By Arsheeya Bajwa

Aug 28 (Reuters) - Nations building artificial

intelligence models in their own languages are turning to

Nvidia's ( NVDA ) chips, adding to already booming demand as

generative AI takes center stage for businesses and governments,

a senior executive said on Wednesday.

Nvidia's ( NVDA ) third-quarter forecast for rising sales of its

chips that power AI technology such as OpenAI's ChatGPT failed

to meet investors' towering expectations. But the company

described new customers coming from around the world, including

governments that are now seeking their own AI models and the

hardware to support them.

Countries adopting their own AI applications and models will

contribute about low double-digit billions to Nvidia's ( NVDA ) revenue

in the financial year ending in January 2025, Chief Financial

Officer Colette Kress said on a call with analysts after

Nvidia's ( NVDA ) earnings report.

That's up from an earlier forecast of such sales

contributing high single-digit billions to total revenue. Nvidia ( NVDA )

forecast about $32.5 billion in total revenue in the third

quarter ending in October.

"Countries around the world (desire) to have their own

generative AI that would be able to incorporate their own

language, incorporate their own culture, incorporate their own

data in that country," Kress said, describing AI expertise and

infrastructure as "national imperatives."

She offered the example of Japan's National Institute of

Advanced Industrial Science and Technology, which is building an

AI supercomputer featuring thousands of Nvidia H200 graphics

processors.

Governments are also turning to AI as a measure to

strengthen national security.

"AI models are trained on data and for political entities

-particularly nations - their data are secret and their models

need to be customized to their unique political, economic,

cultural, and scientific needs," said IDC computing

semiconductors analyst Shane Rau.

"Therefore, they need to have their own AI models and a

custom underlying arrangement of hardware and software."

Washington tightened its controls on exports of cutting-edge

chips to China in 2023 as it sought to prevent breakthroughs in

AI that would aid China's military, hampering Nvidia's ( NVDA ) sales in

the region.

Businesses have been working to tap into government pushes

to build AI platforms in regional languages.

IBM ( IBM ) said in May that Saudi Arabia's Data and

Artificial Intelligence Authority would train its "ALLaM" Arabic

language model using the company's AI platform Watsonx.

Nations that want to create their own AI models can drive

growth opportunities for Nvidia's ( NVDA ) GPUs, on top of the

significant investments in the company's hardware from large

cloud providers like Microsoft ( MSFT ), said Bob O'Donnell,

chief analyst at TECHnalysis Research.