Investors have closely watched Nvidia\u2019s week-long GPU Technology Conference (GTC) for news and updates from the dominant maker of chips that power artificial intelligence applications.<\/p>\n
The event comes at a pivotal time for Nvidia shares. After two years of monster gains, the stock is down 15% over the past month and 22% below the January all-time high.<\/p>\n
As part of the event, CEO Jensen Huang took questions from analysts on topics ranging from demand for its advanced Blackwell chips to the impact of Trump administration tariffs. Here\u2019s a breakdown of how Huang responded \u2014 and what analysts homed in on \u2014 during some of the most important questions:<\/p>\n
Huang said he \u201cunderrepresented\u201d demand in a slide that showed 3.6 million in estimated Blackwell shipments to the top four cloud service providers this year. While Huang acknowledged speculation regarding shrinking demand, he said the amount of computation needed for AI has \u201cexploded\u201d and that the four biggest cloud service clients remain \u201cfully invested.\u201d<\/p>\n
Morgan Stanley analyst Joseph Moore noted that Huang\u2019s commentary on Blackwell demand in data centers was the first-ever such disclosure.<\/p>\n
\u201cIt was clear that the reason the company made the decision to give that data was to refocus the narrative on the strength of the demand profile, as they continue to field questions related to Open AI related spending shifting from 1 of the 4 to another of the 4, or the pressure of ASICs, which come from these 4 customers,\u201d Moore wrote to clients, referring to application-specific integrated circuits.<\/p>\n
Piper Sandler analyst Harsh Kumar said the slide was \u201conly scratching the surface\u201d on demand. Beyond the four largest customers, he said others are also likely \u201call in line looking to get their hands on as much compute as their budgets allow.\u201d<\/p>\n
Another takeaway for Moore was the growth in physical AI, which refers to the use of the technology to power machines\u2019 actions in the real world as opposed to within software.<\/p>\n
At previous GTCs, Moore said physical AI \u201cfelt a little bit like speculative fiction.\u201d But this year, \u201cwe are now hearing developers wrestling with tangible problems in the physical realm.\u201d<\/p>\n
Truist analyst William Stein, meanwhile, described physical AI as something that\u2019s \u201cstarting to materialize.\u201d The next wave for physical AI centers around robotics, he said, and presents a potential $50 trillion market for Nvidia.<\/p>\n
Stein highliughted Jensen\u2019s demonstration of Isaac GR00T N1, a customizable foundation model for humanoid robots.<\/p>\n
Several analysts highlighted Huang\u2019s explanation of what tariffs mean for Nvidia\u2019s business.<\/p>\n
\u201cManagement noted they have been preparing for such scenarios and are beginning to manufacture more onshore,\u201d D.A. Davidson analyst Gil Luria said. \u201cIt was mentioned that Nvidia is already utilizing [Taiwan Semiconductor\u2019s\u2019] Arizona fab where it is manufacturing production silicon.\u201d<\/p>\n
Bernstein analyst Stacy Rasgon said Huang\u2019s answer made it seem like Nvidia\u2019s push to relocate some manufacturing to the U.S. would limit the effect of higher tariffs.<\/p>\n
Rasgon also noted that Huang brushed off concerns of a recession hurting customer spending. Huang argued that companies would first cut spending in the areas of their business that aren\u2019t growing, Rasgon said.<\/p>\n<\/p>\n
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