Shares of chipmaker Nvidia (NVDA) fell in today’s trading after analyst Ming-Chi Kuo raised concerns about the “low” visibility surrounding the mass production of its GB200 NVL72 product, which could create near-term risks for the company.
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Indeed, production has been delayed multiple times after originally being planned for September 2024. As a result, the company is now targeting production in Q2 2025. Kuo estimates that shipments may range between 25,000 and 35,000 racks in 2025, which is far below the earlier forecast of 50,000 to 80,000 racks.
Skepticism Is Building Up
It is worth noting that the GB200 NVL72, a 72-GPU liquid-cooled system designed as a single GPU, requires a more complex development process compared to standard servers due to its advanced technology. Despite Nvidia’s robust supply chain, this complexity has extended the development timeline to 1.5 to 2 years. Kuo warned that further delays into the second half of 2025 could negatively impact investor confidence even more as skepticism builds without clear evidence of mass shipments.
Adding to the uncertainty, shipments of lower-spec GB200 and HGX models remain small and offer limited reassurance to the market. Kuo also noted that the upcoming GB300 NVL72 could face similar production hurdles and potentially delay mass shipments until early 2026.
However, the analyst emphasized that Nvidia’s challenges come from supply constraints rather than weak demand, which suggests that the company is unlikely to cut orders unless there are additional setbacks.
Is NVDA a Good Stock to Buy?
Overall, analysts remain bullish on NVDA stock, with a Strong Buy consensus rating based on 37 Buys and three Holds assigned in the past three months. After a 135% rally in its share price over the past year, the average NVDA price target of $177.76 per share implies an upside potential of 34.3% from current levels.
