Nvidia's Inventory Spike Isn't A Warning Sign - It's A War Chest
Nvidia Corp's inventory increased by 33% to $8.7 billion, which some investors found concerning. However, management views this as a strategic move to meet soaring demand for its Blackwell Ultra chips. Nvidia's VP stated that demand continues to exceed supply, indicating confidence in future growth. The U.S. has also approved GPU exports to China, potentially opening up $5 billion in sales. Overall, Nvidia's inventory rise reflects its aggressive strategy in the AI market rather than a sign of weakness.
Nvidia Corp NVDA isn't hoarding chips – it's flexing. The AI titan's inventory spiked 33% last quarter to $8.7 billion, a number that rattled some investors. But management says the surge isn't a red flag; it's a calculated bet.
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A bet on soaring demand for its Blackwell Ultra (BWU) chips, much of which has already shipped this quarter. Lead times remain measured in "quarters, not months," proof that the AI supercycle is far from cooling.
Speaking at a JPMorgan investor meeting, Nvidia's VP of IR and Strategic Finance, Toshiya Hari, emphasized that demand continues to outpace supply even two years into this AI spending boom. Analyst Harlan Sur, who reiterated his Overweight rating and $215 price target, said Nvidia's inventory strategy shows confidence in future ramps rather than weakness.
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Blackwell Ultra, Rubin Keep The Engine Hot
BWU is now nearly half of all Blackwell shipments, with higher prices set to fuel revenue momentum. Next-gen Vera Rubin chips are also locked in for a late fiscal 2026 debut, quashing rumors of delays.
Nvidia's supply chain partners are preparing to boost rack shipments beyond the current 1,000-a-week pace, setting up a strong second half of the year.
China Approval Opens A Lucrative Lane
The U.S. government has approved H20 GPU exports to China, paving the way for up to $5 billion in potential sales. While orders haven't been placed yet, Nvidia has inventory ready to capitalize quickly.
Networking remains a core growth lever, with attach rates near 80%, underscoring its AI dominance.
Nvidia's inventory surge is less about risk and more about muscle – an aggressive stance that signals the chip giant has no plans to slow its AI momentum.
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