Nvidia lands Uber as self-driving partner to kick off CES

Nvidia Corp. has plenty of partnerships with some of the world’s largest auto manufacturers for self-driving systems, but it landed a whale of a different type Sunday, announcing a partnership with Uber Technologies Inc., along with new developments in Nvidia’s self-driving push.

Nvidia NVDA, +0.85% said at a pre-CES news conference in Las Vegas on Sunday evening that it will supply self-driving hardware for the largest U.S. ride-hailing company, a partnership that has already borne fruit through the companies’ separate relationships with Volvo. As part of the announcement, Uber said its autonomous cars — mostly Volvos with Nvidia hardware — have driven more than 2 million miles, with more than 1 million happening in the past 100 days.

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Uber has been focused on self-driving technology for years, efforts that have led to a lawsuit from Alphabet Inc.’s GOOGL, +1.33% GOOG, +1.46%   Waymo, which recently agreed to supply self-driving systems to Uber’s largest U.S. rival, Lyft. It is all part of a twisted web of partnerships between companies seeking to reach the autonomous future first; Nvidia said it now has 320 partners signed up for Nvidia Drive, up from fewer than 200 at last year’s CES.

Nvidia plans to start testing new machine processors in cars this quarter. The “system on a chip,” which Nvidia claims cost $2 billion to research and develop and offers the computing power of a full data center, will have its highest-profile customer in Uber, one of 25 customers Nvidia has lined up for its solutions for what it calls “robotaxis.”

Uber also owns Otto, a self-driving trucking company focused on hauling freight, the acquisition that led to the lawsuit from Waymo. The agreement announced Sunday evening means Nvidia will supply Uber’s self-driving tractor-trailers as well as cars beyond the deal Uber already has with Volvo.

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Nvidia has spent more than $8 billion on R&D since a 2012 student project showed that GPUs could accelerate machine learning, leading to a booming server business and an automotive business with plenty of potential that hasn’t showed the same type of growth so far. Chief Executive Jensen Huang spent two hours Sunday evening rounding up all of Nvidia’s advances in artificial intelligence, after a brief overview of some new advances in the industry that originally made Nvidia’s name, videogame technology.

Nvidia spent the rest of its time focusing on its breakthroughs in machine learning, in both important and more whimsical ways. The examples included a deep neural network built in partnership with Walt Disney Co. DIS, -0.54%  that was taught to compose music like the legendary John Williams, in honor of the new “Star Wars” movie.

Automotive advances and partnerships were the biggest focus of the night’s event however. Nvidia also showed off efforts from a manufacturing partner, Volkswagen AG VOW, +1.95%  , focused on new software offerings from the company aimed at much more than driving. The Drive IX and Drive AR systems will allow manufacturers and software developers to build new services, including augmented-reality features, gesture and facial recognition.

“We’d like to revolutionize the way we interact with our car,” Huang said.

Nvidia and Volkswagen originally announced their self-driving partnership last July, and executive Herbert Diess joined Huang on stage to show off plans for the technology in a virtual-reality tour of the revamped bus VW has promised. Huang also announced a partnership on autonomous cars with Baidu BIDU, -0.24%  and a deal with ZF.

“Nvidia is demonstrating solid innovation and leadership in the self-driving car market by showcasing customers and partners like Uber and Volkswagen,” said Chris Wilder of Moor Insights. “For this industry to be successful, technology companies must address not just the safety, scalability and reliability challenges, but also the overall user experience inside and outside of the vehicle. Nvidia’s announcements at CES shows they are approaching the Autonomous Vehicle experience holistically which, in my opinion, will keep Nvidia as a leader in this burgeoning market.”

Nvidia stock has gained 109% in the past 12 months, while the S&P 500 index SPX, +0.70%  has gained 20% in the same period.

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