Despite Meeting With Nvidia CEO, Trump Sticks With Plan to Tariff Foreign Chips
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All that bending over with a leather jacket on and nothing to slow for it.
Nvidia doesn't care. Tariffs do not affect their profits at all. If anything, it increases their profits.
The reason is that Nvidia has a monopoly on high end gpus and AI hardware. Tariffs can only influence a country if there is a competitor that could undercut them.
It's not like Intel is making 5090's so a 25% tariff would allow Intel to be competitive.
Remember, the tariff is 25-100%. Let's just say it ends up at 50%. How many gamers will pay 3k for a 5090? It is a mediocre upgrade this generation anyway. Also, both AMD and Intel GPUs are made in Taiwan (TSMC). Nvidia's profits lately have been coming via ai chips. The Chinese just showed us that those aren't needed. Jensen and his cousin at AMD are 2 of the smartest CEOs in the country, they know that tariffs like this will crash demand, give China an opening, and possibly wreck the US economy.
They sold out at $2k. They'd sell out at $3k.
It doesn't matter that it's a weak release. There is no alternative product.
Gpus represent only a small part of Nvidia's revenue. They make the bulk of their money on data center products. If OpenAI needs $10B more B200's, they'll open an office in Vancouver and avoid the tariff.
Nvidia won't be hurt. Corporations won't be hurt. They only people to suffer will be American consumers.
Nvidia, and every GPU manufacturer, got quite some competition in regards to AI, with specialized chips.
E.g. Cerebras - https://www.forbes.com/sites/craigsmith/2024/08/27/cerebras-speeds-ai-by-putting-entire-foundation-model-on-its-giant-chip/
I don't think, that Nvidia will keep its dominance in that branch for much longer. Especially when specialized chips can be run much cheaper and with less electricity cost.
Edit: more up to date article with actual working model on their chip:
https://cerebras.ai/press-release/cerebras-launches-worlds-fastest-deepseek-r1-distill-llama-70b-inference
Never head of Cerebras. shrug
The world buys Nvidia. 98% of datacenter GPUs are made by Nvidia.
Source: https://www.hpcwire.com/2024/06/10/nvidia-shipped-3-76-million-data-center-gpus-in-2023-according-to-study/
I see no reason for that to change. Everybody is using them, knows how to use them and pretty much every AI software in existence runs on them.
Jensen Huang maybe needs to work on his head game. Or maybe learn how to lap dance a bit better for donvict.