Nvidia's Revolutionary AI Chip Propels Stock to New Heights

Nvidia's CEO Jensen Huang unveils a groundbreaking AI chip at a conference, causing a surge in both Nvidia's stock and the stocks of partner companies, highlighting the profound impact of Nvidia's technology across the industry.

By Raunak Bose
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Jensen Huang and a image of the New Blackwell AI Chip

Jensen Huang (Image via New York Times)

Tuesday saw a noteworthy 1% gain in the value of Nvidia's shares, the sharks of the semiconductor industry, as a result of comments made during its annual developer conference in San Jose, California by CEO Jensen Huang and CFO Colette Kress who shared details on Nvidia's most recent advancements in front of their investors. 

Nvidia’s newest flagship AI processor was announced in the conference making it one of the key highlights of the event. Later this year the chip is expected to be shipped, with Kress expressing his confidence in the timeline.

Analysts pointed out that Wall Street's predictions probably took the company's most recent invention, the B200 Blackwell chip, into account. The Blackwell Chip can complete certain operations 30 times faster, showing some notable improvements in its performance. 

Nvidia unveiled new software tools which alongside the Blackwell processor will enable developers to efficiently commercialise AI models. 

Nvidia CEO's Speech Boosts Partner Companies' Stocks More Than Its Own

Huang gave details about the Blackwell chip's pricing plan in an interview with CNBC. The chip's projected price range is between $30,000 and $40,000 per unit. This establishes the chip as a premium option for businesses dealing with taxing AI workloads.

While acknowledging the excitement surrounding Nvidia's technological breakthrough, Aptus Capital Advisors portfolio manager David Wagner cautioned about the hurdles of achieving heightened expectations amidst the company's spectacular 80% stock increase this year. 

Jensen Huang, NVIDIA CEO
Jensen Huang (Image via Bloomberg)

Although Huang's keynote speech did not have a major effect on Nvidia's stock price, many partners and consumers benefited from it. When Huang mentioned additional firms, the shares of engineering software behemoths including Synopsys Inc., Cadence Design Systems Inc., and Ansys Inc. rose more than 2%, even though postmarket trade had declined by 2%. After Huang emphasised Dell Technologies Inc.'s contribution to servers and personal computers, the company experienced a 3.2% increase in value. 

"The enterprise IT industry is sitting on a gold mine," he said. “They have so much understanding of the way work is done, they have all these amazing tools that have been created over the years, and they’re sitting on a lot of data."

Huang also addressed the importance of Nvidia's technology for operating a range of applications, giving chatbots and generative AI as examples. Michael Dell's expertise in establishing large-scale commercial systems was also acknowledged by Huang as he went on to describe the industry titans in software, such as SAP SE and ServiceNow Inc. who use Nvidia's platform. 

Nvidia wishes to grow itself to become the leader in AI with the help of these tools, making it easier for businesses to use its technology to market AI solutions.

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