Max A. Cerny and Stephen Nellis
SAN JOSE, California (Reuters) – Nvidia (NASDAQ:) CEO Jensen Huang kicked off his company’s annual developer conference on Monday with a slew of announcements aimed at maintaining the chipmaker’s dominant position in the artificial intelligence industry.
At a hockey arena in the heart of Silicon Valley, Huang unveiled Nvidia’s latest chip, which is 30 times faster than its predecessor in some tasks.
He also detailed a new set of software tools that will help developers more easily sell artificial intelligence models to companies using Nvidia technology, whose clients include most of the world’s largest tech companies.
Nvidia’s announcement of chips and software at GTC 2024 will help determine whether the company can maintain its 80% share of the artificial intelligence chip market.
“I hope you understand this is not a concert,” Huang said, donning his signature leather jacket and joking that the day’s keynote would be full of heavy math and science.
It was a nod to how Nvidia, once a household name among computer game enthusiasts, has earned recognition alongside tech giants like Microsoft (NASDAQ:) and has become a prominent figure on Wall Street, with sales more than doubling in the last fiscal year. will exceed $60 billion.
Nvidia’s new flagship chip, called the B200, takes two squares of silicon the size of the company’s previous offering and combines them into a single component.
While the B200 “Blackwell” chip is 30 times faster at tasks like responding to chatbots, Huang didn’t provide specific details on how well it performs at processing massive amounts of data to train those chatbots—which is exactly what it does. the kind of work that has fueled much of Nvidia’s meteoric sales growth. He also did not provide pricing details.
Overall, Huang’s statements failed to provide new fuel for a rally that has seen Nvidia shares rise 240% over the past 12 months, making it the third-largest company in the US stock market, behind only Microsoft and Apple (NASDAQ:). Nvidia shares fell 1.4% in extended trading, while shares of Super Micro Computer (NASDAQ:), which makes artificial intelligence-optimized servers powered by Nvidia chips, fell 4%. Shares of Advanced Micro Devices (NASDAQ:) fell nearly 3% during the speech.
Tom Plumb, CEO and portfolio manager of Plumb Funds, whose largest stake is Nvidia, said the Blackwell chip was not a surprise.
“But it confirms that this company is still at the forefront and the leader in all GPUs. That doesn’t mean the market won’t be big enough for AMD and others to enter. But it shows that their lead is pretty compelling,” Plumb said.
Nvidia said major customers including Amazon.com (NASDAQ:), Google Alphabet (NASDAQ:), Microsoft, OpenAI and Oracle (NYSE:) are expected to use the new chip in the cloud computing services they sell, and also for your own AI suggestions.
Nvidia is also shifting from selling individual chips to selling complete systems. Its latest iteration houses 72 artificial intelligence chips and 36 central processing units. In total, it consists of 600,000 parts and weighs 3,000 pounds (1,361 kg).
Many analysts expect Nvidia’s market share to decline by several percentage points in 2024 as new products from competitors enter the market and Nvidia’s largest customers make their own chips.
“Competitors like AMD, Intel (NASDAQ:), startups and even big tech’s own ambitions are threatening to eat into Nvidia’s market share, especially among cost-conscious enterprise customers,” said Insider Intelligence analyst Jason Bourne.
While Nvidia is widely known for its hardware offerings, the company has also created a significant suite of software products.
New software tools called microservices improve system efficiency across a wide range of applications, making it easier for businesses to incorporate an artificial intelligence model into their operations, just as a good computer operating system can help applications perform well.
In addition to artificial intelligence software, Nvidia has delved into software to emulate the physical world using 3D models. For work on automotive, aircraft and product design, Huang also announced partnerships with design software companies Ansys (NASDAQ:), Cadence and Synopsys (NASDAQ:). Shares of the three companies jumped about 3% in extended trading after Huang’s comments.
Huang also said Nvidia software will be able to stream 3D worlds to Apple’s new Vision Pro headset.
Nvidia also unveiled a new line of chips aimed at cars, with new capabilities to run chatbots inside the car. The company deepened its already extensive relationships with Chinese automakers, saying electric vehicle makers BYD (SZ:) and Xpeng (NYSE:) will use its new chips.
Towards the end of his keynote, Huang also introduced a new series of chips for creating humanoid robots, inviting several robots created using these chips to join him on stage.