On February 22nd, NVIDIA released its financial report. During the earnings call following the financial report release, NVIDIA’s CEO Jensen Huang and executives discussed the situation in the Chinese market.
NVIDIA executives mentioned that the revenue from data centers in the Chinese region had dropped to single digits and they had begun supplying a small amount of alternative products that do not require licenses to the Chinese region.
NVIDIA’s performance hit a record high, with the stock price breaking $700 after hours. Jensen Huang stated that “accelerated computing and generative artificial intelligence have reached a critical point, with demand surging from companies, industries, and countries worldwide.” He noted that while overall supply is improving, shortages still exist, and supply constraints will persist throughout the year.
During the earnings call, NVIDIA executives mentioned that following the export control regulations set by the U.S. government in October last year, the revenue from data centers in China had significantly decreased. In the fourth quarter, China accounted for a single-digit percentage of the company’s data center revenue, and it is expected to remain in a similar range in the next quarter. Apart from China, data center growth from all other regions was robust. Historical data indicates that revenue from data center operations in restricted countries and regions like China contributed approximately 20%-25% in past quarters.
NVIDIA executives stated that the company has not yet obtained a license from the U.S. government to ship restricted products to China. However, NVIDIA has started supplying a small amount of alternative products that do not require licenses to the Chinese region.
NVIDIA executives also mentioned that the supply chain for NVIDIA’s supercomputers, from wafers and packaging to memory and networking, has significantly improved.
NVIDIA anticipates that the scale of data center infrastructure will double within five years.
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