In a recent gathering at Nobu Palo Alto, tech titans Larry Ellison and Elon Musk were seen lobbying Nvidia CEO Jensen Huang for a critical resource: more GPUs. This unexpected plea was revealed by Ellison himself during a meeting with analysts last week, where he humorously recounted the incident, saying, “Please take our money. By the way, I got dinner. No, no, take more of it. We need you to take more of our money please.”
The demand for Nvidia’s powerful GPUs is soaring, fueled by the rapid development of artificial intelligence (AI) applications. Ellison, the co-founder and CTO of Oracle, highlighted the urgency, emphasizing, “It’s a big deal.” Oracle, like Tesla, is heavily investing in GPU technology to power its AI initiatives. Oracle, with its longstanding relationship with Nvidia, saw its first-quarter fiscal 2025 revenue rise by 7% to $13.3 billion, driven by its GPU investments.
Tesla, meanwhile, relies on Nvidia GPUs to train its neural networks for its ambitious self-driving technology. The need for these chips is so significant that Musk even diverted Nvidia chips intended for Tesla to his other companies, X and xAI, in June. This decision, however, was justified by Musk as the existing factory space was already allocated to vehicle, battery, and cell production.
The global demand for high-performance memory chips is expected to remain constrained throughout 2024, a consequence of the AI boom. Leading suppliers like SK Hynix and Micron Technology Inc. are grappling with shortages, with stock for 2025 nearly depleted. This shortage is further amplified by U.S. sanctions on advanced chips to China and the surging demand for Nvidia’s RTX 4090 graphics cards.
The dinner at Nobu, while seemingly casual, represents the growing tension in the tech industry. The race to secure enough GPUs for AI development is intensifying, highlighting the crucial role of Nvidia in this rapidly evolving landscape. The outcome of Ellison’s plea remains positive, as he mentioned, “It went ok. I mean, it worked.” But the demand for these chips is expected to only increase, making the battle for GPUs a key factor in the future of AI.
