In a recent earnings call, Nvidia CEO Jensen Huang confidently addressed concerns about the impact of DeepSeek on Nvidia's sales. Despite speculation that DeepSeek's R1 model, which requires fewer chips to train, would negatively affect Nvidia, Huang emphasised that the innovation benefits the company.
DeepSeek's Impact on Nvidia
DeepSeek's R1 model has sparked global enthusiasm, and Huang highlighted that reasoning models like R1 consume significantly more compute power. This increased demand for compute power is great news for Nvidia, as it aligns with their latest Blackwell chip, which is custom-built for reasoning AI.
Record-Breaking Sales
Nvidia reported another record-breaking quarter, with revenue reaching $39.3 billion, surpassing both their own projections and Wall Street estimates. The company's data center sales nearly doubled in 2024, reaching $115 billion. Huang expressed confidence in continued growth, projecting revenue for the next quarter to be around $43 billion.
Future Prospects
Huang remains optimistic about Nvidia's future, stating that the market for AI chips shows no signs of cooling off. Major tech companies like Meta, Google, and Amazon have unveiled massive AI infrastructure investments, collectively committing hundreds of billions for the coming years.
Conclusion
Nvidia's strong performance and strategic focus on reasoning AI models position the company for continued success. As the demand for compute power grows, Nvidia is well-equipped to meet the needs of the evolving AI landscape.