Although the $10 billion revenue and 450,000 unit figures are substantial, they suggest Nvidia will sell its high-demand Blackwell GPUs in limited supply at around $22,000 per unit, significantly lower than the previously rumored $70,000 per module. (Source: Image by RR)

Nvidia Anticipates Blackwell GPU Revenue Surge Despite Yield Fixes and Supply Limits

Morgan Stanley analysts predict that Nvidia will produce around 450,000 AI GPUs based on the Blackwell architecture in the fourth quarter of 2024, despite facing low yields due to a design issue. If Nvidia successfully sells these units this year, it could generate over $10 billion in revenue. This figure is based on an estimated price of $22,000 per unit, significantly lower than the previously rumored $70,000 price for Blackwell GPUs. The lower pricing for early batches of high-end GPUs compared to Nvidia’s current-generation H100 is somewhat unexpected.

While Nvidia could generate $10 billion by selling individual GPUs, the company would likely prefer to sell fully equipped AI server cabinets, which are much more profitable. For example, the NVL36 cabinet, featuring 36 B200 GPUs, could sell for $1.8 million to $2 million, while the NVL72, housing 72 GPUs, might start at $3 million. This approach, as noted in tomshardware.com, would allow Nvidia to meet its revenue goals without needing to sell the full 450,000 units.

Nvidia encountered production issues with the Blackwell GPUs due to a mismatch in the coefficient of thermal expansion (CTE) between the chiplets and packaging materials. This problem arose from the new CoWoS-L packaging technology, which uses passive local silicon interconnect (LSI) bridges. Nvidia had to redesign the GPU’s top metal layers to improve production yields, though no functional changes were made to the Blackwell architecture itself.

Given these production challenges and limited packaging capacity from TSMC, analysts expect Nvidia to deliver fewer Blackwell-based GPUs than initially predicted in the fourth quarter of 2024 or the fourth quarter of fiscal 2025. However, the company still anticipates generating several billion dollars in Blackwell revenue during this period.

read more at tomshardware.com