The three mid-level Silicon Valley engineers behind Nvidia had only $40,000 ($31,500) when the company was founded. pounds sterling) for two. decades ago, fueled by the belief that 3D graphics would change the rapidly growing video game industry.
Nvidia's microprocessor can only be bought for the same amount now, and the company can't produce enough of them . .
The artificial intelligence (AI) boom has made Nvidia arguably the most important tech company in the world, and is valued at over $1.2 trillion.
The latest upswing came on Wednesday evening when the company reported that quarterly profit rose a staggering 843% in just a year, from $656 million to $6.2 billion.
2508 set record revenue
Data center sales, reflecting demand for its top AI chips, rose 141% in just three months, surpassing even Wall Street's high expectations.
The best news for investors was that the company predicted a party. will continue, predicting a new surge in sales in the third quarter of this year.
Already all-time high stocks are up 6.5% since markets opened on Thursday, and for some, the only question is how high they can go.
The latest rally fixed. Nvidia's place as the world's leading technology giant.
Stocks skyrocketed by 2508
Jensen Huang, CEO and chief founder of Nvidia, has always had big ambitions.
The company decided to focus on video games in the 1990s when Huang noticed the demand for increasingly advanced computer graphics and predicted the need for significantly more powerful chips as games moved towards more immersive and 3D worlds.
When Nvidia's share price hit $100, Juan got the company's logo tattooed on his arm.
But even he couldn't see the artificial intelligence hype that boosted his personal fortune to 42 billion dollars.
NVIDIA's work on computer graphics in the 1990s led to the invention of the graphics processing unit (GPU), a type of microchip designed for computer gaming and video tasks.
However, GPUs also excel at other types of number processing.
Nvidia flourished during the cryptocurrency boom in 2017 and 2021 as its processors proved to be highly efficient in high performance computing. powerful mathematics required to mint new bitcoins.
It also sparked a short-term buzz around the “metaverse,” the virtual reality championed by Mark Zuckerberg.
But the boom in artificial intelligence has overshadowed all of that.
Large language models like ChatGPT and Google Bard require thousands of GPUs for both initial «training» and subsequent interactions, known as inferences.
Almost every company and government is struggling to invest in AI.
Amazon, Microsoft and Google, which operate giant cloud computing data centers that typically run AI models, are placing billions of dollars of orders with Nvidia.
The $2,508 trillion club
To some extent, Huang is lucky that he got lucky. Video game chips are such a good fit for AI, but its allies dismiss suggestions that it just stumbled upon a pot of gold.
“He was one of the first people to think about it (AI) and study it,” says the former Nvidia executive.
“Jensen had big ears, he listened to what was going on, he experimented and invested in how they could tweak these GPUs so they could handle these things better.
“Around 2018, he made the decision to bet heavily on artificial intelligence.”
Today, the company has competition from chip giants AMD and Intel, but it has a huge advantage. So much so that Nvidia is now practically synonymous with AI itself.
The company's results on Wednesday were seen as definitive, as they suggested the jump in sales was not just a one-off, but part of a steady surge in sales. investments.
Huang said that there is now a «tipping point» where companies are directing most of their investments into artificial intelligence technologies. “A new computer age has begun,” he said. «Our demand is huge.»
However, not everyone buys what Juan sells. There are fears that the general public's interest in ChatGPT is starting to wane.
Analysis of web traffic data shows that the number of visitors to the ChatGPT OpenAI website decreased by 10% in June.
While the ChatGPT boom was due to companies snapping up batches of Nvidia chips, companies like Meta now support AI algorithms that require less processing power.
Meanwhile, some investors have decided that Nvidia's soaring stock price makes it possible. unpleasant.
One investment firm, AXS Investments, even launched a fund designed to short Nvidia, betting that its stock would fall. So far, investors have invested $100 million in the fund.
The high demand for the company's processors in China may also be reduced due to US sanctions. The White House has already blocked a sale to Beijing of some of its most powerful AI chips and could go further.
Greg Bassuk, chief executive of AXS Investments, says Nvidia's valuation is «suspicious to some investors concerned about the geopolitical impact on the outlook company growth.»
He adds that investors are now looking to see if the company can «maintain runaway AI growth at this rate.»
However, short sellers are taking big losses this year, analysts say S3 Partners, Nvidia's share price will drop and drop more than $11 billion.
«Nvidia hardware has become indispensable to the AI-driven economy,» said Jacob Bourne, analyst at Insider Intelligence. “The results show how important the tech giant is to the current economic growth, based on the prospect that AI will boost productivity and unlock trillions in economic benefits.”
If Nvidia can secure some of those trillions, it might be unstoppable .
Свежие комментарии