Nvidia drops, AMD rises, could the culprit be Arista Networks?

On Friday, the stock price movements of Nvidia and AMD diverged, as the CEO of Arista Networks previously stated during the earnings call that the company is seeing some deployments shifting toward AMD.

Nvidia’s stock price fell nearly 3% during Friday’s trading, while AMD rose close to 1%.

During the Thursday night earnings call, when asked by an analyst about the company’s collaboration with AMD, Arista CEO Ullal said, “A year ago, basically 99% was Nvidia, right? And today, when we look at deployments, about 20%, or even slightly higher, around 20 to 25% of projects, AMD is becoming the preferred accelerator.”

Analysis indicates that although the price fluctuations of Nvidia and AMD are not huge, Ullal’s comments are significant. Since the launch of ChatGPT by OpenAI over three years ago, the AI industry has taken off, with Nvidia dominating the AI GPU market.

Currently, Nvidia holds about 90% of the AI chip market share, with potential challengers including AMD and Google. Google’s TPU is also gaining increasing adoption. Nvidia is currently the most valuable company in the US, with a market capitalization exceeding $4.5 trillion. AMD’s market cap is about $335 billion.

Arista’s role in the wave of AI infrastructure is primarily providing Ethernet switching technology for connecting high-performance chips. AMD announced a partnership with Arista at the end of last year to build customized AI clusters for training and inference.

For Arista, its deployment diversification is largely driven by necessity:

Nvidia has reduced its reliance on Arista technology by building its own networking solutions to connect its powerful GPUs. In October last year, Nvidia announced that Meta and Oracle would adopt Nvidia’s networking technology within their ecosystems. This news caused Arista’s stock to drop 10% within two days.

Some analysts commented, “This isn’t the end of the world, but clearly, it would be more advantageous if Nvidia incorporated Arista into its design ecosystem, and now they are to some extent being phased out, even if not completely excluded.”

Nvidia launched its Spectrum-X Ethernet platform in 2023. Over the following year, Arista’s market value shrank by more than half at one point. The stock rebounded last year, rising 19%, and has increased 6% since 2026.

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