NVIDIA CEO Jensen Huang stated on Thursday that despite the sell-off of memory chip stocks over the past week due to market concerns about oversupply and weakening demand, the likelihood of an oversupply of memory chips by 2029 is not high.
"One of the great things about storage chips is that you can always use more of them," Jensen Huang said in a wide-ranging interview with Arjun Kharpal during the NVIDIA GTC Berlin conference. He added that HBM – a type of random access memory – will continue to be used in the coming years.
"We are the first company in the world to introduce LPDDR memory – the type of memory used in mobile phones – into global data centers, which allows us to achieve twice the energy efficiency of any product currently on the market. Therefore, we will continue to use it in large quantities," he added.
On October 15th, an opinion piece published by a well-known publication in South Korea called on the government to prepare for a slowdown in the artificial intelligence boom. Subsequently, stocks in the storage chip sector suffered a heavy setback over the past week.
According to CNBC, this article quotes two experts who predict that by 2029 there will be a "new wave of supply," which will turn the storage market into a "red ocean." They write that by 2029, "the super cycle may have ended, and the industry could enter a downward cycle."
Storage chips are a core component of NVIDIA's chips. If there is an oversupply, it may drive down prices and hit the profit margins of manufacturers such as SK Hynix, Samsung, and Micron.
SpaceX and Tesla CEO Elon Musk responded to this article at the time, stating that China "will produce a large amount of RAM in 2028."
This sell-off of memory chips was also driven by China's ChangXin Memory Technology Corporation ( CXMT ). The company announced a new design architecture that could lead to higher efficiency. This move has exacerbated investors' concerns that CXMT may seize market share from SK companies such as Hynix, Samsung, and Micron.
When asked whether they plan to cooperate with CXMT and use its storage products, Jensen Huang stated on Thursday: "We are open to it. We cooperate with Chinese companies; almost the whole world cooperates with Chinese companies at some point in the supply chain."
"China is outstanding in infrastructure technology, and no other country is stronger than China in the manufacturing sector as a whole. Therefore, we must take their capabilities very seriously," he added.
US regulation "accelerated" China's chip progress
Jensen Huang also stated to CNBC, that the progress of China's semiconductor industry stems from the increasing regulatory scrutiny by the United States, which has prompted China to accelerate the development of its own chip technology and manufacturing capabilities.
The United States currently restricts the export of its most advanced semiconductor products to China, including high-end NVIDIA chips. However, some Chinese companies are taking advantage of loopholes to obtain the computing power of these products through data centers in Southeast Asia. Experts say that this has always been a key factor in enhancing the capabilities of China's AI models.
"China has indeed accelerated due to all these regulations," he said.
"We have indeed accelerated the localization of China's semiconductor manufacturing capabilities and all industrial support directed towards that field. So without a doubt, we have sped up this process," he added.
Jensen Huang emphasized that American tech companies are “very powerful” and are ready to face competition “from anyone.”
