Jensen Huang says he’s found a ‘brand new’ $200B market for Nvidia

Source: TechCrunch

Jensen Huang’s New $200 Billion Market Claim

Nvidia founder and CEO Jensen Huang is known for his relentless optimism about the company’s future and revenues. After Nvidia posted a record‑breaking quarter with $81.6 billion in revenue and forecast $91 billion for the next quarter, Huang announced that the company has uncovered a “brand new $200 billion total addressable market (TAM)” tied to its new CPU product, Vera.

“Vera opens a brand new $200 billion TAM for Nvidia, a market we have never addressed before, and every major hyperscaler and system maker is partnering with us to deploy it. The world is rebuilding computing for agentic AI and robotic physical AI. Nvidia sits at the center of these transitions,” – Jensen Huang, earnings call.

Nvidia’s Vera CPU

Vera was introduced in March 2024 as a CPU purpose‑built for agentic AI (link). Huang positions Vera as a transformative product that complements Nvidia’s Rubin GPU. According to Huang:

• The “thinking” part of an AI model runs on GPUs, while agents primarily run on CPUs.
• Vera is optimized to process tokens as quickly as possible, unlike classic cloud CPUs that focus on multi‑core parallelism.
• It is sold both standalone and bundled with Rubin GPUs.

Industry Competition

Historically, the CPU market has been dominated by Intel and AMD, while Nvidia has been the leader in GPUs. Recent developments have intensified competition:

• Amazon Web Services announced a large contract with Meta for millions of Amazon‑designed AI CPUs (link).
• AWS CEO Andy Jassy has suggested that AWS can produce AI chips—both GPUs and CPUs—as well as, possibly, better than Nvidia (link).

Despite this, Huang argues that Nvidia’s focus on agentic AI gives it a unique advantage.

Sales and Growth Projections

Huang claims that Nvidia has already sold $20 billion worth of standalone Vera CPUs this year and that the market is only at its beginning. He envisions a future where:

• The world’s billion human users will be joined by billions of AI agents.
• These agents will rely on tools analogous to PCs, driving massive demand for CPUs.

“We’re going to need a lot more CPUs,” Huang said.

Analyst Perspective

While Huang’s confidence is notable, Wall Street remains cautious about what could displace Nvidia from its leading position, especially given the rapid advancements and investments from major cloud providers and AI‑chip startups.