NVIDIA

us-taking-25%-cut-of-nvidia-chip-sales-“makes-no-sense,”-experts-say

US taking 25% cut of Nvidia chip sales “makes no sense,” experts say

AI, AI chips, china, Donald Trump, NVIDIA, Policy, us-china trade war / /

Trump’s odd Nvidia reversal may open the door for China to demand Blackwell access.

Donald Trump’s decision to allow Nvidia to export an advanced artificial intelligence chip, the H200, to China may give China exactly what it needs to win the AI race, experts and lawmakers have warned.

The H200 is about 10 times less powerful than Nvidia’s Blackwell chip, which is the tech giant’s currently most advanced chip that cannot be exported to China. But the H200 is six times more powerful than the H20, the most advanced chip available in China today. Meanwhile China’s leading AI chip maker, Huawei, is estimated to be about two years behind Nvidia’s technology. By approving the sales, Trump may unwittingly be helping Chinese chip makers “catch up” to Nvidia, Jake Sullivan told The New York Times.

Sullivan, a former Biden-era national security advisor who helped design AI chip export curbs on China, told the NYT that Trump’s move was “nuts” because “China’s main problem” in the AI race “is they don’t have enough advanced computing capability.”

“It makes no sense that President Trump is solving their problem for them by selling them powerful American chips,” Sullivan said. “We are literally handing away our advantage. China’s leaders can’t believe their luck.”

Trump apparently was persuaded by Nvidia CEO Jensen Huang and his “AI czar,” David Sacks, to reverse course on H200 export curbs. They convinced Trump that restricting sales would ensure that only Chinese chip makers would get a piece of China’s market, shoring up revenue flows that dominant firms like Huawei could pour into R&D.

By instead allowing Nvidia sales, China’s industry would remain hooked on US chips, the thinking goes. And Nvidia could use those funds—perhaps $10–15 billion annually, Bloomberg Intelligence has estimated—to further its own R&D efforts. That cash influx, theoretically, would allow Nvidia to maintain the US advantage.

Along the way, the US would receive a 25 percent cut of sales, which lawmakers from both sides of the aisle warned may not be legal and suggested to foreign rivals that US national security was “now up for sale,” NYT reported. The president has claimed there are conditions to sales safeguarding national security but, frustrating critics, provided no details.

Experts slam Nvidia plan as “flawed”

Trump’s plan is “flawed,” The Economist reported.

For years, the US has established tech dominance by keeping advanced technology away from China. Trump risks rocking that boat by “tearing up America’s export-control policy,” particularly if China’s chip industry simply buys up the H200s as a short-term tactic to learn from the technology and beef up its domestic production of advanced chips, The Economist reported.

In a sign that’s exactly what many expect could happen, investors in China were apparently so excited by Trump’s announcement that they immediately poured money into Moore Threads, expected to be China’s best answer to Nvidia, the South China Morning Post reported.

Several experts for the non-partisan think tank the Counsel on Foreign Relations also criticized the policy change, cautioning that the reversal of course threatened to undermine US competition with China.

Suggesting that Trump was “effectively undoing” export curbs sought during his first term, Zongyuan Zoe Liu warned that China “buys today to learn today, with the intention to build tomorrow.”

And perhaps more concerning, she suggested, is that Trump’s policy signals weakness. Rather than forcing Chinese dependence on US tech, reversing course showed China that the US will “back down” under pressure, she warned. And they’re getting that message at a time when “Chinese leaders have a lot of reasons to believe they are not only winning the trade war but also making progress towards a higher degree of strategic autonomy.”

In a post on X, Rush Doshi—a CFR expert who previously advised Biden on national security issues related to China—suggested that the policy change was “possibly decisive in the AI race.”

“Compute is our main advantage—China has more power, engineers, and the entire edge layer—so by giving this up, we increase the odds the world runs on Chinese AI,” Doshi wrote.

Experts fear Trump may not understand the full impact of his decision. In the short-term, Michael C. Horowitz wrote for CFR, “it is indisputable” that allowing H200 exports benefits China’s frontier AI and efforts to scale data centers. And Doshi pointed out that Trump’s shift may trigger more advanced technology flowing into China, as US allies that restricted sales of machines to build AI chips may soon follow his lead and lift their curbs. As China learns to be self-reliant from any influx of advanced tech, Sullivan warned that China’s leaders “intend to get off of American semiconductors as soon as they can.”

“So, the argument that we can keep them ‘addicted’ holds no water,” Sullivan said. “They want American chips right now for one simple reason: They are behind in the AI race, and this will help them catch up while they build their own chip capabilities.”

China may reject H200, demand Blackwell access

It remains unclear if China will approve H200 sales, but some of the country’s biggest firms, including ByteDance, Tencent, and Alibaba, are interested, anonymous insider sources told Reuters.

In the past, China has instructed companies to avoid Nvidia, warning of possible backdoors giving Nvidia a kill switch to remotely shut down chips. Such backdoors could potentially destabilize Chinese firms’ operations and R&D. Nvidia has denied such backdoors exist, but Chinese firms have supposedly sought reassurances from Nvidia in the aftermath of Trump’s policy change. Likely just as unpopular with the Chinese firms and government, Nvidia confirmed recently that it has built location verification tech that could help the US detect when restricted chips are leaked into China. Should the US ever renew export curbs on H200 chips, adopting them widely could cause chaos in the future.

Without giving China sought-after reassurances, Nvidia may not end up benefiting as much as it hoped from its mission to reclaim lost revenue from the Chinese market. Today, Chinese firms control about 60 percent of China’s AI chip market, where only a few years ago American firms—led by Nvidia—controlled 80 percent, the Economist reported.

But for China, the temptation to buy up Nvidia chips may be too great to pass up. Another CFR expert, Chris McGuire, estimated that Nvidia could suddenly start exporting as many as 3 million H200s into China next year. “This would at least triple the amount of aggregate AI computing power China could add domestically” in 2026, McGuire wrote, and possibly trigger disastrous outcomes for the US.

“This could cause DeepSeek and other Chinese AI developers to close the gap with leading US AI labs and enable China to develop an ‘AI Belt and Road’ initiative—a complement to its vast global infrastructure investment network already in place—that competes with US cloud providers around the world,” McGuire forecasted.

As China mulls the benefits and risks, an emergency meeting was called, where the Chinese government discussed potential concerns of local firms buying chips, according to The Information. Reportedly, Beijing ended that meeting with a promise to issue a decision soon.

Horowitz suggested that a primary reason that China may reject the H200s could be to squeeze even bigger concessions out of Trump, whose administration recently has been working to maintain a tenuous truce with China.

“China could come back demanding the Blackwell or something else,” Horowitz suggested.

In a statement, Nvidia—which plans to release a chip called the Rubin to surpass the Blackwell soon—praised Trump’s policy as striking “a thoughtful balance that is great for America.”

China will rip off Nvidia’s chips, Republican warns

Both Democratic and Republican lawmakers in Congress criticized Trump’s plan, including senators behind a bipartisan push to limit AI chip sales to China.

Some have questioned how much thought was put into the policy, as the US confusingly continues restricting less advanced AI chips (like the A100 and H100) while green-lighting H200 sales. Trump’s Justice Department also seems to be struggling to keep up. The NYT noted that just “hours before” Trump announced the policy change, the DOJ announced “it had detained two people for selling those chips to the country.”

The chair of the Select Committee on Competition with China, Rep. John Moolenaar (R-Mich.), warned on X that the news wouldn’t be good for the US or Nvidia. First, the Chinese Communist Party “will use these highly advanced chips to strengthen its military capabilities and totalitarian surveillance,” he suggested. And second, “Nvidia should be under no illusions—China will rip off its technology, mass produce it themselves, and seek to end Nvidia as a competitor.”

“That is China’s playbook and it is using it in every critical industry,” Moolenaar said.

House Democrats on committees dealing with foreign affairs and competition with China echoed those concerns, The Hill reported, warning that “under this administration, our national security is for sale.”

Nvidia’s Huang seems pleased with the outcome, which comes after months of reportedly pressuring the administration to lift export curbs limiting its growth in Chinese markets, the NYT reported. Last week, Trump heaped praise on Huang after one meeting, calling Huang a “smart man” and suggesting the Nvidia chief has “done an amazing job” helping Trump understand the stakes.

At an October news conference ahead of the deal’s official approval, Huang suggested that government lawyers were researching ways to get around a US law that prohibits charging companies fees for export licenses. Eventually, Trump is expected to release a policy that outlines how the US will collect those fees without conflicting with that law.

Senate Democrats appear unlikely to embrace such a policy, issuing a joint statement condemning the H200 sales as dooming the US in the AI race and threatening national security.

“Access to these chips would give China’s military transformational technology to make its weapons more lethal, carry out more effective cyberattacks against American businesses and critical infrastructure and strengthen their economic and manufacturing sector,” Senators wrote.

Photo of Ashley Belanger

Ashley is a senior policy reporter for Ars Technica, dedicated to tracking social impacts of emerging policies and new technologies. She is a Chicago-based journalist with 20 years of experience.

US taking 25% cut of Nvidia chip sales “makes no sense,” experts say Read More »

steamos-vs.-windows-on-dedicated-gpus:-it’s-complicated,-but-windows-has-an-edge

SteamOS vs. Windows on dedicated GPUs: It’s complicated, but Windows has an edge

AMD, AMD Ryzen, gaming, intel, NVIDIA, Radeon, steamos, Tech, Windows, Windows 11, windows 11 25h2 / /

Other results vary from game to game and from GPU to GPU. Borderlands 3, for example, performs quite a bit better on Windows than on SteamOS across all of our tested GPUs, sometimes by as much as 20 or 30 percent (with smaller gaps here and there). As a game from 2019 with no ray-tracing effects, it still runs serviceably on SteamOS across the board, but it was the game we tested that favored Windows the most consistently.

In both Forza Horizon 5 and Cyberpunk 2077, with ray-tracing effects enabled, you also see a consistent advantage for Windows across the 16GB dedicated GPUs, usually somewhere in the 15 to 20 percent range.

To Valve’s credit, there were also many games we tested where Windows and SteamOS performance was functionally tied. Cyberpunk without ray-tracing, Returnal when not hitting the 7600’s 8GB RAM limit, and Assassin’s Creed Valhalla were sometimes actually tied between Windows and SteamOS, or they differed by low-single-digit percentages that you could chalk up to the margin of error.

Now look at the results from the integrated GPUs, the Radeon 780M and RX 8060S. These are pretty different GPUs from one another—the 8060S has more than three times the compute units of the 780M, and it’s working with a higher-speed pool of soldered-down LPDDR5X-8000 rather than two poky DDR5-5600 SODIMMs.

But Borderlands aside, SteamOS actually did quite a bit better on these GPUs relative to Windows. In both Forza and Cyberpunk with ray-tracing enabled, SteamOS slightly beats Windows on the 780M, and mostly closes the performance gap on the 8060S. For the games where Windows and SteamOS essentially tied on the dedicated GPUs, SteamOS has a small but consistent lead over Windows in average frame rates.

SteamOS vs. Windows on dedicated GPUs: It’s complicated, but Windows has an edge Read More »

after-nearly-30-years,-crucial-will-stop-selling-ram-to-consumers

After nearly 30 years, Crucial will stop selling RAM to consumers

AI, AI infrastructure, AMD, Crucial, datacenters, DDR5, DRAM, framework, HBM, Lenovo, machine learning, memory, memory shortage, Micron, NVIDIA, pc building, samsung, semiconductors, SK Hynix, SSD, Tech / /

DRAM contract prices have increased 171 percent year over year, according to industry data. Gerry Chen, general manager of memory manufacturer TeamGroup, warned that the situation will worsen in the first half of 2026 once distributors exhaust their remaining inventory. He expects supply constraints to persist through late 2027 or beyond.

The fault lies squarely at the feet of AI mania in the tech industry. The construction of new AI infrastructure has created unprecedented demand for high-bandwidth memory (HBM), the specialized DRAM used in AI accelerators from Nvidia and AMD. Memory manufacturers have been reallocating production capacity away from consumer products toward these more profitable enterprise components, and Micron has presold its entire HBM output through 2026.

A photo of the

A photo of the “Stargate I” site in Abilene, Texas. AI data center sites like this are eating up the RAM supply. Credit: OpenAI

At the moment, the structural imbalance between AI demand and consumer supply shows no signs of easing. OpenAI’s Stargate project has reportedly signed agreements for up to 900,000 wafers of DRAM per month, which could account for nearly 40 percent of global production.

The shortage has already forced companies to adapt. As Ars’ Andrew Cunningham reported, laptop maker Framework stopped selling standalone RAM kits in late November to prevent scalping and said it will likely be forced to raise prices soon.

For Micron, the calculus is clear: Enterprise customers pay more and buy in bulk. But for the DIY PC community, the decision will leave PC builders with one fewer option when reaching for the RAM sticks. In his statement, Sadana reflected on the brand’s 29-year run.

“Thanks to a passionate community of consumers, the Crucial brand has become synonymous with technical leadership, quality and reliability of leading-edge memory and storage products,” Sadana said. “We would like to thank our millions of customers, hundreds of partners and all of the Micron team members who have supported the Crucial journey for the last 29 years.”

After nearly 30 years, Crucial will stop selling RAM to consumers Read More »

testing-shows-why-the-steam-machine’s-8gb-of-graphics-ram-could-be-a-problem

Testing shows why the Steam Machine’s 8GB of graphics RAM could be a problem

AMD, gaming, intel, NVIDIA, steam deck, steam machine, steamos, Tech / /

By Valve’s admission, its upcoming Steam Machine desktop isn’t swinging for the fences with its graphical performance. The specs promise decent 1080p-to-1440p performance in most games, with 4K occasionally reachable with assistance from FSR upscaling—about what you’d expect from a box with a modern midrange graphics card in it.

But there’s one spec that has caused some concern among Ars staffers and others with their eyes on the Steam Machine: The GPU comes with just 8GB of dedicated graphics RAM, an amount that is steadily becoming more of a bottleneck for midrange GPUs like AMD’s Radeon RX 7060 and 9060, or Nvidia’s GeForce RTX 4060 or 5060.

In our reviews of these GPUs, we’ve already run into some games where the RAM ceiling limits performance in Windows, especially at 1440p. But we’ve been doing more extensive testing of various GPUs with SteamOS, and we can confirm that in current betas, 8GB GPUs struggle even more on SteamOS than they do running the same games at the same settings in Windows 11.

The good news is that Valve is working on solutions, and having a stable platform like the Steam Machine to aim for should help improve things for other hardware with similar configurations. The bad news is there’s plenty of work left to do.

The numbers

We’ve tested an array of dedicated and integrated Radeon GPUs under SteamOS and Windows, and we’ll share more extensive results in another article soon (along with broader SteamOS-vs-Windows observations). But for our purposes here, the two GPUs that highlight the issues most effectively are the 8GB Radeon RX 7600 and the 16GB Radeon RX 7600 XT.

These dedicated GPUs have the benefit of being nearly identical to what Valve plans to ship in the Steam Machine—32 compute units (CUs) instead of Valve’s 28, but the same RDNA3 architecture. They’re also, most importantly for our purposes, pretty similar to each other—the same physical GPU die, just with slightly higher clock speeds and more RAM for the 7600 XT than for the regular 7600.

Testing shows why the Steam Machine’s 8GB of graphics RAM could be a problem Read More »

gpu-prices-are-coming-to-earth-just-as-ram-costs-shoot-into-the-stratosphere

GPU prices are coming to earth just as RAM costs shoot into the stratosphere

AMD, gaming, intel, NAND, NVIDIA, RAM, SSDs, Tech / /

It’s not just PC builders

PC and phone manufacturers—and makers of components that use memory chips, like GPUs—mostly haven’t hiked prices yet. These companies buy components in large quantities, and they typically do so ahead of time, dulling the impact of the increases in the short-term. The kinds of price increases we see, and what costs are passed on to consumers, will vary from company to company.

Bloomberg reports that Lenovo is “stockpiling memory and other critical components” to get it through 2026 without issues and that the company “will aim to avoid passing on rising costs to its customers in the current quarter.” Apple may also be in a good position to weather the shortage; analysts at Morgan Stanley and Bernstein Research believe that Apple has already laid claim to the RAM that it needs and that its healthy profit margins will allow it to absorb the increases better than most.

Framework on the other hand, a smaller company known best for its repairable and upgradeable laptop designs, says “it is likely we will need to increase memory pricing soon” to reflect price increases from its suppliers. The company has also stopped selling standalone RAM kits in its online store in an effort to fight scalpers who are trying to capitalize on the shortages.

Tom’s Hardware reports that AMD has told its partners that it expects to raise GPU prices by about 10 percent starting next year and that Nvidia may have canceled a planned RTX 50-series Super launch entirely because of shortages and price increases (the main draw of this Super refresh, according to the rumor mill, would have a bump from 2GB GDDR7 chips to 3GB chips, boosting memory capacities across the lineup by 50 percent).

GPU prices are coming to earth just as RAM costs shoot into the stratosphere Read More »

tech-company-cto-and-others-indicted-for-exporting-nvidia-chips-to-china

Tech company CTO and others indicted for exporting Nvidia chips to China

chip export controls, NVIDIA, Policy / /

Citing export controls that took effect in 2022, the indictment said the US is trying to disrupt China’s plan to build exascale supercomputers for military and surveillance use. “These capabilities are being used by the PRC for its military modernization efforts and in connection with the PRC’s weapons design and testing, including for weapons of mass destruction, as well as in connection with the PRC’s development and deployment of advanced AI surveillance tools,” the indictment said.

The Justice Department said the conspirators used Janford Realtor, LLC, a Florida-based company that was not involved in real estate despite its name, “as a front to purchase and then illegally export controlled GPUs to the PRC.” Ho and Li owned and controlled Janford Realtor, while Raymond operated an Alabama-based electronics company that “supplied Nvidia GPUs to Ho and others for illegal export to the PRC,” the Justice Department said.

Kickbacks, money laundering

The conspirators paid each other “kickbacks” or commissions on the sale and export of the Nvidia chips, the indictment said. The money laundering charges involve a variety of transfers from two Chinese companies to Janford Realtor and the Alabama electronics company, the indictment said. The indictment lists nine wire transfers in amounts ranging from $237,248 to $1,150,000.

Raymond was reportedly released on bond, while the other three alleged conspirators are being detained. “This is an extremely serious offense. At the time these were being exported, these were Nvidia’s most advanced chips,” US prosecutor Noah Stern told a magistrate judge in Oakland yesterday, according to Wired.

Stein also said in court that “text messages obtained by authorities show Li boasting about how his father ‘had engaged in similar business on behalf of the Chinese Communist Party,’” Wired reported. Stern said that in the messages, Li “explained that his father had ways to import” the Nvidia chips despite US export controls.

Tech company CTO and others indicted for exporting Nvidia chips to China Read More »

google’s-latest-swing-at-chromebook-gaming-is-a-free-year-of-geforce-now

Google’s latest swing at Chromebook gaming is a free year of GeForce Now

chromebooks, gaming, GeForce Now, Google, NVIDIA / /

Earlier this year, Google announced the end of its efforts to get Steam running on Chromebooks, but it’s not done trying to make these low-power laptops into gaming machines. Google has teamed up with Nvidia to offer a version of GeForce Now cloud streaming that is perplexingly limited in some ways and generous in others. Starting today, anyone who buys a Chromebook will get a free year of a new service called GeForce Now Fast Pass. There are no ads and less waiting for server slots, but you don’t get to play very long.

Back before Google killed its Stadia game streaming service, it would often throw in a few months of the Pro subscription with Chromebook purchases. In the absence of its own gaming platform, Google has turned to Nvidia to level up Chromebook gaming. GeForce Now (GFN), which has been around in one form or another for more than a decade, allows you to render games on a remote server and stream the video output to the device of your choice. It works on computers, phones, TVs, and yes, Chromebooks.

The new Chromebook feature is not the same GeForce Now subscription you can get from Nvidia. Fast Pass, which is exclusive to Chromebooks, includes a mishmash of limits and bonuses that make it a pretty strange offering. Fast Pass is based on the free tier of GeForce Now, but users will get priority access to server slots. So no queuing for five or 10 minutes to start playing. It also lacks the ads that Nvidia’s standard free tier includes. Fast Pass also uses the more powerful RTX servers, which are otherwise limited to the $10-per-month ($100 yearly) Performance tier.

Google’s latest swing at Chromebook gaming is a free year of GeForce Now Read More »

tech-giants-pour-billions-into-anthropic-as-circular-ai-investments-roll-on

Tech giants pour billions into Anthropic as circular AI investments roll on

AI, AI bubble, AI chips, AI infrastructure, Anthropic, azure, Biz & IT, Cloud Computing, datacenters, enterprise AI, machine learning, microsoft, NVIDIA, openai, sam altman, Satya Nadella / /

On Tuesday, Microsoft and Nvidia announced plans to invest in Anthropic under a new partnership that includes a $30 billion commitment by the Claude maker to use Microsoft’s cloud services. Nvidia will commit up to $10 billion to Anthropic and Microsoft up to $5 billion, with both companies investing in Anthropic’s next funding round.

The deal brings together two companies that have backed OpenAI and connects them more closely to one of the ChatGPT maker’s main competitors. Microsoft CEO Satya Nadella said in a video that OpenAI “remains a critical partner,” while adding that the companies will increasingly be customers of each other.

“We will use Anthropic models, they will use our infrastructure, and we’ll go to market together,” Nadella said.

Anthropic, Microsoft, and NVIDIA announce partnerships.

The move follows OpenAI’s recent restructuring that gave the company greater distance from its non-profit origins. OpenAI has since announced a $38 billion deal to buy cloud services from Amazon.com as the company becomes less dependent on Microsoft. OpenAI CEO Sam Altman has said the company plans to spend $1.4 trillion to develop 30 gigawatts of computing resources.

Tech giants pour billions into Anthropic as circular AI investments roll on Read More »

google-ceo:-if-an-ai-bubble-pops,-no-one-is-getting-out-clean

Google CEO: If an AI bubble pops, no one is getting out clean

AI, AI energy, AI infrastructure, AI investment, AI regulation, alphabet, Biz & IT, climate change, deepmind, dotcom bubble, Ed Zitron, Google, Jamie Dimon, Jensen Huang, large language models, machine learning, NVIDIA, openai, Sundar Pichai / /

Market concerns and Google’s position

Alphabet’s recent market performance has been driven by investor confidence in the company’s ability to compete with OpenAI’s ChatGPT, as well as its development of specialized chips for AI that can compete with Nvidia’s. Nvidia recently reached a world-first $5 trillion valuation due to making GPUs that can accelerate the matrix math at the heart of AI computations.

Despite acknowledging that no company would be immune to a potential AI bubble burst, Pichai argued that Google’s unique position gives it an advantage. He told the BBC that the company owns what he called a “full stack” of technologies, from chips to YouTube data to models and frontier science research. This integrated approach, he suggested, would help the company weather any market turbulence better than competitors.

Pichai also told the BBC that people should not “blindly trust” everything AI tools output. The company currently faces repeated accuracy concerns about some of its AI models. Pichai said that while AI tools are helpful “if you want to creatively write something,” people “have to learn to use these tools for what they’re good at and not blindly trust everything they say.”

In the BBC interview, the Google boss also addressed the “immense” energy needs of AI, acknowledging that the intensive energy requirements of expanding AI ventures have caused slippage on Alphabet’s climate targets. However, Pichai insisted that the company still wants to achieve net zero by 2030 through investments in new energy technologies. “The rate at which we were hoping to make progress will be impacted,” Pichai said, warning that constraining an economy based on energy “will have consequences.”

Even with the warnings about a potential AI bubble, Pichai did not miss his chance to promote the technology, albeit with a hint of danger regarding its widespread impact. Pichai described AI as “the most profound technology” humankind has worked on.

“We will have to work through societal disruptions,” he said, adding that the technology would “create new opportunities” and “evolve and transition certain jobs.” He said people who adapt to AI tools “will do better” in their professions, whatever field they work in.

Google CEO: If an AI bubble pops, no one is getting out clean Read More »

openai-signs-massive-ai-compute-deal-with-amazon

OpenAI signs massive AI compute deal with Amazon

AI, AI chips, AI infrastructure, Amazon, AWS, Biz & IT, chatbots, datacenters, generative ai, Google, large language models, machine learning, microsoft, NVIDIA, openai, oracle, sam altman / /

On Monday, OpenAI announced it has signed a seven-year, $38 billion deal to buy cloud services from Amazon Web Services to power products like ChatGPT and Sora. It’s the company’s first big computing deal after a fundamental restructuring last week that gave OpenAI more operational and financial freedom from Microsoft.

The agreement gives OpenAI access to hundreds of thousands of Nvidia graphics processors to train and run its AI models. “Scaling frontier AI requires massive, reliable compute,” OpenAI CEO Sam Altman said in a statement. “Our partnership with AWS strengthens the broad compute ecosystem that will power this next era and bring advanced AI to everyone.”

OpenAI will reportedly use Amazon Web Services immediately, with all planned capacity set to come online by the end of 2026 and room to expand further in 2027 and beyond. Amazon plans to roll out hundreds of thousands of chips, including Nvidia’s GB200 and GB300 AI accelerators, in data clusters built to power ChatGPT’s responses, generate AI videos, and train OpenAI’s next wave of models.

Wall Street apparently liked the deal, because Amazon shares hit an all-time high on Monday morning. Meanwhile, shares for long-time OpenAI investor and partner Microsoft briefly dipped following the announcement.

Massive AI compute requirements

It’s no secret that running generative AI models for hundreds of millions of people currently requires a lot of computing power. Amid chip shortages over the past few years, finding sources of that computing muscle has been tricky. OpenAI is reportedly working on its own GPU hardware to help alleviate the strain.

But for now, the company needs to find new sources of Nvidia chips, which accelerate AI computations. Altman has previously said that the company plans to spend $1.4 trillion to develop 30 gigawatts of computing resources, an amount that is enough to roughly power 25 million US homes, according to Reuters.

OpenAI signs massive AI compute deal with Amazon Read More »

chatgpt-maker-reportedly-eyes-$1-trillion-ipo-despite-major-quarterly-losses

ChatGPT maker reportedly eyes $1 trillion IPO despite major quarterly losses

AI, AI infrastructure, Biz & IT, chatgpt, CoreWeave, generative ai, IPO, large language models, machine learning, microsoft, NVIDIA, openai, sam altman, SoftBank / /

An OpenAI spokesperson told Reuters that “an IPO is not our focus, so we could not possibly have set a date,” adding that the company is “building a durable business and advancing our mission so everyone benefits from AGI.”

Revenue grows as losses mount

The IPO preparations follow a restructuring of OpenAI completed on October 28 that reduced the company’s reliance on Microsoft, which has committed to investments of $13 billion and now owns about 27 percent of the company. OpenAI was most recently valued around $500 billion in private markets.

OpenAI started as a nonprofit in 2015, then added a for-profit arm a few years later with nonprofit oversight. Under the new structure, OpenAI is still controlled by a nonprofit, now called the OpenAI Foundation, but it gives the nonprofit a 26 percent stake in OpenAI Group and a warrant for additional shares if the company hits certain milestones.

A successful OpenAI IPO could represent a substantial gain for investors, including Microsoft, SoftBank, Thrive Capital, and Abu Dhabi’s MGX. But even so, OpenAI faces an uphill financial battle ahead. The ChatGPT maker expects to reach about $20 billion in revenue by year-end, according to people familiar with the company’s finances who spoke with Reuters, but its quarterly losses are significant.

Microsoft’s earnings filing on Wednesday offered a glimpse at the scale of those losses. The company reported that its share of OpenAI losses reduced Microsoft’s net income by $3.1 billion in the quarter that ended September 30. Since Microsoft owns 27 percent of OpenAI under the new structure, that suggests OpenAI lost about $11.5 billion during the quarter, as noted by The Register. That quarterly loss figure exceeds half of OpenAI’s expected revenue for the entire year.

ChatGPT maker reportedly eyes $1 trillion IPO despite major quarterly losses Read More »

nvidia-hits-record-$5-trillion-mark-as-ceo-dismisses-ai-bubble-concerns

Nvidia hits record $5 trillion mark as CEO dismisses AI bubble concerns

AI, AI chips, AI infrastructure, Apple, Biz & IT, Blackwell chips, data centers, Donald Trump, GPUs, Jensen Huang, machine learning, microsoft, Nokia, NVIDIA, openai, palantir, semiconductors, Uber / /

Partnerships and government contracts fuel optimism

At the GTC conference on Tuesday, Nvidia’s CEO went out of his way to repeatedly praise Donald Trump and his policies for accelerating domestic tech investment while warning that excluding China from Nvidia’s ecosystem could limit US access to half the world’s AI developers. The overall event stressed Nvidia’s role as an American company, with Huang even nodding to Trump’s signature slogan in his sign-off by thanking the audience for “making America great again.”

Trump’s cooperation is paramount for Nvidia because US export controls have effectively blocked Nvidia’s AI chips from China, costing the company billions of dollars in revenue. Bob O’Donnell of TECHnalysis Research told Reuters that “Nvidia clearly brought their story to DC to both educate and gain favor with the US government. They managed to hit most of the hottest and most influential topics in tech.”

Beyond the political messaging, Huang announced a series of partnerships and deals that apparently helped ease investor concerns about Nvidia’s future. The company announced collaborations with Uber Technologies, Palantir Technologies, and CrowdStrike Holdings, among others. Nvidia also revealed a $1 billion investment in Nokia to support the telecommunications company’s shift toward AI and 6G networking.

The agreement with Uber will power a fleet of 100,000 self-driving vehicles with Nvidia technology, with automaker Stellantis among the first to deliver the robotaxis. Palantir will pair Nvidia’s technology with its Ontology platform to use AI techniques for logistics insights, with Lowe’s as an early adopter. Eli Lilly plans to build what Nvidia described as the most powerful supercomputer owned and operated by a pharmaceutical company, relying on more than 1,000 Blackwell AI accelerator chips.

The $5 trillion valuation surpasses the total cryptocurrency market value and equals roughly half the size of the pan European Stoxx 600 equities index, Reuters notes. At current prices, Huang’s stake in Nvidia would be worth about $179.2 billion, making him the world’s eighth-richest person.

Nvidia hits record $5 trillion mark as CEO dismisses AI bubble concerns Read More »