Nvidia's H100 Chip Sparks AI Revolution, Boosting Value by $1T As It Unveils New Chips for China

In 2023, Nvidia Corp NVDA revolutionized the artificial intelligence (AI) and computing industries with the release of its H100 data center chip, contributing over $1 trillion to the company’s value and solidifying its position as a leader in AI technology.

This week, Nvidia reported fourth-quarter revenue of $22.10 billion, higher by 265% year-over-year, above the Street consensus of $20.62 billion. The adjusted EPS of $5.16 beat the Street estimate of $4.64.

The H100 chip, four times faster than its predecessor, the A100, in training large language models (LLMs) and 30 times faster in responding to user prompts, has seen such high demand that customers face up to six-month wait times, Bloomberg reports.

Nvidia’s dominance in the AI accelerator market is uncontested, holding about 80% of the market share.

The company is preparing to introduce the H100’s successor, the H200, and plans for the more advanced B100 model, continuing to drive the AI technology frontier forward.

CEO Jensen Huang revealed that Nvidia is also introducing two new AI chips explicitly designed for the Chinese market. Huang mentioned that these chips are currently being sampled by customers and comply with U.S. regulations without requiring special licenses.

Reports indicate that Nvidia plans to launch three chips—H20, L20, and L2—in China. These chips retain Nvidia’s advanced AI features but have reduced computing power to align with U.S. export control measures, Reuters reports.

Nvidia has already begun pre-orders for the H20 chip, which faces a delay in its release due to integration challenges encountered by server manufacturers.

For the fiscal fourth quarter ending January 28, Nvidia’s sales in China, including Hong Kong, dropped to $1.9 billion, accounting for about 9% of its total sales—a sharp decline from 22% in the previous quarter.