Why Nvidia is up and its prospect?
Why Nvidia is up and its prospect:
• Why up?
AI has been boosting demand for chips with Nvidia having seen its market capitalization more than double this year. Shares in the company soared more than 25 percent last Wednesday after an earnings report showed the AI trend is fueling demand for its sophisticated chips. The company has for years made the computer chips that can run graphics-heavy video games. But several years ago, artificial intelligence researchers began using those same chips to run the powerful new algorithms that were causing breakthroughs in the field.
Last week rise in stock price pushed Nvidia’s worth to around $940 billion. That’s more than Tesla and Facebook, which are worth $584.7 billion and $647.6 billion, respectively.
• Its prospect:
However, Nvidia CEO warns chip war would cause 'enormous damage' to U.S. tech.
Noting that China made up roughly one-third of the U.S. tech industry's market, Huang said there is no substitution for it. "If we are deprived of the Chinese market, we don't have a contingency for that. There is no other China, there is only one China,"
Since August last year, the U.S. has banned Nvidia from exporting two advanced computing chips to China. The ban covers the company's A100 and flagship H100 chips, which are powerful enough to facilitate AI processing. The company flagged a $400 million loss resulting from the restriction at the time. Thankfully, the AI hype has changed its course lately.
Huang noted that Chinese companies are making chips locally since they are cut off from the U.S.-made ones.
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Why Nvidia is suddenly one of the most valuable companies in the world
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