Nations Building AI Models Fuel Nvidia's Soaring Chip Demand
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On Thu, 29 Aug, 8:04 AM UTC
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[1]
Nations building their own AI models add to Nvidia's growing chip demand
Nvidia's chip demand is surging as nations create AI models in their own languages. This development includes governments aiming to strengthen national security with customized AI models and infrastructure. Countries' movements are expected to significantly contribute to Nvidia's revenue, projecting around low double-digit billions by January 2025.Nations building artificial intelligence models in their own languages are turning to Nvidia's chips, adding to already booming demand as generative AI takes center stage for businesses and governments, a senior executive said on Wednesday. Nvidia's third-quarter forecast for rising sales of its chips that power AI technology such as OpenAI's ChatGPT failed to meet investors' towering expectations. But the company described new customers coming from around the world, including governments that are now seeking their own AI models and the hardware to support them. Countries adopting their own AI applications and models will contribute about low double-digit billions to Nvidia's revenue in the financial year ending in January 2025, Chief Financial Officer Colette Kress said on a call with analysts after Nvidia's earnings report. That's up from an earlier forecast of such sales contributing high single-digit billions to total revenue. Nvidia forecast about $32.5 billion in total revenue in the third quarter ending in October. "Countries around the world (desire) to have their own generative AI that would be able to incorporate their own language, incorporate their own culture, incorporate their own data in that country," Kress said, describing AI expertise and infrastructure as "national imperatives." She offered the example of Japan's National Institute of Advanced Industrial Science and Technology, which is building an AI supercomputer featuring thousands of Nvidia H200 graphics processors. Governments are also turning to AI as a measure to strengthen national security. "AI models are trained on data and for political entities -particularly nations - their data are secret and their models need to be customized to their unique political, economic, cultural, and scientific needs," said IDC computing semiconductors analyst Shane Rau. "Therefore, they need to have their own AI models and a custom underlying arrangement of hardware and software." Washington tightened its controls on exports of cutting-edge chips to China in 2023 as it sought to prevent breakthroughs in AI that would aid China's military, hampering Nvidia's sales in the region. Businesses have been working to tap into government pushes to build AI platforms in regional languages. IBM said in May that Saudi Arabia's Data and Artificial Intelligence Authority would train its "ALLaM" Arabic language model using the company's AI platform Watsonx. Nations that want to create their own AI models can drive growth opportunities for Nvidia's GPUs, on top of the significant investments in the company's hardware from large cloud providers like Microsoft, said Bob O'Donnell, chief analyst at TECHnalysis Research.
[2]
Nations building their own AI models add to Nvidia's growing chip demand
Nations building artificial intelligence models in their own languages are turning to Nvidia's chips, adding to already booming demand as generative AI takes center stage for businesses and governments, a senior executive said on Wednesday. Nvidia's third-quarter forecast for rising sales of its chips that power AI technology such as OpenAI's ChatGPT failed to meet investors' towering expectations. But the company described new customers coming from around the world, including governments that are now seeking their own AI models and the hardware to support them. Countries adopting their own AI applications and models will contribute about low double-digit billions to Nvidia's revenue in the financial year ending in January 2025, Chief Financial Officer Colette Kress said on a call with analysts after Nvidia's earnings report. That's up from an earlier forecast of such sales contributing high single-digit billions to total revenue. Nvidia forecast about $32.5 billion in total revenue in the third quarter ending in October. "Countries around the world (desire) to have their own generative AI that would be able to incorporate their own language, incorporate their own culture, incorporate their own data in that country," Kress said, describing AI expertise and infrastructure as "national imperatives." She offered the example of Japan's National Institute of Advanced Industrial Science and Technology, which is building an AI supercomputer featuring thousands of Nvidia H200 graphics processors. Governments are also turning to AI as a measure to strengthen national security. "AI models are trained on data and for political entities -particularly nations - their data are secret and their models need to be customized to their unique political, economic, cultural, and scientific needs," said IDC computing semiconductors analyst Shane Rau. "Therefore, they need to have their own AI models and a custom underlying arrangement of hardware and software." Washington tightened its controls on exports of cutting-edge chips to China in 2023 as it sought to prevent breakthroughs in AI that would aid China's military, hampering Nvidia's sales in the region. Businesses have been working to tap into government pushes to build AI platforms in regional languages. IBM said in May that Saudi Arabia's Data and Artificial Intelligence Authority would train its "ALLaM" Arabic language model using the company's AI platform Watsonx. Nations that want to create their own AI models can drive growth opportunities for Nvidia's GPUs, on top of the significant investments in the company's hardware from large cloud providers like Microsoft, said Bob O'Donnell, chief analyst at TECHnalysis Research. (Reporting by Arsheeya Bajwa in Bengaluru; Editing by Peter Henderson and Jamie Freed)
[3]
Nations building their own AI models add to Nvidia's growing chip demand
(Reuters) - Nations building artificial intelligence models in their own languages are turning to Nvidia's chips, adding to already booming demand as generative AI takes center stage for businesses and governments, a senior executive said on Wednesday. Nvidia's third-quarter forecast for rising sales of its chips that power AI technology such as OpenAI's ChatGPT failed to meet investors' towering expectations. But the company described new customers coming from around the world, including governments that are now seeking their own AI models and the hardware to support them. Countries adopting their own AI applications and models will contribute about low double-digit billions to Nvidia's revenue in the financial year ending in January 2025, Chief Financial Officer Colette Kress said on a call with analysts after Nvidia's earnings report. That's up from an earlier forecast of such sales contributing high single-digit billions to total revenue. Nvidia forecast about $32.5 billion in total revenue in the third quarter ending in October. "Countries around the world (desire) to have their own generative AI that would be able to incorporate their own language, incorporate their own culture, incorporate their own data in that country," Kress said, describing AI expertise and infrastructure as "national imperatives." She offered the example of Japan's National Institute of Advanced Industrial Science and Technology, which is building an AI supercomputer featuring thousands of Nvidia H200 graphics processors. Governments are also turning to AI as a measure to strengthen national security. "AI models are trained on data and for political entities -particularly nations - their data are secret and their models need to be customized to their unique political, economic, cultural, and scientific needs," said IDC computing semiconductors analyst Shane Rau. "Therefore, they need to have their own AI models and a custom underlying arrangement of hardware and software." Washington tightened its controls on exports of cutting-edge chips to China in 2023 as it sought to prevent breakthroughs in AI that would aid China's military, hampering Nvidia's sales in the region. Businesses have been working to tap into government pushes to build AI platforms in regional languages. IBM said in May that Saudi Arabia's Data and Artificial Intelligence Authority would train its "ALLaM" Arabic language model using the company's AI platform Watsonx. Nations that want to create their own AI models can drive growth opportunities for Nvidia's GPUs, on top of the significant investments in the company's hardware from large cloud providers like Microsoft, said Bob O'Donnell, chief analyst at TECHnalysis Research. (Reporting by Arsheeya Bajwa in Bengaluru; Editing by Peter Henderson and Jamie Freed)
[4]
Nations building their own AI models add to Nvidia's growing chip demand
That's up from an earlier forecast of such sales contributing high single-digit billions to total revenue. Nvidia forecast about $32.5 billion in total revenue in the third quarter ending in October. "Countries around the world (desire) to have their own generative AI that would be able to incorporate their own language, incorporate their own culture, incorporate their own data in that country," Kress said, describing AI expertise and infrastructure as "national imperatives." She offered the example of Japan's National Institute of Advanced Industrial Science and Technology, which is building an AI supercomputer featuring thousands of Nvidia H200 graphics processors. Governments are also turning to AI as a measure to strengthen national security. "AI models are trained on data and for political entities -particularly nations - their data are secret and their models need to be customized to their unique political, economic, cultural, and scientific needs," said IDC computing semiconductors analyst Shane Rau. "Therefore, they need to have their own AI models and a custom underlying arrangement of hardware and software." Washington tightened its controls on exports of cutting-edge chips to China in 2023 as it sought to prevent breakthroughs in AI that would aid China's military, hampering Nvidia's sales in the region. Businesses have been working to tap into government pushes to build AI platforms in regional languages. IBM said in May that Saudi Arabia's Data and Artificial Intelligence Authority would train its "ALLaM" Arabic language model using the company's AI platform Watsonx. Nations that want to create their own AI models can drive growth opportunities for Nvidia's GPUs, on top of the significant investments in the company's hardware from large cloud providers like Microsoft, said Bob O'Donnell, chief analyst at TECHnalysis Research. (Reporting by Arsheeya Bajwa in Bengaluru; Editing by Peter Henderson and Jamie Freed)
[5]
Nations Building Their Own AI Models Add to Nvidia's Growing Chip Demand
(Reuters) - Nations building artificial intelligence models in their own languages are turning to Nvidia's chips, adding to already booming demand as generative AI takes center stage for businesses and governments, a senior executive said on Wednesday. Nvidia's third-quarter forecast for rising sales of its chips that power AI technology such as OpenAI's ChatGPT failed to meet investors' towering expectations. But the company described new customers coming from around the world, including governments that are now seeking their own AI models and the hardware to support them. Countries adopting their own AI applications and models will contribute about low double-digit billions to Nvidia's revenue in the financial year ending in January 2025, Chief Financial Officer Colette Kress said on a call with analysts after Nvidia's earnings report. That's up from an earlier forecast of such sales contributing high single-digit billions to total revenue. Nvidia forecast about $32.5 billion in total revenue in the third quarter ending in October. "Countries around the world (desire) to have their own generative AI that would be able to incorporate their own language, incorporate their own culture, incorporate their own data in that country," Kress said, describing AI expertise and infrastructure as "national imperatives." She offered the example of Japan's National Institute of Advanced Industrial Science and Technology, which is building an AI supercomputer featuring thousands of Nvidia H200 graphics processors. Governments are also turning to AI as a measure to strengthen national security. "AI models are trained on data and for political entities -particularly nations - their data are secret and their models need to be customized to their unique political, economic, cultural, and scientific needs," said IDC computing semiconductors analyst Shane Rau. "Therefore, they need to have their own AI models and a custom underlying arrangement of hardware and software." Washington tightened its controls on exports of cutting-edge chips to China in 2023 as it sought to prevent breakthroughs in AI that would aid China's military, hampering Nvidia's sales in the region. Businesses have been working to tap into government pushes to build AI platforms in regional languages. IBM said in May that Saudi Arabia's Data and Artificial Intelligence Authority would train its "ALLaM" Arabic language model using the company's AI platform Watsonx. Nations that want to create their own AI models can drive growth opportunities for Nvidia's GPUs, on top of the significant investments in the company's hardware from large cloud providers like Microsoft, said Bob O'Donnell, chief analyst at TECHnalysis Research. (Reporting by Arsheeya Bajwa in Bengaluru; Editing by Peter Henderson and Jamie Freed)
[6]
Nations building their own AI models add to Nvidia's growing chip demand
Also Read: Maruti Suzuki, Toyota, Hyundai, and others to launch new seven-seaters as utility vehicle demand grows: Report Nvidia's third-quarter forecast for rising sales of its chips that power AI technology such as OpenAI's ChatGPT failed to meet investors' towering expectations. But the company described new customers coming from around the world, including governments that are now seeking their own AI models and the hardware to support them. Countries adopting their own AI applications and models will contribute about low double-digit billions to Nvidia's revenue in the financial year ending in January 2025, Chief Financial Officer Colette Kress said on a call with analysts after Nvidia's earnings report. That's up from an earlier forecast of such sales contributing high single-digit billions to total revenue. Nvidia forecast about $32.5 billion in total revenue in the third quarter ending in October. "Countries around the world (desire) to have their own generative AI that would be able to incorporate their own language, incorporate their own culture, incorporate their own data in that country," Kress said, describing AI expertise and infrastructure as "national imperatives." Also Read: Decoding Proton Docs and Zoom Docs suites, mounting a challenge to Google Docs She offered the example of Japan's National Institute of Advanced Industrial Science and Technology, which is building an AI supercomputer featuring thousands of Nvidia H200 graphics processors. Governments are also turning to AI as a measure to strengthen national security. "AI models are trained on data and for political entities -particularly nations - their data are secret and their models need to be customized to their unique political, economic, cultural, and scientific needs," said IDC computing semiconductors analyst Shane Rau. "Therefore, they need to have their own AI models and a custom underlying arrangement of hardware and software." Washington tightened its controls on exports of cutting-edge chips to China in 2023 as it sought to prevent breakthroughs in AI that would aid China's military, hampering Nvidia's sales in the region. Businesses have been working to tap into government pushes to build AI platforms in regional languages. IBM said in May that Saudi Arabia's Data and Artificial Intelligence Authority would train its "ALLaM" Arabic language model using the company's AI platform Watsonx. Nations that want to create their own AI models can drive growth opportunities for Nvidia's GPUs, on top of the significant investments in the company's hardware from large cloud providers like Microsoft, said Bob O'Donnell, chief analyst at TECHnalysis Research.
[7]
Nations building their own AI models add to Nvidia's growing chip demand
Nvidia's chip demand is surging as nations create AI models in their own languages. This development includes governments aiming to strengthen national security with customized AI models and infrastructure. Countries' movements are expected to significantly contribute to Nvidia's revenue, projecting around low double-digit billions by January 2025.
[8]
Nations building their own AI models add to Nvidia's rising chip demand
That's up from an earlier forecast of such sales contributing high single-digit billions to total revenue. Nvidia forecast about $32.5 billion in total revenue in the third quarter ending in October. "Countries around the world (desire) to have their own generative AI that would be able to incorporate their own language, incorporate their own culture, incorporate their own data in that country," Kress said, describing AI expertise and infrastructure as "national imperatives." She offered the example of Japan's National Institute of Advanced Industrial Science and Technology, which is building an AI supercomputer featuring thousands of Nvidia H200 graphics processors.
[9]
Saudi Arabia is building its own AI models -- and this is helping Nvidia
Credit: Getty Images Nations building artificial intelligence models in their own languages are turning to Nvidia's chips, adding to already booming demand as generative AI takes center stage for businesses and governments, a senior executive said on Wednesday. Nvidia's third-quarter forecast for rising sales of its chips that power AI technology such as OpenAI's ChatGPT failed to meet investors' towering expectations. But the company described new customers coming from around the world, including governments that are now seeking their own AI models and the hardware to support them. Countries adopting their own AI applications and models will contribute about low double-digit billions to Nvidia's revenue in the financial year ending in January 2025, chief financial officer Colette Kress said on a call with analysts after Nvidia's earnings report. That's up from an earlier forecast of such sales contributing high single-digit billions to total revenue. Nvidia forecast about $32.5bn in total revenue in the third quarter ending in October. "Countries around the world (desire) to have their own generative AI that would be able to incorporate their own language, incorporate their own culture, incorporate their own data in that country," Kress said, describing AI expertise and infrastructure as "national imperatives." Global examples She offered the example of Japan's National Institute of Advanced Industrial Science and Technology, which is building an AI supercomputer featuring thousands of Nvidia H200 graphics processors. Governments are also turning to AI as a measure to strengthen national security. "AI models are trained on data and for political entities -particularly nations - their data are secret and their models need to be customized to their unique political, economic, cultural, and scientific needs," said IDC computing semiconductors analyst Shane Rau. "Therefore, they need to have their own AI models and a custom underlying arrangement of hardware and software." Washington tightened its controls on exports of cutting-edge chips to China in 2023 as it sought to prevent breakthroughs in AI that would aid China's military, hampering Nvidia's sales in the region. Businesses have been working to tap into government pushes to build AI platforms in regional languages. IBM said in May that Saudi Arabia's Data and Artificial Intelligence Authority would train its "ALLaM" Arabic language model using the company's AI platform Watsonx. Nations that want to create their own AI models can drive growth opportunities for Nvidia's GPUs, on top of the significant investments in the company's hardware from large cloud providers like Microsoft , said Bob O'Donnell, chief analyst at TECHnalysis Research.
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Nvidia's chip demand surges as countries worldwide invest in developing their own AI models. This trend is driven by concerns over data privacy, national security, and the desire for technological independence.
Global AI Ambitions Drive Nvidia's Chip Demand
As nations across the globe race to develop their own artificial intelligence (AI) models, Nvidia Corporation finds itself at the center of a surging demand for its cutting-edge chips. This trend is reshaping the landscape of AI development and has significant implications for Nvidia's market position and the global tech industry 1.
National Security and Data Privacy Concerns
The push for domestically developed AI models is largely driven by concerns over data privacy and national security. Countries are increasingly wary of relying on AI systems developed by other nations, particularly in sensitive areas such as defense and critical infrastructure 2. This has led to a growing emphasis on technological sovereignty, with governments investing heavily in building their own AI capabilities.
Nvidia's Market Dominance
Nvidia has emerged as the dominant player in the AI chip market, with its graphics processing units (GPUs) being the preferred choice for training large language models. The company's H100 chip, in particular, has become the gold standard for AI development, commanding premium prices and contributing significantly to Nvidia's revenue growth 3.
Global Adoption and Investment
Countries such as Saudi Arabia, the United Arab Emirates, and India are among those making substantial investments in AI infrastructure. These nations are not only purchasing Nvidia's chips but also developing the necessary software and building data centers to support their AI ambitions 4. This trend is expected to continue, with more countries likely to join the race for AI supremacy.
Economic and Geopolitical Implications
The surge in demand for AI chips is having far-reaching economic and geopolitical consequences. It's contributing to a realignment of global tech supply chains and influencing international relations. Countries with advanced AI capabilities may gain significant advantages in various sectors, from economic competitiveness to military applications 5.
Challenges and Future Outlook
While Nvidia currently enjoys a dominant position, the company faces challenges in meeting the explosive demand for its chips. Supply constraints and potential export restrictions could impact its ability to capitalize on the global AI boom fully. Additionally, competitors are ramping up efforts to develop alternative AI chips, which could eventually challenge Nvidia's market leadership.
As nations continue to invest in their AI capabilities, the demand for high-performance chips is expected to grow further. This trend not only benefits Nvidia but also has the potential to accelerate global AI innovation and reshape the international technological landscape in the coming years.
Reference
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