NVIDIA (NASDAQ:NVDA) is using its GPUs (graphics processing units) to make a big splash in the field of artificial intelligence (AI). The graphics specialist is leveraging the immense computational capacities of its GPUs, which can perform a huge number of mathematical calculations in a parallel manner, for enabling AI across several applications.
NVIDIA has started witnessing terrific growth in some of its businesses that rely on AI. For instance, NVIDIA's automotive business increased almost 20% year over year in the last reported quarter; the company's DRIVE PX2 autonomous vehicle platform uses AI to help cars drive themselves.
But this is just one of the many areas where NVIDIA is applying AI to boost its business. The company has been testing the uses of AI across several applications as it tries to take advantage of a technology that's expected to clock an annual growth rate of over 45% through 2022.
Driving deep learning in data centers
Deep learning is a segment of AI that allows several computers to communicate with each other, using software to make sense of the data that they're consuming. Grand View Research forecasts that the deep learning market could be worth $10 billion by 2025, growing at a pace of over 52% a year.
NVIDIA definitely doesn't want to miss this gravy train, so it has launched its DGX-1 supercomputer to train AI models at breathtaking speeds. In fact, NVIDIA claims that a Tesla V100 GPU equipped DGX-1 supercomputer can train AI models three times faster than other GPU-equipped systems. Furthermore, NVIDIA says that this solution is ready to work out-of-the-box, so potential clients can start training their AI models within hours instead of spending months on developing hardware and software of their own.
The plug-and-play nature of NVIDIA's deep learning solution has helped it land marquee clients of late. Wal-Mart, for instance, has decided to use NVIDIA GPUs in huge data centers. The retail giant will build a "GPU farm" by sourcing graphics chips from NVIDIA, and equipping its cloud computing platform with deep learning capabilities.
Wal-Mart is going in-house to apply deep learning on the huge volumes of customer data it generates to drive its own sales, instead of relying on rival Amazon's cloud infrastructure. This deal will give NVIDIA's data center business a shot in the arm as Wal-Mart is expected to begin deployment in the next six months.
In fact, data center is NVIDIA's fastest-growing business, clocking 175% year over year revenue growth in the latest quarter. Its deal with Wal-Mart, as well as partnerships with other data center customers, should help NVIDIA sustain this segment's impressive momentum.
AI in healthcare will be a big deal
The adoption of AI in healthcare is estimated to grow at 40% a year until 2025. This could open up a huge opportunity for NVIDIA.
In May this year, NVIDIA announced that it will train 100,000 developers in deep learning for implementation in the fields of healthcare and cancer research. This is a logical step for the chipmaker as it has already been using its Tesla K80 GPU to train models for breast cancer detection. Training more developers will allow NVIDIA to deploy more of its GPUs into healthcare, setting the company on pace to take advantage of the huge opportunity.
The good news for investors is that NVIDIA's healthcare business is already getting off the ground. The Center for Clinical Data Science recently bought four DGX-1 supercomputers (costing over $150,000 per unit) so that they can apply deep learning to MR and CT scan analysis, and it won't be surprising if the company keeps landing more such deals.
The Foolish bottom line
NVIDIA has already made headlines in AI technology by covering as much of the end market as possible, including the drone market. And NVIDIA's AI application in the automotive space is already quite well-documented given its strong partnerships with marquee automakers and truck makers.
NVIDIA, therefore, could win big as AI application gains momentum.