Nvidia, known for its cutting-edge chips and gaming products, has been expanding its networking division into a significant revenue stream, rivaling its core business. Led by CEO Jensen Huang, Nvidia’s foray into AI-specific chips and data center networking has paid off, with the networking business generating a staggering $11 billion in revenue last quarter, a 267% year-over-year increase.
This networking division, crucial for connecting data centers, has swiftly become Nvidia’s second-largest revenue source, thanks to innovations like NVLink for GPU communication and Spectrum-X for AI networking. According to Kevin Cook from Zacks Investment Research, Nvidia’s networking segment, stemming from the acquisition of Mellanox, has surpassed industry giants like Cisco in quarterly revenue.
Nvidia’s networking segment forms the foundation for what the company calls an ‘AI factory’ – a data center optimized for AI model training. While this division operates in the shadow of Nvidia’s chip and gaming businesses, its rapid growth and revenue figures underscore its vital role in Nvidia’s overall success.
Source: TechCrunch