands-ai-capabilities-with-next-gen-inference-chip/