Forget Nvidia: Morgan Stanley says Intel’s much-hyped AI chips will boost 3 stocks globally

The world’s three largest semiconductor companies are expected to benefit from the launch of Intel’s latest artificial intelligence chip, Morgan Stanley said. Intel launched Gaudi 3, its third-generation artificial intelligence accelerator, earlier this month. The semiconductor giant says the latest chip is twice as energy efficient as Nvidia’s H100 GPU, the current leader in the AI ​​chip market, and can run AI models one and a half times faster. Intel says high demand for AI chips means major OEMs such as Dell, HP, Lenovo, AMD and others have already announced Gaudi 3 adoption. Supply constraints in the past have meant that Intel has struggled to convert backlog orders into production capacity. The sale has been confirmed, but Morgan Stanley believes the issues will be resolved in the second half of 2024. Taiwanese companies TSMC, Semiconductor Electronics and Wistron Technologies could be the biggest beneficiaries of demand for Intel’s Gaudy chips, the Wall Street bank said in a research note on Monday. Shares of all three companies also trade in the US. Gaudi 3 chip manufacturing will be done by TSMC using its latest generation 5nm process, while Sechim Electronics is expected to be a major beneficiary of the semiconductor supply chain by providing design services for Gaudi 2 and Gaudi 3. Wistron is expected to be a major beneficiary of the semiconductor supply chain. Become a major skirting board supplier. “According to our supply chain inspection, if TSMC can deliver sufficient CoWoS capabilities, the total Gaudy shipment (including 2 and 3) in 2025 could be as high as 300-400,000 units ($2-3 billion for Intel’s revenue)),” Morgan Charlie Chan Lead Stanley analysts said in a note to clients on April 22. The investment bank’s forecast is based on its survey of the semiconductor supply chain and indicates that other major cloud companies such as Amazon, Microsoft and Google are also interested in adopting Gowdy chips. In the report, Morgan Stanley reiterated its overweight ratings on SMIC Electronics and TSMC, believing them to be long-term winners in AI semiconductor demand. Analysts overweight Wistron, noting that Nvidia’s new Blackwell GB200 AI chip will drive immediate growth for the Taiwanese electronics maker. —CNBC’s Michael Bloom contributed reporting.