Stock Charts Showdown: NVIDIA against Cypress Semiconductor

Both NVIDIA and Cypress Semiconductor as a tech company enjoy various fortunes within its sector. Both have its part in the developing world of technology. NVIDIA embrace its high stock market attention credits to its leading graphics cards and its developing technology. For instance, artificial intelligence (AI), in which differs them from other tech companies approach on the never-ending development on technology.

NVIDIA is popular for its graphics cards mainly use in PC gaming, AI applications, and self-driving vehicle. Meanwhile, Cypress Semiconductors supply’s connectivity chips which mainly used in various applications. That includes consumer, industrial, automotive, and others alike. NVIDIA under Nasdaq obviously dominates against Cypress. In fact, it managed to generate significant growth in a longer timeframe as compared with Cypress.

However, in recent quarter charts, NVIDIA caught up into trouble. Mainly because of the slowing demands on its graphics processing units (GPUs). Meanwhile, looking at Cypress management, it’s in a steady state even with undecided semiconductor demand situation. Does this turn around indicate Cypress is a better bet against NVIDIA?

Cypress Steady growth

What does Cypress do in keeping its steady profit? Have you heard of the term Cypress 3.0 strategy? That mainly was one of the company’s secrets. Cypress goes after semiconductor niches with fast pace growth, quicker than the whole industry. As this strategy fails to bring Cypress on a remarkable growth as NVIDIA does, it does secure a higher profit for the company.

Explaining further, since 2016 Cypress implements its 3.0 strategy. As a result, it brought the company’s gross margin to 1,080 basis points. In addition, the company holds on to its aim, touching 50% gross margin level within a long run compared to its preceding quarter report at about 47.8%.

The company’s margin gains brought it to an early move towards the market. Additionally, its solid growth capability could enable the company to sell its premium chips. That includes the company’s control on about a third of the burgeoning USB-c market with its built a relationship with the top PC manufacturers. Currently, demands on USB-C chips expect to increase soon to reach around 5 billion units by 2021.

Cypress is getting in the right path gaining attention within profitable markets. Soon it could get its best strategic growth and improve its end-market environment.

NVIDIA

The company’s downfall is quite notable. It is believed to continue declining with a lot of tough times. Last quarter, the company’s revenue went down by 24%. Moreover, its net income went to half decline. GPU specialist expects a 31% annual revenue drop in the current fiscal quarter.

Meanwhile, NVIDIA estimated to have no revenue growth for the whole year. That indicates a possible depletion on its graphics card market share. There is a high possibility for it to occur as AMD now looks forward at a technology lead on NVIDIA within the GPU space with its powerful graphics card offering with a competitive amount.

Subsequently, AMD is on its way on refreshing its whole GPU line-up. Those will be based on the advance 7-nanometer manufacturing process. As a result, it could provide AMD a one-year product lead against NVIDIA as 7nm cards estimated to launch in 2020.