Amazon's AWS Suspends Ordering Nvidia's GraceHopper, Waiting for GraceBlackwell
On the evening of May 21, Beijing time, it was reported that Amazon's cloud computing department AWS has suspended ordering Nvidia's most advanced super chip GraceHopper to wait for the more powerful new product GraceBlackwell (GH200). This comes at a time when investors are worried that Nvidia will experience a demand decline between two product cycles.
In March this year, Nvidia released a new-generation processor named Blackwell, less than a year after its predecessor Hopper began shipping to customers. Nvidia CEO Jensen Huang said that the new product's ability in training large language models will double.
GraceHopper was officially launched in August this year. AWS also confirmed the news to the media, saying that the time interval between the two products is very short, and waiting for the new product is reasonable.
In response, Nvidia refused to comment before releasing the quarterly financial report on Wednesday on the grounds of the silent period rule. In Tuesday's early morning trading, Nvidia's share price fell by about 1%.
Analysts expect that driven by large tech companies' heavy investment in AI technology, Nvidia's sales in this quarter will triple. But some investors have begun to question how long this extraordinary growth momentum can last.
Morgan Stanley analysts said in a report to clients this week that although large tech companies promised to continue to invest tens of billions of dollars this year to build data center infrastructure for AI, Wall Street is anxious about Nvidia's pause before the launch of Blackwell.
The production of the new Blackwell chip will gradually increase this year. Analysts expect that they will be delivered in the fourth quarter. Citigroup analysts believe that during this period, there will be a fault in the demand for Nvidia AI chips.
Neither Amazon nor Nvidia is willing to disclose the value of the order. Analysts at HSBC estimated that the price of one GB200 chip will be as high as $70,000, and the price of the entire server equipped with this new technology can be up to $3 million at most.
AWS will continue to provide its cloud customers with other Nvidia chips including H100. However, as one of Nvidia's largest customers, AWS's move may worry investors who had previously worried that tech companies would postpone purchases while waiting for Blackwell to go on the market.
For most of last year, with the launch of OpenAI's breakthrough ChatGPT, it triggered a wave of investment in AI infrastructure by cloud and internet companies, start-ups and enterprise buyers, resulting in Nvidia's H100 AI chip being in short supply by far. But since the beginning of 2024, the long wait for the H100 chip has eased.
Due to investors' confidence in the demand for AI chips, Nvidia's share price has almost doubled since the beginning of this year. But since the release of Blackwell in March, Nvidia's share price has been struggling to show a sustained increase.