Nvidia CEO says the metaverse could save companies billions of dollars in the real world
- Nvidia CEO Jensen Huang told CNBC on Friday that running simulations in the metaverse can deliver real-world benefits to corporations.
- In a "Mad Money" interview, Huang said that's why companies are willing to invest in the creation of virtual reality universes.
- "We waste a whole bunch of things to overcompensate for the fact that we don't simulate," he said.
Companies are investing money into the creation of the so-called metaverse because it may ultimately save them significant chunks of change in the real world, Nvidia CEO Jensen Huang told CNBC's Jim Cramer on Friday.
In an interview on "Mad Money," Huang painted a vision of connected, virtual reality universes that go beyond facilitating recreation and commerce. Rather, Huang said he believes businesses can lean on the metaverse — or omniverse, which is Nvidia's preferred term — to reduce wastefulness and increase operational efficiency.
"We waste a whole bunch of things to overcompensate for the fact that we don't simulate. We want to simulate all factories in metaverses, in this omniverse. We want to simulate plants in omniverse. We want to simulate the world's power grids in the omniverse," Huang said.
"By doing that, we could decrease the amount of waste, and that's the reason why the economics are so good for companies," he continued. "They're willing to invest a small amount of money to buy into this artificial intelligence capability but what they save is hopefully hundreds and hundreds and hundreds of billions of dollars."
California-based Nvidia is the largest maker of graphics and artificial intelligence chips in the world. While demand for its semiconductors was already growing, increased attention and investment focused on the metaverse is a boon for Nvidia. That's because the company's chips play crucial roles in the computing devices that will run the metaverse.
The concept of the metaverse has been around for decades in science-fiction circles, but Wall Street is taking notice now that a number of technology giants such as Facebook-parent Meta are marshaling resources toward creating interactive, immersive virtual worlds.
Huang's appearance on "Mad Money" comes two days after Nvidia reported better-than-expected earnings and revenue for its third quarter. Nvidia shares have been on a tear in recent weeks, driven at least partly by investor optimism on the metaverse. The stock is up 29% so far this month and 66.6% over the past three months.
Nvidia's market capitalization now stands at $824.6 billion, making it the seventh most valuable company in the S&P 500.
Sign up now for the CNBC Investing Club to follow Jim Cramer's every move in the market.
Questions for Cramer?
Call Cramer: 1-800-743-CNBC
Want to take a deep dive into Cramer's world? Hit him up!
Mad Money Twitter - Jim Cramer Twitter - Facebook - Instagram
Questions, comments, suggestions for the "Mad Money" website? email@example.com
31-year-old used her $1,200 stimulus check to start a business on track to bring in $1 million
I talked to 70 parents who raised highly accomplished adults: 5 signs your kid will be successful
Why there may be no return to 'normal' for the U.S. used vehicle market
This 40-year-old introvert makes $2 million a year—3 things she always does to look more confident
This 39-year-old makes $160,000 a month in passive income: '3 businesses you can start today for $0'