Surging Demand for Nvidia AI Chips Reflects Soaring Growth in AI Development

Surging Demand for Nvidia AI Chips Reflects Soaring Growth in AI Development

Nvida AI Chip Value Soars Amid AI Development Boom

On May 24, Nvidia — the company behind the chip hailed as one of the world’s most powerful semiconductors — released its second-quarter revenue forecast, which came in at 50% above market expectations, according to a Reuters report.

Moreover, the company’s shares increased by nearly 28%, reaching an all-time high stock price of $391.50. Nvidia’s stock market value topped $950 billion, pushing the company far ahead as the world’s most valuable chipmaker.

Other Chip Developers in the Market

Other chip developers in the market include:

  • Google
  • Intel
  • Amazon
  • Apple

Meeting the Escalating Demand

Nvidia has been actively increasing its supply in response to the rising demand for AI chips, particularly those used in applications such as ChatGPT.

According to a follow-up report, Nvidia’s impressive results sparked a rally for other AI-related companies, adding nearly $100 billion to the market.

Microsoft’s AI Chip Development

Alongside Nvidia and other prominent tech companies, Microsoft recently announced its own AI chip development. The purpose is to power AI applications for OpenAI and internal projects.

In April, it was reported that Elon Musk, the CEO of SpaceX, Tesla, and former CEO of Twitter, had purchased thousands of general processing units for an upcoming Twitter AI project, according to a source close to the matter.

Overcoming Challenges in China

In China, developers are faced with sanctions that prohibit them from obtaining the latest version of Nvidia chips in the local market. As a result, Chinese companies and developers are exploring alternative solutions.

They are currently studying methods to develop AI using weaker semiconductors and combinations of various chips as a workaround.

While some experiments have shown promise, developers in China currently have access to chips that can only support small-scale AI models, such as the Nvidia chips A800 and H800.