NVIDIA Q1 FY25 earnings conference call

Confrence Call Q&A

Q: I wanted to ask about the competition. Many of your cloud customers have announced new or updated internal programs in parallel to what they're working on with you guys. To what extent did you consider them competitors, medium to long term?

A: We're different in several ways. First, NVIDIA's accelerated computing architecture allows customers to process every aspect of their pipeline from unstructured data processing to prepare it for training, to structured data processing, data frame processing like SQL to prepare for training, to training to inference.

Second, we're in every cloud. And so for developers that are looking for a platform to develop on, starting with NVIDIA is always a great choice.

The third reason has to do with the fact that we build AI factories. And this is becoming more an apparent to people that AI is not a chip problem only. And so the fact that NVIDIA builds this system causes us to optimize all of our chips to work together as a system, to be able to have software that operates as a system, and to be able to optimize across the system.

Q: You have a lot of demand for H200 and for Blackwell products. Do you anticipate any kind of pause with Hopper and H100 as you sort of migrate to those products?

A: We see increasing demand of Hopper through this quarter. And we expect to be -- we expect demand to outstrip supply for some time as we now transition to H200, as we transition to Blackwell. Everybody is anxious to get their infrastructure online. And the reason for that is because they're saving money and making money, and they would like to do that as soon as possible.

Q: Being supply constrained, you came out with a product for China, H20. I'm assuming there'd be a ton of demand for it, but obviously, you're trying to serve your customers with the other Hopper products. Just kind of curious how you're thinking about that in the second half.

A: Well, we have customers that we honor and we do our best for every customer. It is the case that our business in China is substantially lower than the levels of the past. And it's a lot more competitive in China now because of the limitations on our technology. And so those matters are true. However, we continue to do our best to serve the customers in the markets there and to the best of our ability, we'll do our best. But I think overall, the comments that we made about demand outstripping supply is for the entire market and particularly so for H200 and Blackwell towards the end of the year.

Q: I know Blackwell hasn't even launched yet, but obviously, investors are forward-looking and amidst rising potential competition from GPUs and custom ASICs, how are you thinking about NVIDIA's pace of innovation and your million-fold scaling over the last decade?

A: Well, I can announce that after Blackwell, there's another chip. And we are on a one-year rhythm. And so and you can also count on us having new networking technology on a very fast rhythm. We're all in on Ethernet, and we have a really exciting road map coming for Ethernet. We have a rich ecosystem of customers and partners who are going to announce taking our entire AI factory architecture to market.

And we're fully committed to all three links, NVLink computing fabric for single computing domain to InfiniBand computing fabric, to Ethernet networking computing fabric. And so we should be able to scale out with the NVIDIA architecture for this new era of computing and start this new industrial revolution where we manufacture not just software anymore, but we manufacture artificial intelligence tokens and we're going to do that at scale.

Q: I've never seen the velocity that you guys are introducing new platforms at the same combination of the performance jumps. But, it also creates an interesting juxtaposition where the current generation of products that your customers are spending billions of dollars on is going to be not as competitive with your new stuff. So I'd like you to--if you wouldn't mind speaking a little bit about how you're seeing that situation evolve itself with customers.

A: We're in a one-year rhythm, as we've explained to the world. And we want our customers to see our road map as far as they like, but they're early in their build-out anyway, so they had to just keep on building. And so there will be a whole bunch of chips coming at them, and they just have to keep on building and, if you will, performance average your way into it. So that's the smart thing to do. They need to make money today. They want to save money today. And time is really, really valuable to them.

And so the question is, do you want to be repeatedly the company delivering groundbreaking AI or the company delivering 0.3% better? And that's the reason why this race, as in all technology races, the race is so important.

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