Nvidia (NVDA) stock sank as much as 3% early Monday following a new report from The Information, which highlighted overheating issues with its latest Blackwell AI servers.
The news also comes ahead of the AI chipmaker’s earnings report, which is slated for release after the market close on Wednesday.
The news is not the first time issues have been reported with the company’s Blackwell products. In August, The Information reported that the leading AI chipmaker was dealing with design flaws related to the individual Blackwell chips themselves.
Nvidia confirmed fears that Blackwell production would be delayed in its earnings report in late August, stating that production of the chips would ramp up in the December quarter, rather than its previously-stated goal to ramp during the September period. The company has not publicly confirmed any design flaws or overheating issues, and Nvidia did not immediately respond to Yahoo Finance’s request for comment Monday.
Those Blackwell chips are set to bring in “several billion dollars” in sales in the fourth quarter, according to CEO Jensen Huang. Customers looking to use the 72-chip rack include Meta (META), Microsoft (MSFT), and Elon Musk’s xAI, according to The Information.
As Yahoo Finance’s Dan Howley noted last week, even a stellar report and outlook from the company could send its stock down. Nvidia topped expectations across the board in its most recent quarter, for example, but shares still fell 6% immediately after it announced its results.
Investor excitement over AI spending has also stoked fears Big Tech’s AI spending will ease — or sharply decline — punching AI chip companies in the gut.
Such fears were on display last Friday, when chip stocks fell across the board after a disappointing earnings report from Applied Materials (AMAT), which makes tech used by TSMC (TSM) to manufacture advanced computing chips such as Nvidia’s.
Nvidia shares closed Friday down 3.3%, while the PHLX Semiconductor Index (^SOX) fell 3.4%.
Still, Nvidia shares are up roughly 186% from last year. The chipmaker’s monumental rise has pushed it past Apple (AAPL) as the world’s most valuable company, and Nvidia recently replaced Intel on the Dow.
Laura Bratton is a reporter for Yahoo Finance. Follow her on X @LauraBratton5.
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