Reporter of the Economic Business: Wen Qiao Reporter of the Economic Business Business: Gao Han
From September 19th to 22nd local time, NVDA (NVDA, stock price of US$132.61, market value of US$330.199 billion) held the latest GTC conference in Santa Clara, California, USA.
htmlOn September 20, Nvidia launched the highly anticipated RTX 40 series graphics cards; the new Ada Lovelace architecture GPU (image processing technology); the OVX computing system powered by the Ada Lovelace GPU that will lay a solid foundation for the graphics processing and simulation of the metaverse; and the Omniverse Cloud service mainly used to build and run industrial metaverse applications, etc.One of the keywords of the above products is " Metauniverse ". However, compared with other technology giants, Nvidia relies on its foundation to establish its GPU and is positioned at the bottom of the hardware in the metaverse world. At present, core technology industries such as artificial intelligence , cloud computing , data analysis and high-performance computing are inseparable from the strong support of the top GPU .
In November 2021, Nvidia once rode the east wind of the metaverse and its stock price reached a historical high of US$333.76 per share, with a market value of more than US$800 billion. However, since the beginning of this year, Nvidia has suffered from the decline in main performance and plummeting gross profit margins, and its stock price has fallen by more than half from its highest point.
This time, can Nvidia use the metaverse to get out of the "darkest moment"? What confidence does Nvidia have in positioning the bottom layer of the hardware in the universe?
Image source: Daily Economic News Data picture
"Engineer's Metaverse"
At the GTC conference, Nvidia officially released a new generation of graphics card product - RTX 40 series graphics cards after two years. It is worth noting that this series of graphics cards has been replaced with a brand new GPU architecture - Ada Lovelace, which is designed for neural graphics and advanced virtual world simulation. Some media commented that the latest Ada Lovelace architecture is the hero behind most new products and technological breakthroughs.
In addition to graphics cards, Nvidia has also launched Omniverse Cloud service. Omniverse ("all universe") is a virtual world simulation engine. It can be a database, a computing platform, and an AI server. It is also an enterprise platform for product design and styling, and can be used in the game development, automobile manufacturing, film and television industries and other industries.
In addition, Nvidia officially announced the OVX computing system based on Ada Lovelace GPU-driven. The new generation of OVX systems will bring strong help to designers when using advanced 3D software to build a 3D virtual world.
These products revolve around one keyword - the meta universe.
In 2021, with the first stock of the metaverse, Roblox, listed on New York Stock Exchange, Facebook; Facebook was renamed Meta, and the company's CEO Mark Zuckerberg announced that he would transform into a metaverse company within five years, the popularity of the metaverse was pushed to a new high, causing huge waves among global technology companies.
In fact, long before this meta-universe boom, Nvidia officially proposed Omniverse in 2019. In 2020, the public beta version of Omniverse Open Beta was launched, and the virtual digital factory of BMW was built on this platform.
In an interview with foreign media VentureBeat last month, Nvidia founder and CEO Jensen Huang said that in his opinion, through the function of universal data exchange, Omniverse provides any tools needed for product design company - whether it is a company that manufactures automobiles, ships, aircraft, agriculture, consumer goods or electronics. Through the Omniverse in the cloud, every designer, CAD engineer, CAE engineer, supply chain team, factory building personnel and simulators can be synchronized at once in the industrial metaverse. Therefore, Nvidia's Omniverse platform is also known as the "Engineer's Metaverse".
He also revealed that Nvidia will continue to lay out meta-universe related fields around the Omniverse platform in the future, focusing on computer graphics, artificial intelligence, as well as scientific computing and physical simulation. These three fields are the three pillars of Nvidia's meta-universe world, and what brings it together is the Omniverse platform.
At this GTC conference, Nvidia announced that Omniverse Cloud service has welcomed its first batch of customers - RIMAC Group, WPP and Siemens ; OVX system has also welcomed its first batch of customers - BMW Group and Jaguar Land Rover , and its imagination of "Engineer's Metaverse" officially kicked off.
Huang Renxun is full of confidence in the future of the metaverse. He said that if Nvidia can build a "Earth-2" with meter-level accuracy (the digital twin of the earth, one of Nvidia's most important long-term projects), then humans will enter the metaverse for free.
Image source: Photo Network-401116818
Where is the confidence?
In the competition in the meta-universe field, the most eye-catching ones are Meta (formerly Facebook) and Apple . They are scrambling to make efforts in VR/AR technology, confronting high-end head-on devices, and entering the metaverse from the C-end consumer scenario.
According to the research report of Anxin Securities , in addition to the hardware entrance, Meta and Apple are also focusing on layout in the underlying architecture, artificial intelligence, content and scenarios of the metaverse. However, in contrast, Apple's importance to the metaverse world lies in its most potential to push the metaverse hardware entrance - AR/VR devices to the mainstream.
Microsoft took the lead in proposing the concept of "enterprise meta-universe", using Dynamics 365 Connected SpaCES and Mesh for Teams to enter the meta-universe from the B-end. Currently, Microsoft also has layouts in hardware entrances, underlying architecture, content and scenarios; Google and Amazon are also key points to focus on underlying technologies.
Similarly, Nvidia has made efforts in front-end hardware, back-end infrastructure, and underlying architecture of the metaverse. However, compared with other technology giants, Nvidia relies on GPU card to the bottom of the world hardware. At the 2021 GTC conference, Nvidia announced the upgrade of its product route to the "three-core" strategy of "GPU+CPU ( central processing unit ) + DPU (data processor)".
According to the aforementioned research report, Nvidia's foundation is GPU. At present, core technology industries such as AI, cloud computing, data analysis and high-performance computing are inseparable from the strong support of the top image processing technologies.
In an interview with foreign media, Huang Renxun called "computer graphics, artificial intelligence, and scientific computing and physical simulation" "three things that Nvidia is really good at." As a professional graphics processing chip company, Nvidia invented the graphics processor GPU - GeForce 256 in 1999. Since then, GPU has begun to profoundly change the world. Nvidia GPU has dominated the fields of gaming and 3D simulation.
Obviously, Nvidia has natural advantages in graphics processing chips. The GPU graphics card field has always been dominated by Nvidia and AMD. According to Statista's statistics, Nvidia accounts for 70% to 80% of the market share and has absolute voice and dominance.
Finance and global information services company GLG said in an article that Nvidia may be the best company to compete with giants such as Meta, Google, and Amazon for the development of the metaverse. "Nvidia has long been a GPU innovator. When Nvidia combines Omniverse with software, it will unleash the potential for new developments in the metaverse. More importantly, giants like Amazon, Meta and Google that have larger AI units but not as good as Nvidia's graphics processing level can rely on Omniverse to make greater progress in their own metaverse projects."
It is worth noting that at CES 2022, Nvidia announced that it would provide millions of individual creators and artists around the world with free versions of Omniverse. VentureBeat said in a commentary article that Nvidia's authorization of content producers is a highlight, in stark contrast to Meta's inherent approach to "controlling all data."
"To make the metaverse a true cultural phenomenon, we need visionary artists and creatives to create content. Unleashing creative energy in the metaverse to make products and experiences will make it attractive to consumers, which is also crucial to the commercial viability of building the metaverse," the article reads.
All these factors—the connectivity of Omniverse, the ability to work with big companies and individual designers, the power of Nvidia’s hardware, heralds Nvidia is ready to be the cornerstone of the metaverse, GLG concludes. Can
get out of the "darkest moment"?
In fact, Nvidia has not had a good life in the past year.
Time goes back to November 9, 2021. At that time, Huang Renxun announced the latest progress in the Omniverse strategy at the Nvidia GTC conference. Riding on the east wind of the metaverse, the company's stock price once broke through $323 per share on the same day, setting a record high intraday. Nvidia's rise did not diminish that month, and reached an all-time high of US$333.76 per share at the end of the month, with a market value of US$834.4 billion.
However, as of the closing of US stock on September 21 this year, Nvidia's stock price closed at US$132.61 per share, with a market value of US$330.199 billion. Compared with the highest point at the end of last year, Nvidia's stock price has plummeted by more than half.
Image source: Yingwei Finance
The reason is that since the graphics chips of the game are Nvidia's "foundation of life", the game business has always been its main revenue sector in the past, but this sector has shown a downturn this year.
According to its second quarter report for the 2023 fiscal year ended July 31 this year, Nvidia's game business revenue fell to US$2.04 billion, a year-on-year decline of 33%, a month-on-month decline of 44%, and the proportion of game revenue also fell to 30%. In addition, in the third quarter guidance given by Nvidia, the revenue of the game business will continue to decline.
In addition, according to the second quarter financial report, Nvidia's net profit recorded US$656 million, a 72% drop from US$2.374 billion in the same period last year. At the same time, Nvidia's gross profit fell sharply from US$5.431 billion in the first quarter to US$2.915 billion, and its gross profit margin was only 43.5%, down more than 20 percentage points from 65.5% in the first quarter of this year and 64.8% in the second quarter of last year.
In response to this, Huang Renxun said, "We are undergoing supply chain transformation in a challenging macro environment, but we will overcome the difficulties." At that time, he said he was looking forward to the GTC conference in September, as the company's breakthrough in artificial intelligence and the metaverse will be announced.
However, the GTC conference on September 20 did not seem to have brought the effect that Huang Renxun expected. After the new product was released, Nvidia's stock price fell by more than 1.5% on the closing day. On September 21, it closed slightly higher by 0.65%.
On various tracks, Nvidia's competitors are also eyeing them. In Nvidia's old business GPU graphics card market, AMD has made a comeback, and its AMD RX 7000 series graphics card is scheduled to be released on November 3; the main battlefield has always been the CPU field, Intel , Intel , is also entering the GPU graphics card market, trying to get a share of this market with huge potential; even Apple has emerged in GPUs and launched the M1 Max graphics card in 2021.
In the meta-universe field, Nvidia Omniverse reportedly faces challenges from its main competitors Unity, Autodesk and Epic's Unreal Engine. However, in an interview with the media, Omniverse Lead of NVIDIA China, He Zhan said that (Omniverse and theirs) positioning is different. Unreal Engine and Unity prefer the application side, while Omniverse is more positioned at the middle layer between the application side and the hardware, and the way some technologies are introduced is also different.
In addition, although Nvidia has an advantage in GPU, Omniverse is also facing considerable pressure in the layout of leading technology giants such as Meta, , Qualcomm, , Microsoft, and Apple in the underlying architecture of the meta-universe.
This time, can Nvidia rise again as last year, just like last year? The answer is still unknown.
Daily Economic News
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