Nvidia`s Meteoric Rise: Can the AI Chip Giant Sustain its Growth Momentum?

Case Code: BSTR687 Case Length: 14 Pages Period: 2023-2024 Pub Date: 2025 Teaching Note: Available

Price: Rs.400 Organization : Nvidia Corporation Industry : Technology & Communications Countries : United States Themes: Competitive Strategy, Growth Strategy Artificial Intelligence,Regulatory Environment

Abstract Case Intro 1 Case Intro 2 Excerpts

Abstract

The case discusses American AI chip giant Nvidia Corporation’s (Nvidia) meteoric rise in the global Artificial Intelligence (AI) chip market. Nvidia’s success was majorly attributed to its data center segment. This segment accounted for 87.4% of the company’s revenues for the second quarter of 2024.

Having garnered a market leadership position in the global AI chip market, Nvidia faced the challenge of maintaining this position as several of its clients such as Meta Platforms Inc. Google Inc., Amazon.com Inc. and Microsoft Corporation were launching their own graphics cards. Nvidia was also under huge pressure to roll out new and advanced AI chips to add to the company’s revenues.

While rising competition was a challenge, there were other concerns too for Nvidia. In September 2024, the US Department of Justice (DoJ) sent a subpoena to the company alleging that Nvidia was indulging in monopolistic practices. Though Nvidia denied the charges, it faced antitrust allegations. Amidst these challenges, would Nvidia be able to maintain the momentum and continue its growth going forward? How would the company under the leadership of Huang combat the rapidly intensifying competition from rival chipmakers and customers who were making efforts to get a piece of the pie in the lucrative AI chip market? How should Nvidia tackle DoJ’s antitrust allegations?

Issues

The case is structured to achieve the following teaching objectives:

• Analyze a company’s competitive position in an industry
• Evaluate the challenges posed to a market leader by the regulatory environment
• Formulate strategies for a market leader to maintain its momentum in an increasingly competitive market segment

Contents

Introduction
About Huang and NVIDIA
Initial Hiccups
The Success
Global AI Chip Market
Competition
Looking Ahead
Exhibits

Keywords

Nvidia Corporation; Artificial Intelligence; Jensen Huang; AI chip market; Graphics card market; Data center segment; Deep learning; Machine learning; Artificial Intelligence of Things; Cloud computing; Market leadership position; Department of Justice; Monopolistic practices; Antitrust investigation; Competitive Strategy;Microsoft Corporation; Apple Inc; Intel Corporation; Advanced Microdevices; Meta Platforms Inc.; Google Inc.; Amazon.com Inc.; LSI Logic Corporation; Tesla Inc. OpenAI

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