Chip designer NVIDIA Corporation believes that the introduction of Tesla Inc.’s D1 chip to train its artificial intelligence models for autonomous driving validates NVIDIA’s approach to combining key computing elements for automotive artificial intelligence solutions. NVIDIA’s comments were made by the company’s chief financial officer, Ms. Colette Kress, at the technology summit of the Bank of Montreal’s investment banking subsidiary BMO Capital Markets today. During her presentation, the executive also shared details of NVIDIA’s supply bottlenecks for its graphics processing units (GPUs), its prospects for the cryptocurrency market, and its expectations for the company’s upcoming acquisition of British design house Arm Ltd.
NVIDIA emphasizes that it is working with board partners to alleviate the graphics processor shortage
Ms. Kress first explained the delivery bottlenecks that her company is facing with GPUs. The semiconductor sector as a whole has faced serious shortages since the onset of the ongoing pandemic as consumer electronics demand skyrocketed amid restrictions that have forced buyers to move to remote work and entertainment.
According to her, NVIDIA is working with its channel partners, especially its original equipment manufacturers, to ensure that their needs are met and that GPUs find their way to gamers.
The executive outlined the following:
At the end of the second quarter and into the third quarter, our overall offering in the channel is still rather vague. We have therefore set ourselves the goal of further improving these levels so that GeForce cards are available to our players as the game progresses. That now means working with each of our channel partners.
She repeated a similar strategy for the data center products, later adding:
And now we are trying to find these solutions for our customers. We will continue to be areas where we need to focus with our OEMs and our partners to ensure that everything needed for the data center is available at both the OEM and through NVIDIA to serve our overall customers.
NVIDIA GeForce & AMD Radeon graphics card (GPU) price trend for early August 2021. (Image source: 3DCenter)
She also commented on the downward move in retail prices for GPUs, but cautioned that more needs to be done to bring prices down.
According to the executive:
So let me remind everyone how we address the two important areas of both gaming and full blown crypto mining. We’ll focus first on getting our GeForce gaming cards into the hands of gamers. This final quarter, the Ampere GPU cards were one of the fastest ramps. We believe we have succeeded with our strategy. I just want to remind everyone that it is difficult for us to gauge the impact cryptocurrency mining has on our sales, we simply have no insight into the end uses of our GPUs.
However, our strategy includes providing CMP – Crypto Mining Processor cards for professional miners and GeForce cards with low hash rate for our players. This enables us to control this offer to our players. Low hash rate cards shipped in the second quarter accounted for over 80% of our ampere desktop GPU shipments in the second quarter. And we are at the beginning of the process for the Ampere architecture. Now we’re starting to see retail prices moving directionally down for GeForce, but we still have some additional effort to make to bring retail prices down.
Tesla’s D1 chip in a presentation slide shared on August 19, 2021. Image: Tesla Inc / YouTube
The moderator then asked Ms. Kress for her thoughts on Tesla’s D1 chip and its introduction at a time when the automotive semiconductor industry is transitioning from simple infotainment systems to autonomous driving and other companies will follow suit.
Their answer was as follows:
So when you think of our automotive business, there are two main areas of focus at the moment. First, the old infotainment business. We have been part of this business for more than a decade. This is an area that is likely to see a decline over the next year or so. As we move, we focus on non-goods and focus on autonomous driving. We’ve been talking about this for the past few quarters. Our pipeline, our pipeline for sales, is more than $ 8 billion by 2027. A good part of that is our focus on the agreement we have with Daimler for the entire vehicle fleet over the next few years.
You will likely see a turning point in our autonomous driving solutions in the next year and a half or so, in terms of the passenger parts market, but also in terms of robotic axes and our overall market [INAUDIBLE]. We rely on an end-to-end platform. We’re focused on an end-to-end platform that starts today as automotive companies have an infrastructure in their data centers to grow and develop what they will have in terms of autonomous vehicles in the next decade. And we offer what is probably the most powerful, but also the complete solution of all the hardware inside a car and the software to move forward.
In the case of Tesla, they really demonstrated or validated our full-stack approach and the importance of our innovation through systems, connectivity and software in relation to what we put together. It’s interesting to see Tesla in terms of overall performance, but keep in mind that NVIDIA is still working on our roadmap every day, which I am sure we can show even more to our customers and our investors, as well as our investors. …