Nvidia’s growth depends on success of the Chromebook
Nvidia's innovative product launches indicate a bright future (Part 13 of 15)
Chromebooks are growing at a rapid pace
In 2011, Samsung and Acer together launched the low-cost, cloud-based Chromebook that runs Google’s (GOOGL) operating system. In 2Q14, Chromebooks achieved a sequential shipment growth of over 60% with Acer accounting for 37% of these shipments.
According to Gartner estimates, 5.2 million Chromebook units were sold in 2014, an 80% increase over the 2.9 million Chromebooks sold in 2013. Analysts predict that Chromebook sales will triple to 14.4 million by 2017.
Leaders in the Chromebook market
As the above chart shows, in 2013, Samsung led the Chromebook market with a market share of ~65%. Samsung is followed by Acer and HP, which command ~21.4% and ~6.8% of the market share, respectively. Lenovo and Dell are other leading players in this market.
Samsung benefited from the first mover advantage, while Acer uses cheaper Intel Corporation (INTC) chips instead of ARM-based chips to target price-sensitive customers.
Acer also holds the distinction of being the first company to launch Nvidia’s (NVDA) Tegra K1-controlled Chromebook in August 2014. According to Digitimes, Acer, Samsung and HP (HPQ) together account for over 70% of the Chromebook market, in which 80% of the shipments are directed towards the education market.
You can consider investing in the Market Vectors Semiconductor ETF (SMH) to gain exposure to Nvidia. The company makes up about 1.94% of this ETF.
We’ll see in the later part of the series how Acer has surpassed Samsung in the Chromebook market.
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