A recent Wall Street Journal profile of Nvidia interim CEO Colette Kress has shed more light on how Nvidia controversially financed its own customers to drive the...

cross-posted from: https://lemmy.world/post/54411557

A chip oversupply may have pushed Nvidia to manufacture its own demand

The AI boom has been widely blamed for GPU prices spinning out of control over the past year. Following Jensen Huang’s resignation from Nvidia, new information suggests that this was the goal of the former CEO’s business strategy, which has long drawn accusations of circular financing.

A recent Wall Street Journal profile of Nvidia interim CEO Colette Kress has shed more light on how Nvidia controversially financed its own customers to drive the AI boom. According to the report, the company pushed for more deals in mid-to-late 2026 to keep its GPU prices high amid an oversupply of TSMC wafers.

Since at least last year, Nvidia has been accused of prolonging the AI boom by supporting the companies that buy its chips. Founder and former CEO Jensen Huang, along with then-CFO Kress, even went so far as to defend the company against comparisons to Enron, which used similar tactics to illegally obscure its debt before its 2001 collapse.

  • givesomefucksEnglish
    9·
    52 minutes ago

    At a Berlin conference, the former CEO told major clients a story about a busy Japanese soup vendor who refused to give him a second serving after he had waited in a long line, saying the vendor had too many customers and not enough soup. Huang used the story to highlight the value of maintaining a diverse customer base and keeping prices high, suggesting that Nvidia’s circular financing strategy inflated GPU prices by creating the perception of high demand.

    I hear that story and feel like the reason each consumer could.only buy one, was if one person bought them all, he couldn’t maintain a consumer base and would be at the whim of his big buyers demands…

    The lesson should have been to prioritize amount of customers over a few large contracts that could disappear overnight.