(Reuters) -Nvidia said on Tuesday it would launch a new artificial intelligence chip by the end of next year, designed to handle complex functions such as creating videos and software.

The chips, dubbed "Rubin CPX", will be built on Nvidia's next-generation Rubin architecture - the successor to its latest "Blackwell" technology that marked the company's foray into providing larger processing systems.

As AI systems grow more sophisticated, tackling data-heavy tasks such as "vibe coding" or AI-assisted code generation and video generation, the industry's processing needs are intensifying.

AI models can take up to 1 million tokens to process an hour of video content - a challenging feat for traditional GPUs, the company said. Tokens refer to the units of data processed by an AI model.

To remedy this, Nvidia will integrate various steps of the drawn-out processing sequence such as video decoding, encoding, and inference - when AI models produce an output - together into its new chip.

Investing $100 million in these new systems could help generate $5 billion in token revenue, the company said, as Wall Street increasingly focuses on the return from pouring hundreds of billions of dollars into AI hardware.

The race to develop the most sophisticated AI systems has made Nvidia the world's most valuable company, commanding a dominant share of the AI chip market with its pricey, top-of-the-line processors.