SemiAnalysis, a semiconductor research firm, released a report on November 13th stating that Nvidia's most difficult-to-replicate competitive advantage is not a single chip, but rather its supply chain organization capabilities that integrate GPUs, HBM, advanced packaging, networking equipment, and complete systems. Nvidia itself doesn't own a wafer fab, yet through long-term procurement commitments, securing capacity in advance, and coordinating suppliers, it has expanded its single-product business from approximately $1 billion to $250 billion. SemiAnalysis believes that as Google, Amazon, and AMD expand their AI chip supply, Nvidia's share of HBM and CoWoS advanced packaging capacity has declined and is expected to continue declining in 2027. However, this decline in share doesn't necessarily mean an immediate contraction in profits: due to the continued rapid expansion of the AI infrastructure market, Nvidia's profits are still expected to double next year. The firm compares the current competitive landscape to Apple in 2020: even with pressure on market share, strong supply chain control can still support profitability.
