‘Demand is just so strong’: Nvidia CEO Jensen Huang tells Yahoo Finance supply can’t keep up

‘Demand is just so strong’: Nvidia CEO Jensen Huang tells Yahoo Finance supply can’t keep up

NVIDIA (NVDA) CEO Jensen Huang has no shortage of demand. What it lacks is supply.

In an exclusive interview with Yahoo Finance following the company’s first quarter earnings report on WednesdayHuang pushed back on concerns that the company could face a lull in demand as it transitions from its current to the next generation of AI chips.

“People want to deploy these data centers right now,” Huang said. “They want to get our (graphics processing units) running right now and start making money and saving money. And so this demand is so strong.”

Nvidia is moving from its current Hopper AI platform to its more advanced Blackwell system. Before the company’s earnings release Wednesday, some Wall Street analysts had wondered whether some customers would be more cautious with Hopper orders ahead of new Blackwell units later this year.

“Demand for hoppers has increased throughout this quarter – after the Blackwell announcement – ​​and so that tells you how big the demand is,” Huang said.

Huang added that demand for both platforms will outstrip supply until next year, with the complexity of these chips also testing the company’s efforts to keep pace.

“Every component, every part of our data center is the most complex computer ever built in the world,” Huang said. “So it makes sense that almost everything is constrained.”

For the first quarter, Nvidia reported results that beat Wall Street forecasts, with adjusted earnings per share reaching $6.12 on revenue of $26 billion, a jump of 461% and 262% by compared to the previous year, respectively. Non-GAAP operating income was $18.1 billion in the first quarter.

‘Demand is just so strong’: Nvidia CEO Jensen Huang tells Yahoo Finance supply can’t keep up

Nvidia’s quarterly results beat expectations again on Wednesday. (Source: company files)

For the current quarter, Nvidia expects revenue to reach $28 billion, plus or minus 2%. This is better than the $26.6 billion expected by analysts.

The company also announced a 10-for-1 stock split – in which shareholders will receive 10 shares for every share of the company they currently own – which will take effect on June 10 for shareholders starting June 7. June.

Nvidia too joined its Big Tech peers by increasing its quarterly dividend, with shareholders now expected to receive a dividend of $0.10 per share, up from $0.04.

Nvidia shares rose 6% in extended trading on Wednesday.

FILE - Nvidia CEO Jensen Huangs speaks at the company's office in Santa Clara, Calif., April 16, 2024. Nvidia reports earnings on Wednesday, May 22, 2024. (AP Photo/Jeff Chiu, File)FILE - Nvidia CEO Jensen Huangs speaks at the company's office in Santa Clara, Calif., April 16, 2024. Nvidia reports earnings on Wednesday, May 22, 2024. (AP Photo/Jeff Chiu, File)

Nvidia CEO Jensen Huangs speaks at the company’s office in Santa Clara, California, April 16, 2024. (AP Photo/Jeff Chiu, File) (ASSOCIATED PRESS)

Huang also explained how Nvidia will manage the transition from AI training, in which companies train AI models, to AI inference, where those same companies deploy models for customers to use.

Questions swirl around whether large-scale cloud providers like Microsoft (MSFT), Google (GOOG, GOOGLE) and Amazon (AMZN) would abandon Nvidia’s chips for inference in favor of their own offerings.

But Huang sees Nvidia’s offerings as equally powerful for inference as they are for training.

“We’re in a great position in the inference space, because inference is a very complicated problem,” he said.

“The software stack is complicated. The type of models people use are complicated. Today the vast majority of inference is done on Nvidia. And we hope that continues.”

The CEO also discussed the growth the company is seeing in its sales to customers other than major cloud service providers like Amazon, Microsoft and Google, saying companies ranging from Meta (META) and Tesla (TSLA) to pharmaceutical companies are buying more and more Nvidia chips. In fact, it’s the largest industry using Nvidia’s data center chip, excluding cloud companies. is automobile.

“Tesla is far ahead in self-driving cars,” Huang said. “But every car, one day, we will have to have autonomous capability.”

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