What Will NVIDIA’s New Chip Mean for Tomorrow’s Cars?

The NVIDIA K1 chip is expected to enhance safety and customizability for the auto industry.

Jun 12, 2014 at 4:02PM

NVIDIA (NASDAQ:NVDA) introduced its powerful Tegra K1 chip at the 2014 International CES earlier this year. It's an important product for the company, and investors are hoping it helps add to the business (and stock price) momentum NVIDIA has seen over the past year.

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The "Tegra Processor" unit is one of two reporting segments for NVIDIA. It comprises Tegra system-on-chip product lines for phones, tablets, PCs, automotive, and gaming devices. The unit pulled in $398 million last fiscal year, accounting for almost 10% of all NVIDIA revenue. However, that total is down some 48% from the prior year – so management and shareholders alike are hoping the K1 will help reverse that trend.

CES provided a great first look at the K1. Motley Fool analyst Rex Moore was in Las Vegas for the big show, and spoke with NVIDIA's Doug MacMillan about the new chip and what it will mean to consumers and developers.

The Tegra K1's visual computing power will help automakers improve safety by informing and fueling the driver, MacMillan says. The chip will also make customization possible at an unprecedented level, allowing the buyer to choose the look and feel of a virtual dashboard. In this video segment, MacMillan explains how NVIDIA's "Project Mercury" opens a whole new planet of possibilities.

A full transcript follows the video.

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Doug MacMillan: Safety is the number one concern for anything on automotive. You want to make sure that you're presenting everything in a clean, crisp manner, so that you're actually informing and fueling the driver, not confusing him or anything else. Obviously, that's the auto manufacturer's job, but our technology fuels that.

(...)

The core of what we're showing over there is some of the stuff I've just mentioned -- Project Mercury, which is the configurator that auto manufacturers can use to design gauges in cars -- but think of that at the next level, where you could go into a dealership and you could configure what your dash looks like.

You may want carbon fiber gauges, I might want brushed titanium gauges. You could decide down to that level of detail in your dash. That, in addition to all the driver assistance stuff that I mentioned earlier, that's really going to fuel the next generation of cars.

Rex Moore has no position in any stocks mentioned. The Motley Fool recommends Nvidia. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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