Bottom line: Nvidia sees the race to develop generative AIs like ChatGPT and Midjourney as the iPhone moment for artificial intelligence. More importa

The AI chip boom is propelling Nvidia to new heights, gamers be damned

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2023-05-25 20:00:15

Bottom line: Nvidia sees the race to develop generative AIs like ChatGPT and Midjourney as the iPhone moment for artificial intelligence. More importantly, the company seems well-positioned to capitalize on the surging demand for GPUs and AI accelerators, and this has sent its valuation close to $1 trillion this week. Its latest financial report paints a good forward outlook, but it's also a reminder that pleasing gamers isn't a priority for the company. And it probably won't be for as long as the tech industry is obsessed with AI.

Almost every business out there is trying to jump on the AI train, and this is making Nvidia and its investors happier than ever. So happy, in fact, that the company feels confident it can soon become the first chipmaker to be valued at more than $1 trillion, thanks to the enormous demand for data center GPUs and AI accelerators. Investors have sent the share price soaring, and it's hovering around $384 (up more than 25 percent from Tuesday) as of writing this.

AI is one of the main reasons Nvidia's data center business grew no less than 14 percent during the first three months of this year compared to the same period last year. For reference, Intel's Data Center and AI Group recorded a staggering 39 percent drop, and AMD's data center division delivered flat revenue compared to the same quarter in 2022.

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