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Nvidia is dominating earnings season, and it hasn’t even reported outcomes but.
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Different mega-cap tech giants have been mentioning on earnings calls that they are boosting funding in AI infrastructure.
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Nvidia provides the favored H100 GPU chip that many firms use, and was particularly name-checked in some cases.
Nvidia is dominating first-quarter earnings season, and it hasn’t even reported its outcomes but.
The corporate has obtained a number of nods, each instantly and not directly, from mega-cap tech firms that it counts as a few of its greatest prospects.
Phrases like “AI Infrastructure” and “generative AI” and “infrastructure capex” persistently popped up on the earnings calls of Microsoft, Alphabet, Amazon, and Meta Platforms, and all of it factors to more cash being directed to Nvidia for its extremely widespread H100 GPU chip.
Nvidia’s H100 GPU, which prices upwards of $40,000, allows the AI applied sciences that make ChatGPT, Anthropic, and different generative AI platforms doable.
The corporate is gearing up for the discharge of its next-generation AI chip, named Blackwell, later this yr.
Elon Musk shouts out Nvidia’s AI chips
Maybe the most important vote of confidence for Nvidia throughout this earnings season got here from Tesla CEO Elon Musk, who mentioned on his firm’s earnings name that the electrical automobile producer will greater than double its H100 GPU chips by the tip of the yr.
“We have put in and commissioned, which means they’re truly working, 35,000 H100 computer systems or GPUs,” Musk mentioned final month. “Roughly 35,000 H100s are energetic, and we count on that to be in all probability 85,000 or thereabouts by the tip of this yr.”
Musk mentioned the H100s are serving to Tesla additional enhance its Full Self-Driving software program.
Mega-cap tech’s AI spending is hovering
Meta Platforms mentioned it was rising its forecasted capital expenditures for 2024 to a variety of $35 billion to $40 billion from a previous vary of $30 billion to $37 billion. The rise, based on Meta, is primarily being pushed by the buildout of its “infrastructure investments to help our AI roadmap.”
In January, Meta mentioned it will purchase 350,000 H100 GPUs from Nvidia in 2024, however a latest replace from the corporate’s head of AI, Yann LeCun, means that the corporate has purchased much more H100 chips in latest months.
Talking on the Forging the Way forward for Enterprise with AI summit final month, LeCun and host John Werner mentioned that Meta has purchased a further 500,000 GPUs from Nvidia, bringing its whole to 1 million with a retail worth of about $30 billion.
Microsoft has comparable ambitions and mentioned it hopes to amass a conflict chest of 1.8 million GPUs by the tip of 2024, based on an inner doc.
Alphabet mentioned its first-quarter CAPEX was $12 billion, or about double from the prior yr, pushed “overwhelmingly by funding in our technical infrastructure with the biggest part for servers adopted by information facilities.”
Microsoft mentioned it expects $50 billion in capital expenditures in its upcoming fiscal yr, and its fiscal third-quarter spending soared virtually 80% to $14 billion.
And whereas Amazon did not element its capital expenditure plans, it did say it expects to spend more cash.
“We anticipate our general capital expenditures to meaningfully enhance year-over-year in 2024, primarily pushed by larger infrastructure capex to help development in AWS, together with generative AI,” Amazon CFO Brian Olsavsky mentioned.
Altogether, the mixed capex of Microsoft, Alphabet, Meta, and Amazon is anticipated to achieve $205 billion this yr, representing a 40% enhance from 2023 ranges, based on UBS. And a very good chunk of that cash will doubtless be funneled to Nvidia for its H100 and Blackwell AI chips.
Nvidia has competitors, however it nonetheless dominates
Current earnings outcomes from Nvidia’s rival, AMD, recommend that almost all of this enterprise goes to Nvidia and never its rivals.
AMD mentioned its MI300 AI chip would generate income of about $4 billion in 2024, which pales compared to Nvidia’s anticipated income of greater than $100 billion this yr.
In the meantime, Intel just lately unveiled its Gaudi 3 AI chip that may compete with Nvidia, however it mentioned it expects the chip to generate solely $500 million in gross sales this yr.
Buyers should wait till after the market shut on Might 22 to listen to what Nvidia’s earnings outcomes truly are.
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