Nvidia CEO Jensen Huang told CNBC on Thursday that he was confident in the company’s growth story, even if the potential blockbuster takeover of British chip designer Arm falls through.
“Nvidia is going to be huge anyway,” Huang said in “Mad Money,” in response to a question from Jim Cramer, the show’s host. Cramer asked the executive what investors should think about Nvidia in the long term, while the $ 40 billion deal to buy Arm, owned by Softbank, was pending.
Numerous companies in the technology landscape, including California-based chipmaker Qualcomm and Microsoft, have reportedly told the Federal Trade Commission that they were concerned that the Nvidia-Arm deal could hurt competition. The FTC, the US antitrust regulator, has opened an “in-depth investigation” into the acquisition, Bloomberg reported earlier this month.
Nvidia, which is known for its gaming graphics chips, first announced the deal in September. Shortly after it was published, Cramer told “Mad Money” viewers that if “Nvidia Arm Holdings can close, the stock will be unstoppable, even after its wonderful multi-year run.”
Nvidia’s stock is up 103% over the past 12 months, compared to a 22.4% gain for the S&P 500. Over the past five years, the chipmaker’s stock is up nearly 1,600%.
Huang said Thursday that Nvidia’s chips remain at the heart of numerous disruptive technologies, keeping the secular tailwind intact. The day before, the company reported quarterly sales of $ 5 billion, representing a year-over-year growth of 61%. Both sales and earnings exceeded Wall Street expectations.
“The growth opportunity that lies ahead for artificial intelligence, autonomous vehicles, manufacturing, industrial robotics, 5G-edge, those applications will make us a very large company,” said Huang, who founded California-based Nvidia in 1993. our growth trajectory is very exciting… We expect it to be a tremendous growth year for data centers, all independent of Arm, ”added Huang.
At the same time, Huang was also trying to defend Nvidia’s desire to buy Arm, which is known for designing the chip architecture used in most of the world’s cell phones.
“We will be able to inject so much exciting and so much technical scale into Arm to accelerate their roadmap, which the ecosystem will love,” he said, adding, “We’re going to get this deal done. I’m confident. ”
Last year, Nvidia completed a $ 7 billion acquisition of chip maker Mellanox Technologies. It took more than 13 months to complete as Chinese regulators scrutinized the deal.
Shares of Nvidia closed more than 8% on Thursday, proving a difficult session for many tech companies as investors digested rising bond yields.
Disclosure: Cramer’s charity owns shares of Nvidia.