2023-08-23 22:43:27
The market expected a lot from Nvidia, and the American processor giant had set the bar high itself, but its second quarter results still far exceeded all expectations, showing the importance of investments in artificial intelligence (AI ).
For the period from May to July, the Californian group doubled its turnover over one year, to 13.5 billion dollars. It generated 6.2 billion in net profit, or 843% more than last year at the same period.
“The godfather of AI (…) has pulled off a masterstroke,” immediately reacted Wedbush analyst Dan Ives.
“The entire tech industry and market has been waiting for Nvidia, as it is the purest and most accurate barometer of AI demand,” he added.
On Wall Street, the title of Nvidia took nearly 10% during electronic trading following the close of trading.
Since the start of the year, its stock has swelled by 200% and the company has entered the very closed circle of companies worth more than a trillion dollars on the stock market (including Apple, Microsoft, Amazon and Alphabet).
Nvidia boss Jensen Huang hailed “record” results on Wednesday, due to “enormous demand” for the platforms and semiconductors designed by his company.
“The data centers installed around the world are now worth regarding a trillion dollars. And they are all in the process of moving to generative AI”, the latest generation of this technology, and faster advanced processors, he said. -he rocks.
Nvidia’s sales to cloud companies topped $10 billion in the past quarter, a 171% year-on-year jump.
– “Epoustouflants” –
Dan Ives compared the AI-driven disruption to the emergence of the internet in 1995, “because this wave of spending is expected to, by our conservative estimates, result in an $800 billion increase in spending by businesses and consumers over the next decade.
Nvidia’s “stunning” numbers prove “this is NOT a hype cycle, it’s a real transformation,” he said.
For the current quarter, the company forecasts approximately $16 billion in revenue, a figure also beyond expectations.
The American group is first known for its graphics processors (the “GPUs”), which notably allow you to play high-resolution video games or make videoconferences.
But the craze for so-called generative AI has created enormous needs for these cutting-edge components since the beginning of the year.
Nvidia’s flagship product, the H100, is by far the most popular in the industry and is worth tens of thousands of dollars each.
It allows technology giants to launch programs capable of creating text, music, images or video without human intervention, in response to a request in common language, like ChatGPT.
According to research firm TrendForce, this interface requires around 30,000 graphics processing units (GPUs) to operate.
“Virtually any industry can benefit from generative AI,” said Jensen Huang, referring in particular to virtual assistants who help or will help engineers code, consumers choose products, students do their homework, etc.
“These assistants will create opportunities in the order of hundreds of billions of dollars for our customers,” he insisted.
– Chine –
The production of the overwhelming majority of semiconductors used for driving artificial intelligence models in the world depends on two companies, Nvidia for the design, and the Taiwanese TSMC for the manufacturing.
And this industry is considered a national security issue by some governments.
The United States is thus seeking to reduce its dependence on the main producers, by supporting American manufacturers such as Intel.
Washington has also imposed restrictions on exports of high-end chips to China, which has restricted exports of certain metals needed to produce semiconductors.
“The current (American) laws are having the desired effect,” said Jensen Huang, who co-founded Nvidia thirty years ago.
But he warned that if the government ever decided to ban the sale of data center GPUs to China, it would mean “a lost opportunity for American industry to compete and lead in one of the world’s largest markets. of the world”.
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