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Jensen Huang says Nvidia is pulling back from OpenAI and Anthropic

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Re: Jensen Huang says Nvidia is pulling back from OpenAI and Anthropic

#31

Post by LarsDu88 »

01100011 wrote: post #14

Nvidia could flip a switch and start competing with former customers. They have the talent, the models, the HW, and they know how to quickly build out DCs.

That's not how a smart business runs and that's now how Nvidia operates.

Jensen is smart. He's gone through over 30 years of tech cycles.

Nvidia actively commoditizes the LLM models. Look at Nemotron. They've avoided making a SOTA model solely to keep the hyperscalers (aka crack addicts) coming back for more GPUs.

As soon as the bubble bursts, they can release some open weight NemoMambaDiffusiontron and keep folks buying GPUs to run the damn thing.

It still wouldn't be smart to do so, as this would fall into the common business pitfall of thinking you could easily do the next stack layer of work.

Re: Jensen Huang says Nvidia is pulling back from OpenAI and Anthropic

#32

Post by eitally »

y1n0 wrote: post #17
01100011 wrote: post #14

Nvidia could flip a switch and start competing with former customers. They have the talent, the models, the HW, and they know how to quickly build out DCs.

That would not go well for nvidia. Why would they want to enter and compete in a market where everybody is losing money? And in so doing alienate the people that make them profitable?

They don't, not directly. That's why they've generally been winding down DGX Cloud. However, lots of folks dramatically underestimate their frontier models (Nemotron family), and they license those models (free) for embedding in MANY other, large tech companies' own products and platforms, which either directly or indirectly consume massive quantities of GPU time.

Nvidia is best known for selling huge volumes of GPUs to the hyperscalers & neoclouds, but I don't think lots of folks appreciate how many GPUs ISVs like Snowflake, Databricks, Teradata, etc consume, too, just by virtue of designing much of their internal products around CUDA & Nemotron.

Re: Jensen Huang says Nvidia is pulling back from OpenAI and Anthropic

#33

Post by eitally »

tl2do wrote: post #4

Instead of pouring more money into OpenAI and Anthropic, Nvidia should invest more in expanding production capacity for the RTX 5000 series and future generations. High-end consumer GPU availability is still constrained, especially for the RTX 5090, and street prices remain elevated. Nvidia should come back to the consumer side.

Why would they do that? They launched the DGX Spark last year with multiple hardware OEMs selling flavors of the reference device (Dell, Lenovo, Asus). That contains a desktop-sized Grace Blackwell architecture GPU (GB10), and word on the street is that they're moving into laptops this year. Their market is the same market Apple is pitching the MacBook 5 Pro/Max, too: devs wanting local models. It's not currently a large market, but it's growing quickly. It makes far more sense for Nvidia to build hardware to service this market than to overly focus on their gaming lines. RTX GPUs are sell once. GB-containing consumer devices are "sell once, but then collect recurring revenue when the workloads those developers build hit production on a cloud somewhere."

Re: Jensen Huang says Nvidia is pulling back from OpenAI and Anthropic

#34

Post by eitally »

TheDong wrote: post #22
yndoendo wrote: post #16

Earlier quoted context omitted.

That is not substantiable. AI bubble is wealthy hype like a single drop of blood can be used to validate 100 different diagnostic test. Reality is parts per million fails this along with reusable medium. Wealth latches to idiocy. Gaming and CAD market are real expectations that latch to reality. Grow the education systems and grow both. So is matrix math, such as hashing. AI has reached a state of software issue, not…

> AI has reached a state of software issue, not hardware Citation very much needed. At the very least, OpenAI seems to believe more and larger datacenters is the path to better models... and they've been right about that every time so far.

Moreover, all the frontier labs and hyperscalers are capacity constrained, and will be for the foreseeable future.

Re: Jensen Huang says Nvidia is pulling back from OpenAI and Anthropic

#35

Post by SirMaster »

wingmanjd wrote: post #8
tl2do wrote: post #4

Instead of pouring more money into OpenAI and Anthropic, Nvidia should invest more in expanding production capacity for the RTX 5000 series and future generations. High-end consumer GPU availability is still constrained, especially for the RTX 5090, and street prices remain elevated. Nvidia should come back to the consumer side.

Datacenter income for nVidia last quarter was something like 62B vs the gaming market of https://nvidianews.nvidia.com/news/nvidia-announces-financia...

But so many gamers want to buy GPUs and can’t because they are sold out or won’t because they are super price inflated. Wouldn’t the gaming market be larger if the products were actually available and at their actual MSRP?

Re: Jensen Huang says Nvidia is pulling back from OpenAI and Anthropic

#36

Post by adventured »

whynotminot wrote: post #23

As long as both companies remain stable and viable, there's probably limited upside to pouring more money into them. If they fail, and bring down the AI ecosystem with them, that is very bad news for Nvidia. So they've been there nurturing their success and providing capital to backstop their exponential growth. You can see Nvidia stepping in throughout the ecosystem with confidence boosting investments where needed.…

These days Nvidia has more money than it knows what to do with. They could certainly push $5b+ into each company annually and never miss it. They're tracking toward an astounding $200b in operating income (maybe over the next four quarters if the music doesn't suddenly stop).

Re: Jensen Huang says Nvidia is pulling back from OpenAI and Anthropic

#37

Post by danpalmer »

SirMaster wrote: post #35
wingmanjd wrote: post #8

Earlier quoted context omitted.

Datacenter income for nVidia last quarter was something like 62B vs the gaming market of https://nvidianews.nvidia.com/news/nvidia-announces-financia...

But so many gamers want to buy GPUs and can’t because they are sold out or won’t because they are super price inflated. Wouldn’t the gaming market be larger if the products were actually available and at their actual MSRP?

Nvidia can't sell 10x the number of GPUs they sell. As much as the supply issues are discussed, it would likely take them a long time to just double the market. They could try to become the vendor of choice for the PS6/next xbox, but that's a big strategy shift for again maybe double the market, not 10x the market.

On the other hand right now the market doesn't seem to think that the >60bn of datacenter revenue is going away or even going to slow down _growing_ any time soon. Just adding 10% more revenue there is worth more than doubling their GPU business which they likely can't do.

Re: Jensen Huang says Nvidia is pulling back from OpenAI and Anthropic

#38

Post by estimator7292 »

y1n0 wrote: post #17
01100011 wrote: post #14

Nvidia could flip a switch and start competing with former customers. They have the talent, the models, the HW, and they know how to quickly build out DCs.

That would not go well for nvidia. Why would they want to enter and compete in a market where everybody is losing money? And in so doing alienate the people that make them profitable?

Presumably Nvidia would have a significant advantage on hardware costs, and could run custom hardware that the rest of the market will never see

Re: Jensen Huang says Nvidia is pulling back from OpenAI and Anthropic

#39

Post by codemac »

> Nvidia CEO Jensen Huang said his company’s recent investments in OpenAI and Anthropic are likely to be its last in both, saying that once they go public as anticipated later this year, the opportunity to invest closes

ok, sounds obvious

> Nvidia, for its part, isn’t offering much more on the matter

ok, so no more news from nvidia

> Still, a few other dynamics might also explain the pullback..

Wait it's a pullback?

This is terrible reporting, right?

Re: Jensen Huang says Nvidia is pulling back from OpenAI and Anthropic

#40

Post by locusofself »

adventured wrote: post #36
whynotminot wrote: post #23

As long as both companies remain stable and viable, there's probably limited upside to pouring more money into them. If they fail, and bring down the AI ecosystem with them, that is very bad news for Nvidia. So they've been there nurturing their success and providing capital to backstop their exponential growth. You can see Nvidia stepping in throughout the ecosystem with confidence boosting investments where needed.…

These days Nvidia has more money than it knows what to do with. They could certainly push $5b+ into each company annually and never miss it. They're tracking toward an astounding $200b in operating income (maybe over the next four quarters if the music doesn't suddenly stop).

5 billion doesn't look like much when OpenAI just raised $110b though. And how sustainable is NVDA's immense profits if this bubble actually bursts?
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