The strong rise in Nvidia's stock price after this week's impressive earnings shows that in the age of artificial intelligence (AI), the world's most important chip developer is managing to grow without its third-largest market, China. , analysts say.
Nvidia on Wednesday reported a bigger-than-expected 265% rise in quarterly revenue, despite facing increased U.S. trade sanctions restricting sales of advanced chips to China, a day after its stock price rose It rose by 16%. “Demand is rapidly increasing across companies, industries and countries around the world,” said Jensen Huang, CEO of the company.
Nvidia's AI business in China saw revenue of about US$900 million in the quarter ended January 28, down from about US$2.9 billion in the previous quarter. Financial services firm Morningstar estimates that Chinese data centers' share of total revenue in the sector fell to 5% from 20% in the previous quarter.
Nvidia has newly tuned Chinese chips to compete with rival Huawei products
Nvidia has newly tuned Chinese chips to compete with rival Huawei products
“Demand for Nvidia hardware remains so high that even smaller countries are now competing for its graphics processing units. [GPUs]'' said Su Lian Jie, chief analyst at research firm Omdia.
Huang said NVIDIA has suspended exports of restricted chips to China to comply with tightened U.S. export controls imposed in October and has not yet received U.S. government approval to resume those exports. He admitted that he had not done so.
Meanwhile, in a filing with the Securities and Exchange Commission, Nvidia for the first time identified Chinese telecommunications and networking equipment giant Huawei as a competitor in a specific category of AI chips.
The next fiscal year will be a critical one for Nvidia as demand continues to outstrip supply, Morningstar analyst Brian Colello said in a research note.
Nvidia has released three new products for Chinese customers after its A800 and H800 GPUs, which were previously customized for Chinese customers to comply with an early version of U.S. export regulations, were banned in China. We have developed new data center GPUs (H20, L20, L2). October.
Nvidia has started accepting pre-orders for the H20, the most powerful of the three GPUs available to China-based customers for AI training. The Post first reported that the cards range in price from US$12,000 to US$15,000 each. February.
Industry officials, who asked not to be named due to the sensitivity of the matter, said Friday that some Chinese customers have already begun testing Nvidia's new replacement chips.
Nvidia is expected to face more competition from local companies this year as Chinese AI chip startups and Huawei seek to take a bigger slice of the AI chip pie.
Huawei, which made a comeback in the smartphone space in 2023 with the 5G-enabled Mate 60 Pro device powered by its own chips, has started promoting its Ascend AI chip, which could be a serious rival to Nvidia products, through distribution channel partners. .
