Nvidia CEO: AI today is fundamental infrastructure, like electricity

Nvidia CEO: AI today is fundamental infrastructure, like electricity

NVIDIA's CEO Jensen Huang recently emphasized the pivotal role of artificial intelligence (AI) as a fundamental resource, akin to electricity. During his visits to Washington, D.C., and Beijing, Huang underscored the transformative potential of AI and NVIDIA's commitment to its development. In the U.S. capital, he met with President Trump and policymakers, reaffirming NVIDIA's support for job creation, domestic AI infrastructure, and onshore manufacturing. In Beijing, Huang discussed AI's role in raising productivity and expanding opportunity with government and industry officials [1].

Huang also provided updates on NVIDIA's GPU offerings. The company is filing applications to sell the NVIDIA H20 GPU again, with the U.S. government assuring NVIDIA of license grants and imminent deliveries. Additionally, NVIDIA announced the RTX PRO GPU, designed for digital twin AI applications in smart factories and logistics. Huang noted that the world has reached an inflection point, with AI becoming a fundamental resource like energy, water, and the internet [1].

The AI revolution is accelerating, with global data center spending projected to hit $1 trillion by 2028. NVIDIA's dominance in AI-driven data center GPUs, commanding a 92% market share as of Q1 2025, positions it as a linchpin of the next decade's tech economy. The company's 39.3% year-over-year revenue growth in Q1 2025 underscores its ability to monetize AI's hunger for compute, despite rising costs [2].

NVIDIA's data center margins have held steady above 65%, demonstrating its pricing power. The company's forward P/E of 25x is modest compared to peers, reflecting its undervaluation. Despite a 78% revenue surge in FY2025, the stock's price-to-sales ratio of 12x is reasonable given its AI-driven moat [2].

However, NVIDIA faces challenges, including U.S. export restrictions costing it $4.5 billion in write-downs and lost revenue, and competition from AMD and DeepSeek. The company's ability to adapt and innovate will be crucial in the coming years [2].

NVIDIA's AI Factory initiative, designed to manufacture intelligence at unprecedented scale, is a strategic imperative for organizations looking to leverage AI's competitive advantages. Legacy infrastructure is ill-equipped to meet the demands of modern AI ecosystems, necessitating purpose-built data centers engineered for cutting-edge AI workloads [3].

In conclusion, NVIDIA's CEO Jensen Huang's recent remarks highlight the transformative potential of AI as a fundamental resource. NVIDIA's dominance in AI-driven data center GPUs, coupled with its commitment to innovation, positions it as a key player in the AI economy. However, the company must navigate geopolitical risks and competitive pressures to maintain its leadership position.

References:
[1] https://blogs.nvidia.com/blog/nvidia-ceo-promotes-ai-in-dc-and-china/
[2] https://www.ainvest.com/news/nvidia-ai-imperium-10-000-investment-1-million-2035-2507/
[3] https://www.cio.com/article/4017280/why-ai-factories-matter-now-infrastructure-for-the-new-intelligence-era.html