Nvidia’s shares experienced a 2% dip on Tuesday morning after the company unveiled its latest and most powerful artificial intelligence chips to date – the Blackwell series. This new generation of chips was announced by CEO Jensen Huang at Nvidia’s developer conference in San Jose, California on Monday.
The first chip in the Blackwell lineup is the GB200, which Huang touted as even more potent than the current flagship Hopper GPUs that have been in high demand for running large AI models. He revealed that bringing this groundbreaking processor to life required inventing novel technologies, showcasing the immense engineering effort behind it.
Huang estimated that a single Blackwell GB200 chip could cost a staggering $30,000 to $40,000, reflecting the cutting-edge nature of the product. He also disclosed that Nvidia had invested a massive $10 billion in research and development for this new AI processor architecture.
In addition to the Blackwell chips, Nvidia also unveiled a new enterprise software offering called the Nvidia Inference Microservice. This innovative solution aims to simplify the process of running older generations of Nvidia GPUs, potentially extending the lifespan and utility of existing hardware investments.
Analysts at Bernstein maintained an “outperform” rating on Nvidia stock with a $1,000 price target, commending Huang’s ability to captivate audiences akin to a sold-out Taylor Swift concert with his keynote presentation at the developers conference.
Wells Fargo analysts expressed measured optimism, reiterating their “overweight” rating on Nvidia shares while boosting their price target from $840 to $970. They acknowledged that while some investors may have anticipated an even more impressive launch for the Blackwell B200, the announcement reinforced their long-standing positive thesis on Nvidia’s technological prowess and monetization opportunities.
Goldman Sachs analysts, retaining a “buy” rating, raised their price target for Nvidia stock from $875 to $1,000. They expressed a “renewed appreciation” for Nvidia’s innovation capabilities, strong customer and partner relationships, and pivotal role in the generative AI space following the company’s keynote presentation.
The analysts at Goldman Sachs went on to state, “Based on our recent industry conversations, we expect Blackwell to be the fastest ramping product in Nvidia’s history.” They highlighted Nvidia’s instrumental role in democratizing AI across various industry verticals, bolstering their confidence in the company’s future prospects.
Despite the initial share price dip, the overall reaction from analysts appears positive, with recognition of Nvidia’s technological leadership and the potential for the Blackwell chips to drive substantial growth and adoption in the rapidly evolving AI landscape.
The unveiling of the Blackwell series underscores Nvidia’s commitment to pushing the boundaries of AI computing power. By continually innovating and developing increasingly powerful hardware and software solutions, the company aims to solidify its position as a dominant force in the AI revolution.
As generative AI applications continue to capture the imagination of businesses and consumers alike, Nvidia’s ability to deliver cutting-edge processors like the Blackwell chips could prove pivotal in shaping the future trajectory of this transformative technology.
