Nvidia CEO Jensen Huang likes to joke around. He once said Nvidia was 30 days from going out of business just to inspire his engineers. Many years ago, that was true. He still says it. But considering Nvidia is now the most valuable chip company in the U.S., with a market capitalization of $310.8 billion, I think he has lost all credibility with that remark.
But Huang likes to remember Nvidia’s humble roots as it becomes a behemoth in AI and graphics chips. This week, Nvidia reported stellar earnings and noted its datacenter revenue surpassed its gaming revenue for the first time. Huang also said he expects the second half of 2020 to be great for gaming, as players hunker down in the pandemic and play games across all platforms. Nvidia is also rumored to be making a bid to buy Arm, the chip intellectual property company Softbank plans to sell.
I spoke with him after the earnings call this week, and we chatted about these subjects. The banter is fun, but I appreciate how it gives me the chance to learn a thing or two.
Here’s an edited transcript of our interview.
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GamesBeat: This is the first quarter where the datacenter revenue was bigger than the games revenue, right?
Jensen Huang: And it’s amazing, because the games revenue was very big. There’s just more gamers than ever, and we ramped 150 laptops.
GamesBeat: That must feel good because it’s a validation of the AI strategy, the data strategy.
Huang: The AI strategy and the datacenter strategy are working out well. We were right that AI processing is going to require acceleration, and the Ampere architecture is the biggest generational leap we’ve ever had. It was a home run.
We were right that the workflow, the workload of a datacenter is going to be disaggregated. It’s going to be broken up into these containers that are going to make up microservices. As a result, the east-west traffic inside a datacenter was going to explode, to go through the roof. As a result, we bought Mellanox. That was a great call. The combination of those things is playing out.
GamesBeat: You said you think we’re going to have a great second half for gaming. I did wonder how long some of the behavior was going to continue in gaming. There are parts of the world that have recovered already, where people are able to go outside, whereas in the U.S. we’re still stuck inside. I wonder whether the strength in gaming continues even when people can go outside again.
Huang: I think it will, for several reasons. One, there are new gamers that didn’t used to game coming into the format, into this medium, and once you’re in, you’re hooked. Whether you play a little or play a lot, you’re hooked. Second, the number of ways that people game has grown a lot. The creativity by which people game — whether it’s the social stuff, all the stuff with Fortnite and how they’re hanging out in these Fortnite worlds, how people are hanging out in Roblox worlds and Minecraft worlds. They’re using it to create art and video and movies and mashups. There are so many different ways that people game now, and it’s built on top of this medium.
Of course, as you know, spectator sports is going to be very different. It’s not just esports, like League of Legends, but look at the stuff that’s happening with Formula One. F1 is going to become an esports format where it’s not just the professionals racing. The format of games has grown a lot. I don’t think that’s ever going to go back.
GamesBeat: Is it a good guess that you’re going to reveal Ampere chips for games and desktops on September 1?
Huang: Well, on September 1, I’ll have some really exciting news to tell you. But I don’t want to ruin it for you. I have to have some surprises for you. You’re hard to surprise. I’ve gotta surprise you.
GamesBeat: I thought you were going to surprise me with a purchase of Arm.
Huang: [Laughs] That’s just a rumor! On September 1, it’s about GeForce. I’ve got some fun things to tell you about.
GamesBeat: Did you have fun when Nvidia saw its market cap become the No. 1 for a chip company in the U.S.?
Huang: Well, I can’t say that I thought about it much. I got a lot of congratulations. But you know me. I still feel that the company is barely hanging on.
GamesBeat: You think you’re 30 days from going out of business still?
Huang: I wasn’t going to say it. I didn’t know whether you remembered it or not. But I literally feel, every single morning, that we’re 30 days from going out of business. I wake up in a panic. I’ve got lots of work to do. We have a company to save. We have a bunch of partners and a lot of companies we don’t want to let down. That feeling never leaves me.
GamesBeat: I thought you could put that one to rest.
Huang: No, I don’t think so. People just don’t change. I don’t know what it is. Of course, everything we’re doing is grander than ever, riskier than ever, and it takes a lot of attention. I’ve got more than enough work to do. In the next several years, we’re going to see an acceleration of the fusion of the physical and the virtual world. This intersection that you’ve loved for a long time, we’re going to see a lot of advances here.
GamesBeat: I’m still waiting for that metaverse (the universe of virtual worlds that are all interconnected, like in novels such as Snow Crash and Ready Player One). It feels closer.
Huang: It’s coming. In a lot of ways, it’s happening right in front of us. For example, we designed a factory in virtual reality with a bunch of robots that we’re designing in virtual reality to build a car in virtual reality that is all based on robotics technology. This is happening right in front of us. This is all based on simulation technology. It’s how we build self-driving cars these days.
Our engineers are as productive as ever. They’re testing all their self-driving cars in a virtual Santa Clara, a virtual Munich, a virtual Tokyo. They’re able to do this all virtually. Well, those are all metaverses. They’re just going to keep on expanding. You’re going to design everything in virtual reality, and then the blueprint comes out while you’re in virtual reality. You have artificially intelligent agents helping you. As you go to sleep tomorrow, your design gets better. This new world is happening right in front of us, and because of everything that’s happening around the world, it’s being accelerated. Your dreams and my dreams are going to come true.
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