NVIDIA Delays Shipment of B200, What's the Impact on Revenue?

According to a report by technology media The Information, NVIDIA has informed its customers that the new Blackwell B200 chip will be delayed by three months or more, with bulk shipments potentially postponed until Q1 of next year.

The Blackwell chip was originally scheduled to begin mass production in October 2024; if the delay pushes it back to April 2025, it will directly affect NVIDIA's quarterly revenue. In response to the media, NVIDIA stated that the strong demand for Hopper chips and the production plan for Blackwell chips have not changed.

An NVIDIA spokesperson stated:

"As we have said before, the demand for Hopper is very strong. The large-scale sampling of Blackwell has been completed, and production in the second half of the year will proceed as planned. Beyond that, we do not comment on rumors."

This implies that even if the B200 is delayed in hitting the market, the impact on NVIDIA's revenue may not be particularly significant, as the market demand for Hopper chips remains robust.

Currently, the known chip models for the Blackwell GPU architecture include the B100, B200, and the GB200 superchip. If the B200 chip is delayed, according to Mizuho analyst Vijay Rakesh's estimate, its price could be set between $30,000 and $40,000, while the GB200 might be priced between $50,000 and $70,000.

UBS analyst Timothy Arcuri predicts that by the quarter ending in January 2025, shipments of B200 and GB200 will reach approximately 32,500 and 43,400 units, respectively, but they will only account for 7% of all chip shipments for that quarter, with the majority still being Hopper chips.

Combining the estimates of the two analysts, the revenue contribution of the B200 product in the quarter of January next year will reach $3 billion, accounting for 9% of the total expected revenue ($34.5 billion) for that quarter.

For NVIDIA's customers, the chip delay may exacerbate concerns about the timing of delivery. It is reported that technology giants including Alphabet (Google's parent company), Amazon, Microsoft, and Meta (Facebook's parent company) had a total capital expenditure of nearly $60 billion in the second quarter, a year-on-year increase of two-thirds, with a significant portion flowing towards NVIDIA.The Information also reported that Meta has now placed orders worth at least $10 billion, while Microsoft has increased its order size by 20% in recent weeks and plans to have 55,000-65,000 GB200 chips ready for OpenAI by Q1 2025.

In addition, design flaws will also affect the production and delivery of Nvidia's NVLink server racks, as companies working on servers will have to wait for new chip samples before they can finalize the server rack design.

However, there are still opinions that Nvidia's minor fluctuations in sales and revenue are unlikely to change its popularity on Wall Street. As of Friday, Nvidia's stock closed at $107, with a price-to-earnings ratio of 40 times this year's expected earnings and 30 times next year's expected earnings, still at a high level.