Nvidia CEO Jensen Huang Makes A Joke That Customers May Not Find Funny

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Nvidia CEO Jensen Huang made a joke this week that his biggest customers probably won't find funny.

"I said before that when Blackwell starts shipping in volume, you couldn't give Hoppers away," he said at Nvidia 's big AI conference Tuesday.

He was talking about Nvidia's latest AI chip-and-server package, Blackwell . It's notably better than the previous version, Hopper, which came out in 2022.

These companies should be happy about an even more powerful GPU like Blackwell. It's generally great news for the AI community. But there's a problem, too.

When new technology like this improves at such a rapid pace, the previous versions become obsolete, or at least less useful, much faster.

This makes these assets less valuable, so the big cloud companies may have to adjust. This is done through depreciation, where the value of assets are reduced over time to reflect things like wear and tear and ultimately obsolescence. The faster the depreciation, the bigger the hit to earnings.

Ross Sandler, a top tech analyst at Barclays, warned investors on Friday that the big cloud companies and Meta will probably have to make these adjustments, which could significantly reduce profits.

Google and Meta did not respond to Business Insider's questions about this on Friday. Microsoft declined to comment.