Nvidia shares surged to a record high, or will launch AI chips for China in the second quarter

The world's largest consumer electronics show CES opened, Nvidia released a new consumer chip for personal computers, reached a number of AI business cooperation, and announced that several key Chinese automotive customers, led to investor optimism. At the end of the day, Nvidia shares rose 6.4% to $522.53 / share, hitting a record high.

Market news continues to stir investor sentiment. On January 9, according to Reuters, Nvidia plans to mass produce the H20 AI chip designed for China in the second quarter to comply with US export regulations. According to the report, the H20 was supposed to be launched in November last year, but server vendors have encountered difficulties in integrating the chip, and the H20 will prioritize meeting the needs of large customers in China.

Cooperation with a number of Chinese companies in the field of gaming and auto autonomous driving is a highlight of Nvidia at CES. Nvidia announced at CES that Chinese game manufacturers such as Miha You, NetEase Games, Palm Fun Technology, and Tencent Games will cooperate with it in the field of AI technology application and be applied to game development. According to Palm Fun Technology, Nvidia will provide AI technology support such as DLSS and Audio2Face to its "AI game creation platform".

In the emerging autonomous driving market, Nvidia has also secured several key Chinese auto customers. On January 9, at the same time as the launch event before the CES show, Nvidia announced that the Ideal Car will use the Thor automotive chip platform in the next generation of models. In addition, three manufacturers, including Great Wall Motor, polar Krypton and Xiaomi Automobile, have adopted Orin chips to do a new generation of intelligent driving systems.

This series of partnerships is seen by Nvidia as a major breakthrough in the autonomous driving business. Wu Xinzhou, vice president of Nvidia's automotive division, said that Orin chips have become the preferred AI computing platform for today's smart cars, and as car manufacturers need more advanced autonomous driving functions and AI performance, the next generation of Thor chips will continue to be adopted by car manufacturers in future models.

The automotive business is Nvidia's fourth largest segment independent of data centers, gaming, and professional visualization. Nvidia maintains its lead in the self-driving car space, but competitors are still catching up. According to the data of the high-tech Intelligent Automobile Research Institute, in the first half of 2023, among the models with high-level assisted driving function (NOA), NVIDIA's share reached 52.57%, almost half.

At present, most of the high-end models in China basically choose NVIDIA Orin chips to assist driving, and individual automakers such as Weilai Automobile have been equipped with 4 Orin chips as standard across the line. In terms of competitors, Mobileye, which was spun out of Intel, has partnered with Geely to enter Geely's brand models. The domestic start-up horizon product computing power is not as good as Nvidia, but it relies on personal service and price advantages to enter the supply chain of Ideal Automobile and BYD. Qualcomm is also trying to make efforts in the field of autonomous driving and launch related chip products.