'Godfather Of GPU' Nvidia's Jensen Huang Says 'AI Factories' Will One Day Take Over The World

"Godfather of GPU" Jensen Huang thinks that "AI factories" will one day take over the world, marking their presence in "every industry, every company, every region."

What Happened: Nvidia Corp. NVDA CEO Huang sounded gung-ho about the rapid adoption of AI applications and accelerated computing – after all, his company has a 70% market share worldwide regarding AI chips.

On top of it, Nvidia is now developing what it calls "operating system of AI" – Huang thinks it could one day become a "very significant" business after the company's software services segment hit $1 billion in annualized revenue run rate during the fourth quarter.

See Also: Jensen Huang Predicts Every Enterprise On The Planet Will Eventually Run On Nvidia’s ‘Operating System For AI’

Overall, Nvidia reported $22.1 billion in revenue during the fourth quarter, against Street expectations of $20.62 billion, according to data from Benzinga Pro.

So, what exactly does Huang mean by AI factories?

Huang thinks Nvidia's AI chips have enabled an entirely new industry. "Basically, it takes raw material, which is data, it transforms it with these AI supercomputers that Nvidia builds, and it turns them into incredibly valuable tokens."

These valuable tokens are the output generated by AI chatbots like OpenAI's ChatGPT, or Midjourney. Essentially, end users like us see this when we interact with ChatGPT or Midjourney and other AI chatbots.

"All of these tokens are generated in a very specialized type of data center. And this data center we call AI supercomputers and AI generation factories," Huang explained.

Why It Matters: Huang says AI factories are already here, enabling an entirely new type of industry that uses data as its raw material. With Nvidia's dominance in the AI chips industry with a 70% market share, this puts the Huang-led company in a very favorable position to power the next "industrial revolution" in the world.

At the same time, Huang has also been advocating for "Sovereign AI" – he is essentially urging nations to invest in and develop their own AI to ensure their data is in their own hands.

NVDA Price Action: Nvidia stock closed at $735.94, up 9.07% during the last 24 hours, versus a 52-week range of $204 to $746, according to Benzinga Pro data.

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Photo by Igor Omilaev on Unsplash