‘Moore’s Law’s dead,’ Nvidia CEO Jensen Huang says in justifying gaming-card price hike

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Nvidia Corp Chief Executive Jensen Huang said Wednesday that he thinks it’s going to be “an awesome Q4 for ADA,” even as the company’s next-generation chip architecture was unveiled this week. That critics pointed to a price hike during a period of sluggish consumer demand. ,

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nvidia nvida,
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Expects high demand for gaming chips using its next-generation “Ada Lovelace” chip architecture, Named after a 19th century English mathematician It is generally considered the world’s first computer programmer for his work on Charles Babbage’s Theoretical Analytical Engine.

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Sales of Nvidia’s $1,599 flagship RTX 4090 will drop as soon as sales begin on October 12, with other cards such as the $899 mid-tier 4080 to follow, and the “vast majority” of launches are due in late January. . fiscal fourth quarter, Huang said.

Complaints about the unexpected price hike circulated online. For the respective class of chip, the 4090 is priced 7% higher than the 2020 launch price of the 3090, which it is to replace. (For the 3090, an improved version of the original was going for $1,100 at . best Buy In an advertised $900 price drop.) Even more surprising, the 4080 costs 29% more than the 3080’s 2020 launch price.

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Lovelace replaces Ampere, which was unveiled in May 2020, amid strong demand for gaming cards, nearly two months into the COVID-19 pandemic. Ampere-based gaming cards were introduced in September 2020.

Huang certainly paid for that optimism in the form of two quarters of “really hard medicine,” when the chipmaker cut its outlook to not just once or twice, but three times, saying that $$ in sales. 400 million are now in the air. The US ban on the sale of data-center products to China, and a $1.22 billion fee to clear Ampere-based inventory ahead of the Lovelace launch.

Nvidia’s ‘China Syndrome’: Is the Stock Melting?

“We’re selling a lot, especially in the market for a lot less than what we’re selling, much less than what’s selling out of the market,” Huang said. “And I expect the channel to be back to normal sometime in Q4, by the Q4 time frame, and that would have made room for a great launch for Ada.”

As for critics, Huang said he thinks the high price is justified, especially since the state-of-the-art Lovelace architecture is necessary to support Nvidia’s expansion into the so-called metaverse.

“a 12 inch” [silicon] The wafer is a lot more expensive today than it was yesterday, and it’s not just a little more expensive, it’s a ton more expensive,” Huang said.

“Moore’s law is dead,” Huang said, referring to the standard that the number of transistors on a chip doubles every two years. “And the ability for Moore’s Law to deliver performance twice every year and a half, at half the cost, at the same cost, or at the same performance, is gone. It’s completely gone, and so the idea that The price of a chip going down over time is, unfortunately, a story of the past.”

“Computing isn’t a chip problem, it’s a software and chip problem,” Huang said.

, “Moore’s law is dead… it’s completely over.”,


— Jensen Huango, CEO of Nvidia

Nvidia continues to develop software

This is why, over the years, Nvidia has developed such a strong software ecosystem for its chips, that some analysts have begun to view Nvidia as a fast-growing software company.

This time around, Huang unveiled a major expansion of the company’s so-called Metaverse platform, which features the company’s first software-as-a-service and infrastructure-as-a-service products, designed, published, operated and experienced. Metaverse Application.

Another push into SaaS is Nvidia’s NeMo and BioNeMo large-language-model cloud AI services. LLMs are machine-learning algorithms that use large-scale text-based data sets to recognize, predict, and generate human language. While NeMo is the general model service, BioNemo specializes in implementing LLMs for biological and chemical research.

Noting that Nvidia essentially offers the RTX 3080-gaming-chip-as-a-service with its GeForce Now priority service, which dropped in November, customers will be charged $30 for six months of RTX 3080 gaming chip performance. 99.99, MarketWatch asked Huang if he foresaw the use of purchased, physical GPU hardware being replaced by cloud-based subscription services.

Nvidia sales drop nearly $1 billion less than expected, stock falls

“I don’t think so,” Huang said. “There are clients who want to be owners, and there are clients who like to be hired.”

“Some people would prefer to outsource the factory,” Huang said. “And remember, artificial intelligence is going to be a factory, it’s going to be the most important factory in the future.”

“Raw material comes into a factory, and some comes out,” Huang said. “In the future, data is going to come in factories, and what comes out is going to be intelligence, models.”

As far as factories are concerned, Nvidia should have options to serve all customers at large. “Things will be at OPEX instead of startup,” Huang said. “Large, established companies will have things in capex.”

Over the years, Nvidia has shown that it is not resistant to change, going from that gaming-chip company to becoming the largest US chip maker by market cap after data-center designers replaced Nvidia’s graphics-processing units, or Could not find GPU. Just beautify videogames, their parallel processors were very useful in machine learning.

Cisco Systems Inc. Many other tech hardware companies like CSCO,
-2.33%
and International Business Machines Corp. IBM,
-1.08%,
Over the years and to varying degrees of resistance and enthusiasm, software and services companies have virtually transformed by necessity, as more businesses migrate their data to the cloud rather than keeping it on-premises in proprietary servers.

Reading: The end of one-chip wonders: why the valuations of Nvidia, Intel and AMD have experienced massive turmoil

Of the 43 analysts who cover Nvidia, 31 have a buy-grade rating, 11 have a hold rating, and one has a sell rating. Of those, 13 lowered their price targets, resulting in an average target price of $202, down from the previous $202.51.

Shares closed up 0.7% at $132.61 on Wednesday, while the S&P 500 index was down 1.7%, led by SPX.
-1.71%,

During the year, Nvidia shares fell 55%, compared to a 36% drop by the PHLX Semiconductor Index SOX,
-0.97%,
20% down by S&P 500 index SPX,
-1.71%,
and a 28% drop for the tech-heavy Nasdaq Composite Index comp,
-1.79%,

As for Ampere Run, Nvidia’s stock price has declined 4.7% since September 1, 2020, when Nvidia unveiled its RTX 3000 series Ampere-based gaming chips, a 9.3% gain by the S&P 500 over that period.

factset/marketwatch

Credit: www.marketwatch.com /

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