ChatGPT ‘arms race’ adds US$4.6 billion to Nvidia founder’s fortune

ONE of the biggest winners from the soaring popularity of the ChatGPT tool is a billionaire Taiwanese immigrant known for his black leather jackets and tattoo resembling the logo of Nvidia, the company he co-founded in 1993.

Jensen Huang has seen his fortune climb by 33 per cent this year to US$18.4 billion, a larger percentage gain than any other US billionaire, according to the Bloomberg billionaires Index. It’s a sharp contrast to last year, when his wealth decline was one of the biggest among US technology titans, along with Meta Platforms’ Mark Zuckerberg.

His firm, initially focused on creating computer chips to create graphics for video games, has become the dominant player in powering artificial intelligence (AI) applications, from autonomous cars to robots to crypto mining. That speciality has made it one of Wall Street’s top wagers for how to profit from exuberance about the future of AI, encouraged by Microsoft Corp. vowing to put US$10 billion into OpenAI, the startup that developed ChatGPT.

“ChatGPT kind of started an arms race,” said Christopher Rolland, senior analyst at Susquehanna Investment Group. “Nvidia is far and away the leader.”

Rapid growth from ChatGPT usage could result in sales of US$3 billion to US$11 billion for Nvidia over 12 months, Citigroup estimated last week. While acknowledging the difficulty in modelling growth for such a nascent service, analyst Atif Malik based his values on projections for the number of words generated by ChatGPT and revenue per word for Nvidia.

Huang, 59, who studied electrical engineering at Oregon State and Stanford universities, declined to comment through a spokesperson.

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At an event this week in Stockholm, Huang said AI will present challenges to society and regulators, and that while the new technology offers much promise, it also has “some potential harm.”

“What is the social norm for using it?” Huang said at the meeting of Nordic executives and researchers. “What are the legal norms? Everything is evolving now.”

After peaking at more than US$800 billion in late 2021, Nvidia’s market value retreated last year as its shares tumbled 50 per cent amid a sharp decline in sales of its gaming chips and a general slowdown in personal computer sales. The company’s stock has jumped more than 35 per cent since the start of 2023, mirroring investor enthusiasm over the chatbot’s potential.

“There’s obviously a lot of noise around ChatGPT,” said Ruben Roy, managing director at Stifel Nicolaus. “A semiconductor company like Nvidia is the best way to play AI.” BLOOMBERG