Analysts Q&A Summary:
1) Joe Moore, Morgan Stanley:
– The question: Joe inquired about the scaling up of inference around reasoning models and sought clarity on NVIDIA’s capacity to meet the demand and the scale required for such solutions.
– The response: Jensen highlighted that Grace Blackwell NVLink 72 is the ideal machine for reasoning AI, explaining its capability to handle token generation that is substantively higher than previous models. He emphasized NVIDIA’s ability to serve most of the demand with improved performance.
2) Vivek Arya, Bank of America Securities:
– The question: Vivek sought clarification on the impact of China on financials and inquired about the broader AI spending outlook that Jensen previously suggested could reach $1 trillion.
– The response: Colette detailed the financial hit from the halted H20 shipments due to export controls. Jensen elaborated on the global AI infrastructure buildup, emphasizing the foundational and expansive nature of AI implementations across industries and geographies.
3) CJ Muse, Cantor Fitzgerald:
– The question: CJ asked about other large-scale GPU cluster investments similar to those in Saudi Arabia and UAE, and how these orders might affect lead times for Blackwell.
– The response: Jensen acknowledged more orders are in the pipeline and NVIDIA is ramping up supply chain to meet demand. He emphasized each country’s need for AI infrastructure, likening it to essential infrastructure such as the internet.
4) Ben Reitzis, Melius Research:
– The question: Ben asked for a breakdown of guidance in light of exporting controls and sought Jensen’s view on sequential growth prospects following policy changes and increased demand.
– The response: Colette confirmed growth outside of China, driven by Blackwell’s expansion. Jensen cited exponential growth in reasoning AI, the lifting of the AI diffusion rule, and enterprise AI’s readiness to drive further growth.
5) Timothy Arcuri, UBS:
– The question: Tim inquired about potential replacements for H20 in China and the feasibility of resuming past quarterly revenue levels there after modifications to comply with restrictions.
– The response: Jensen suggested that new product development under current stringent restrictions is challenging, with nothing ready immediately for announcement in compliance with the controls.
6) Jake on behalf of Aaron Rakers, Wells Fargo:
– The question: Jake asked for elaboration on the strength in NVIDIA’s networking business, specifically adoption by CSPs.
– The response: Jensen discussed NVIDIA’s networking platforms like NVLink and SpectrumX, highlighting significant enhancements leading to improved utilization and strong adoption by CSPs.
Sentiment Score Distribution Table:
| Analyst Name | Firm Name | Sentiment Score (1-10) |
|—————-|————————-|————————|
| Joe Moore | Morgan Stanley | 8 |
| Vivek Arya | Bank of America | 7 |
| CJ Muse | Cantor Fitzgerald | 8 |
| Ben Reitzis | Melius Research | 7 |
| Timothy Arcuri | UBS | 6 |
| Jake for Aaron | Wells Fargo | 8 |
The sentiment scores reflect the analysts’ generally optimistic outlook, despite challenges, based on NVIDIA’s strategic positioning and technological advancements.