Nvidia Slips to Second on WSB as Blackwell GPU Challenges Emerge

Nvidia has slipped to the second position on the latest WSB rankings, down one spot from the previous day. The company's stock experienced a 2.81% drop, marking a continuous two-day decline.

Recent reports have circulated about difficulties encountered with Nvidia's new Blackwell architecture GPUs before their official shipment. Allegedly, these issues have affected production yield rates and strained Nvidia's relationship with TSMC. However, Nvidia CEO Jensen Huang promptly addressed these concerns.

Huang clarified that while there was a minor design flaw within the Blackwell architecture, it did not impact the chip's core functions but did reduce yield rates. He emphasized that this issue was solely Nvidia's responsibility and did not involve TSMC, assuring that the partnership remains unaffected.

During a recent meeting, Nvidia announced that the design flaw affecting Blackwell's GPUs had been corrected, with improved versions poised for production. Huang reiterated that the defect was entirely Nvidia's fault and credited timely assistance from TSMC for the swift resolution.

Despite initial speculation about potential friction with TSMC, Huang dismissed such claims as "fake news," reaffirming the ongoing collaboration between the two companies. Nvidia utilized TSMC’s advanced 4NP process to develop the Blackwell chips, leveraging innovative packaging technologies to achieve substantial performance improvements over previous models.

It was acknowledged that, to meet the demand for its new AI chips, Nvidia needed to produce initial batches with lower yield rates. Nevertheless, they are optimistic about achieving full-scale production, targeting the fourth quarter for ramping up output.

The semiconductor industry is not unfamiliar with yield-impacting bugs, as companies regularly employ new stepping processes to mitigate such challenges. Nvidia's swift action to rectify the Blackwell yield issues has been notably effective, positioning them to start shipments early next year.

Looking forward, the company aims to cater to major clients such as AWS, Google, Meta, and Microsoft, who collectively represent a significant portion of its revenue. This ongoing demand underscores the importance of successfully rolling out the Blackwell GPUs to reinforce Nvidia's position in the AI and computing sectors.