It is the star of the year in business circles around the world.
To show that they are fashionable, every entrepreneur, every CEO, every investor must say the word Nvidia. The manufacturer of microprocessors has become the equivalent of the company which has understood what the new trend. And this new gold is artificial intelligence.
When the startup OpenAI launched ChatGPT, a conversational chatbot, on Nov. 30, 2022, the public did not yet really know the extent of the progress made in recent years by AI.
While many cars today are equipped with technologies that allow them to perform many maneuvers on their own, consumers have not often linked these developments to advances in AI. Likewise, they never thought that artificial intelligence had made colossal progress, despite the introduction of voice assistants like Siri and Alexa into their daily lives. ChatGPT has lifted this veil which obscured the world from seeing AI in its true light.
A Huge Market
The chatbot has indeed taken the world by storm. ChatGPT, which provides human-like responses to even complex requests, has changed the way internet search is perceived. The chatbot showed that artificial intelligence has reached a point where technology can perform certain tasks much better than humans can.
Microsoft, Alphabet's Google, Amazon, Meta Platforms META, parent company of Facebook, Instagram and WhatsApp and almost every tech group and many platforms are developing their own AI platforms and tools. From automotive to finance to fashion, AI is everywhere.
The global artificial intelligence market size was valued at $428 billion in 2022 and is projected to grow from $515.31 billion in 2023 to $2.02 trillion by 2030, according to a report from Fortune Business Insights. This supersonic growth is due, according to these experts, to the fact that AI will cut significant corporate costs, create jobs that did not exist and kill many existing jobs.
"The pandemic crisis changed the way businesses operated and increased business complexities," the report said. "In order to adopt these changes, companies shifted their work processes on cloud. This surged the adoption of advanced technologies such as Al, machine learning, and others. The healthcare sector was among the early adopters of this technology which improved the accuracy and efficiency of diagnosis, treatments, and forecasting."
Nvidia (NVDA) is at the heart of this revolution. Its graphics processing units, or GPUs, are used to train and develop AI systems through machine learning and deep learning programs. AI companies need Nvidia's GPUs for high-performance computing within their data centers. One of Nvidia's weapons to dominate AI is its all-new H100 data center graphics processing unit. The H100 is said to be nine times faster than its predecessor in AI training and up to 30 times faster in AI inference for large transformer-based language models like chatbots ChatGPT (OpenAI) and Bard (Google).
As a result, Nvidia's stock is up 165% this year, translating to nearly $600 billion in more market value. Nvidia was thus one of the very first chipmakers to reach the symbolic threshold of $1 trillion in market capitalization.
Nvidia Won't Have a Monopoly: Musk
Elon Musk, CEO of Tesla (TSLA), is not very impressed with this performance. The billionaire, who was one of the first to invest in OpenAI, the startup that developed ChatGPT, believes that Nvidia's current popularity is also due to the fact that the group enjoys a virtual monopoly situation. This will not last, promises Musk, who foresees the arrival of other actors able to produce processors capable of being very efficient in their task of taking data, collecting and classifying them at a very accelerated rate. These processors are called neural network accelerator chips (NN accelerators).
For the billionaire, the competition is coming after Nvidia.
"One reason the AI boom is being underestimated is the GPU/TPU shortage," said Adam D'Angelo, chief executive of Quora, a social question-and-answer website and online-knowledge market, on Twitter on June 7. "This shortage is causing all kinds of limits on product rollouts and model training but these are not visible. Instead all we see is Nvidia spiking in price. Things will accelerate once supply meets demand."
Musk agreed.
"True. Also, many other NN accelerator chips are also under development," the tech mogul commented. "Nvidia will not have a monopoly on large-scale training & inference forever."
Musk does not name potential Nvidia rivals in this market. The billionaire is building his own AI platform. In addition, he also promised last month a ChatGPT moment for Tesla this year or next. Basically, the electric vehicle manufacturer is very advanced in AI so that its vehicles will be completely autonomous in the coming months.
