Finance
Nvidia is reportedly delaying the next-generation Blackwell AI chip due to a design flaw
Nvidia (NVDA) is reportedly delaying its next generation of artificial intelligence chips by at least three months. Mass shipments may not happen until early 2025.
Nvidia told Microsoft (MSFT) and another key cloud customer that its Blackwell B200 AI chips will be delayed due to a design flaw discovered late in the manufacturing process, The Information reported Saturday, citing a Microsoft employee and another source.
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The B200 chips are expected to replace the very popular H100 chips, which have skyrocketed Nvidia’s revenue, profits and stock.
The AI leader is now holding new test runs Taiwan Semiconductor Manufacturing Co. (TSM), which makes Nvidia chips.
An Nvidia spokesperson declined to comment on the delay, telling The Information that “production is on track to ramp up later this year.”
A slowdown could impact Nvidia’s revenue later this year, as well as NVDA stock. It could affect both TSMC and its rivals Advanced micro devices (AMD), which would fall behind Nvidia with the new Blackwell chips. Major customers such as Microsoft, Google parent company Alphabet (GOOGL), Metaplatforms (META) have ordered tens of billions of dollars worth of next-generation chips for its AI ambitions.
What to do after stocks fall; Nvidia’s next AI chip delayed
Nvidia stock
NVDA shares tumbled 5.1% to 107.27 last week, now well below the 50-day and 10-week lines. Chip and AI plays struggled with the broader markets last week. There were also multiple reports late in the week that the Justice Department is investigating Nvidia for its AI dominance.
AMD shares fell 5.35% last week to a 2024 low. Shares initially rose on strong AMD earnings, but retreated lower.
TSM shares fell 7.5% last week, now well below the 50-day and 10-week lines. Taiwan Semiconductor will report July sales on Friday.
Microsoft tumbled 3.95% last week amid weaker-than-expected growth from Azure cloud computing, although shares did find support at the 200-day mark.
Meta shares fell 4.8% to 488.14 this week, but closed below the 50-day line after initially peaking in gains on Thursday.
Google fell 0.2% last week, following a decline in earnings the week before.
Microsoft, Meta and Google are also signaling continued strong AI-led capital spending, much of which is expected to go for Nvidia chips.
Follow Ed Carson on Threads at @edcarson1971 and X/Twitter on @IBD_ECarson for stock market updates and more.
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