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Nvidia to Become an Integrated Data Center Service Provider

Nvidia CEO Jensen Huang is pushing the company's strategy to become a full-service supplier of data center components.

Nvidia to Become an Integrated Data Center Service Provider

Nvidia (NASDAQ: NVDA) CEO Jensen Huang is reportedly pushing the company's strategy to become a comprehensive supplier of data center components, covering software, network technology and design services, with the goal of consolidating its leadership in the AI ​​field.

Nvidia's latest financial report shows that its performance in the previous quarter exceeded Wall Street expectations, and it also started after its competitor AMD (NASDAQ: AMD) announced a nearly $5 billion acquisition of data center design and manufacturing company ZT Systems.

Today, Nvidia has more than 80% market share in the field of AI chips, using its dominant position to provide more comprehensive products and services for the data centers of this "AI factory". These data centers are used to create and run AI tools such as OpenAI's ChatGPT.

Relevant people pointed out that Huang Renxun's ambition is to transform Nvidia from a hardware supplier to a one-stop service provider for all key data center components. The company is using its proprietary software CUDA, which has been a key driver of the company's success for 17 years, which allows developers to use Nvidia's GPUs for computing tasks.

In addition, Nvidia is investing in InfiniBand, a high-speed networking standard widely used in AI training. Five years ago, Nvidia acquired InfiniBand equipment maker Mellanox (NASDAQ: MLNX) Technologies for nearly $7 billion.

Nvidia is also investing in AI-optimized Ethernet services, which are expected to bring in significant revenue in the coming year, said Chief Financial Officer Colette Kress. The service is part of Nvidia's larger portfolio of data center solutions, which includes central processing units and network chips that are designed to work together. The company also personalizes its services to meet the specific needs of a variety of industries such as healthcare and robotics by providing specialized software and hardware configurations.

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