Nvidia chief Jensen Huang's first acknowledgement of DeepSeek; here's what he said on Chinese startup's blockbuster R1 model

During Nvidia's recent earnings call, CEO Jensen Huang commented on the unexpected popularity of DeepSeek, the Chinese AI firm whose R1 model has been creating a stir worldwide. Huang acknowledged for the first time directly about the R1's success, reported Fortune. Here is what he said.

What does Jensen Huang say about DeepSeek's R1?

While DeepSeek's launch had brought a steep decline in Nvidia's market cap, losing $600 billion in one day, Huang did not seem concerned and remains optimistic about the company's future. According to Fortune, Huang admitted the "global enthusiasm" for the R1 model, referring to it as "an excellent innovation." He also mentioned that DeepSeek "has open-sourced a world-class reasoning AI mode," as quoted in the report.

Nvidia's long-term vision for AI chips and compute power

According to Huang, Nvidia's emphasis is on the long-term, wider demand for AI chips and computing power, reported Fortune. He highlighted the rise of digital assistants, which can use AI to complete complex, multi-step tasks, as well as AI’s integration with robotics. He said "Each of these [technologies] is just getting started," as quoted in the report.

Big investments from major clients

Although admitting the success of DeepSeek has rocked the market, Huang is sure that Nvidia's position in the AI race is safe. Key clients, such as Meta, Amazon, Google, and Microsoft, are planning to pump $320 billion into AI and data centre infrastructure, guaranteeing constant demand for Nvidia's chips, as per a CNBC report. Such clients, Huang said, were already making enormous investments to increase AI capabilities, further cementing the demand for powerful computing.

AI factories everywhere

Huang said, "Going forward, data centres will dedicate most of CapEx to accelerated computing and AI," as quoted by Fortune. He also claimed, "Data centres will increasingly become AI factories, and every company will have them, either rented or self-operated," as per the report.

Blackwell chip demand soars

Huang also touched on some of the pressing issues regarding Nvidia's product lines. He pointed out that although the Blackwell chips, Nvidia's new-generation product, are seeing "extraordinary" demand. The company said it sold $11 billion worth of the chips for the quarter, reported Fortune. While the platform had been plagued by server rack overheating problems, Huang assured analysts that these issues were anticipated and future updates would be easier to implement.

CFO Colette Kress claimed, “This is the fastest product ramp in our company’s history, unprecedented in its speed and scale,” as quoted by Fortune.

Nvidia’s resilience in the face of challenges

According to Huang, the rise of AI is a global trend that will outlast any temporary obstacles, including export restrictions and competition from startups like DeepSeek. Despite a reduction in Nvidia’s Chinese revenue following US export controls, Huang is confident that AI’s potential to address a significant portion of the global economy is too large to be impacted by these challenges.

He said “No technology has ever had the opportunity to address a larger part of the world's GDP than AI,” as quoted by Fortune.

FAQs

Is Nvidia worried about competition from DeepSeek?
No, Huang remains confident that Nvidia's position in the AI race is secure despite competition from startups like DeepSeek, citing the large-scale investments being made by major tech companies in AI infrastructure.

How did DeepSeek's success affect Nvidia’s market cap?
DeepSeek's launch led to a sharp drop in Nvidia’s market cap, losing $600 billion in one day.