Nvidia Corp. shares fell after CEO Jensen Huang’s product presentation failed to boost the company’s stock to new heights. The stock dropped 6.2% to $140.14, marking the biggest single-day decline in four months. While the announcements painted an optimistic picture of Nvidia’s long-term prospects, some investors were disappointed by the lack of short-term upside. Stifel Financial Corp. noted that the announcements were significant but long-tailed.
Huang’s presentation at the CES trade show in Las Vegas outlined Nvidia’s vision for the future of AI and showcased the new lineup of products. The company aims to be at the forefront of a tech world with a billion humanoid robots, 10 million automated factories, and 1.5 billion self-driving cars and trucks.
Interest in Nvidia’s products and forecasts has been on the rise as companies rush to adopt new AI computing technology. Huang detailed Nvidia’s products and strategy, including collaborations with Toyota Motor Corp. and MediaTek Inc., which led to a more than 3% increase in their respective share prices.
Prior to the stock decline, Nvidia’s shares had more than tripled in the past year. Asian suppliers like Taiwan Semiconductor Manufacturing Co. and Hon Hai Precision Industry Co. also saw gains on the back of optimism surrounding Nvidia’s future prospects.
According to Chief Financial Officer Colette Kress, the AI transition will continue to drive growth for the next decade and beyond. Nvidia sees significant growth opportunities in the future as the demand for AI accelerates.
During the presentation, Huang also announced updates to the GeForce GPUs targeting gamers. The new GeForce 50 series cards will leverage AI capabilities to deliver more immersive gaming experiences.
Nvidia’s data center operation is now a major source of revenue, surpassing gaming. The company’s accelerator chips are in high demand among tech giants, positioning Nvidia for continued growth. Expansion into new markets like business and government agencies is set to diversify Nvidia’s revenue streams.
Nvidia’s Cosmos technology aims to make robots smarter and enable fully autonomous vehicles by utilizing AI. The company is collaborating with Uber Technologies Inc. on self-driving technology, leveraging the vast amount of data from Uber’s daily trips for AI training.
Nvidia is also introducing Project Digits, a desktop PC designed for AI developers. The machine, developed with Taiwan’s MediaTek, features a powerful Grace Blackwell Superchip for running large AI models efficiently.
Huang hinted at Nvidia’s broader interest in the PC market, suggesting potential future plans in the sector. The company selected MediaTek for Project Digits due to its expertise in low-power semiconductors, with plans to offer the technology to other customers.
These developments indicate a significant shift in Nvidia’s focus towards AI-related products and technologies, reflecting the growing demand for AI solutions across various industries.
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