Semiconductors
Nvidia Q1/Q2 Guide: Blackwell is (Finally) Here
Nvidia posted a strong Q1 and marginally missed estimates in Q2 due to Blackwell revenue that exceeded expectations. The larger Blackwell systems are in full production and are shipping in volume now, which sets up a strong second half of the year. According to management commentary, the ramp is happening very quickly: “On average, major hyperscalers are each deploying nearly 1,000 NVL72 racks or 72,000 Blackwell GPUs per week and are on track to further ramp output this quarter.” The rough math here implies hyperscalers are deploying $3 billion every week right now since each rack goes for $3 million. Furthermore, the run rate of this comment implies data center revenue will be above and beyond analyst consensus for Q2, Q3 and Q4. The loss of China revenue in Q1 was $2.5 billion yet inventory charges were higher at $4.5 billion from orders placed prior to April 9. For Q2, the loss of China revenue was $8 billion –or about $2 to $3B higher than the typical $5.5B in China revenue. The readthrough is that Blackwell came in $2-$3B above analyst expectations to absorb that impact from China, since guidance marginally missed.
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