Nvidia brought in $13.51 billion in revenue in the three months ended July 30, setting a new record for the company. “The new era of computing has begun. Global enterprises are shifting from general-purpose computing to accelerated computing and generative AI,” Nvidia founder and CEO Jasen Huang said in a statement.
Mr. Huang revealed that demand for Nvidia products is extremely strong and the company will expand production capacity. Supply will increase sharply in the rest of 2023 and next year.
Much of the demand for AI chips comes from China, even as the U.S. has imposed export restrictions on the country. Nvidia said Chinese buyers accounted for 20% to 25% of its data center product revenue. In total, data center products contributed $10.32 billion, up 171% from the second quarter of 2022.
Chinese internet giants are racing to secure high-performance Nvidia chips, with orders reaching $5 billion amid fears the US will further tighten its export ban, according to the Financial Times .
In September 2022, Washington announced a new export ban targeting high-end graphics processing units (GPUs) and AI accelerators used in high-performance computing in China, a move seen as further curbing China's technological and military advances.
After sales of its A100 and H100 AI chips were affected by the ban, Nvidia began selling its lower-end A800 and H800 chips to China. However, the US is reportedly considering further export restrictions to prevent Nvidia from selling AI chips to Chinese customers.
If that were to happen, it would have an immediate impact on the company’s bottom line, and in the long term, the restrictions would permanently deprive the U.S. industry of the opportunity to compete and lead in one of the world’s largest markets, Nvidia CFO Colette Kress said.
Another US chip giant, Intel, recently announced a four-fold increase in its high-end chip packaging services by 2025, with a new factory in Malaysia aimed at regaining its global leadership in semiconductor manufacturing.
The Penang plant will be Intel’s first overseas facility to use Foveros 3D chip packaging technology. The company is also building a new chip assembly and test line in Kulim.
Advanced chip packaging technology combines multiple chips into one package to increase computing power and reduce energy consumption. Malaysia will become Intel's largest 3D chip packaging facility, according to Vice President Robin Martin.
Chip packaging was previously considered less important and in lower demand than chip manufacturing. However, it has emerged as an important area in the current chip manufacturing race, especially with the explosion of artificial intelligence.
The advanced chip packaging market was worth $44.3 billion in 2022, according to research firm Yole Intelligence, and is expected to grow 10.6% annually to $78.6 billion by 2028. The latest catalyst is largely coming from chips that process large language models for AI, said semiconductor expert Mark Li.
(According to Nikkei)
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