Nvidia on Tuesday launched Spectrum-X, its latest generation of Ethernet networking technology, designed for data centers with heavy AI workloads.\n\nSpectrum-X, which integrates into Nvidia\u2019s Spectrum Ethernet stack, is a combination of hardware and software, melding the Spectrum-4 Ethernet switch (which boasts up to 51 terabits per second) and BlueField-3 DPU together, which are designed to work in tandem to reduce traffic congestion and potentially eliminate packet loss.\n\nThis new stack, according to Nvidia, offers a 1.6x improvement over traditional Ethernet for AI applications, a necessity as AI workloads generate significantly more data and can quickly congest data centers.\n\nNvidia calls its AI-enabled network interfaces a SuperNIC, a specialized network accelerator designed for AI cloud computing, providing high-speed Ethernet connectivity and efficiency enhancements for hyperscale AI workloads.\n\nThe new technology will be available in servers from Dell, Hewlett Packard Enterprise (HPE), and Lenovo. The new servers also include Nvidia\u2019s latest H100 Tensor Core GPUs and its AI Enterprise, as well as AI Workbench software.\n\n\u201cThrough our collaboration, Dell Technologies and Nvidia are providing customers with the infrastructure and software needed to quickly and securely extract intelligence from their data,\u201d Dell Chairman and CEO Michael Dell said in a release.\n\nNvidia is best known for its GPUs, but the company has also made network switches, with the Spectrum series first being known for accelerating big data workloads in data centers.\n\n\u201cGenerative AI will undoubtedly drive innovation across multiple industries,\u201d said Antonio Neri, president and CEO of HPE, in a press release. \u201cThese powerful new applications will require a fundamentally different architecture to support a variety of dynamic workloads.\u201d\n\nSpectrum-X is currently used in Nvidia\u2019s Israel-1 supercomputer, built with Dell servers and Nvidia\u2019s HGX 100 platform, featuring GPUs, BlueField-3 DPUs, SuperNICs, and Spectrum-4 switches. According to Nvidia, this model serves as a reference for firms building AI-driven high-performance computing clusters.\n\nBroadcom says \u201cnot new\u201d\n\nNvidia first announced Spectrum-X at the Computex trade show in Taipei, with CEO Jensen Huang saying on stage that it was \u201cthe world's first high-performance ethernet for AI\u201d and it doesn\u2019t drop packets.\n\nBut at the time, Broadcom shot back, telling The Register that \u201cthere\u2019s nothing unique about their device that we don\u2019t already have.\u201d\n\nRam Velaga, SVP of Broadcom\u2019s core switching group, told The Register that Broadcom\u2019s technology already effectively manages congestion in a more vendor-agnostic way, taking aim at Nvidia\u2019s proprietary software layer.\n\n\u201cThe whole reason why Ethernet is successful today is it\u2019s a very open ecosystem,\u201d he is quoted as saying.\n\nAI throughout the data center\n\nDemand for new AI-ready network infrastructure, such as Nvidia\u2019s Spectrum-X, is largely being driven by a surge in data center spending to build capacity to handle these workloads. \n\nIn Q2 2023, global spending on cloud infrastructure products increased by 7.9% to $24.6 billion, research firm IDC said in a release. \n\nIDC said that it expects worldwide spending on AI solutions will grow to more than $500 billion in 2027, with 41% of retail banking in Asia inclined to invest in it, and 80% of CIOs will leverage organizational changes to harness AI, both driving demand for AI-ready data centers.\n\nLooking towards earnings\n\nDespite the cloud of export curbs to China threatening to dampen Nvidia\u2019s earnings, the company\u2019s stock has topped $500 \u2013 an all-time high \u2013 largely because of its position of being well-capitalized on continued demand from the AI revolution pushing spending on data centers. \n\n\u201cWe believe demand from US cloud and other data center clients remains strong and intact given these firms are still in the process of transforming their data centers with accelerated compute capabilities,\u201d Piper Sandler analyst Harsh Kumar wrote in a recent note.