NVIDIA’s business model
We all know NVIDIA (NVDA) as a chip supplier and leader in the discrete GPU (graphics processing unit) market. However, NVIDIA’s CEO, Jensen Huang, describes NVIDIA differently.
At the GTC 2018 (GPU Technology Conference), Huang stated that NVIDIA is “not a chip company” but a full stack computing company that offers a complete package encompassing computing architecture, system software, algorithms, and applications. With this, the company is laying the foundation for an entire AI (artificial intelligence) ecosystem.
NVIDIA still supplies GPU hardware and earns revenues from this sector. However, its GPU-optimized software CUDA makes this GPU hardware functional across various applications such as automotive, robotics, and AI. Within the CUDA platform, the company is developing several industry-specific applications such as medical imaging, product design, oil and gas exploration, and logistics.
NVIDIA has accelerated its efforts in the value-added platform, which is visible from its employee strength—it has more software engineers than hardware engineers.
Focus of GTC
At the GTC 2018, NVIDIA showcased its work that looks to ease the adoption of high-performance computing, accelerated analytics, VR/AR (virtual and augmented reality), rendering, and imaging into industry verticals such as healthcare, manufacturing, logistics, oil and gas, financial, and retail. This is a sign that GPU computing is going mainstream.
Rivals invest in AI
Rival Advanced Micro Devices (AMD) also supplies discrete GPU, but NVIDIA’s GPUs are preferred for AI because of the value-added platform CUDA that it has been building for more than ten years. AMD has also started investing in ROCM (Radeon Open Compute platform) to make its GPUs capable of machine learning.
Intel (INTC) tried to tap AI with several other accelerators such as FPGAs (field programmable gate array) but so far hasn’t been able to compete with NVIDIA in the AI space. Intel is now developing its discrete GPU with the help of the former AMD GPU head, Raja Koduri. It remains to be seen whether this new GPU can challenge NVIDIA’s GPU in the AI space.
In an interview with Barron’s, Rosenblatt Securities analyst Hans Mosesmann stated that NVIDIA is innovating its processors and software at a pace that is difficult to compete with. In this series, we’ll look at the past, present, and future of NVIDIA’s GPU technology.
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