Gaming was Nvidia’s largest business. Now 80% of the income comes from somewhere else entirely

Nvidias (NASDAQ: NVDA) Its creation aimed to revolutionize 3D computer graphics for the gaming and multimedia sectors. Initially finding success with a variety of chips, the company made a significant leap in 1999 with the introduction of the Nvidia GeForce 256, the world’s first graphics processing unit (GPU).

This milestone has culminated in the latest GeForce RTX 40 series, which can deliver lifelike graphics to digital content using Deep Learning Super Sampling (DLSS), an incredible innovation from Nvidia. DLSS usage artificial intelligence (AI) to create additional frames in a video game scene and improve image quality.

Until fiscal year 2022 (ending January 30, 2022), gaming was routinely Nvidia’s largest source of revenue. The segment generated $12.5 billion in revenue that year, which accounted for 46% of the company’s total revenue. But then everything changed:

Data source: Nvidia. Chart by The Motley Fool.

Artificial intelligence is transforming the data center

Data centers used to be where businesses stored valuable information, but have since evolved into centralized hubs for online activities (also known as cloud computing). Today, data centers are home to powerful chips designed by Nvidia to handle AI workloads.

The shift began in 2016 when Nvidia delivered the first AI supercomputer to OpenAI, which used it to power its early generative AI models that culminated in the famous ChatGPT online chatbot.

Now, Nvidia’s industry-leading H100 data center GPUs are selling for up to $40,000 each. With centralized data center operators such as Microsoft And Amazon ordering hundreds of thousands of them to give cloud customers the computing power they need to develop AI.

It sent Nvidia’s…

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