Nvidia Corp (NASDAQ:NVDA) CEO Jensen Huang said the company is benefiting from the rapid rise of both open and closed AI models, arguing that the success of either approach ultimately drives demand for Nvidia’s computing infrastructure.
Nvidia Sees Opportunity In Both Open And Closed AI
During Nvidia’s second-quarter earnings call, UBS analyst Timothy Arcuri asked Huang whether the growing popularity of open models could eventually hurt Nvidia by reducing demand for major frontier AI companies and their massive computing needs.
Huang pushed back on that idea, saying "the world will need both closed models and open models" and that both are seeing explosive adoption.
"Nearly all open models run on NVIDIA," Huang said, pointing to the company’s broad hardware footprint and CUDA software ecosystem.
He added that Nvidia is positioned to support AI models across PCs, workstations, data centers, robots and edge devices.
Huang Says AI Model Success Is Nvidia’s Win
Huang argued that open models reaching frontier-level capabilities are helping startups, enterprises and governments build their own specialized AI systems.
"Every major company and every — surely, every country and every startup needs to build their domain-specific, their proprietary AI," he said.
That growing customization, Huang suggested, creates another source of demand for Nvidia’s computing platforms.
The CEO ultimately said Nvidia does not need to choose a winner in the open-versus-closed AI debate.
"We’re delighted by any model succeeding," Huang said. "So long as models succeed, I’m very happy. And both closed and open models are going to succeed and they’re both simultaneously driving our sales."
Nvidia Revenue Surges 106% As Q3 Guidance Tops $105 Billion
Nvidia reported $96.22 billion in second-quarter revenue, up 106% year over year and above the Street consensus estimate of $92.18 billion.
For the third quarter, the chipmaker expects revenue of $105.84 billion to $110.16 billion, representing year-over-year growth of 85.7% to 93.2% from the $57.01 billion it reported in the year-ago quarter.
Price Action: Nvidia shares closed 1.59% lower on Wednesday at $209.66 and climbed 7.3% in early pre-market trading on Thursday to $225.
According to Benzinga Edge Rankings, Nvidia ranks in the 99th percentile for growth and maintains positive price-trend ratings across the short-, medium- and long-term periods.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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