After a quarter where Nvidia Sales have nearly doubled, and investors and analysts wonder how long the chipmaker can continue this kind of growth now that it has an annual revenue run rate of $140 billion.
Those hopes rest on Blackwell, Nvidia's name for a range of server products based on its next-generation AI chip.
CEO Jensen Huang and CFO Colette Kress provided investors with several new data points on how Blackwell's launch is shaping up on a call with analysts on Wednesday. The duo emphasized that the rollout is on the right track, and noted that Blackwell's sales over the next few quarters will be limited by the number of chips and systems that Nvidia can make, not by the amount of what it can sell.
“Blackwell's production is going full steam ahead,” Huang said. “This quarter we will deliver more Blackwell vehicles than we previously expected.”
The company's positive comments on Blackwell are one reason the stock fell just 1%, despite the company missing out on high expectations from optimistic investors who expected Nvidia to significantly exceed its expectations.
Huang and Kress' comments also addressed concerns about shipping delays prompted by reports that Nvidia is making ongoing engineering changes to its systems to address the issues.
Some of Nvidia's most important end-customers have already received some Blackwell chips, the company confirmed on Wednesday. Microsoft, Oracle and OpenAI posted photos of Blackwell-based server racks on their social media accounts, and the company said Wednesday that 13,000 Blackwell chips have already been shipped to customers.
“There is still a lot of engineering work happening at this point,” Huang said. “But as you can see from all the systems that have been in place, Blackwell is in great shape.”
These sample chips do not represent the bulk of the shipments the company expects to make. They are early releases intended to allow customers to start testing and prepare their systems and software for large shipments, which will begin this quarter from Nvidia.
“We will ship more Blackwells next quarter than this (quarter), and we will ship more Blackwells next quarter than in the first quarter,” Huang said.
In July, Nvidia said it expects “several billion dollars” in Blackwell revenue in the current quarter, and on Wednesday, the company said it expects Blackwell's sales volume for the quarter to be higher than its original forecast. Huang also said Microsoft will soon begin previewing its Blackwell-based systems for cloud customers.
The factor limiting production of more Blackwell systems is the amount of components Nvidia's suppliers can supply, Huang said. Additionally, it takes time to ramp up a manufacturing process that has gone from zero shipments to billion-dollar shipments in just a few months.
“Demand is exceeding our supply, which is to be expected because we are at the beginning of the generative AI revolution,” Huang said.
He also named some of Nvidia's “great partners,” including… TSMC, Amphenol, Vertif, SK Hynix and Micron.
“It seems like almost every company in the world is involved in our supply chain,” Huang said.
Nvidia said Blackwell's gross margins will be lower in the coming months than the 73.5% it reported in the third quarter, but the company said the margin will increase as the product matures. Huang noted that Blackwell comes as a chip itself or in configurations that include a complete rack and other components.
Nvidia's overall message on Wednesday was that its new Blackwell chip is out of stock because companies like OpenAI need the fastest GPUs available as quickly as possible to develop next-generation AI models. With the introduction of Blackwell, Nvidia's existing AI chips, which it calls Hopper, will move to serving AI models, not creating new ones. Nvidia said Blackwell's sales will eventually surpass Hopper's.
“You see now that at the end of the last generation of foundation models, we reached about 100,000 hoppers,” Huang said. “The next generation starts with 100,000 Blackwell.”
Watch: Nvidia can still grow even as Amazon and Microsoft enter the space: Susquehanna's Chris Rowland
