Intel’s (NASDAQ:INTC) deal with Nvidia (NASDAQ:NVDA) to co-develop PC and data center chips could have major implications for Astera Labs (NASDAQ:ALAB), but it’s unclear exactly what they are at this point, Morgan Stanley said.
“While Intel was not listed on the initial NVLink Fusion press release from earlier this year, we always viewed it as a way for NVIDIA to capture more of the sizeable market that uses x86 CPUs in their servers,” Morgan Stanley analysts wrote in a note to clients. “There is some concern that this extension of NVLink into the x86 domain could replace the traditional PCIe connection between the x86 CPU and NVIDIA GPU, which would impact ALAB given its meaningful PCIe content. However, we would hesitate to draw firm conclusions at this stage.”
While Astera Labs is listed as a partner of NVLink Fusion and could still have content, it’s unclear what the specifics are at this point.
And the Intel-Nvidia collaboration is still a couple of years away. Nevertheless, the seismic shift in the semiconductor market “does speak to the importance of connectivity and the advantages of rack-scale computing,” Morgan Stanley analysts added.
Astera Labs shares fell 2% in premarket trading on Friday.