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Nvidia has far more room to absorb falling margins than AMD, according to a Yahoo Finance analysis comparing the chipmakers’ latest reported results. The figures put a useful number on the gap: operating margins of 66.2% for Nvidia and 17.3% for AMD.
Why it mattersThe analysis illustrates what a five-percentage-point margin drop would do if revenue stayed flat: Nvidia’s operating income would fall 7.5%, against 29% for AMD. That is a simplified stress test, not a forecast. AMD’s smaller base could also mean faster earnings growth if its margins improve. For AI-chip watchers, the contrast is clear: Nvidia has the stronger cushion today, while AMD’s case depends more heavily on converting growth into profit and cash.
Discuss: Would you favour Nvidia’s proven profit cushion, or AMD’s greater potential for growth if its margins improve?
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