What you need to know
- NVIDIA CEO Jensen Huang recently appeared at the Goldman Sachs Communacopia and Technology Conference, speaking about the high GPU demand for AI advances, its impact on the job market, and more.
- The chipmaker’s valuation recently tanked with analysts referring to it as the biggest single-day drop in history, after briefly becoming the world’s most valuable company ahead of Microsoft and Apple.
- Jensen Huang predicts that the AI revolution will evolve to more than data centers and chatbots.
As an analyst with over two decades of industry experience, I’ve witnessed the rise and fall of numerous tech giants. The current AI hype reminds me of the dot-com bubble, where exorbitant costs and unrealistic expectations led to significant losses for many companies. However, it seems that some lessons have not been learned yet.
As an analyst, I’ve noticed a swift surge in the AI sector, with tech giants like Microsoft, Apple, and Google diving headfirst into this trend as a means to boost their earnings. They’ve managed to carve out their roles within this burgeoning terrain, but at a significant price tag.
Artificial intelligence initiatives from Google and Microsoft use as much electricity as over a hundred countries combined. Elon Musk suggests that the upcoming technological leap in AI may be unprecedented, but by 2025, we might not have enough power to sustain this growth. Additionally, it’s important to note that AI also requires vast amounts of cooling water.
Although companies such as Microsoft heavily rely on NVIDIA for their AI model training, the GPU manufacturer experienced its largest single-day decline ever – a significant event occurring several months after it surpassed Microsoft and Apple to become the most valuable company globally. However, investors are now voicing worries because the investment in artificial intelligence projects has not corresponded with commensurate returns, making it challenging to define a lucrative path forward.
NVIDIA CEO on tanking AI hype, high GPU demand, and future job market
In a conversation with David Solomon, CEO of Goldman Sachs, during the Goldman Sachs Communacopia and Technology Conference, NVIDIA CEO Jensen Huang emphasized that their company has no plans to slow down.
Under a significant amount of pressure from many sources, we are relied upon by numerous individuals. The high demand for our components, technology, infrastructure, and software creates an intense emotional response because it directly impacts their earnings and competitive edge.
According to Huang, while generative AI is currently in a nascent stage, he envisions it advancing beyond just AI chatbots and data centers. In addition, this tech leader shared his thoughts on its impact on the workforce, focusing particularly on the field of coding.
According to Huang:
In the future, it’s likely that software engineers won’t be solely responsible for writing each line of code. Instead, they may work alongside digital engineers continuously, as this could be the norm moving forward.
Huang acknowledges that investing in generative AI can be costly. In fact, OpenAI was reported to be near bankruptcy within a year, anticipating losses amounting to $5 billion. It’s been suggested by experts and market analysts that additional funding is necessary to keep the company operating.
According to recent reports, Microsoft, Apple, and NVIDIA are rumored to join the investment round of OpenAI, which could potentially boost its market value over $100 billion. It’s been speculated that OpenAI is negotiating with investors to secure around $6.5 billion, bringing its market capitalization close to $150 billion. Additionally, the startup plans to borrow around $5 billion from several banks as debt financing.
One key point from Huang’s statement is that while training an AI model is important, it’s equally significant to actually utilize the trained model. By employing the model, you can significantly reduce the amount of time spent on processing tasks.
As the AI revolution unfolds, Huang expresses that “It’s truly overwhelming, carrying the weight of the world.” The CEO seems unfazed by the prospect of putting in extra time at work to meet the increased demand for technology that drives AI progress. He even jokingly says, “A few less hours of sleep won’t hurt. I just need three solid hours.
In essence, it’s said that NVIDIA workers often put in long hours, even working for weeks straight until 2 o’clock in the morning. However, this demanding schedule is offset by generous salary and benefits packages.
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2024-09-12 18:39