Why NVDA Is Retreating Today

Nvidia (NVDA) stock is falling 2% after the company’s CFO, Colette Kress, late yesterday afternoon said that it “is going to take some time” for NVDA to meet the demand for its new Blackwell chip.

Additionally, Kress indicated that a meaningful number of NVDA’s customers are considering building their own chips and suggested that obtaining export licenses from the U.S. government would be “quite complex.”

Ramping Up Blackwell and Facing Competition From Customers

In an interview with a Morgan Stanley analyst yesterday, Kress said that, due to supply issues, it will “take some time” for NVDA to meet all of the demand for its new Blackwell chips. As a result, the company will likely keep selling both Blackwell and its older chips, known as Hopper, simultaneously, the CFO reported.

Asked about firms building their own chips instead of using NVDA’s offerings, Kress said that “almost all, if not every one of our customers (are) still” using NVDA’s offerings. However, she added, “Even though (the customers) may think that they” will design their own chips. The latter statement indicates that a sizeable number of NVDA’s customers are exploring the custom chip option.

The Licensing Issue Is “Complex”

Asked about obtaining export licenses from the U.S. government, the CFO said that “The timing of licensing is unclear. Do we believe possibly that the licensing would work out? It’s just quite complex to think about the globe as a total and the amount of countries” to which we export.

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Disclosure: None. This article is originally published at Insider Monkey.