Semiconductor & Technology Specialist, Ingenuity

William Keating

Semiconductor & Technology Specialist

Ingenuity

Our focus is exclusively on in-depth research & consulting in the broader semiconductor industry. We focus on the key players, namely Intel, Micron, Qualcomm, Apple, Samsung, NVIDIA, AMD, TSMC & Global Foundries - as well as some of the lesser known, but nonetheless critical, companies such as ASML (for EUV), Mellanox, Cavium, Xilinx etc. We specialise in their products, roadmaps, process technologies, competitive advantages & threats etc. We also help our clients understand the implications of new and emerging technologies, e.g. 3D X-Point, 3D NAND, Carbon Nanotubes, Autonomous Driving, Graphene, Silicon Photonics, Wafer-Level Optics, Artificial Intelligence, FPGA, GPU, ASIC etc. 

Semiconductor Analysis & Research

Equity Bottom-Up

On March 11'th 2019, <a href="https://www.smartkarma.com/entities/5891" target="_blank" data-smartkarma-citation="entities:5891:1">Nvidia</a> announced the acquisition of market leading high-speed interconnect company <a href="https://www.smartkarma.com/entities/27424" target="_blank" data-smartkarma-citation="entities:27424:1">Mellanox</a> for $6.9 billion in an all-cash deal. At first blush, the benefits touted by both companies and accepted by most commentators make sense and the deal will be immediately accretive to both EPS and revenues upon closing according to NVIDIA. However, the clear and present threat to NVIDIA's future success has little to do with interconnect technologies. Rather, it is the competitive challenge to their GPU solutions for data center acceleration from a broad spectrum of alternatives from the likes of <a href="https://www.smartkarma.com/entities/11369" target="_blank" data-smartkarma-citation="entities:11369:1">Alphabet</a>, <a href="https://www.smartkarma.com/entities/179" target="_blank" data-smartkarma-citation="entities:179:1">Baidu</a>, <a href="https://www.smartkarma.com/entities/16764" target="_blank" data-smartkarma-citation="entities:16764:1">Intel</a>, <a href="https://www.smartkarma.com/entities/11600" target="_blank" data-smartkarma-citation="entities:11600:1">Xilinx</a>, <a href="https://www.smartkarma.com/entities/19009" target="_blank" data-smartkarma-citation="entities:19009:1">Advanced Micro Devices </a>etc, not to mention the host of custom-ASIC accelerator startups poised to launch their products this year. The acquisition of Mellanox will do nothing to address this situation and we see it as being a distraction from where the company really needs to be focusing.It will serve one purpose though, as a BandAid to mask the otherwise inevitable decline in its data center revenue growth in the face of ever-increasing competition.

On March 11'th 2019, Nvidia announced the acquisition of market leading high-speed interconnect company Mellanox for $6.9 billion in an all-cash deal. At first blush, the benefits touted by both companies and accepted by most commentators make sense and the deal will be immediately accretive to both EPS and revenues upon closing according to NVIDIA. However, the clear and present threat to NVIDIA's future success has little to do with interconnect technologies. Rather, it is the competitive challenge to their GPU solutions for data center acceleration from a broad spectrum of alternatives from the likes of Alphabet, Baidu, Intel, Xilinx, Advanced Micro Devices etc, not to mention the host of custom-ASIC accelerator startups poised to launch their products this year. The acquisition of Mellanox will do nothing to address this situation and we see it as being a distraction from where the company really needs to be focusing.It will serve one purpose though, as a BandAid to mask the otherwise inevitable decline in its data center revenue growth in the face of ever-increasing competition. 

NVIDIA's $6.9 Billion Mellanox Band-Aid Is A Strategic Misstep

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Mellanox Technologies Ltd. designs and develops semiconductor-based, high-performance interconnect products.  The Company's products facilitate data transmission between servers and storage systems through communications infrastructure equipment.

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Mellanox Technologies (MLNX US)

NVIDIA's $6.9 Billion Mellanox Band-Aid Is A Strategic Misstep

On March 11'th 2019, Nvidia announced the acquisition of market leading high-speed interconnect company Mellanox for $6.9 billion in an all-cash...

William Keating

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