Wedbush's Dan Ives highlighted the potential ripple effect of Nvidia’s highly popular H100 GPU on the wider tech ecosystem.
What Happened: Ives suggested that every dollar spent on an Nvidia Corp (NASDAQ:NVDA) H100 GPU could lead to an additional $10-$12 spending across the tech ecosystem.
"This in our opinion is about the 2nd/3rd/4th derivatives of the AI Revolution now playing out."
Earlier, after Nvidia's fourth-quarter results, Ives said that the "AI party" is just starting. He added that the current AI revolution is a 1995 moment, not a 1999 moment.
"Nvidia and the golden GPUs are the start of the spending wave…not the end," Ives said, adding that the Huang-led company had "essentially cracked the code."
Why It Matters: Ives’ statement comes in the wake of a growing consensus on the accelerating AI revolution. In February, Ives pointed to the better-than-expected Q4 results of mid-cap AI company c3.ai, Inc. as further evidence of this trend.
Earlier, Microsoft Corp. (NASDAQ:MSFT) CEO Satya Nadella underscored the rapid infiltration of AI across sectors, calling the revolution “fast and furious”.
Nvidia’s H100 chip, released in 2023, has been a game-changer in the AI and computing industries, contributing over $1 trillion to the company’s value. The chip’s high demand has led to customers facing up to six-month wait times.
However, ARK Investment Management CEO Cathie Wood has recently raised concerns about a potential market correction in the semiconductor sector due to improvements in the supply chain.
Despite this, AI’s future is expected to have a significant financial impact, with Ark Invest estimating a $28 trillion opportunity in the sector.
Price Action: Nvidia's stock closed 1.1% lower on Friday, according to data from Benzinga Pro.
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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.
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