By Zaheer Kachwala and Stephen Nellis<\/p>\n
May 19 (Reuters) – Nvidia<\/a> is expected to deliver another blockbuster earnings report on Wednesday, but a shift in how artificial intelligence<\/a> is used is raising doubts on how long its dominance in AI chips \u200ccan last.<\/p>\n After years of near-monopoly in chips used to train AI systems, Nvidia is facing competition from tech giants building their \u200cown chips to capture demand that is shifting toward processors that run AI systems, respond to queries and carry out tasks in real time.<\/p>\n This so-called inference market is \u200bmuch larger, but also more contested.<\/p>\n Traditional rivals Intel and AMD\u00a0are pushing processors better suited for the smaller, cost-sensitive workloads that dominate the market.<\/p>\n Meanwhile, Alphabet has emerged as a key challenger, striking deals worth tens of billions of dollars for its custom tensor processing units. Amazon’s chip business, including its Trainium processors, is also gaining ground.<\/p>\n “It’s less so Nvidia versus TPUs, Nvidia versus AMD. I think it’s more: is the Nvidia ecosystem as dominant moving forward, \u200cas some of these new inference workloads start \u2060to proliferate,” said John Belton, portfolio manager at Gabelli Funds, which holds Nvidia shares.<\/p>\n Nvidia’s stock has risen about 19% this year, lagging a two-fold surge in AMD, Intel and Arm, as well as a 27% gain in \u2060Alphabet.<\/p>\n To defend its position, the chipmaker unveiled a new central processor and AI system built on technology from Groq in March, an inference-focused startup it bought.<\/p>\n Those chips are not included in Nvidia’s forecast for $1 trillion in sales from Blackwell and Rubin platforms by 2027 end, leaving investors to closely watch for signs \u200bof \u200ba new growth engine.<\/p>\n