Nvidia Chief Executive Jensen Huang talked up Tesla autonomous driving efforts on Wednesday, claiming the EV giant is "far ahead" on self-driving vehicles and that all cars will eventually have autonomous abilities. TSLA shares angled lower Thursday.
"Tesla is far ahead in self-driving cars but every single car someday will have to have autonomous capability," Huang told Yahoo Finance Wednesday night. "It's safer, more convenient, it's more fun to drive."
Tesla along with Chief Executive Elon Musk are major customers of Nvidia.
Huang added that it is better for artificial intelligence (AI) models to learn from video directly, as opposed to photographs. However, he said that this technology requires enormous training facilities because the data rate of video is so high.
"The best way to teach these AIs how the physical world behaves is video," Huang said. This will require high levels of computing demand "in the years to come," according to Huang, referring to automakers and demand for AI data centers.
Nvidia on its earnings call Wednesday mentioned myriad automotive customers working on AI self-driving, including several China EV players.
Nvidia reported that revenue from automotive was $329 million, up 17% sequentially and up 11% year-on-year. The company added that this increase was primarily due to its "self-driving platforms."
Chief Financial Officer Colette Kress said on the earnings call Wednesday that Nvidia "supported" Xiaomi to launch its first electric vehicle, the SU7 sedan, which is posing a serious threat to the Tesla Model 3 in China.
Kress added that its updated AI car computer software, Nvidia Drive Thor, is slated for production in vehicles in 2025. Customers include BYD, XPeng and others.
"We expect automotive to be our largest enterprise vertical within data center this year," Kress said Wednesday.
Nvidia stock jumped 9.4% to 1038.45 Thursday on the AI chip leader's booming earnings and guidance.
Meanwhile, Tesla broke ground on $200 million Megapack site in Shanghai for its energy storage business. It's set to be mass production in early 2025. It will face off against a number of rivals including BYD and CATL, a major Tesla supplier for EV and storage batteries.
Tesla Stock Performance And Tesla Vote
TSLA shares dropped 3.5% to 173.88 during market trade on Thursday. Tesla stock fell 3.5% to 180.11 on Wednesday after surging 6.6% on Tuesday. The stock is up 1.5% on the week but TSLA remains down around 30% on the year.
Tesla reported first quarter earnings and revenue on April 23, and has rallied since then, finding support at its 50-day moving average, according to MarketSurge analysis. Tesla stock hit a 52-week low of 138.80 on April 22.
Meanwhile, Tesla shareholders are voting in the run-up to the June 13 annual meeting as everyone awaits the result to see if Musk's 2018 $56 billion compensation package will be reapproved or not.
Tesla stock ranks seventh in the 35-member IBD Auto Manufacturers industry group. The stock has a weak 38 Composite Rating out of a best-possible 99. Tesla stock also has a 17 Relative Strength Rating and a 62 EPS Rating.
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