Nvidia $NVDA Blackwell Development Delay Report: Actual Situation and Market Impact (Forbes)
1 ️ ︎ News content and market reaction
In 2024/8, The Information quoted an anonymous source of information and reported that there was a delay in development of the Blackwell series (B100, B200, GB200), which is Nvidia's next-generation AI GPU. According to this report, there is a possibility that product shipments will be delayed by 3 months or more due to design defects.
The market reaction was immediate, and Nvidia $NVDA's stock price fell approximately 15% in 7 days. This reaction could be said to be excessive considering that the Blackwell series was scheduled to be deployed on a large scale in the first quarter of 2025.
2 ️ ︎ Nvidia's official statement and past comments
Following the report, Nvidia made the following comments to The Verge:
“Nvidia expects production of [B200] chips to 'expand in the second half of 2024'”
The statement does not directly deny the reports, but it suggests that there are no major changes to the production plan.
Furthermore, looking back at past Nvidia management comments, there were the following suggestions regarding Blackwell's development:
- On GTC Financial Analyst Day in 2024/3, CEO Jensen Huang stated that “the first system will be shipped at the end of the year, but supply restrictions are expected.”
- At the BofA GTC conference in 2024/6, VP Ian Buck stated that “Blackwell is currently in production builds, samples will be shipped this quarter, and production will expand towards the end of the year.”
These comments suggest that Blackwell's deployment was gradual and anticipated supply constraints in the early stages. Therefore, the “unexpected significant delay” scenario, as shown by The Information's report, does not seem to match Nvidia's official views.
3 ️ ECT INFORMATION FROM SUPPLY CHAIN PARTNERS
TSMC trends:
- Monthly revenue for July accelerated significantly, up 23.6% from the previous month and 38.3% from the same month last year.
- CEO C.C. Wei mentioned that “demand related to AI and high-end smartphones is strong.”
- It is predicted that CoOS (chip-on-wafer-on-board) capacity will continue to be tight until 2025.
Super Micro reports:
- Sales guidance for the first quarter of fiscal year 2025 (2024/9/12) predicts a record high growth rate, with a 206.6% increase from the same period last year.
- Demand for direct liquid cooling (DLC) systems has surged. We shipped over 1000 racks during the two months of June and July alone.
- We plan to expand DLC production capacity to 3000 racks per month by the end of the year (200% increase in 6 months).
Foxconn comments:
- Small shipments of new Nvidia AI servers will begin in the fourth quarter of 2024, with plans to increase production in the first quarter of 2025.
- “When new product specifications and technology are drastically upgraded, it is normal to dynamically adjust shipping schedules,” and indirectly denied The Information's claims.
4 ️ ︎ Discussion of alternative scenarios
Consider a few scenarios that might explain the discrepancy between coverage and actual circumstances:
1) Planned Delays:
- Given the complexity of CoWoS-L technology, additional testing and optimization are likely to be required.
- Nvidia has previously hinted at this possibility, and supply chain partners may have anticipated this as well.
2) Focus on GB200 NVL36/NVL72 systems:
- These systems have higher profit margins than the B100/B200 alone.
- There is a possibility that limited CoWoS-L production capacity is being directed to more profitable products.
3) Buffering with H200 and GH200:
- The H200 (with HBM3e) is already shipping, mitigating memory bandwidth issues.
- Shipment of GH200 super chips has also started.
- There is a possibility that these products will meet demand during the transition to Blackwell.
4) Phased deployment strategy:
- Nvidia anticipated supply constraints in the early stages and may have planned gradual deployment.
- Delays on some SKUs may not have a significant impact on the overall plan.
📍 Conclusions
The Information report had an impact on Nvidia's short-term stock price, but considering information and technical background from supply chain partners, questions remain about the content of the report. There may certainly be challenges with Blackwell's development, but it is likely that Nvidia anticipated and incorporated them into its plans.
Going forward, it will be important to keep a close eye on Blackwell's actual shipping status, customer responses, and supply chain partner trends. These factors will be indicators showing Nvidia's true competitiveness and growth potential.
In 2024/8, The Information quoted an anonymous source of information and reported that there was a delay in development of the Blackwell series (B100, B200, GB200), which is Nvidia's next-generation AI GPU. According to this report, there is a possibility that product shipments will be delayed by 3 months or more due to design defects.
The market reaction was immediate, and Nvidia $NVDA's stock price fell approximately 15% in 7 days. This reaction could be said to be excessive considering that the Blackwell series was scheduled to be deployed on a large scale in the first quarter of 2025.
2 ️ ︎ Nvidia's official statement and past comments
Following the report, Nvidia made the following comments to The Verge:
“Nvidia expects production of [B200] chips to 'expand in the second half of 2024'”
The statement does not directly deny the reports, but it suggests that there are no major changes to the production plan.
Furthermore, looking back at past Nvidia management comments, there were the following suggestions regarding Blackwell's development:
- On GTC Financial Analyst Day in 2024/3, CEO Jensen Huang stated that “the first system will be shipped at the end of the year, but supply restrictions are expected.”
- At the BofA GTC conference in 2024/6, VP Ian Buck stated that “Blackwell is currently in production builds, samples will be shipped this quarter, and production will expand towards the end of the year.”
These comments suggest that Blackwell's deployment was gradual and anticipated supply constraints in the early stages. Therefore, the “unexpected significant delay” scenario, as shown by The Information's report, does not seem to match Nvidia's official views.
3 ️ ECT INFORMATION FROM SUPPLY CHAIN PARTNERS
TSMC trends:
- Monthly revenue for July accelerated significantly, up 23.6% from the previous month and 38.3% from the same month last year.
- CEO C.C. Wei mentioned that “demand related to AI and high-end smartphones is strong.”
- It is predicted that CoOS (chip-on-wafer-on-board) capacity will continue to be tight until 2025.
Super Micro reports:
- Sales guidance for the first quarter of fiscal year 2025 (2024/9/12) predicts a record high growth rate, with a 206.6% increase from the same period last year.
- Demand for direct liquid cooling (DLC) systems has surged. We shipped over 1000 racks during the two months of June and July alone.
- We plan to expand DLC production capacity to 3000 racks per month by the end of the year (200% increase in 6 months).
Foxconn comments:
- Small shipments of new Nvidia AI servers will begin in the fourth quarter of 2024, with plans to increase production in the first quarter of 2025.
- “When new product specifications and technology are drastically upgraded, it is normal to dynamically adjust shipping schedules,” and indirectly denied The Information's claims.
4 ️ ︎ Discussion of alternative scenarios
Consider a few scenarios that might explain the discrepancy between coverage and actual circumstances:
1) Planned Delays:
- Given the complexity of CoWoS-L technology, additional testing and optimization are likely to be required.
- Nvidia has previously hinted at this possibility, and supply chain partners may have anticipated this as well.
2) Focus on GB200 NVL36/NVL72 systems:
- These systems have higher profit margins than the B100/B200 alone.
- There is a possibility that limited CoWoS-L production capacity is being directed to more profitable products.
3) Buffering with H200 and GH200:
- The H200 (with HBM3e) is already shipping, mitigating memory bandwidth issues.
- Shipment of GH200 super chips has also started.
- There is a possibility that these products will meet demand during the transition to Blackwell.
4) Phased deployment strategy:
- Nvidia anticipated supply constraints in the early stages and may have planned gradual deployment.
- Delays on some SKUs may not have a significant impact on the overall plan.
📍 Conclusions
The Information report had an impact on Nvidia's short-term stock price, but considering information and technical background from supply chain partners, questions remain about the content of the report. There may certainly be challenges with Blackwell's development, but it is likely that Nvidia anticipated and incorporated them into its plans.
Going forward, it will be important to keep a close eye on Blackwell's actual shipping status, customer responses, and supply chain partner trends. These factors will be indicators showing Nvidia's true competitiveness and growth potential.
References
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