Nvidia unveils AI chips for video, software generation

As AI systems grow more sophisticated, tackling data-heavy tasks such as “vibe coding” or AI-assisted code generation and video generation, the industry’s processing needs are intensifying.

AI models can take up to 1 million tokens to process an hour of video content — a challenging feat for traditional GPUs, the company said. Tokens refer to the units of data processed by an AI model.

To remedy this, Nvidia will integrate various steps of the drawn-out processing sequence such as video decoding, encoding, and inference — when AI models produce an output — together into its new chip.

Investing $100 million in these new systems could help generate $5 billion in token revenue, the company said, as Wall Street increasingly focuses on the return from pouring hundreds of billions of dollars into AI hardware.

The race to develop the most sophisticated AI systems has made Nvidia the world’s most valuable company, commanding a dominant share of the AI chip market with its pricey, top-of-the-line processors.