Huang: AI's Future Runs Through China

Nvidia CEO Jensen Huang stated that China’s AI industry could reach a market size of $50 billion in the next few years. He warned that being excluded from that market would be a “tremendous loss.”

Huang highlighted the potential economic upsides for the United States if business in China were allowed. He mentioned that sales to China would drive U.S. revenues, increase taxes, and boost employment.

In a joint interview with ServiceNow CEO Bill McDermott during a Las Vegas tech conference, Huang reiterated Nvidia’s willingness to align with U.S. government policies. “We will support what’s best for the country,” he remarked.

Nvidia, a titan in GPU production, has fueled the global AI surge. Yet, recent U.S. regulations now limit the export of its H20 AI chips to China unless special licenses are obtained, dampening momentum.

These chips, built around the Hopper architecture, were crafted to comply with earlier export restrictions. Nvidia estimates the ban will cause a $5.5 billion hit to its quarterly financials, suggesting a deceleration in its rapid ascent.

Despite geopolitical friction, Huang argued that China is keeping pace in the AI race. He praised Huawei as a technological powerhouse during a conference in Washington, D.C., asserting that the nation is far from lagging.

Nvidia’s stock, after tripling in 2023, has slipped 15% this year. As it prepares to release its next earnings report on May 28, projections show a 65% revenue increase—still strong, but significantly slower than last year’s explosive growth.