Jensen Huang explains why Nvidia’s latest partnership with OpenAI is different

In an interview with CNBC’s Jim Cramer, Nvidia CEO Jensen Huang discussed his company’s new deal with OpenAI, saying it’s the first “direct partnership” with the ChatGPT maker.

“This is the first time OpenAI will purchase directly from us,” said Huang. “Usually…a cloud service provider buys from us and leases from a cloud service provider. So now it will be a direct partnership.”

Nvidia announced in September that it plans to invest up to $100 billion in OpenAI to develop its AI data center capacity. companies in question OpenAI is trying to build and distribute Nvidia systems that require 10 gigawatts of power. Huang previously told CNBC that 10 gigawatts equals 4 to 5 million GPUS.

OpenAI and Nvidia are two of the biggest drivers of the AI ​​boom. Demand for Nvidia’s chips began to explode after OpenAI first released ChatGPT three years ago, greatly popularizing the mainstream use of generative AI. Nvidia’s market cap has more than tripled in the last few years. In addition to being the most valuable company in the market, it also became the first stock ever to surpass $4 trillion.

Huang spoke with Cramer at the CNBC Investment Club Monthly Meeting held at the New York Stock Exchange on Tuesday afternoon. In the interview, part of which also aired on the evening’s episode of “Mad Money,” Huang and Cramer also talked about China, global trade and important partnerships with China. AMD And Intel.

Huang told Cramer that Nvidia’s OpenAI partnership is “incremental” over the company’s work with other AI names. Seer And CoreWeave.

“We will help them build an AI infrastructure that they will run themselves… and we will prepare them for when, you know, five years from now they will already be running their own cloud,” Huang said.

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Disclaimer CNBC Investing Club Charitable Trust owns shares of Nvidia.