Nvidia Stock Drops on Report of Snag With Blackwell Chip Servers
KEY TAKEAWAYS
Nvidia (
NVDA
) shares fell Monday as reports, citing
The Information
, said that its next-generation
artificial intelligence (AI)
Blackwell chips have faced problems with accompanying servers that overheat.
According to a Reuters report digesting
The Information's
coverage, Nvidia’s Blackwell graphics processing units overheat when connected in server racks designed to hold up to 72 chips.
The chipmaker, which will release its highly anticipated
earnings report
on Wednesday, has asked its suppliers to change the design of the racks several times to resolve overheating problems,
Reuters
said.
Reuters
indicated that some customers are worried they won’t have enough time to get new data centers up and running.
Nvidia stock was down as much as 1.8% Monday morning and has almost tripled this year.
Nvidia Says Engineering Changes are 'Normal'
"NVIDIA GB200 systems are the most advanced computers ever created. Integrating them into a diverse range of data center environments requires co-engineering with our customers,” an Nvidia spokesperson said in a statement to
Investopedia
.
“While our customers race to be first to market, NVIDIA is working with leading CSPs (cloud service providers) as an integral part of our engineering team and process. The engineering iterations are normal and expected," the spokesperson added.
Nvidia
Chief Executive Officer (CEO)
Jensen Huang has called the Blackwell chip "a
complete game changer
for the industry." Nvidia has said it expects to ship several billion dollars worth of Blackwell revenue during the January quarter as production ramps up.