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The Parallel-Processing Revolution Continues
Porter's Journal Issue #61, Volume #2
Porter Stansberry
May 28, 2025
Why Nvidia Will Be Vastly Bigger Than Intel
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The computing revolution has only just begun… The world will change more in the next 20 years than it has in the last 2,000… Nvidia reports earnings tonight… There’s a reason it is the most valuable business in the world… Musk is not a fan of One Big Beautiful Bill… |
Table of Contents
They had no idea what they’d built.
On June 8, 1978, Intel (INTC) launched sales of its 8086 microprocessor. This was a 16-bit chip with 29,000 transistors.
At first, it didn’t seem like a big deal. Designed by Stephen P. Morse, the 8086 was meant as a stopgap to improve performance over Intel’s 8080 and 8085 while maintaining compatibility. Morse himself called it a “short-lived” project.
The key innovation was moving from 8-bit architecture to 16-bit architecture. Doesn’t sound like that big of a change, does it? You might guess it led to a 100% increase in computation power. No: it was a 2.5x magnitude improvement in computational power.
You see what “16-bit” means is that the 8086 could process data in 16-bit chunks. Thus, it could address 216 (65,536) memory locations simultaneously. That enabled vastly faster and larger computational functions compared to the previous, 8-bit (28 = 256) architecture.
This wasn’t an incremental improvement. It was a revolution.
What happened next changed the world and created well over $1 trillion in new wealth.
I’m sure you’ll remember how, starting in the 1980s, computing power was harnessed to more and more products that changed our lives forever.
In 1980, Tim Paterson, at Seattle Computer Products, wrote the world’s first operating system – 86-QDOS: Quick and Dirty Operating System for Intel’s 8086. Microsoft licensed it in December 1980 and bought it outright on July 27, 1981, for $50,000, renaming it MS-DOS. Released with the IBM personal computer (“PC”), it became the dominant operating system, cementing Microsoft’s (MSFT) rise. By 1985, Microsoft’s revenues hit $140 million.
On August 12, 1981, IBM launched its first PC. Priced at $1,565, it used an Intel 8088 (a cheaper and slower 8086 variant for its first PC). This standardized computing, spawning a $100 billion industry by 1990.
The Pentium, launched March 22, 1993, was the evolution of the 8086 architecture, with 3.1 million transistors. It powered 90% of PCs by 1995, driving Intel’s market cap to $115 billion by 2000.