Nvidia Set for its Next Explosive Growth Engine – Robotics

Nvidia is betting on robotics as its next big driver of growth amid increasing competition in its core artificial intelligence business. The semiconductor giant is set to launch Jetson Thor, a new generation of compact computers for humanoid robots, in the first half of 2025.

Nvidia aims to establish itself as the leading platform for what it believes is an imminent robotics revolution. The company offers a full stack solution, encompassing software layers for training AI-powered robots to the chips that power them.

ChatGPT moment for physical AI and robotics is around the corner, Deepu Talla, Nvidia's vice-president of robotics, told the Financial Times, indicating that the market has reached a tipping point.

This strategic push into robotics comes as Nvidia faces more competition for its powerful AI chips from rival chipmakers such as AMD, and cloud computing giants like Amazon, Microsoft, and Google, who are developing their own AI chips to reduce reliance on Nvidia.

Nvidia, whose valuation has soared past $3 trillion due to high demand for its AI chips, is investing in the 'physical AI' space to help grow the next generation of robotics companies. In February, Nvidia was among several companies, including Microsoft and OpenAI, to invest in humanoid robotics company Figure AI at a $2.6 billion valuation.

Despite its potential, robotics remains an emerging niche that has yet to generate substantial returns. Many start-ups in the space are grappling with scaling, cost reduction, and increasing the accuracy of their robot products. Currently, robotics represents a relatively small share of Nvidia's overall revenues.

However, Talla highlighted that a shift in the robotics market is being driven by two technological breakthroughs: the explosion of generative AI models and the ability to train robots on these foundational models using simulated environments. This development helps address the Sim-to-Real gap, ensuring robots trained in virtual environments can operate effectively in the real world.

In the past 12 months, this gap has matured sufficiently that we can now carry out experiments in simulation, combining with generative AI, that we could not do two years ago, said Talla. We provide the platform for enabling all of these companies to do any of those tasks.

Nvidia's Jetson line of robotic 'brain' modules, which emerged in 2014, evolved from the company's initial work on its 'Tegra' chip aimed at the smartphone market. Talla, who joined Nvidia in 2013, oversaw the redeployment of about 3,000 engineers into AI and autonomous training, leading to the development of Jetson.

Nvidia supports robotics development at three stages: software for training foundational models through its 'DGX' system, simulations of real-world environments in its 'Omniverse' platform, and the hardware to go inside the robots as their 'brain.'

Companies like Apptronik, which uses Nvidia's technology for humanoid robots, and Amazon, which has deployed Nvidia's robotics simulation technology in three of its US warehouses, are among Nvidia's clients. Toyota and Boston Dynamics also use Nvidia's training software.

The global robotics market, currently valued at about $78 billion, is projected to reach $165 billion by the end of 2029, according to US market researchers BCC. However, significant challenges remain, including training models and ensuring their safety when deployed. David Rosen, who leads the Robust Autonomy Lab at Northeastern University, noted that verifying the safety and reliability of machine learning systems in robotics is a major open scientific question.

With the launch of Jetson Thor and its comprehensive approach to robotics, Nvidia is positioning itself to capitalize on the growing AI-driven robotic opportunities, supporting hundreds of thousands of robot developers worldwide. This move underscores Nvidia's ongoing expansion into the robotics sector, potentially setting the stage for its next significant growth engine.