Tag Archives: amzn

Cisco At Risk As Workloads Shift To Public Cloud, Amazon: JPMorgan

Corporate America may need fatter communications pipes for cloud computing, but the trend toward lower-cost hardware in data centers — including networking gear — doesn’t bode well for Cisco Systems ( CSCO ), says a JPMorgan report. Despite the rise of Amazon.com’s ( AMZN ) Web Services unit and Microsoft ’s ( MSFT ) Azure, money spent on public cloud computing services will account for only 7% of the $215 billion global data center market in 2016, JPMorgan analyst Rod Hall said in a recent note to clients. Hall forecasts that from 2016 to 2020, traditional data center infrastructure spending will fall at a 2% rate annually. The bigger problem for legacy information technology suppliers is that computer workloads are moving at a faster rate to infrastructure-as-a-service, or IaaS, providers, he says. Amazon Web Services is the biggest IaaS provider, through which customers rent computer servers and data storage systems via the Internet. Microsoft is No. 2, with Alphabet ’s ( GOOGL ) Google third. According to a JPMorgan survey of chief information officers, more than 40% of workloads could shift to the public cloud in five years. “A near-tripling of public cloud workloads represents a monumental architectural shift, which shows no signs of abating and is likely to create a major ripple effect across the entire technology landscape,” wrote Hall. “(We) continue to believe it represents material earnings risk for companies like Cisco.” Hall added: “Though companies like Cisco focus on the increased bandwidth required for big data they miss the fact that this inevitably drives companies to want to deploy commodity (data center) solutions faster in our opinion.” Cisco reports fiscal third-quarter earnings on May 18 after the market close.

Tesla Partner Nvidia Speeds To Record High On ‘Superhuman’ AI

Nvidia ‘s ( NVDA ) AI technology with Facebook ( FB ), Alphabet ( GOOGL ) and Microsoft ( MSFT ) is powering “superhuman” levels of inference, or artificial intelligence, Nvidia CEO Jen-Hsun Huang said Thursday, after the Tesla Motors ( TSLA ) partner blasted Q1 views on record deep-learning sales. “The truth is that nobody really knows how big this deep-learning market is going to be,” Huang said on the company’s earnings conference call. He referred specifically to gains that customer Microsoft was making with AI and deep learning. “The work that recently was done at Microsoft Research, they’ve achieved superhuman levels of inferencing … of image recognition and voice recognition that’s really kind of hard to imagine,” he said, “and these networks are now huge.” In midday trading on the stock market today , Nvidia stock was up more than 14% and hit an all-time high at 40.30. Main graphics chip rival  Advanced Micro Devices ( AMD ) was up nearly 3% midday Friday. IBD’s 41-company Electronic Semiconductor-Fabless industry group was up 1.5%. Nvidia late Thursday said its Q1 data center sales, which includes AI, soared 63% year over year to a record $143 million. Nvidia’s chips power IBM ( IBM ) Watson and Facebook’s Big Sur server, Huang said. Amazon.com ( AMZN ), Alibaba ( BABA ), Baidu ( BIDU ) and Twitter ( TWTR ) also use its AI technology. “Twitter has recently said they use Nvidia GPUs (graphics processing units) to help users discover the right content among the millions of images and videos shared every day,” Huang said, adding he can’t imagine a future Internet without deep learning. For Q1, Nvidia reported $1.3 billion in sales and 33 cents earnings per share, up 13% and 38% year over year, respectively. Both metrics topped Wall Street views for $1.26 billion and 32 cents. Nvidia Gaming Gains Seen Ahead Automotive sales grew 43% to $113 million, offsetting weaker growth in Nvidia’s core gaming and professional gaming segments — up a respective 17% to $687 million, and 4% to $189 million. But MKM analyst Ian Ing sees Nvidia’s gaming unit getting a robust refresh in the second-half of the year when it releases its new Pascal GPU, replacing the outmoded Maxwell units. The GPUs will be sold for $699 vs. the Maxwell 980 Ti at $682. “Nvidia continues to be our top pick, given the imminent Pascal gaming refresh and GPUs having unique exposure to a long list of promising applications that are outperforming PCs and smartphone opportunities,” he wrote in a research report. Despite continued headwinds in the PC and smartphone markets, “gaming continues to appear to have macro immunity,” he wrote. Ing reiterated his buy rating on Nvidia stock and boosted his price target to 43 from 39. For the current quarter, Nvidia expects $1.35 billion in sales, plus or minus 2%, up 17% at the midpoint vs. the year-earlier quarter. Rosenblatt analyst Kinngai Chan called the guidance “conservative” despite likely seasonal headwinds and a maturing product line. “We did not see any meaningful market share shifts and continue to see a benign pricing environment,” he wrote in a report.

Apple Is No Longer The Biggest Stock: Why You Should Worry This Time

Loading the player… Apple ( AAPL ) has again lost its crown as the most valuable company, as it plunges to its lowest level in nearly two years. Google owner Alphabet ( GOOGL ) is dropping in the stock market today as well, but it is now the biggest company. The switch comes shortly after Apple posted its first-ever decline in iPhone sales, and as analysts continued to voice concerns over a longer upgrade cycle. The last time Alphabet was able to overtake Apple was a little over two months ago, though it only lasted a few days. But as Apple’s stock becomes more and more technically damaged, it’ll be interesting to see if it can last this time. Apple shares are crumbling 2.6% in huge volume, dropping below the 90 price level intraday to a fresh 23-month low. The stock is now 32% below its all-time high, reached in April 2015. IBD’s Take: How healthy is Apple’s stock and how does it stand up vs. rivals? Find out at IBD Stock Checkup Alphabet is sliding 0.4% in slightly above-average volume. Shares were able to retake the 200-day line last week and are now looking for support near that level. The stock is 10% below its early-February high and 7% below a cup-with-handle buy point of 777.41 that it failed to break out of after issuing disappointing earnings results. Amazon Worth $3 Trillion? And don’t forget to keep an eye on the other big “A” tech stock: Amazon ( AMZN ). The e-commerce giant has a market cap of about $338 billion, compared with Apple’s $493 billion valuation and Alphabet’s nearly $500 billion market cap, but its stock is performing very well. Amazon hit another new all-time high in intraday trade Thursday, with the stock up fractionally at midday. Amazon is extended about 18% past a cup-with-handle buy point it initially cleared shortly before the company’s latest quarterly report. Venture capital firm Social Capital recently gave Amazon a $3 trillion, 10-year valuation. Analysts say Amazon is set to overtake Macy’s ( M ) as the No. 1 U.S. apparel retailer next year. It may also be poised to grab bigger positions in the consumables and food and beverage markets in the next few years. Meanwhile, Facebook ( FB ) has a $342 billion market cap. The social networking giant is very near its recent all-time high as it continues to trade within buy range from a cup-with-handle base that it broke out of on its earnings results. Facebook shares were essentially flat in early afternoon trade.