Coursera Learner working on a presentation with Coursera logo and

Nvidia has been the hot topic at AI events leading up to its earnings report

Coursera Learner working on a presentation with Coursera logo and

Last week, OpenAI’s tech chief personally thanked Nvidia’s CEO, Jensen Huang, for providing the necessary advanced chips to run their latest AI model demo. Similarly, at Google’s annual developer conference, Alphabet’s CEO, Sundar Pichai, emphasized their long-standing partnership with Nvidia, announcing plans for Google Cloud to utilize Nvidia’s Blackwell GPUs in early 2025.

This week, Microsoft, a provider of servers to OpenAI, will unveil new AI advancements developed on Nvidia GPUs at its Build conference. As Nvidia gears up for its quarterly earnings report, the company finds itself in a central role in the tech scene, with its market cap surpassing $2 trillion. Analysts predict Nvidia will report over 200% year-over-year revenue growth for the third consecutive quarter, with a projected first-quarter revenue increase of 243%.

Much of Nvidia’s revenue is expected to stem from its data center business, supplying advanced processors to tech giants like Google, Microsoft, Meta, Amazon, and OpenAI. The company’s profitability from its AI products is anticipated to result in a significant increase in net income compared to the previous year. Nvidia’s stock has seen substantial growth, with a 91% increase this year following a tripling in value in 2023.

Industry experts liken Nvidia’s position in the AI market to Cisco’s role during the internet buildout of the 1990s. They anticipate Nvidia experiencing similar growth cycles, with revenue potentially tripling or quadrupling over the next few years. Major tech companies like Google, Amazon, Microsoft, Meta, and Apple are projected to invest heavily in AI infrastructure, with a significant portion directed toward Nvidia chips.

OpenAI relies on Nvidia’s technology for its latest chatbot, GPT-40, while Meta plans to incorporate 350,000 Nvidia GPUs into its computing infrastructure. Despite Nvidia’s historical association with gaming chips, the company signaled a period of unprecedented growth about a year ago, which has since accelerated. However, analysts expect growth to slow starting in the second quarter, with concerns about the longevity of the AI investment cycle and potential market saturation.

Despite potential challenges, Nvidia is expected to retain a dominant share of the AI accelerator market, even as competitors like Google develop their own custom chips. One uncertainty for Nvidia is the transition to its next-generation AI chips, Blackwell, expected to launch later this year. Analysts speculate about a potential pause in purchasing older GPU models as clients await the release of Blackwell-based chips.

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