Nvidia's Huang Says Memory Glut Unlikely by 2029 as Stocks Slide

"One of the things that's really great about memory is that you can always use more of it," Huang told CNBC. He added that HBM, a type of random access memory, will be used for years to come. "We're the first company in the world to put LPDDR memory — what goes into your cell phones — into the world's data centers, and it's enabled us to deliver performance that's twice as energy efficient as anything in the world today, and so we're going to continue to use abundant amounts of them as well," he said.

Memory stocks have fallen over the past week after an opinion column published in a prominent South Korean publication on Oct. 15 urged the country's government to brace for a deceleration in the AI boom. The column cited two experts who said they expect a "flood of new supply" that will turn the memory market "into a red ocean" in 2029, according to CNBC's translation. They wrote that "the supercycle could be over, and the industry could enter a downturn" by 2029.

Memory is a core component of Nvidia's chips, and a glut of supply could push prices lower and hit profit margins for memory makers such as SK Hynix, Samsung and Micron. SpaceX and Tesla CEO Elon Musk responded to the article at the time, saying China "will be making a LOT of RAM in 2028."

The memory selloff was also driven by China's ChangXin Memory Technologies, or CXMT, which announced a new design architecture that could lead to greater efficiencies. The announcement added to investor concern that CXMT could take market share from SK Hynix, Samsung and Micron.

Asked whether he plans to partner with CXMT and use its memory products, Huang said: "We're open-minded." He added: "We work with Chinese companies; just about the whole world works with Chinese companies in the supply chain somewhere." Huang said China is "incredible at the fundamental infrastructure technology, and no country collectively is better at manufacturing than China, and so we have to take their capabilities very seriously."

Huang also told CNBC that China's advancements in the semiconductor industry are due to mounting U.S. regulations, which pushed the country to speed up its own chip technology and manufacturing. The U.S. currently restricts exports of the country's most advanced semiconductors to China, including top-end Nvidia chips. However, some Chinese firms are making use of a loophole to access the product's compute power through data centers in Southeast Asia, a move experts say has been key to Chinese AI models becoming more capable.

China "definitely accelerated because of all the regulations," Huang said. "We've definitely accelerated China's initiatives, its nationalization of semiconductor manufacturing capabilities, and all of the industrial support that has been put into that sector, and so there's no question we've accelerated that," he added. Huang emphasized that American tech firms are "mighty" and are prepared to take on competition "from anybody."

Editor's Summary

Nvidia CEO Jensen Huang told CNBC that memory demand can absorb supply through 2029, countering investor fears behind a recent memory-stock selloff. The stock moves also reflected concerns about CXMT's new architecture and a South Korean column warning of oversupply, while Huang said U.S. restrictions have accelerated China's chip efforts.