Nvidia, the leading graphics processing unit (GPU) manufacturer, has announced ambitious revenue projections for its sovereign artificial intelligence (AI) segment in 2025. This growth is expected to be driven by the increasing global demand for nation-specific AI infrastructure.
During the company’s second-quarter earnings call, Colette Kress, Nvidia’s Chief Financial Officer, stated that they anticipate sovereign AI revenue to reach the low double-digit billions this year. This projection underscores Nvidia’s confidence in the expanding market for country-specific AI solutions.
Jensen Huang, Nvidia’s CEO, highlighted the importance of sovereign AI, emphasizing that countries are increasingly recognizing their data as a valuable national resource. He asserted that nations need to develop their own AI infrastructure to establish their own digital intelligence.
The surge in demand for sovereign AI is closely linked to the rise of generative AI technologies. Kress explained that this is a unique and growing opportunity, stemming from the desire of countries worldwide to have their own generative AI capabilities.
Nvidia’s announcement comes after a strong second-quarter earnings report, where the company exceeded revenue expectations. Its data center revenue played a pivotal role in boosting the topline, despite a slight decline in gross margin. Notably, Nvidia’s revenue in China has remained resilient despite U.S. export controls, demonstrating the company’s ability to navigate complex geopolitical landscapes.
CEO Huang has identified a $1 trillion opportunity as data centers shift towards accelerated computing and generative AI. This transition is expected to drive significant demand for Nvidia’s products and services, further solidifying its position as a dominant player in the AI market.
In after-hours trading, Nvidia’s stock price fell by 6.89% to $116.95, following a 2.10% decline during the regular trading session. Despite the recent dip, NVDA has experienced a remarkable year-to-date gain of 160.76%, showcasing its continued strength and investor confidence in its future prospects.
