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Nvidia CEO Jensen Huang says smuggled data centers are a dead end and national security comes first
Jensen Huang told shareholders national security comes first and that data centers built with smuggled Nvidia chips cannot function without support.
TL;DR
- Nvidia CEO Jensen Huang stated that national security comes first and will be prioritized over commercial opportunities.
- Huang described attempts to build AI data centers with smuggled Nvidia hardware as a "dead end," as these systems require trusted components and ongoing support.
- Nvidia would not provide support or repairs for smuggled hardware, rendering smuggled AI data centers inoperable at the scale required for modern AI.
- Recent crackdowns include the charging of Supermicro co-founder Wally Liaw for conspiring to smuggle Nvidia-equipped servers to China and Taiwan's first criminal prosecution of AI chip smuggling.
- Grey-market prices for Nvidia's B300 servers in China have doubled due to these crackdowns.
- The US government has also taken action, ordering Anthropic to shut down powerful AI models due to national security concerns.
- Nvidia's revenue from China has been declining due to US export controls.
- Huang emphasized the strong return on investment for AI, citing increased pull requests on GitHub due to AI-generated code.
- Nvidia plans to return 50% of its free cash flow to investors through buybacks and dividends.
- Shareholders re-elected all board members and approved executive compensation and an outside proposal requiring simple majority votes.