Nvidia: Morgan Stanley checks suggest no further GB200 server rack shipment delay

Investing.com -- Morgan Stanley analysts provided their view on Nvidia (NASDAQ:NVDA)'s GB200 server rack production, noting that recent supply chain checks suggest no further delays in shipments.

Concerns had arisen in the market regarding Nvidia's Blackwell platform, specifically about supply and demand uncertainties, but the production process appears to be on track, according to the investment bank.

"Our latest supply chain checks suggest no further delay for GB200 server rack shipments," Morgan Stanley (NYSE:MS) states.

They also noted that no leakage problems have been spotted, and cable connection issues can be resolved through manufacturing adjustments. Production rollout is scheduled for November 2024, with the first batch of shipments expected by the end of the year.

The bank highlights that while both NVL36 and NVL72 designs should hit the market by late 2024, "NVL72 should be the customer preference for high computing power density and better cost-effectiveness in the long term."

Moreover, Morgan Stanley says some tier-one server buyers will have access to the Blackwell platform around the year-end, while broader shipments to the rest of the market are likely to begin by the end of the first quarter in 2025.

They explain that due to the immense power consumption of GB200 server racks, however, most enterprise buyers may prefer HGX/MGX servers for the Blackwell platform.

Morgan Stanley's analysis suggests that Nvidia's supply chain remains strong, with growth expected in high-speed switches and large-scale 800G switch shipments projected for the fourth quarter of 2024.

"We see the supply chain continuing to progress to mass production toward year-end," writes Morgan Stanley.

While volatility may persist in the short term, the bank remains optimistic, particularly on companies like Wistron, Accton, and Hon Hai for their relationships with Nvidia and contributions to the AI hardware supply chain.