NVIDIA's Coming Blackwell Chip Expected to Surpass Hopper Revenue
NVIDIA is making headlines with its new Blackwell AI chip, anticipated to significantly ramp up production and revenue. Analysts from a prominent financial institution predict that production revenue for this next-generation chip in the first quarter of 2025 might actually exceed that of its predecessor, the Hopper chip. This exciting development signals a new phase in NVIDIA's advancement in artificial intelligence technology.
Projected Production Surge in Q1 2025
According to insights from Morgan Stanley, supply chain checks illustrate the potential for Blackwell chip production to hit between 750,000 and 800,000 units during the first quarter of 2025. This marks a remarkable rise compared to the estimated production of 250,000 to 300,000 units in the preceding quarter. Such a dramatic increase in output could generate substantial revenue, with projections suggesting that NVIDIA could see between $5 billion and $10 billion in revenue just from the production in the last quarter of 2024.
Customer Demand and Competitive Advantage
NVIDIA's CEO, Jensen Huang, recently described the demand for the Blackwell chips as "insane" during a CNBC interview. This high demand is driven by customers' desire to obtain large quantities of these high-performance AI chips. Huang emphasized that the competition is fierce, with companies eager to secure their position in the market by acquiring the latest technology first.
Comparative Analysis of Hopper and Blackwell Chips
While Hopper chips, particularly the H200 and H20 models, are projected to reach production volumes of approximately 1.5 million units by the end of 2024, these numbers are expected to taper to around 1 million units in the following quarter. Importantly, Blackwell chips offer a pricing advantage as they command a price premium, with B200 chips priced 60-70% higher than their H200 counterparts. This pricing strategy positions Blackwell to potentially surpass Hopper in revenue during the imminent quarter.
Future Innovations and Technological Developments
Additionally, NVIDIA has plans for their GB300 NVL72 server racks, which are set to debut in 2025. This innovative product is likely to further enhance the company's supply chain and bolster demand for Blackwell chips. With each of these advancements, NVIDIA continues to solidify its role as a leader in the GPU market.
Market Impact and Supply Chain Opportunities
The anticipated upsurge in Blackwell production is viewed positively for stocks associated with NVIDIA's graphics processing unit supply chain. Notable partners and suppliers like TSMC, KYEC, and ASE could see beneficial effects due to the increase in demand for NVIDIA's cutting-edge technology. Moreover, Aspeed may also reap rewards due to higher Baseboard Management Controller (BMC) content, although some uncertainties surrounding specification changes remain.
Frequently Asked Questions
What is the expected revenue from Blackwell chip production?
Blackwell chip production could contribute between $5 billion and $10 billion in revenue for NVIDIA in the last quarter of 2024.
How many units of Blackwell chips are projected for Q1 2025?
Analysts predict that Blackwell chip production could reach between 750,000 and 800,000 units in the first quarter of 2025.
What distinguishes Blackwell chips from Hopper chips?
Blackwell chips command a price premium and offer higher performance, making them a preferred choice despite Hopper's larger production numbers initially.
What future innovations is NVIDIA planning?
NVIDIA plans to introduce GB300 NVL72 server racks in June 2025, which are expected to drive demand for Blackwell chips further.
What companies may benefit from the increase in Blackwell production?
Companies within NVIDIA's GPU supply chain, including TSMC, KYEC, and ASE, may experience positive market impacts due to increased demand for NVIDIA products.
