Nvidia’s chip delay could impact Google, Meta and Microsoft, says report

A delay of three or more months in the launch of Nvidia's new artificial intelligence chips could impact customers such as Alphabet's Google, Meta Platforms and Microsoft, Reuters reported.

The delay, due to design flaws in the upcoming AI chips, was first reported by tech-focused publication the Information on August 2.

Customers Affected

The setback could affect customers such as Meta Platforms, Alphabet's Google and Microsoft. The tech giants have collectively ordered tens of billions of dollars' worth of chips, the Information report added, citing people who help produce chip and server hardware for Nvidia.

Nvidia unveiled its Blackwell AI chips in March, following its flagship Grace Hopper AI Superchip, which was designed to speed generative AI applications, Reuters reported.

"As we've stated before, Hopper demand is very strong, broad Blackwell sampling has started, and production is on track to ramp in the second half," an Nvidia spokesperson told Reuters via email.

Meanwhile Microsoft said it “had nothing to add”, and Google and Meta did not respond to queries, Reuters added.

Production Delays

Nvidia informed Microsoft and another major cloud service provider of the likely delay this week, the Information report added, citing a Microsoft employee and another person with knowledge of the matter.

The delays mean big shipments aren’t expected until the first quarter of 2025, The Information added.

Nvidia adds record $329 billion in market value

On August 1, Nvidia share prices surged nearly 13 per cent, adding around $330 billion in stock market value to the chip maker, in a record one-day gain for any company on Wall Street. Nvidia stock price jumped 12.81 per cent to $117.02 per share, making it worth $2.88 trillion — and the third most valuable company on Wall Street, behind Apple and Microsoft.

This market cap surge shattered Wall Street’s previous record, which was also set by Nvidia on February 22 when it gained $277 billion, Reuters reported. Nvidia’s highest ever closing stock market value was $3.34 trillion on June 18, according to LSEG.

The rally in Nvidia shares was due to expectations of high demand for its processors after Microsoft late on Tuesday reported a massive increase in artificial intelligence expenditures.

(With inputs from Reuters)