Btw, the truth can be funny, now proven, or at least amusing, but not necessarily hee haw, even if bears rumination so as to extract every morsel of understanding - sort of like attempts at gold mining and at paper gold-mining
finance.yahoo.com
Nvidia CEO Jensen Huang's Joke Sparks Concerns Over Rapid Depreciation Of AI Chips
Bibhu Pattnaik
Tue, March 25, 2025 at 9:40 AM GMT+8 3 min read
In a recent jest, Nvidia’s CEO Jensen Huangmay have inadvertently raised serious concerns for the company’s major clients, including tech behemoths like Amazon, Microsoft, and Google.
What Happened: According to a report, Huang humorously commented on the swift obsolescence of Nvidia’s AI chips at the company’s AI conference.
While the introduction of more potent GPUs like Blackwell is generally a positive development for the AI community, the fast-paced advancement of technology can render previous versions outdated quicker.
This could result in these assets depreciating faster, which could affect the earnings of large cloud companies, reports the Insider.
“I said before that when Blackwell starts shipping in volume, you couldn’t give Hoppers away,” he stated, alluding to the company’s latest AI chip-and-server package, Blackwell, and its predecessor, Hopper.
Barclays’ leading tech analyst, Ross Sandler, cautioned that these companies might need to implement changes that could substantially decrease profits. “Hyperscalers are likely overstating earnings,” he noted in an investor memo.
Amazon Web Services, the biggest cloud provider, has already experienced the effects. CFO Brian Olsavsky announced last month that the company had to reduce the useful life of some of its servers and networking equipment, which will decrease operating income this year by approximately $700 million.
Sandler projected that a similar alteration at Meta and Google could diminish their operating income by $5 billion and $3.5 billion, respectively.
However, not all companies may need to implement the same changes. Some might design their AI data centers differently, enabling Nvidia GPU systems to last longer or become less obsolete less quickly.
Why It Matters: The rapid depreciation of AI chips could have significant financial implications for tech giants who are major customers of Nvidia. The depreciation of these assets could lead to a decrease in earnings and operating income, which could in turn impact their overall profitability.
This situation underscores the challenges faced by tech companies in keeping up with the fast-paced advancement of technology and the need for strategic planning in managing their resources. |
