AI impact: Nvidia close to becoming the first trillion dollar chip company

Increasing demand for graphics processors (GPUs) produced by Nvidia and powering artificial intelligence applications such as Google, Microsoft and OpenAI has skyrocketed. Nvidia reported that it placed new production orders as it could not meet the demand for artificial intelligence chips. The company targets this year as a “record” period. In light of these strong financial projections, the company’s shares approached a $1 trillion market value.

Nvidia on track to become first trillion dollar chip company

There’s only one thing to be said for the explosion in Nvidia and productive artificial intelligence (AI): everything, everywhere, at the same time.

Nvidia recently announced its financial results for the first quarter. You can reach these explanations and details from the link above. To summarize, Nvidia performed above all expectations, and these future predictions are also very ambitious. Due to these strong statements, Nvidia shares have seen historical record levels ($391) since the beginning of the year.

With this effect, Nvidia proceeded to increase its market value by approximately 210 billion dollars to approximately 970 billion dollars. This rise is also a record. There is no other company that has increased its value so much in one day, the previous record belonged to Apple with 190 billion dollars. So Nvidia is now very close to being the first trillion dollar chip company.

Nvidia, the fifth most valuable company in the US, announced its quarterly revenue on Wednesday 50% above Wall Street estimates and said it will procure more artificial intelligence chips to meet the increase in demand in the second half. CEO Jensen Huang stated that as productive AI is applied to every product and service, $1 trillion worth of existing equipment in data centers will need to be replaced with AI chips.

Nvidia caught the change

In the past, the most important part in a computer or server was the central processor or CPU, and this market was dominated by Intel, while AMD was its main competitor. With the emergence of artificial intelligence applications that require a lot of computing power, the graphics processor (GPU) comes to the fore, and the most advanced systems have eight GPUs to one CPU. Nvidia currently dominates the market for AI GPUs.

According to Huang, data centers and servers are in a state of flux. The CEO states this shift: “Instead of millions of CPUs, you’ll have far fewer CPUs but dependent on millions of GPUs.” For example, Nvidia’s own DGX systems include eight of the company’s high-end H100 GPUs and only two CPUs. is using .

Analysts say Nvidia remains the leader in AI chips due to its proprietary software that makes it easy to use all GPU hardware features for AI applications. This is one reason why Nvidia’s data center business grew 14 percent in the first quarter versus steady growth in AMD’s data center unit and a 39 percent decline in Intel’s Artificial Intelligence and Data Center business unit.