Market Analysis

Market Analysis
Economic Calendar
Newsflash

Open Account

Nvidia’s Blackwell Ultra AI Chip Powers Future of AI Processing

Mellissa · 19 Mar1.6K Views

Image Credit: Bloomberg

Nvidia (NVDA) CEO Jensen Huang introduced the company’s next-generation Blackwell Ultra AI chip at its annual GTC event in San Jose, California, on Tuesday. Alongside the Blackwell Ultra, Nvidia unveiled its GB300 superchip, which combines two Blackwell Ultra chips with the company’s Grace central processing unit (CPU). These chips are designed to power AI systems for a wide range of clients, including tech giants like Amazon (AMZN), Google (GOOG, GOOGL), Microsoft (MSFT), Meta (META), and research labs worldwide.

The Blackwell Ultra offers 1.5 times the performance of its predecessor, Blackwell, and is expected to create a 50x increase in data center revenue potential compared to Nvidia's Hopper chip, thanks to its enhanced AI capabilities. Nvidia says that the Blackwell Ultra is built for the "age of AI reasoning," a type of AI processing that mirrors human thought processes and decision-making. This approach gained mainstream attention with models like DeepSeek's R1, OpenAI's o1, and Google's Gemini 2.0 Flash Thinking.

Nvidia counters DeepSeek’s claim that it developed its AI models using lower-end chips at a fraction of the cost by emphasizing that reasoning models benefit from high-performance GPUs, enabling faster, more accurate responses. Similar to Blackwell, the Blackwell Ultra integrates into Nvidia’s NVL72 rack server, which combines 72 GB300 superchips, boosting efficiency and serviceability.

The GB300 NVL72 can process 1,000 tokens per second using DeepSeek’s R1 model, a significant leap from the 100 tokens per second it handled with the Hopper chip. This upgrade reduces response time from 1.5 minutes to about 10 seconds. Additionally, Nvidia will offer the GB300 in its DGX SuperPod, a high-performance AI supercomputer that merges multiple NLV72 servers, featuring 288 Grace CPUs, 576 Blackwell Ultra GPUs, and 300TB of memory.

Nvidia's Blackwell chip is now in full production and has ramped up quickly, becoming the fastest in the company’s history. In its most recent quarter, Nvidia reported $11 billion in revenue from Blackwell, contributing to its $39.3 billion total revenue.

Despite the strong performance, Nvidia’s stock has been impacted by concerns that hyperscalers are overinvesting in AI without seeing adequate returns. Additionally, President Trump's proposed 25% tariff on overseas-produced semiconductors and the possibility of further export controls have added to the pressure. Nvidia’s shares are down 11% year-to-date but have gained 36% over the past 12 months.