NVIDIA CEO Addresses High Demand and Supply Challenges for AI Chips

NVIDIA CEO Says "Restricted Supply" Has Frustrated Its Clients, Increasing Business Tensions

NVIDIA's CEO claims that the "restricted" supply of AI hardware has frustrated its mainstream clients, but Team Green is actively working on improving the situation. It's no surprise that NVIDIA's existing products are in hot demand by the industry, especially the big players such as Microsoft and Meta. The supply issue has been present for NVIDIA for quite some time now, since the AI hype initially kicked off, and surprisingly, the demand has sustained for several quarters now, which is why Team Green and its partners have upscaled its production facilities exponentially during the past year. Despite such attempts, NVIDIA's CEO Jensen Huang claims that the demand is gigantic, and the backlogs create frustration amongst its clients, ultimately raising business tensions. The demand on it is so great, and everyone wants to be first and everyone wants to be most. We probably have more emotional customers today. Deservedly so. It's tense. We're trying to do the best we can. - NVIDIA's CEO Jensen Huang via BNN Bloomberg Team Green's Hopper generation of products provided the company with decent sales traction, but the ultimate "juice" lies within the upcoming Blackwell AI products, which are set to revolutionize the AI markets with their immense capabilities. Customers like Meta and Amazon have already placed "exclusive" orders for the Blackwell AI clusters, and NVIDIA has seen tremendous optimism from the markets as well, which shows that in terms of overall revenue, Blackwell will likely surpass all generations and might prove to be the most successful product in the firm's history. Apart from this, NVIDIA also mentioned the role of the Taiwan giant TSMC in the success the company has witnessed in the markets and claims that TSMC's capabilities to respond to the demand from the firm are quite impressive. However, in a separate coverage, we have revealed how NVIDIA doesn't look to be reliant on the Taiwan giant since the company sees a "gloomy" future mainly due to the geopolitical tensions and how big of an impact TSMC will witness if the situation escalates. Team Green has also hinted towards adding in new suppliers, but up till now, it hasn't announced its new "key ally" yet. There were reports that Team Green has handed over the production of some units of NVIDIA's H100s to Intel Foundry, while other sources quoted that Samsung Foundry might get a take on NVIDIA's success, but we haven't seen a conclusive development for now. Still, NVIDIA is eager to opt for additional partners moving into the future, which is why TSMC's competitors have an excellent chance to grab the spotlight. NVIDIA's Blackwell will play a crucial role in how the company develops over the upcoming months, and it's highly likely that we will witness a new wave of AI frenzy, yet again bringing all fortunes towards NVIDIA.

Nvidia chips are in such high demand that customers are 'emotional,' Huang said

This story is available exclusively to Business Insider subscribers. Become an Insider and start reading now. Have an account? Log in. "We have a lot of people on our shoulders, and everybody is counting on us," Huang said. He added, "Demand is so great that delivery of our components, our technology, infrastructure, and software is really emotional for people." The CEO added that while demand for Nvidia's latest line of chips, Blackwell, has soared, suppliers to which the company has outsourced hardware production are catching up. Demand for Nvidia's graphics processing unit has skyrocketed as companies and countries scramble to secure supplies to improve their AI capabilities. "We probably have more emotional customers today. Deservedly so. It's tense. We're trying to do the best we can," Huang said. As one of the few players in this space, Nvidia has a stronghold on anyone looking to accelerate their business or economy using AI models. These AI models need to be trained on large piles of data and then fine-tuned carefully, which takes thousands of GPUs, creating pressure on chip demand. In August, Nvidia sparked worries that its next generation of AI chips, Blackwell, would be delayed by two to three months. The delay meant that shipments would be pushed to the first quarter of 2025 instead of later this year, affecting customers including Meta, Microsoft, and Google, and smaller cloud firms, which have built their businesses on Nvidia chips. On an earnings call last month, Huang promised that the company would ship out billions of dollars worth of Blackwell GPUs by the fourth quarter -- a metric that analysts said was vague. While Nvidia executives on the call remained unclear about the gains expected from the Blackwell chip, they managed to temper most concerns around the shipment delays. Analysts and experts have previously noted that the company's ability to deliver on these promises will be crucial. Last week Nvidia's stock slid 9.5%, shedding $278.9 billion in valuation -- the biggest single-day loss ever recorded by a US company. The rout was partly attributed to the economy and partly to resurfaced doubts on when tech giants will bear the fruit of massive AI spending.

Jensen Huang says Nvidia chips are in high demand: 'People emotional, it's tense'

Read more: Adani Group 'unequivocally reject and deny' Hindenburg's new allegations: 'Preposterous, irrational, absurd' At a Goldman Sachs tech conference in San Francisco, Jensen Huang said, "We have a lot of people on our shoulders, and everybody is counting on us. Demand is so great that delivery of our components, our technology, infrastructure, and software is really emotional for people." Demand for Nvidia's latest line of chips Blackwell has soared, he said, resulting in suppliers to which the company has outsourced hardware production still catching up. He said, "We probably have more emotional customers today. Deservedly so. It's tense. We're trying to do the best we can." In August, Nvidia said that its next generation of AI chips Blackwell would be delayed by two to three months. The delay meant that shipments would be pushed to the first quarter of 2025 instead of later this year, affecting customers like Meta, Microsoft, and Google, which sparked concerns. However, Jensen Huang promised in an earnings call last month that the company would ship out billions of dollars worth of Blackwell GPUs by the fourth quarter. This comes as Nvidia's stock slid 9.5% last week, shedding $278.9 billion in valuation -- the biggest single-day loss ever recorded by a US company.

NVIDIA CEO on Blackwell AI GPU demand: it 'is so great, everyone wants to be first'

NVIDIA CEO Jensen Huang has said that there is a mad scramble for companies to get their hands on the limited supply of Blackwell AI GPUs, and that is frustrating some companies, while raising tensions with others. Jensen Huang was recently speaking to the audience at the Goldman Sachs Group Inc. technology conference in San Francisco, where he said: "The demand on it is so great, and everyone wants to be first and everyone wants to be most. We probably have more emotional customers today. Deservedly so. It's tense. We're trying to do the best we can". He continued, adding that TSMC's "agility and their capability to respond to our needs is just incredible" said Jensen, adding: "And so we use them because they're great, but if necessary, of course, we can always bring up others". NVIDIA's new Blackwell B200 AI GPUs have been going through some troubles before their launch, as well as limited supplies of GB200 AI servers and B200 AI GPUs in Q4 2024, before the big flood of Blackwell begins. Oracle recently laid out plans of spending over $100B in new data centers, while teasing a 130,000+ Blackwell AI GPU supercluster, which I'm sure is making Jensen smile ear-to-ear. NVIDIA has been relying on TSMC for its success, making all of its recent generations of GPUs at Taiwanese semiconductor leader. Huang did talk about the geopolitical risks involved in Taiwan (China) and that China sees TSMC's home island of Taiwan as a "rogue province" and that has concerns raised that it might try to reclaim the territory. I wrote a story back in March 2024 that China was "on track to be ready to invade Taiwan by 2024" said a top US admiral under a testimony at the time. If this happened it wouldn't just affect TSMC and NVIDIA, but every TSMC customer: Intel, AMD, Qualcomm, Apple, and every one of their partners, and the entire world. However, companies like NVIDIA and their mega-success is going to have to be concerned about the happenings in Taiwan, especially if an invasion from China were to occur. The flow and supply of NVIDIA's entire stack of products, with hundreds of billions of dollars in revenue flushed down the toilet if those devastating events were to occur.

Nvidia Customers Get 'Emotional' as AI Chips Run Short | PYMNTS.com

A limited supply of Nvidia's chips has reportedly left its customers frustrated. "The demand on it is so great, and everyone wants to be first and everyone wants to be best," Jensen Huang, CEO of the nearly $3 trillion company, said Wednesday (Sept. 11). "We probably have more emotional customers today. Deservedly so. It's tense. We're trying to do the best we can," added Huang, whose comments at a Goldman Sachs tech conference were reported by Bloomberg News. According to the report, Nvidia is seeing robust demand for its latest generation of chips, called Blackwell, The company outsources the production of its hardware, and Nvidia's suppliers are progressing in catching up, Huang told his audience. Nvidia's chips help develop and run artificial intelligence (AI) models at data centers. The firm's sales have soared amid intense appetite for these services, with Nvidia becoming -- for a time -- the largest company in the world earlier this year. (As of Wednesday afternoon, it was in the number three spot, behind Apple and Microsoft). However, Bloomberg notes, Nvidia relies on a smaller portion of its customers -- data center operators like Meta and Microsoft -- for the bulk of its revenues. Huang was asked if the vast amounts of spending on AI is giving customers a return on investment, something that's been a concern during the tech sector's AI fever. He said companies have no choice but to embrace "accelerated computing," adding that his firm's technology speeds up conventional workloads -- data processing -- while handling AI tasks that older technology can't. PYMNTS examined Nvidia's meteoric rise last month, noting that it hasn't come without turbulence. The company's stock saw a 20% slump through July and early August, a sign of investor concerns about its ability to meet sky-high expectations. Questions linger about the sustainability of AI-related spending by major tech firms. "Nvidia faces mounting regulatory scrutiny as well. U.S. regulators are probing whether the company has pressured cloud providers to buy multiple products or attempted to bundle its networking equipment with AI chips," that report said. "Competition in the AI chip market is intensifying. Long-time rival AMD is making strides with its own AI processors, while tech giants like Google and Amazon are developing custom silicon for their data centers. In China, where U.S. export restrictions limit Nvidia's reach, domestic champion Huawei is emerging as a formidable competitor."

Nvidia CEO Jensen Huang says AI chip shortage is making his customers tense and emotional

Nvidia boss Jensen Huang is starting to feel like Atlas with the weight of the world -- or at least AI -- bearing down squarely on his shoulders. The CEO and founder of the $2.9 trillion semiconductor giant spoke openly on Wednesday about the tension he's feeling, offering a glimpse into the pressure he faces to crank up the supply of microchips capable of training the latest AI systems like the successor to OpenAI's GPT-4. Customers see his products from the perspective of a player in a zero-sum game -- each chip they receive means both an advantage for them as well as a disadvantage for rivals who struck out. Huang's job is to walk this tightrope, balancing the allocation of supply as best he can in order not to endanger client relationships. "Delivery of our components -- and our technology, and our infrastructure and software -- is really emotional for people, because it directly affects their revenues, it directly affects their competitiveness," he told a tech conference hosted by Wall Street investment bank Goldman Sachs. What Huang exactly meant by "emotional" is unclear, and Nvidia declined to comment further when reached by Fortune. But one thing is certain -- customers -- especially the three main cloud hyperscalers Microsoft, Google and Amazon, which each require a vast supply -- realistically have nowhere else to turn. Nvidia controls 90% of the market. As founder and CEO, Huang takes his responsibility to key customers personally. In April, he hand delivered the world's first DGX server equipped with its upgraded Hopper series AI training chip, the new H200, to OpenAI chief executive Sam Altman and president Greg Brockman. And in his quest to topple OpenAI from the industry summit, Elon Musk recently revealed plans to purchase 50,000 H200s over the next few months to double the compute at his xAI training cluster in Memphis, where his rival AI model, Grok-3, is currently in training. "Our fundamental competitiveness depends on being faster than any other AI company. Thiss is the only way to catch up," Musk explained in a recent social media post. "When our fate depends on being the fastest by far, we must have our own hands on the steering wheel, rather than be a backseat driver." That's why he was willing to risk the ire of Tesla shareholders after allocating Nvidia chips to xAI that should have gone to training the carmaker's self-driving software system, FSD. It also explains how xAI was able to bring online the largest single compute cluster in the world, powered by 100,000 Nvidia H100 graphic processing units, in the span of just three months. Whether Musk is a preferred customer is not known, but Nvidia has revealed that just four data center clients were responsible for nearly half of its Q2 top line revenue. "If we could fulfil everybody's needs, then the emotion would go away, but it's very emotional, it's really tense," Huang told the Goldman conference on Wednesday. "We've got a lot of responsibility on our shoulders and we try to do the best we can." Huang is not being facetious. At the end of last month, Nvidia' posted fiscal second quarter results that Wedbush tech analyst Dan Ives called nothing short of "the most important tech earnings in years". One of the core concerns that both investors and customers were most keen to hear addressed included any additional information on the rollout and ramp-up of Blackwell, the next series of AI chips after Hopper, following reports of delays. During the investor call, Huang confirmed changes had to be made to the production design template, or "mask", to improve the yield of chips printed on each silicon wafer. Nonetheless, he insisted he would still be able to ship several billions of dollars' worth of Blackwell processors before the fiscal fourth quarter ends in late January. Unlike integrated device manufacturers like Intel or Texas Instruments, Nvidia outsources all semiconductor fabrication to dedicated foundries that specialize in production technology, primarily TSMC. The Taiwanese giant leads the industry when it comes to efficiently miniaturizing transistors, the building blocks of the logic chips printed on each wafer. That means however that Nvidia cannot quickly reply to demand spikes, especially since these chips go through months of complicated process steps before they are fully fabricated. Pressed about the issue, Huang told Bloomberg Television late last month that constraints were easing. "We're expecting Q3 to have more supply than Q2, we're expecting Q4 to have more supply than Q3 and we're expecting Q1 to have more supply than Q4," he said in the interview. "So I think our supply condition going into next year will be a large improvement over this last year." If true, then Huang can finally look forward to fewer tense moments with less emotional customers in the not too distant future.

Nvidia CEO Says Customers Are 'Emotional' About AI Chip Shipments

Demand for Nvidia's artificial intelligence chips is so high that the company's relationships with its largest customers have been getting "really tense," CEO Jensen Huang said at a Goldman Sachs technology conference in San Francisco on Wednesday. "Delivery of our components and our technology and our infrastructure and software is really emotional for people, because it directly affects

Nvidia CEO Jensen Huang's Biggest Worry Shows that Success Has a Downside

AI chip orders from Meta, Microsoft, Amazon, and Google comprise over 40% of Nvidia's revenue. Nvidia's stock may be down, but the AI chipmaker's CEO emphasized that demand for the company's products is stronger than ever -- and that high level of demand has him on edge. "We have a lot of people on our shoulders, and everybody is counting on us," Nvidia CEO Jensen Huang said on Wednesday at the Goldman Sachs Communacopia and Technology Conference. Huang was responding to a question about his biggest worry from Goldman Sachs CEO David Solomon. Nvidia is the third most valuable company in the world, after Apple and Microsoft. "Demand is so great that delivery of our components, our technology, infrastructure, and software is really emotional for people," Huang explained. "Because it directly affects their revenues, it directly affects their competitiveness." Meta, Microsoft, Amazon, and Google are the biggest buyers of Nvidia's AI chips, constituting more than 40% of the company's revenue. Nvidia's stock rallied 8% on Wednesday after Huang's remarks and other AI chip manufacturers like Foxconn and TSMC gained too, at 5% and 4% respectively. Nvidia has 70% to 95% of the AI chip market as of June, though competition is rising. Nvidia's top rival, AMD, bought an AI startup for over half a million dollars in cash in July. Related: Employees Who Worked at This Company for the Past 5 Years Are Now Multi-Millionaires in 'Semi-Retirement' Huang justified the high price of Nvidia's servers on Wednesday by saying that though the cost "could be a couple of million dollars per rack," AI has the potential to replace older systems and drive cost savings. Huang also addressed the issue of AI replacing software engineers when it comes to writing code. "I think the days of every line of code being written by software engineers, those are completely over," Huang said. "The idea that every one of our software engineers will essentially have companion digital engineers 24/7 -- that's the future." Amazon Web Services CEO Matt Garrman predicted the same future last month in a leaked conversation with employees. Garman said that AI would change the job description of software engineers and make it possible for them not to code at all. Related: Amazon Cloud CEO Predicts a Future Where Most Software Engineers Don't Code -- and AI Does It Instead Marco Argenti, the CIO of Goldman Sachs, said in April that technical skills alone couldn't handle AI. He encouraged future software engineers to take philosophy classes in addition to their standard coursework.