Key Highlights
- Nvidia shares advanced 1.6% during Wednesday’s premarket session, hitting $177.97
- Arm Holdings unveiled the Arm AGI CPU, its inaugural data center processor, projecting $15B yearly revenue by 2031
- Analysts view Arm’s CPU as non-competitive with Nvidia’s GPU line—though potential overlap exists with Nvidia’s standalone Vera CPU offerings
- Amazon Web Services committed to purchasing 1 million Nvidia GPUs for AI inference workloads, valued at over $50 billion
- Nvidia restarting H200 chip manufacturing and developing China-compliant Groq 3 variants, representing approximately $32B in annual revenue
Nvidia shares experienced upward momentum in Wednesday’s early trading session, dismissing concerns about Arm Holdings’ debut in the artificial intelligence chip sector. This development arrived alongside two significant revenue streams that had largely escaped widespread attention.
Arm revealed its inaugural data center central processing unit on Tuesday—the Arm AGI CPU—identifying Meta Platforms and OpenAI as initial adopters. During an after-hours investor presentation, Arm outlined bold projections for the CPU division, forecasting approximately $15 billion in yearly revenue by 2031 as part of an overarching $25 billion revenue target.
Arm’s shares surged 12% in premarket activity following the disclosure.
However, industry analysts rapidly clarified that this new processor doesn’t directly challenge Nvidia’s primary GPU offerings.
Benchmark Research’s Cody Acree noted that Arm’s strategic direction is “less about catching up to the accelerator wave and more about inserting itself deeper into the architecture that governs how AI infrastructure actually runs.”
Nvidia’s Jensen Huang appeared in Arm’s promotional materials, describing their nearly 20-year collaboration as foundational for “one seamless platform, from cloud to edge to AI factories.”
The competitive landscape becomes more complex regarding Nvidia’s standalone Vera CPU line, introduced during last week’s developer conference. J.P. Morgan’s Harlan Sur highlighted potential overlap between Arm’s processor and that product category. He additionally noted Meta’s existing agreement with Nvidia for Arm-architecture CPUs—creating ambiguity in the competitive dynamics.
Amazon Web Services Commits to Massive Nvidia GPU Purchase
In parallel developments, Amazon Web Services revealed plans to acquire 1 million Nvidia graphics processing units for artificial intelligence inference applications. The announcement caught many off guard—AWS had previously promoted its Indiana data center, operational since October 2025, as hosting “the largest cluster of non-Nvidia chips in the world.”
The agreement encompasses a “broad mix” of six supplementary Nvidia chip varieties, including the recently announced Groq 3 inference processors, alongside Nvidia networking infrastructure. Industry estimates place the complete package value above $50 billion, with completion anticipated by late 2027.
This individual contract accounts for approximately 25% of Nvidia’s total 2025 yearly revenue.
Chinese Market Revenue Returning to Portfolio
Chief Executive Jensen Huang confirmed last week that Nvidia is resuming H200 chip manufacturing—engineered to satisfy U.S. export control requirements—targeting the Chinese marketplace. Industry intelligence suggests a China-compliant variant of the Groq 3 chip is under development.
Nvidia had projected zero Chinese data center revenue in its first-quarter guidance. Throughout 2025, those transactions averaged roughly $8 billion quarterly—approximately $32 billion on an annualized basis, representing about 15% of total 2025 revenue.
Together, the AWS contract and China market resumption constitute over $82 billion in revenue opportunities absent from Nvidia’s current financial forecasts.
Nvidia shares traded 1.6% higher at $177.97 during Wednesday’s premarket session, rebounding from a 0.3% decline in the previous trading day.
