Nvidia's founder and CEO, Jensen Huang, is renowned for his unwavering optimism regarding the company's trajectory. His recent announcement of a "brand new $200 billion Total Addressable Market (TAM)" for Nvidia reflects this enthusiasm, particularly surrounding the launch of their new CPU product, Vera.
During a recent earnings call, where Nvidia reported an impressive $81.6 billion in revenue, Huang positioned Vera as a potentially groundbreaking innovation with promising sales figures already emerging. He emphasized that Vera could serve as a significant growth driver for Nvidia, stating it is "the world's first CPU, purpose-built for agentic AI."
Despite Nvidia's strong performance, there remains cautious sentiment on Wall Street regarding potential competition in the CPU space, traditionally dominated by companies like Intel and AMD. Recently, Amazon Web Services announced a major contract with Meta for its own AI CPUs, raising questions about Nvidia's future in this sector.
Huang, however, remains confident in Vera's potential. He explained that while GPUs handle the cognitive aspects of AI, CPUs are essential for executing tasks. With Vera, which can be purchased separately or bundled with Nvidia's Rubin GPU, Huang believes the company is well-positioned to lead in the evolving landscape of AI and robotics.
"Vera opens a brand new $200 billion TAM for Nvidia, a market we have never addressed before," Huang stated. He noted that major hyperscalers and system manufacturers are eager to collaborate with Nvidia to implement this technology. "The world is rebuilding computing for agentic AI and robotic physical AI, and Nvidia is at the forefront of this transition," he added.
Vera is engineered to process tasks efficiently, focusing on rapid token processing rather than traditional multi-core capabilities. Huang's confidence is bolstered by the fact that Nvidia has already sold $20 billion worth of standalone Vera CPUs this year, indicating robust demand.
Looking ahead, Huang envisions a future where billions of AI agents will emerge, each requiring powerful computing tools akin to today's PCs. "We're going to need a lot more CPUs," he concluded, highlighting the expansive growth potential for Nvidia in the coming years.