Nvidia simply reported a $44 billion quarter. That’s up 69% from a 12 months in the past…
And practically sufficient income to purchase Normal Motors outright.
Its information heart enterprise alone introduced in $39 billion. And regardless of U.S. export restrictions that hit gross sales to China, the corporate posted $18.8 billion in revenue.
However as spectacular as these numbers are, the actual story from Nvidia’s earnings name didn’t come from the corporate’s steadiness sheet.
It was what CEO Jensen Huang stated about Tesla.
As a result of it factors to the place the subsequent trillion-dollar AI alternative would possibly come from…
Huang’s Daring Prediction
Talking with Bloomberg Information final Wednesday, Huang singled out Tesla’s humanoid robotic undertaking, Optimus.
Supply: Tesla
He stated: “That is the primary robotic that actually has an opportunity to attain the excessive quantity and expertise scale essential to advance expertise.”
I’m on document that the robotic revolution is coming, and that the proliferation of humanoid robots over the subsequent decade goes to return as a shock to most individuals.
However what Huang stated subsequent about Optimus ought to make each investor take discover: “I feel that is more likely to be the subsequent multi-trillion greenback business.”
That’s a reasonably heady prediction from the man whose chips are powering your entire AI increase.
Microsoft — which has a 49% stake in OpenAI — is shopping for Nvidia chips as quick as Huang could make them.
The corporate stated it processed greater than 100 trillion AI tokens final quarter. That’s solely attainable due to Nvidia’s highly effective GPUs.
Google, Meta and Amazon are all racing to construct their very own customized AI chips.
However proper now, they nonetheless want Nvidia.
The corporate has develop into important to the worldwide tech stack. And that places Huang in a singular place.
Since he’s supplying the instruments to advance AI, he’s capable of spot developments and make daring bets about what comes subsequent.
That’s why Nvidia invested in Utilized Digital Corp (NASDAQ: APLD), which builds information facilities for patrons.
And why the corporate additionally owns shares of Arm Holdings (NASDAQ: ARM), which helps semiconductor firms design superior computing chips.
And it’s why I’m holding an in depth eye on Tesla and Optimus.
Elon Musk says Tesla is already constructing Optimus items at its Fremont facility. The short-term purpose is to deploy 1000’s of those robots in Tesla’s personal factories by the top of subsequent 12 months.
However Musk’s long-term purpose is way greater. He desires to provide 1,000,000 Optimus items a 12 months by 2030.
Proper now, Optimus can stroll, stack containers and carry out fundamental duties. It’s nonetheless clunky and lurches when it walks. It’s form of like watching the primary iPhone attempt to load a YouTube video over 2G.
However as anybody who’s adopted Tesla — or Apple — is aware of, you possibly can’t decide a expertise by its first model.
We’re nonetheless at the start of the curve for humanoid robotics, however this curve will quickly bend up because the expertise improves.
Identical to what’s occurring with AI.
Supply: ml-science.com
If Tesla can ship even a fraction of what it’s promising, it may upend whole sectors…
Logistics, elder care, retail, hospitality and even private companionship may all quickly be dealt with by humanoid robots like Optimus.
How huge may this get?
Analysts at Goldman Sachs assume humanoid robots might be a $38 billion market by 2035.
Morgan Stanley places the potential nearer to $4.7 trillion a 12 months by 2050.
That’s a variety. However even when we land on the low finish, it could mark a seismic shift within the financial system.
Right here’s My Take
I don’t all the time agree with Jensen Huang. However when he talks, I pay attention.
In spite of everything, he has efficiently pivoted Nvidia a number of occasions. He was proper about GPU acceleration. He’s been proper about information heart acceleration.
And now he’s pointing to humanoid robots as the subsequent tech frontier. A world the place labor isn’t constrained by folks.
Tesla is constructing the form of AI-native, vertically built-in robotic platform that nobody else can match at scale.
However Optimus doesn’t simply characterize the way forward for labor. It additionally represents a possible acceleration within the improvement of AI.
You see, each time Optimus picks up a field, navigates a hallway or adapts to a brand new process, it generates real-world information.
This information is pure gold for coaching AI programs.
As a result of it’s one factor to simulate intelligence in a lab, it’s one other factor fully to study immediately from bodily interplay in the actual world.
We don’t actually know but what it is going to take to attain synthetic superintelligence (ASI). However it would possibly take one thing past greater language fashions and extra compute.
It would take grounding AI within the messy, bodily world.
Robots like Optimus function a form of sensory interface between machine studying and actuality.
And Tesla has an enormous head begin on this space as a result of it already has hundreds of thousands of autos accumulating real-time driving information.
In different phrases, Tesla has already constructed one of many world’s largest real-world reinforcement studying networks.
And now it could actually carry that very same data-driven philosophy to humanoid robotics, making a loop the place every robotic learns from each different robotic’s expertise.
That form of networked intelligence might be the lacking piece that pushes AI from slim to normal.
And THAT’S why I consider Huang is so bullish on Optimus.
Regards,
Ian KingChief Strategist, Banyan Hill Publishing
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