Wall Street’s sleeping on Nvidia, AMD, and Broadcom? A major investment bank says yes

Nvidia, AMD and Broadcom are the most talked about companies in the field of artificial intelligence. JPMorgan believes that even after many major mergers, improvements on Wall Street and trillions of dollars in valuations, investors still don’t understand how much these three businesses are worth.

On a new note, analyst Harlan Sur says the AI ​​revenue potential for these three chip giants is much higher than current estimates, even if targets rise thanks to the significant progress of these companies.

“Simply put, while the year-end street numbers for AVGO, NVDA, and AMD have risen sharply over the past few weeks, there is understandably still some conservatism in the forecasts,” Sur wrote.

As visibility increases and additional capacity deals are announced, we anticipate continued positive revisions to AI revenue estimates.

JPMorgan thinks visibility will emerge as tech companies build next-generation data centers driven by GPUs and XPUs, the hardware needed by all three businesses.

They recently closed major deals with OpenAI and other leading AI companies. It’s what Sur calls the “growing AI pie” and could push Nvidia’s earnings as high as $35 billion per gigawatt; Broadcom and AMD are not far behind this situation.

Nvidia, AMD, and Broadcom are key players fueling the AI ​​data center boom.

AI has already changed what people expect from Nvidia, AMD, and Broadcom. But JPMorgan sees something more fundamental happening: an AI hardware supercycle that hasn’t been fully accounted for even in analysts’ recent upgrades.

More Nvidia:

Power is at the center of everything. Especially the electrical power and cost of new generation data centers. JPMorgan says that every gigawatt of AI computing—equivalent to the amount of electricity needed to run these facilities—earns tens of billions of dollars for the chipmakers who create them.

• Nvidia: $35 billion to $40 billion in revenue per gigawatt can be achieved, especially with the upcoming Rubin and Rubin Ultra platforms.

• AMD: New Helios platform expected to reach $20 billion per gigawatt; Annual revenue from the OpenAI deal alone could top $30 billion.

• Broadcom: Estimated ~$27B per gigawatt with XPUs; Full deployment from OpenAI could mean $70 billion to $90 billion in three years.

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JPMorgan says that although these numbers are high, “there is some conservatism in the estimates.” This is partly because there are still concerns about getting the money and building the infrastructure.