Throughout its 31-years history, Nvidia has acquired multiple companies to enhance its existing capabilities and address new markets. The company sells boatloads of premium GPUs for AI and HPC use and has a lot of excess cash on hand. Nvidia continues to grow organically by hiring new employees, but the company is also considering buying other companies to acquire new talent and enter new markets.
"We can also think about that in terms of our work, of bringing on great teams in some M&A [merger and acquisition] form that they come on board," said Colette Kress, chief financial officer of Nvidia, at the UBS Global Technology and AI Conference this week. "That is a great opportunity for us to do, and we will continue to work also in that area."
Nvidia hasn't disclosed any specific plans for what companies it might pursue, for obvious reasons, but its strategic direction for vertical growth are pretty clear. Just a decade ago, the company only offered accelerators for supercomputers. With Ampere and Hopper, Nvidia began to offer DGX and HGX platforms that are effectively complete servers that can be deployed quickly. With Blackwell GPUs, the green company aims to offer full server racks.
"Then it leads to thinking about new types of business models that we may want to add and focus on in new areas of AI and the support that we can do. Not only for, let us just say, building out software, but building out full systems for others, and we will be investing in that after we determine those types of investment. Our work is in terms of returning to shareholders," said Kress.
Nvidia has previously acquired companies including 3dfx, MediaQ, ULi, Portal Player, Ageia, Icera, and Mellanox, just to name a few. While some of the acquisitions enhanced the company's graphics and platform capabilities, others opened the doors to new markets. However, the company's biggest takeover over — the proposed acquisition of Arm — did not happen due to regulatory challenges.
Nvidia now has a team developing CPUs, though the company is significantly behind rivals when it comes to processors. It wouldn't be surprising if some of the M&A efforts focus on companies with talent in that specific area.
