Nvidia CEO Jensen Huang Talks Earnings, AI Growth Outlook, China Market
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Let's bring in Nvidia CEO Jensen Huang following the company's earnings and analyst call. Jensen, thank you for your time here on Bloomberg Technology. You went into great detail about what's happening, particularly in China. I just wanted to go over something that I felt wasn't asked, which is fiscal second quarter sales, $45 billion, plus or minus 2%.

$8 billion of lost revenue opportunity, specifically relating to China and H20. It seems as if you made up somewhere some demand for a different product or from a different geography or from a different corner of the market. What was that?

Well, we got a whole bunch of engines firing right now. The biggest one, of course, is the reasoning AI inference. The demand is just off the charts. You see the popularity of all these AI services now, ChatGPT, Gemini.

you know, so on and so forth, Grok. I mean, they're just doing incredibly well across the board. And all of the APIs that they serve out and all the agentic AI services that are built on top of them, they're all doing incredibly well. I think that there's just a giant breakthrough in AI's capability and inferencing has just become a giant workload. Second,

And people realize that Blackwell is just a home run. MVLink 72 is a home run architecture. We designed it to be a thinking machine, a reasoning AI system. And I think people now, the confluence of the breakthrough in reasoning AI and the availability, you know, now the emergence of Grace Blackwell, MVLink 72, perfect timing. I think that's at the core of

And so it is fair to say that some of that additional supply on Blackwell and the demand for Blackwell kind of made up for the opportunity lost in China, at least in the outlook for this current period?

Yeah, I guess so. But you just can't underestimate the importance of the China market. This is the second largest AI market. This is the home of the world's largest population of AI researchers. And we want all of the world's AI researchers and all of the world's developers to be building on American stacks.

And so, irrespective of the near-term revenue success that we have, we can't ignore the fact that the Chinese market is very important. You explained again in some detail that at least in the Hopper architecture, you have engineered down to the lowest spec possible. It's not possible to do anything different with Hopper for the Chinese market.

But in your consideration for a different architecture or a chip for the Chinese market, is that what we're talking about, a new design or new class? And have you made that proposal to the administration, just designing from the ground up a new chip? We're still thinking through that. The limitations are quite stringent, quite limited, if you will. H20 is...

as far down as we could take a hopper. We don't know how to make it even less. And so that's really the limit. But so there aren't main, the limitations are quite stringent. So we have to really think through it. Whatever we make ultimately has to add value to the market. And so it's a really tight rope because

Because the Chinese competitors have evolved and advanced greatly over the last year. Like everybody else, they're doubling, quadrupling their capabilities every year. And the volume is increasing substantially. And remember, these are data center chips. They don't have to be small. They could be quite large. And without American technology, the availability of Chinese technology will fail the market. And so...

Whatever we offer has to at least be competitive and has to add value to the market. Jensen, does Huawei have an AI accelerator or a GPU that is performant as H20 or is performant of other classes of GPU that you make? Huawei's technology, based on our best understanding at the moment, and we have a lot of ground truth there, is probably comparable to an H200.

And so they've been moving quite fast. And they've also offered this new system called Cloud Matrix that scales up to even a larger system than our latest generation, Grace Blackwell. And so Huawei, as you know, is a formidable technology company, and they're not sitting still. And they look for ways to compete, and they're quite formidable.

With that in mind, you've kind of explained the landscape now, NVIDIA's ability to operate in China. I mean, you and I this year alone have already discussed the idea that there are 50% of the world's AI researchers in or from China. But are you having a sense of the vacuum created that those big names, I think about Tencent or Alibaba or Baidu that were buyers of H20, that they've already pivoted and turned to the offering from Huawei because of the policy that is in place?

Yeah, they have no choice but to, you know, one of the challenges of the changing regulations is the ability for markets to trust the Nvidia and ultimately American platforms. And so it's prudent, I think, for the Chinese customers to make sure that they develop their stack on Huawei.

And because it's hard to rely on American technology at this point. And so that's one of the unfortunate parts of changing policies. But anyhow, I have every confidence that if able to compete, American companies will compete. This is to...

to write off American technology companies is not smart. This is the home of some of the brightest computer scientists in the world. American companies are incredibly competitive. We just have to have the confidence to go compete. And if we have the confidence to compete, we will win.

You said during the earnings call that you trust President Trump and that the president has a vision and a plan. Could I ask if you've talked to him about that plan and if it includes coordinating with Nvidia on policy adjustment that relates to changes in technology export controls? Well, obviously, I don't know all of his ideas, but let me tell you about two that are incredible.

The first one is utterly visionary, the idea of tariffs being a pillar of a bold vision to reindustrialize to onshore manufacturing and motivate the world to invest in the United States.

It's just an incredible vision. I think this is going to be a transformative idea for the next century for us. We're all in on the idea. We're setting up plants and encouraging our partners from around the world to invest in the United States, and we have a lot of stuff going on. And so I'm very excited about that. The second major idea is to rescind the AI diffusion rule, recognizing that this isn't about limiting American technology, but this is about accelerating technology

American stacks around the world to make sure that before it's too late that the world builds on on American stacks during this extraordinary time the AI era and so these two these two initiatives are completely visionary and it's going to be transformative for America

Jensen, in the time that you and I have been on air having this conversation, some news has broken from US Secretary of State Rubio, who has said that the US will begin revoking some Chinese student visas. What I wanted to ask you is that with US government limits on foreign student visas, how does that impact a company like NVIDIA? I think about the size, but also composition of your engineering talent here in California and elsewhere in the United States.

I believe the administration still feels very strongly about the incredible importance of immigration. Look, I'm an immigrant. I know many immigrants that came to the United States to build a great life, and many of us have contributed greatly to the technology industry in the United States. I believe that that's going to have to continue.

Remember, people from all over the world want to come to the United States. This is such an extraordinary country with such incredible opportunities. We want the brightest to come here. We don't want everybody to be able to come here and there should be rules.

And but nonetheless, for the ones that really can make a contribution, want to make a difference, we want to make it possible for them to come here and bring their great ideas, bring their great intellect and help us build a great America. And so I think the administration is all in on that. And I don't think anything that they've said changes that.

Jensen, I surveyed our Bloomberg Technology audience around the world for questions for you. And I think the most common question is understanding who NVIDIA's customers are away from the hyperscalers. But actually, many questions about Elon Inc. and whether Tesla and XAI in aggregate might actually be one of the biggest customers you have. You think about not just the data center chips, but the chips specific for automations.

Optimus or in the cars, the Omniverse component. Could you speak a little about that? We do a lot of business with Tesla and XAI. Elon, as you know, is just an extraordinary engineer. And I love working with him. We've built some amazing computers together. We're going to build many more computers together. And the work that he's doing in Grok is

his self-driving car, his Optimus. These are all, every single one of them, world-class. Every single one of them, revolutionary. Every single one of them are going to be gigantic opportunities. And we're delighted, I'm delighted to be working with him on that. And so I think the

The optimist opportunity is just right around the corner. It's very likely that human robots are going to be robots that we can deploy into the world relatively easily. And this is the first robot that really has a chance to achieve the high volume and technology scale necessary to advance technology. And so I think this is likely to be the next multi-trillion dollar industry. I'm very excited for him.

Jensen, let's end by talking about Europe. You alluded to a trip you're taking next week. It sounds as if the infrastructure build-out in Europe is coming. Where will you be visiting and who will you be speaking with? Well, I'm going to leave the who as a surprise for all of you, but I'll be seeing lots of heads of states, and I'll be in France and UK and Germany.

and Belgium and I think that the, it's very clear now that every country recognizes that artificial intelligence like electricity, like internet, like communications is part of a national infrastructure. No society could do without intelligence as you know

And there's an awakening that every country has to take some initiative to ensure that their country and their society has access to artificial intelligence. And so we're really delighted to be able to work with the European countries

countries to bring AI infrastructure to them and work with them to build AI factories. There's an umpteen number of AI factory projects in discussion and development. And so I'm really excited to make this trip. We're going to be all over Europe. NVIDIA CEO, Jensen Wang, thank you.

Thank you. Great to see you. Thrivent can help you plan your finances for the people, causes, and community you love. What makes Thrivent different? Financial services and generosity programs are combined to help you build a financial roadmap for the future while also creating opportunities to give back along the way. Visit Thrivent.com to learn more. Thrivent, where money means more. This is an iHeart Podcast.