Nvidia, a leading technology company renowned for its cutting-edge graphics processing units (GPUs), is currently experiencing a remarkable upsurge in GPU sales driven by the growing demand for artificial intelligence (AI) applications. While this surge in demand bodes well for Nvidia’s GPU business, it also presents the company with significant challenges, particularly in terms of stock shortages that are projected to persist until the end of this year.
Shortages of Nvidia GPUs Expected to Extend till December
Meeting the escalating demand is proving to be a formidable task for Nvidia, as the company endeavors to collaborate with TSMC (Taiwan Semiconductor Manufacturing Company) to ramp up production. It is worth noting that TSMC manufactures the chips utilized in Nvidia’s graphics cards. The surge in the GPU market aligns with the rapid growth of AI applications, which Nvidia has been at the forefront of.
Innovative AI technologies such as ChatGPT and other AI-based models heavily rely on Nvidia GPUs for their exceptional computing power. In fact, our previous report highlighted astonishing instances of Nvidia’s AI chips being sold for staggering amounts of up to $40,000 on online platforms like eBay.
The overwhelming demand is particularly concentrated on Nvidia’s latest GPU models, namely the A100 and H100, which are highly sought after by tech firms aiming to leverage their AI capabilities. Reports indicate that the tremendous demand for AI chips has resulted in stock issues for Nvidia, making it challenging for the company to meet the soaring requirements.
Consequently, Nvidia is exploring options to increase its orders from TSMC, the world’s largest contract chipmaker. The A100 GPU is based on TSMC’s 7nm process, while the H100 utilizes the more advanced 4nm TSMC process node.
Moreover, the intensified demand has triggered a surge in prices. Nvidia is now offering modified versions of its A100 and H100 GPUs, known as A800 and H800 respectively, which are priced at a substantial 40 percent higher than the manufacturer’s suggested retail price (MSRP). Additionally, the delivery cycle for these new GPU models has been affected as Nvidia prioritizes shipping to tech firms located outside of China.
As Nvidia strives to address the ongoing GPU shortages and cater to the escalating AI demand, industry observers eagerly await further updates and measures taken by the technology giant to ensure a consistent supply of GPUs to its eager customers.
