Nvidia Revenue Doubles on AI Demand, CEO Sees 70% Growth Next Year

* Editor's note: AI PRISM (Personalized Report & Insight Summarizing Media) is an artificial intelligence-based personalized news recommendation and summary service developed with support from the Korea Press Foundation. It selects and provides six news items tailored to each reader type.

1. Jensen Huang: Nvidia to Grow 70% Next Year, Could Have Doubled Without Memory Bottleneck

- Key summary: Nvidia posted second-quarter fiscal 2027 revenue of $96.22 billion (about 133.2 trillion won) and operating profit of $63.734 billion (about 88.34 trillion won), up 106% and 124% respectively from a year earlier. Data center revenue, which includes AI chips, drove the overall results at $89 billion, and its customer base diversified from hyperscalers to sovereign AI, general enterprises and neoclouds. Jensen Huang, Nvidia's chief executive officer, said AI demand is close to 100% but that the company set next year's revenue growth rate at 70% based on its own supply volume, adding that the growth rate would have been far higher without supply constraints. Analysts also expect competition to secure high-bandwidth memory (HBM) to intensify further as Nvidia's component supply commitments more than doubled to $279 billion from $119 billion in the previous quarter.

2. Caught Between Korea and China, Kioxia Pours 8.6 Trillion Won Into NAND Expansion

- Key summary: Kioxia executives visited the prime minister's office on the 27th and announced plans to build a third fab on the grounds of its Kitakami plant in Iwate Prefecture, with operations expected to begin as early as 2029. Kioxia, which had been cautious about capital spending, is seen as having turned to aggressive investment because of its declining market share: it ranked fourth globally in both NAND revenue and shipments in the second quarter of this year, ceding third place to YMTC on a shipment basis. Subsidies from Japan's Ministry of Economy, Trade and Industry are expected to be used to fund the investment, and its joint venture with U.S.-based SanDisk, which had been set to expire in 2029, was extended through 2034. Meanwhile, rivals are matching the pace of expansion, with SK hynix deciding to invest 35.2 trillion won in its Y2 DRAM fab in Yongin and 19.1 trillion won in its M17 NAND fab in Cheongju.

3. The Information: Nvidia Agrees to Acquire Hugging Face, the 'GitHub of AI'

- Key summary: The Information reported on the 26th, citing sources, that Nvidia has agreed to acquire Hugging Face for $12.9 billion. Hugging Face is an open-source platform founded in 2016 by Clément Delangue and others, and it earned the nickname "the GitHub of AI" by building an ecosystem where developers worldwide exchange AI models and datasets. Its valuation was assessed at $4.5 billion in a 2023 funding round, but this acquisition values it at roughly three times that level, with the purchase price amounting to about 80 times its recent annualized revenue of $150 million. The Information projected that the deal would effectively revive the AI cloud business Nvidia had shelved a year ago.

4. "Circular Financing? I Regret Not Doing More" — Jensen Huang Rebuts AI Funding Criticism

- Key summary: Jensen Huang, Nvidia's chief executive officer, appeared on CNBC's "Mad Money" on the 26th and directly rebutted criticism that its equity investments in customers and financial support amount to circular financing. Huang stressed that AI companies are the first generation of startups that need tens of billions of dollars to fund their businesses, and that the financial system is not keeping pace with their growth. Nvidia had earlier agreed to create a $500 billion AI infrastructure financing package with Apollo Global Management, Blackstone and Goldman Sachs, and pledged more than $100 billion in funding support for the construction of an Ohio data center to be leased by OpenAI. Meanwhile, Chief Financial Officer Colette Kress explained that investments and commitments to AI companies amount to only a small fraction of free cash flow (FCF), which is expected to reach about $50 billion.

5. SK Telecom Launches AI Data Center Infrastructure Company 'SK Horizon'

- Key summary: SK Telecom (017670.KS) said in a regulatory filing on the 27th that it will split its wholly owned subsidiary SK Broadband into a surviving entity and a newly established company, SK Horizon. The split ratio is about 84% for SK Broadband and about 16% for SK Horizon based on book value of net assets, and the company plans to complete the spin-off in the first quarter of next year after obtaining government approvals and holding an extraordinary shareholders meeting. SK Horizon will take over eight data centers, including those in Seocho, Ilsan, Bundang and Gasan, along with AI data centers (AIDC) under construction in Ulsan and Guro, for a total capacity of 318 megawatts, and will also handle the submarine cable projects needed for its global AI business. SK Telecom also attracted a combined 3.08 trillion won in investment from KKR and a consortium of IMM Investment and Stonebridge Capital, and will retain a 51% stake and management control even after the investment is completed.

6. [Exclusive] Lotte Non-Life Insurance Heads to Open Sale as Shinhan Talks Collapse

- Key summary: Lotte Non-Life Insurance (000400.KS) will enter an open sale process after private negotiations with Shinhan Financial Group effectively fell apart. JKL Partners, which holds a 77% stake in Lotte Non-Life Insurance, and sale manager Samjong KPMG are preparing to file a public sale disclosure at the end of next month, with plans to receive letters of intent (LOI) at the end of October and select a preferred bidder after due diligence. The price gap is cited as the reason the talks broke down: Shinhan Financial Group offered around 1 trillion won for a 100% stake, while JKL Partners wanted slightly more than 1 trillion won. Lotte Non-Life Insurance's basic capital ratio improved to minus 5.4% in the second quarter from minus 21.4% in the first quarter of this year. Its overall solvency ratio under the Korean Insurance Capital Standard (K-ICS) also stood at 161.9% after transitional measures, above the financial authorities' recommended level of 130%. Analysts say this will reduce the capital replenishment burden on an acquirer.