Nvidia's Stock Rollercoaster: Blackwell Chip Delay Concerns Amid Strong Demand

Nvidia's Blackwell Chip Delay Is Center Stage Amid Stock Slump

(Bloomberg) -- Nervous Nvidia Corp. investors are eager for an update on its Blackwell chip rollout -- hoping for a catalyst to halt the stock's recent decline. The next-generation processor was unveiled six months ago, but has faced engineering snags that delayed its release. While Chief Executive Officer Jensen Huang tried to reassure the market last month that revenue from the chip is coming soon, some investors were left wanting for details. That -- along with broader macroeconomic jitters -- has contributed to a 13% selloff since the earnings report. Lingering questions about Blackwell will be a key focus when Huang speaks at a Goldman Sachs conference in San Francisco on Wednesday. He's scheduled to speak with David Solomon, Goldman's chief executive officer, at 7:20 a.m. local time. Shares of Nvidia were up as much as 2.8% in early trading Tuesday. "Nobody likes a delay," said Brian Mulberry, client portfolio manager at Zacks Investment Management Inc. "It's one of those blips that investors are just kind of latching onto." In the absence of other positive catalysts for the stock -- and combined with broader worries hitting the whole tech sector -- the Blackwell snags have added to concerns that the artificial intelligence darling has risen too far, too fast. While Nvidia has done a good job of managing expectations, "they probably could communicate better, particularly around the Blackwell issue," Mulberry added. That sentiment was echoed by Bank of America analysts, who wrote in a research report last week that details about the readiness of Blackwell shipments are the key fundamental catalyst for a recovery in Nvidia shares. Blackwell is the next generation of the company's dominant AI processor and has been eagerly awaited by investors to provide the next leg of growth. Nvidia acknowledged in its latest earnings report that there were issues with production and said it has had to revamp part of the chip's manufacturing process. Still, the company said it expects to bring in "several billion dollars" of revenue from Blackwell in its fiscal fourth quarter, which ends January 31. The production ramp is scheduled to begin in the fourth quarter and continue into fiscal 2026, according to comments on the earnings call. If everything goes smoothly and Nvidia is able to deliver its Blackwell chips on this schedule, then the stock may become less volatile than in recent months, Mulberry said. They've said they'll be able to bring things up to speed by early 2025, and "if they can communicate clearly that they are still on track to do that and there won't be any further delays in production, they can quell some of these short-term fears," he said. Still, if Blackwell faces more delays or snags, that could add to downside pressure on the shares -- especially with few other catalysts on the horizon and potential risks related to a US Justice Department antitrust probe. Randy Hare, portfolio manager at Huntington National Bank, agrees that near-term pressure on Nvidia shares is likely to the downside. Still, for investors who believe in the potential of AI in the long-term, it could be a good time to add to positions. "We're maybe part-way through the mid-cycle correction," said Hare. "And then I think you'll get a good opportunity where people will realize that this is the best growth area in the market and they'll start putting money to work again." Tech Chart of the Day Oracle Corp. shares rose as much as 12% to $156.74 on Tuesday, hitting a record high after reporting quarterly profit and bookings that topped estimates, signaling that artificial intelligence demand continues to boost its cloud computing business. --With assistance from Jeran Wittenstein and Subrat Patnaik.

Nvidia stock surges as CEO Huang talks up strong demand By Investing.com

Investing.com-- Shares of Nvidia rose sharply on Wednesday, underpinning a broader rally in technology stocks after Chief Executive Jensen Huang said the company was experiencing stellar demand for its artificial intelligence chips. Speaking at a Goldman Sachs (NYSE:GS) conference in San Francisco, Huang said that tensions had risen among Nvidia's customers as they scrambled to obtain a limited supply of the company's advanced AI chips, Bloomberg reported. He said that the firm was experiencing strong demand for its newest generation of AI chips, called Blackwell, and said that companies would have no choice but to embrace "accelerated computing" to keep up with demand for AI. NVIDIA Corporation (NASDAQ:NVDA) surged 8.1% to $116.86 on Wednesday, its biggest one-day gain in six weeks. But the stock fell slightly in aftermarket trade. Huang said generative AI was still in an early stage, and it was likely that the technology will expand beyond data centers. His comments come after Nvidia was hit with a bruising sell-off last week, after the guidance provided with its July-quarter earnings failed to meet some elevated expectations. Still, the stock is trading up about 150% so far this year. Losses in Nvidia had also spurred a broader sell-down in the technology sector. Goldman Sachs reiterated its Conviction Buy rating on Nvidia along with a $135.0 price target in a recent note. The firm is at the heart of a massive, AI-driven valuation boom over the past year, and is expected to continue benefiting from a broader push into generative AI. Nvidia makes the most advanced AI chips in the market, but counts on buying from a relatively small pool of technology giants for a bulk of its revenues.

Nvidia Faces Investor Scrutiny Over Blackwell Chip Delays, Big Revenue Expected: Report - NVIDIA (NASDAQ:NVDA)

Nvidia expects Blackwell chip to generate billions in fiscal Q4 revenue. Nvidia Corp's NVDA jittery investors await an update on its Blackwell chip rollout ahead of the Goldman Sachs Group Inc GS conference in San Francisco, where Nvidia chief Jensen Huang will speak with Goldman chief speak with David Solomon, Bloomberg reports. The stock took a 15% hit since it released its quarterly print and disclosed Blackwell chip's launch remains impaired by engineering snags. CEO Jensen Huang's assurances also failed to contain the meltdown. However, Nvidia expects "several billion dollars" of revenue from Blackwell in its fiscal fourth quarter. Bloomberg reports that Zacks Investment Management client portfolio manager Brian Mulberry and Bank of America analysts flagged the delay as a potent concern in the absence of other positive catalysts for the stock. Mulberry expects Blackwell's timely execution to contain the stock volatility. Mai Capital Management portfolio manager Chris Grisanti, in a CNBC interview, snubbed the selloff backed by the ambitious artificial intelligence ambitions of cash-rich Big Tech giants like Microsoft Corp MSFT and Amazon.Com Inc AMZN Amazon Web Services. Meanwhile, Nvidia's key supplier, Taiwan Semiconductor Manufacturing Co TSM, recorded 33% topline growth in August 2024, signaling optimism over the smartphone market recovery and continued demand for Nvidia's artificial intelligence chips. Despite the selloff, Nvidia stock is up over 137% in the last 12 months. Investors can gain exposure to the stock through iShares Russell 1000 Growth ETF IWF and iShares S&P 500 Growth ETF IVW. Price Action: NVDA stock is down 0.37% at $106.08 at the last check on Tuesday. Photo via Shutterstock Market News and Data brought to you by Benzinga APIs

Nvidia CEO Says Chipmaker Is Seeing 'Incredible' Demand, Sending Stock Higher Wednesday

The CEO also touted the return on Nvidia products for customers, saying every dollar a cloud company might spend on Nvidia infrastructure translates to $5 in rentals for the company. Nvidia Corporation (NVDA) shares surged 8% Wednesday after CEO Jensen Huang said the chipmaker is seeing "incredible" demand. Huang said at Goldman Sachs' Communacopia + Technology Conference that "everything is sold out," as customers clamor for Nvidia infrastructure to support artificial intelligence (AI). "Our company works with every AI company in the world today," Huang said, according to a transcript provided by AlphaSense. "Everybody's counting on us." Nvidia's chips are used by several major cloud providers, including Microsoft (MSFT) and Amazon (AMZN). Both companies have told investors they expect to boost spending on AI infrastructure. Huang touted the return on Nvidia's products for customers as well, saying every dollar a cloud company might spend on Nvidia infrastructure translates to $5 in rentals for the company. Nvidia GPUs were also on display at Oracle's (ORCL) CloudWorld conference Wednesday. The company unveiled an Oracle Cloud Infrastructure (OCI) Supercluster supported by Nvidia's Blackwell platform equipped with more than 100,000 GPUs to train and deploy AI models. The OCI Superclusters are expected to be available in the first half of 2025. Oracle and Nvidia partnered at the conference to showcase how Nvidia's platform can accelerate AI and data processing for enterprise customers. Shares of Nvidia closed 8% higher at $116.91 Wednesday, partially reversing recent losses following a sales forecast that came up short of lofty expectations.

Asian chip stocks track Nvidia rally on AI hopes By Investing.com

Investing.com-- Asian chipmaking stocks rose on Thursday, tracking an overnight rally in Nvidia after CEO Jensen Huang offered encouraging comments on artificial intelligence-driven demand. Gains in tech came tracking an 8.1% rally in NVIDIA Corporation (NASDAQ:NVDA) on Wednesday- the chipmaker's best day in over six weeks. Nvidia CEO Huang said the company was seeing strong demand for its top-end AI chips, including the upcoming Blackwell line, and was also facing a potential supply shortage due to heightened demand for its chips. His comments helped Nvidia rebound from a bruising loss clocked last week, after Nvidia executives were seen selling some shares. Nvidia's current-quarter revenue and margin guidance- released in late-August- had also missed some elevated expectations. But the stock was still trading up about 150% so far in 2024, having seen a stellar rally on hype over AI-fueled demand. Huang said that companies could not escape the need for higher processing power, flagging increased chip demand from higher computing and data center requirements. Huang's comments helped spur bets that AI demand will help the tech industry duck a broader decline in economic conditions.