Semiconductors are in a bit of a gully right now. IDC predicted last week that after three consecutive years of growth, the market will decline 7%. Ironically, chip shortages have in part led to slower growth in certain markets. Unsurprisingly, NAND prices have plummeted, and there’s even mention that Intel will see declines in its datacenter business. Earnings in the category have also been mixed, leading equities analysts to downgrade certain companies, if not the entire category. Those who have been more optimistic about the category seemed to pin their hopes on a new trade deal with China. With such hopes fading quickly, it certainly puts a dark cloud over the entire industry.

So, in the short term, some investors may take pause. It’s important to remember that the need for compute, and therefore compute semiconductors, isn’t about to slow down — not with the world’s technology community focused on growth areas like artificial intelligence and analytics, high-performance computing, gaming, autonomous vehicles, delivery drones, and 5G. Most of these technologies are powered by the bigger compute and graphics processing capabilities of Intel, Nvidia, and AMD. These companies will battle hard for market share, and while it’s been a popular sentiment to discount Intel, I believe there are fundamental reasons that in the end, Intel has the best chance of coming out on top.

A stronger portfolio and ecosystem

Take a look at where each of these companies is focused. AMD’s categories of focus include PC, gaming, and datacenter. Nvidia also focuses on PC, gaming, and datacenter, as well as automotive. Of the trio, Intel is by far the most diversified, competing in five categories: compute, storage, autonomous vehicles, network/carrier, and IoT. Intel has also significantly extended its definition of compute to include several new areas, like integrating machine learning into its server compute chips. The company also plans to launch its own discrete consumer-oriented graphics cards by 2020 and discrete Nervana machine learning accelerators yet this year (although conservative estimates might add a year to either plan). The latter is a market where Nvidia dominates, with nearly 99% of the market share. As Intel makes inroads here, AMD and Nvidia stand to lose out.

Based on its current portfolio and near-term roadmap, Intel is set to directly compete in the areas that AMD and Nvidia have historically dominated. And it is likely to capture the training and inference performance-per-watt crown from Nvidia soon with Nervana. Based on Intel’s historic ability to dominate its “big core” compute market categories, its expansion into areas once dominated by others should concern the competition. Nvidia and AMD, meanwhile, have relatively narrow product portfolios. Even in cases where a customer prefers AMD for server chips or Nvidia for discrete GPUs, there’s still a considerable chance Intel will find its way into the mix via its storage or networking products. Intel also brings a platform approach to every market, so it wins even where some piece-parts may not be as competitive.

Better marketing resources and a solid refocus

AMD likes to tout its strengths in server chips, but if it is so good, why does it only have ~3% of the market? (And that 3% share comes despite the fact that Intel had delays launching its 10nm solutions.) While a significant amount of AMD’s server marketing budget seems to go toward negative campaigning against Intel, the company isn’t even halfway to where it sought to be in terms of server market share. At best, AMD has made small gains in the PC market, which is an area that’s only about half as profitable as the server side.

Nvidia has suffered similar setbacks in some of its supposed areas of strength, including the loss of Tesla as one of its marquee autonomous driving customers. Currently, Nvidia’s pivot strategy is to try to compete in the ADAS (Adaptive Driver Assistance Systems) space, which is Intel Mobileye‘s sweet spot and is an area where Qualcomm is also planning to compete. Qualcomm took out most of Nvidia’s cockpit wins, so Nvidia has nowhere to go. And the greatest challenge to Nvidia is that most inference is still done on Intel Xeon CPUs rather than Nvidia silicon, and Intel had Amazon on stage to reinforce this for the second year in a row at its Xeon Scalable launch.

Intel also has the greatest brand equity of the three companies and the deepest pockets for marketing investment, which is one reason the company does so well in markets even if it doesn’t have the “best chip.” Intel’s recent exit from the 5G modem business will allow it to refocus on its datacenter business, which should only make it harder for Nvidia and AMD to defend against market share loss. Even if Intel takes 5% of the discrete GPU and ML accelerator space from Nvidia and AMD, it will be a crushing defeat.

Total available market

Intel’s more diverse portfolio, mentioned above, also means it has a significantly larger total available market. Estimated at more than $330 billion at its analyst day, this market is more than 4x larger than the $74 billion market AMD shows in its current investor deck. Nvidia doesn’t break out its total addressable market (TAM) in its investor presentations as clearly, but it does provide forward-looking market sizing out to 2023 for datacenter and to 2025 for automotive, showing those to be at $50 billion and $30 billion, respectively. That’s a far cry from Intel’s figure. And for anyone who wants to make a big deal out of the exit from 5G modems, the TAM for that business is a mere $10 billion and wasn’t even included in the $330 billion TAM that Intel is currently planning to address. In the end, it really isn’t that hard to see why Intel is the best positioned for growth. Its much larger product portfolio and total addressable market, together with its historic ability to dominate the compute market categories where it focuses, means Intel will be able to take market-dominating positions in its focal categories. And, in the near future, those categories will constitute most, if not all, of the places AMD and Nvidia play.

Graphics aren’t a weakness, but Intel is set to get stronger

It’s perhaps a little-known fact that Intel is actually the #1 market share leader today in PC graphics thanks to its lead in integrated graphics. Intel has historically ceded the discrete PC gaming graphics card market to AMD and Nvidia but is planning a competitive offering. Slated for release in 2020, the Intel Xe family will run the gamut from integrated graphics to discrete client graphics cards to discrete datacenter cards. If Intel delivers strong enough performance against the current competition, it could chip away at the market share Nvidia and AMD currently own. It would be devastating to both if Intel takes just 5% of this market in its first year.

Nanometers apart, and it doesn’t really matter

There’s been a general obsession about processor specs — 7nm, 10nm, 14nm, and so on. But it’s useful to reset expectations on that a bit. All the chip analysts, including us, equate TSMC 10nm with Intel 14nm+. Intel 14nm++ demonstrates superiority on cache cell size and density advantages over TSMC 10nm. Experts also equate TSMC 7nm with Intel 10nm on cache cell size and density. Intel will have 10nm notebooks in Q3 2019, and AMD is talking about having 7nm notebooks in volume in Q1 2020. I’m confident, though, that AMD will not have mass availability for six months or so after the announcement. And if, as expected, TSMC 7nm and Intel 10nm have reasonable parity, then there’s no meaningful advantage either way.

The worst is history

I firmly stand by my assessment and Intel’s strong position going forward. I believe it’s important to take the past 12-24 months at Intel, and the challenges that the company has faced, into consideration. The negativity that has recently surrounded the company is certainly not baseless. The past two years have seen a lot, from an unexpected CEO change to chip shortages to Spectre/Meltdown to delays in its 10nm rollout. Yet all the while, Nvidia and AMD have had these Intel flaws to their advantage but have made only nominal market gains in their wake. This holds especially true in the datacenter, where AMD sought to gain significant ground in server chips but barely made a dent. Now, with the 10nm delays reaching an end and a datacenter product roadmap that directly competes for market share in areas where Intel has never competed before, the company’s prospects are looking up. Going forward, Intel’s much larger, more diverse product portfolio and total addressable market, coupled with its historic ability to dominate the compute market categories where it focuses with a massive marketing budget, means it’s poised to achieve strong market positions in its focal categories. And, in the near future, those categories will constitute most, if not all, of the places AMD and Nvidia play.

Daniel Newman is the principal analyst at Futurum Research, which provides research, analysis, advising, and/or consulting to high-tech companies in the tech and digital industries. The firm doesn’t hold any equity positions with any companies cited.