The 2020 edition of the Consumer Electronics Show was the year’s biggest showcase of technology aimed at consumer use. TVs, gaming PCs, 5G smartphones, smart home devices and everything in between was on display.
CES 2020 also set the stage for an epic battle between three chip stocks: Intel (NASDAQ:INTC), Advanced Micro Devices (NASDAQ:AMD) and Nvidia (NASDAQ:NVDA).
Last year saw big developments — especially with a surging AMD — but 2020 will be even more interesting.
Intel (INTC)
Intel has been fighting to hang onto marketshare against a resurgent AMD for PC processors. AMD continued to eat away at desktop sales, but Intel retained a stronger grip on the laptop market.
However, Microsoft (NASDAQ:MSFT) gave Intel a black eye last fall when it announced an AMD processor in its new premium version Surface Laptop 3. Trying to prevent Microsoft’s move from setting the stage for a mass exodus of laptop makers to AMD, Intel introduced new Tiger Lake mobile CPUs at CES. Built on Intel’s 10nm+ process, they include AI acceleration and Intel’s new Xe graphics architecture.
In addition, Intel was showing off a graphics card based on Xe — its first such card in decades. The Intel DG1 is currently available only to developers, but the fact that it exists and was shown to the public suggests a consumer release may be in the cards.
Advanced Micro Devices (AMD)
AMD has continued to eat into Intel’s computer marketshare, and it chose CES 2020 to preview new Ryzen 4000 series mobile processors. These are built on AMD’s 7nm Zen2 architecture and promise significant performance gains over Intel chips.
The company says over 100 systems have already signed up to use the new CPU in 2020, a real blow to Intel. On the graphics front, AMD announced the Radeon RX 5600 XT. Priced at $279, it’s an attempt to win entry-level PC gamers from Nvidia and continues a price war between the companies.
The company also noted wins in the console and streaming gaming launches coming in 2020. AMD processors will be in the new Playstation 5 and Xbox Series X. AMD processors will also power the cloud servers behind Microsoft’s xCloud and Alphabet’s (NASDAQ:GOOG, NASDAQ:GOOGL) Google Stadia streaming video game services.
Nvidia (NVDA)
Nvidia was largely focused on gaming at CES 2020. This included promoting its G-SYNC technology in gaming monitors, and continuing to leverage the real-time ray tracing support in its RTX series video cards.
The company continues to be a player in the autonomous driving space, where it competes against Intel’s Mobileye division. NVDA’s new DRIVE AGX Orion platform was on display, featuring a new Orion system-on-a-chip with seven times the performance of its predecessor.
While not confirmed yet, there were plenty of rumors about the Switch Pro. The new, more powerful, Nintendo mobile console is rumored for a 2020 launch to take on the PS5 and Xbox Series X. Nvidia Tegra chips power the current Switch consoles, so it’s a no-brainer that Nvidia would be in the Switch Pro as well. Based on the success of the original and the follow-up Switch Lite, that could move a lot of Tegra chips for the company in 2020.
Could There Be 3-Way Skirmish Between Chip Stocks?
In many of the scenarios, two of these companies have been squaring off for domination in an industry segment. AMD is fighting to take graphics card market share from Nvidia. AMD is also trying to eat away at Intel’s domination of the PC processor market.
However, we are poised for a year where all three could increasingly be coming into competition. Intel’s GPU ambitions set the stage for two fights in particular.
Advanced Micro Devices is already trying to gain a foothold in the AI data center market against Nvidia. Intel’s new graphics platform better positions it to be in that fight, where GPU-powered parallel computing dominates. And while AMD and Nvidia continue their battle for marketshare for PC graphics cards, Intel could commercialize a graphics card of its own and sell it to consumers. That would put it in direct competition with Nvidia and AMD on that front as well.
Of these three chip stocks, AMD performed the best last year, notching an impressive 157% growth on the year. Nvidia also did very well, moving the bar 76%. Intel trailed at 28%.
Keep an eye on the competition between these three companies, because the outcome of their efforts on various fronts will have a very real impact on the finishing order in 2020.
As of this writing, Brad Moon did not hold a position in any of the aforementioned securities.
