Core Insights - Nvidia's inventory increased by 33% last quarter to $8.7 billion, which has raised concerns among some investors, but management views this as a strategic move rather than a warning sign [1] - The surge in inventory is a calculated bet on the rising demand for Blackwell Ultra (BWU) chips, with significant shipments already made this quarter [2] - Nvidia's VP of IR and Strategic Finance highlighted that demand continues to exceed supply even two years into the AI spending boom, indicating strong market conditions [3] Inventory Strategy - BWU now constitutes nearly half of all Blackwell shipments, with higher prices expected to enhance revenue growth [3] - The next-generation Vera Rubin chips are scheduled for a late fiscal 2026 release, dispelling rumors of delays [3] - Nvidia's supply chain partners are preparing to increase rack shipments beyond the current pace of 1,000 per week, indicating a robust second half of the year [4] Market Opportunities - The U.S. government has approved H20 GPU exports to China, potentially opening up $5 billion in sales opportunities, with Nvidia ready to leverage its inventory [5] - Networking remains a key growth area for Nvidia, with attach rates close to 80%, reinforcing its leadership in the AI sector [5] - The inventory increase reflects Nvidia's aggressive strategy to maintain its momentum in the AI market rather than signaling any weakness [5]