Artificial Intelligence

Nvidia sees sales more than double following demand for AI chips

24th August 2023
Kristian McCann

Nvidia has seen its sales soar by more than double as demand for its AI chips heats up. The record-high sales saw the chip giant’s revenue jump to above $13.5 billion for the three months to the end of June.

The company is expecting revenue of around $16 billion for the three months to the end of September, equating to a 170% or so rise compared to the same time last year.

Revenue earned by the company over the last quarter is much stronger than the $11.2 billion that Wall Street analysts expected. This comes despite rough headwinds effecting the Nasdaq, the exchange Nvdia is listed on, and the company complaining how the US and China’s ongoing chip war stands to affect them.

Commenting on the news, Nvidia's Chief Jensen Huang said: "A new computing era has begun. Companies worldwide are transitioning from general-purpose to accelerated computing and generative AI."

The strong performance is attributed to Nvidia's data centre business, which includes AI chips, and has cloud computing service providers and large consumer Internet companies scrambling to snap up its next-gen processors.

This follows racing interest in AI after the debut of the likes of generative AI systems like ChatGPT reigniting interest in the application of the technology. ChatGPT, which generates human-like responses to user queries within seconds, was trained using 10,000 of Nvidia's graphics processing units clustered together in a supercomputer belonging to Microsoft.

Since it’s release, tech giants like Meta, previously gung-ho on the Metaverse, realigned its focus to AI, and telecom giant BT promising to replace up to 10,000 jobs with it by the end of the decade.

The firm's shares rose by more than 6.5% in New York trading, adding to their huge gains this year. Nvidia reportedly intends to use the anticipated growth in the current quarter to buy back $25 billion of its stock; its stock market value has tripled to reach more than $1 trillion this year, becoming the fifth publicly traded US company to reach the milestone.

Nvidia, originally known for making computer chips that process graphics for computer games, now creates hardware underpins most AI applications, with one report finding it had cornered 95% of the market for machine learning.

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