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NVIDIA CEO Jensen Huang Responds to DeepSeek Impact: Computing Power Demand Will Surge, AI Chips

Cailian Press 2025-03-20 09:15:40

NVIDIA CEO Jensen Huang recently stated that the R1 model released by Chinese AI company DeepSeek will only increase the demand for computing infrastructure, and therefore, concerns about a potential decrease in chip demand are unfounded.

Local time on Wednesday (March 19), Jensen Huang stated at the GTC conference meeting with analysts and investors that the previous understanding of "R1 may reduce chip demand" was completely wrong, and future computing demands would be much higher.

In January this year, the R1 model released by DeepSeek caused a sensation in the market. The model was developed in just two months, at a cost of less than 60 million US dollars, using only about 2,000 Nvidia chips, but R1's performance in key areas can rival that of OpenAI's strongest inference model o1.

This has led many to question the significance of the substantial investments made by numerous large American tech companies in AI models and data centers. Nvidia's stock price plummeted nearly 17% on January 27, and continued to fall last week to its lowest level since September of last year.

However, several major clients of Nvidia have reaffirmed their spending plans on AI in recent financial reports. Media analysis has found that the actual growth rate of spending by the largest data center operators is increasing faster than expected.

At the analyst meeting, someone mentioned that some of Nvidia's customers are developing their own chips in an attempt to replace Nvidia's products, for example, Google is working with Broadcom to develop ASIC chips. In response, Jensen Huang argued that many ASICs cannot be deployed in data centers.

Huang Renxun believes that these major clients need better chips to generate more revenue from their infrastructure, rather than using cheaper alternatives to save on costs. He added that CEOs are very good at math, so they won't simply focus on costs.

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Huang Renxun pointed out that the competitors' chip products cannot match Nvidia's Hopper design, and the current performance of Blackwell is even 40 times more powerful than Hopper.

Huang Renxun also showed some figures indicating that the company received far more Blackwell orders than Hopper during the same period. He mentioned that this was just from cloud providers, and spending by other companies on AI data centers would further boost these numbers.

Huang Renxun mentioned that if the US economy falls into recession, corporate clients may shift more investment towards AI equipment—because this is exactly where their business growth lies.

He also stated that the proposed tariff policies of the Trump administration would only have a minor impact on Nvidia in the short term, as the company will continue to shift the manufacturing of the most critical parts of its product line to the United States.

Huang Renxun stated that Nvidia is already utilizing the production capacity of TSMC's Arizona factory, and as its suppliers increase capacity, Nvidia will increase its usage.

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NVIDIA CEO Jensen Huang Responds to DeepSeek Impact: Computing Power Demand Will Surge, AI Chips

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