Nvidia CEO Jensen Huang says fears that AI will replace the software industry are fundamentally misguided, as he believes that AI’s biggest breakthroughs are actually reinforcing the value of existing software tools.
Speaking at the Cisco AI Summit, Huang pushes back on the idea that pressure on software stocks signals an industry in decline, calling that conclusion logically flawed.
“Remember what software is. Software is a tool. There’s this notion that the software industry is in decline and will be replaced by AI. You could tell because there’s a whole bunch of software companies whose stock prices are under a lot of pressure. Because somehow AI is going to replace them. It is the most illogical thing in the world and time will prove itself.”
Huang says a simple thought experiment explains his view.
“Suppose we are the ultimate AI, artificial general robotics, the ultimate AI, the physical version of us. You could, of course, solve any problem because, you know, you’re humanoid. You could do things. If you were a human or robot, would you use a screwdriver or invent a new screwdriver? I would just use one. Would you use a hammer or invent a new hammer? Would you use a chainsaw or invent a new chainsaw?
Now do the digital version of that. If you were an artificial general intelligence, would you use the tools like ServiceNow and SAP and Cadence and Synopsys, or would you reinvent a calculator? Of course, you would just use a calculator.
That’s the reason why the latest breakthroughs in AI are what? Tool use. Because the tools are designed to be explicit.”
Huang’s comments come as the S&P 500 Software & Services Select Industry Index now trades in bear territory, plunging by over 20% in the past year. Meanwhile, the S&P 500 is up about 15% over the same period.
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