Nvidia reported a significant increase in quarterly net profit due to the demand for its chips to power artificial intelligence in data centers. The company’s net profit was $14.9 billion, while its revenue reached $26 billion, almost four times higher than the previous fiscal quarter. Nvidia announced a 10-for-one stock split effective June 7 to make owning shares more accessible. CEO Jensen Huang stated that the next industrial revolution has begun, with companies and countries partnering with Nvidia to shift traditional data centers to accelerated computing and build AI factories to produce artificial intelligence.
Demand for sophisticated GPU tailored for AI model training was strong, with interest in generative AI expanding to various industries, including consumer internet, automotive, healthcare, and nations looking to build sovereign AI. Emarketer senior analyst Jacob Bourne highlighted Nvidia’s continued success in the AI market, with innovative moves helping the company maintain its industry position. Analysts also noted that while demand for Nvidia systems is being primarily driven by artificial intelligence in businesses and cloud computing, interest for consumer services offered by tech titans like Apple, Amazon, Meta, Google, and Microsoft is on the horizon.
Amazon, a US tech giant, announced a 15.7 billion euro investment to expand its data centers in Spain’s Aragon region, following recent investments in Germany and France to develop cloud infrastructure. Nvidia chips are described as essential in the transformation of data centers into AI generation factories, where data is turned into experiences like prompt-generated videos using tools like OpenAI’s Sora. The concept of ‘sovereign AI,’ referring to a nation’s ability to create and control its own artificial intelligence, is driving demand for Nvidia chips globally. Sovereign AI infrastructure is being built in countries like Canada, France, and Japan.
Nvidia’s CFO Colette Kress explained that sovereign AI is becoming a significant factor in the demand for Nvidia chips, as countries focus on building their own artificial intelligence capabilities. In Europe, cloud computing is experiencing growth, with Amazon’s investments in data center expansion in Spain, Germany, and France. Nvidia chips play a crucial role in supporting the development of AI technologies and infrastructure in various industries and regions. CEO Jensen Huang emphasized the importance of Nvidia’s technology in enabling the creation of AI generation factories and the production of artificial intelligence in data centers worldwide.
Overall, Nvidia’s strong financial performance and continued focus on AI innovation position the company as a key player in the global AI market. With increasing demand for Nvidia chips in various industries and regions, including the development of sovereign AI capabilities by nations, the company is well-positioned to maintain its industry leadership in the foreseeable future. As interest in AI technologies continues to grow, Nvidia’s partnerships with companies and countries seeking to leverage AI capabilities for economic and strategic advantages will drive further growth and success for the company.
