Nvidia CEO Jensen Huang delivers his keystone speech ahead of Computex 2024 in Taipei on June 2, 2024.
Sam Yeh | AFP | Getty Images
Nvidia CEO Jensen Huang said on Wednesday that the company’s advantage in artificial intelligence chips was due to a bet it made more than 10 years ago, centering on billions of dollars in AI investment and a team of thousands of engineers.
Huang’s comments came during the Q&A period of Nvidia’s shareholder meeting following a more than 200% surge in the stock over the past year. Wall Street has been enamored by the company’s dominant position in the AI chip market.
Nvidia recently split its stock 10-for-1, passed a $3 trillion valuation and briefly reached the status of most valuable public company.
The first question Huang answered Wednesday was about the company’s competition, as traditional chipmakers and startups alike release products intended to challenge Nvidia’s more than 80% market share in AI chips.
Nvidia shares fell more than 1% in trading on Wednesday.
Without naming competitors, Huang laid out the company’s overall strategy to maintain its position, leading with the idea that Nvidia has already “transformed” into a data center-focused company from its previous gaming focus. The company is also looking to create new markets for its AI, such as in industrial robotics, and it aims to partner with every computer maker and cloud provider to do so.
Huang said its AI chips provide the “lowest total cost of ownership,” suggesting that while other chips may be less expensive, Nvidia’s are more economical considering their performance and cost to run.
Ultimately, Huang said Nvidia had achieved a “virtuous circle,” a term in the technology industry that refers to when a platform has the most users, which allows it to make the improvements it needs to attract even more users.
“The NVIDIA platform is broadly available through every major cloud provider and computer maker, creating a large and attractive install base for developers and customers, which makes our platform more valuable to our customers,” Huang said.
Nvidia shareholders were pleased with the company’s performance and approved a nonbinding vote on executive compensation called “say on pay.” Nvidia executives are paid in a combination of salary and various kinds of restricted stock units.
Huang received a compensation package worth about $34 million during the company’s 2024 fiscal year, a 60% increase since 2023, according to the company’s annual filing.