Nvidia CEO Jensen Huang Dismisses DeepSeek Concerns, Touts 'Excellent Innovation' in AI Chips

Riley King

Riley King

February 27, 2025 · 3 min read
Nvidia CEO Jensen Huang Dismisses DeepSeek Concerns, Touts 'Excellent Innovation' in AI Chips

Nvidia CEO Jensen Huang has reiterated his confidence in the company's future, brushing off concerns that DeepSeek's R1 model could negatively impact sales. During the latest earnings call on Wednesday, Huang emphasized that reasoning AI models like R1 are a boon for Nvidia, requiring significantly more compute power and driving demand for the company's AI chips.

Speculation surrounding DeepSeek's R1 model had sparked a record drop in Nvidia's stock price last month, with investors worried that the model's reduced chip requirements could eat into Nvidia's sales. However, Huang remains bullish, touting R1 as an "excellent innovation" that has ignited global enthusiasm and open-sourced a world-class reasoning AI model.

According to Huang, reasoning models like R1 can consume 100 times more compute power, and future models will require even more. This increased demand for compute power is music to Nvidia's ears, as the company reported another record-breaking quarter with revenue reaching $39.3 billion, exceeding both its own projections and Wall Street estimates.

Nvidia's data center sales nearly doubled in 2024 to $115 billion, rising 16% from the previous quarter. The company expects revenue to continue growing, with projections for the next quarter reaching around $43 billion. Huang attributed this growth to the extraordinary demand for Nvidia's latest Blackwell chip, custom-built for reasoning and AI workloads.

The market for AI chips shows no signs of cooling off, despite last month's panic over DeepSeek. In fact, tech giants Meta, Google, and Amazon have all unveiled massive AI infrastructure investments, collectively committing hundreds of billions of dollars for the coming years. This increased investment in AI infrastructure bodes well for Nvidia, which is poised to capitalize on the growing demand for AI chips.

Huang's confidence in Nvidia's future is palpable, with the CEO stating that the company will "grow strongly in 2025." As the AI landscape continues to evolve, Nvidia's focus on reasoning AI models and its custom-built Blackwell chip position it well to ride the wave of growing demand for AI chips.

The earnings call marks a significant turning point for Nvidia, as the company puts to rest concerns surrounding DeepSeek's impact on sales. With its strong Q2 earnings and growing demand for AI chips, Nvidia is well-positioned to continue its dominance in the AI chip market.

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