Core Viewpoint - The HBM (High Bandwidth Memory) market is expected to experience tight supply and demand until 2027, driven by technological iterations and AI demand, with SK Hynix and Micron leading the market due to their technological and capacity advantages [1][2]. Supply and Demand Trends - HBM supply tightness is projected to persist through 2027, with a gradual easing of oversupply expected in 2026-2027. Channel inventory is anticipated to increase by 1-2 weeks, reaching a healthy level [2]. - The delay in Samsung's HBM certification and the strong demand growth from NVIDIA's Rubin GPU are the main factors contributing to the current supply-demand tension [2]. - HBM4 supply is expected to significantly increase by 2026, accounting for 30% of total bit supply, with HBM4 and HBM4E combined expected to exceed 70% by 2027 [2]. Demand Drivers - HBM bit demand is forecasted to accelerate again in 2027, primarily driven by the Vera Rubin GPU and AMD MI400 [3]. - From 2024 to 2027, the CAGR for bit demand from ASICs, NVIDIA, and AMD is projected to exceed 50%, with NVIDIA expected to dominate demand growth [3]. - Sovereign AI demand is emerging as a key structural driver, with various countries investing heavily in national AI infrastructure to ensure data sovereignty and security [3]. Pricing and Cost Structure - Recent discussions around HBM pricing are influenced by Samsung's aggressive pricing strategy to capture market share in HBM3E and HBM4 [4]. - HBM4 is expected to have a price premium of 30-40% over HBM3E12Hi to compensate for higher costs, with logic chip costs being a significant factor [4]. Market Landscape - SK Hynix is expected to lead the HBM market, while Micron is likely to gain market share due to its capacity expansion efforts in Taiwan and Singapore [5]. - Micron's HBM revenue grew by 50% quarter-over-quarter, with a revenue run rate of $1.5 billion, indicating a stronger revenue-capacity conversion trend compared to Samsung [6]. Industry Impact - HBM is driving the DRAM industry into a five-year upcycle, with HBM expected to account for 19% of DRAM revenue in 2024 and 56% by 2030 [7]. - The average selling price (ASP) of DRAM is projected to grow at a CAGR of 3% from 2025 to 2030, primarily driven by the increasing sales proportion of HBM [7]. - Capital expenditures for HBM are expected to continue growing, as memory manufacturers focus on expanding capacity to meet rising HBM demand [7].

Core Viewpoint - HSBC's report indicates that NVIDIA is losing its pricing power over GPUs, leading to a downgrade of its stock rating from "Buy" to "Hold" and a price target reduction from $175 to $120 [1][2]. Group 1: Pricing Trends - The average selling price (ASP) of NVIDIA's B200 and B300 Blackwell AI GPUs has not shown significant growth, raising concerns about demand for these products [2]. - The lack of substantial price increases for the B200 and B300 GPUs, as well as the GB200 and GB300 NVL72 server racks, suggests limited upgrades in GPU specifications [2]. Group 2: Market Performance - NVIDIA's stock has declined by 24% year-to-date, with a further drop of 4.9% on the day of the report's release, attributed to recent tariffs imposed by the Trump administration affecting the U.S. and global markets [1][2]. Group 3: Company Response - NVIDIA's CEO Jensen Huang defended the pricing of the company's GPUs, emphasizing their efficiency and the complexity of manufacturing as reasons for their high costs [3]. - The company is collaborating with TSMC and Foxconn to manufacture GPUs domestically in the U.S., while also lobbying the government to lift restrictions on AI GPU sales to most countries [3].

Core Insights - The GTC event highlighted NVIDIA's advancements in AI and GPU technology, particularly the introduction of the Blackwell architecture and its Ultra variant, which promises significant performance improvements over previous models [1][3][5] - NVIDIA's CEO, Jensen Huang, emphasized the rapid evolution of AI technology and the increasing demand for high-performance computing in data centers, projecting that capital expenditures in this sector could exceed $1 trillion by 2028 [1][42][43] Blackwell Architecture - NVIDIA has announced that the four major cloud providers have purchased 3.6 million Blackwell chips this year, indicating strong demand [1] - The Blackwell Ultra platform features up to 288 GB of HBM3e memory and offers 1.5 times the FP4 computing power compared to the previous H100 architecture, significantly enhancing AI inference speed [3][4][5] - The Blackwell Ultra GPU (GB300) is designed to meet the needs of extended inference time, providing 20 petaflops of AI performance with increased memory capacity [3][4] Future Developments - NVIDIA plans to launch the Vera Rubin architecture in 2026, which will include a custom CPU and GPU, promising substantial performance improvements in AI training and inference [7][8][11] - The Rubin Ultra, set for release in 2027, will feature a configuration capable of delivering 15 exaflops of FP4 inference performance, significantly surpassing the capabilities of the Blackwell Ultra [12][81] Networking Innovations - NVIDIA is advancing its networking capabilities with the introduction of co-packaged optics (CPO) technology, which aims to reduce power consumption and improve efficiency in data center networks [14][17][21] - The Quantum-X and Spectrum-X switches, expected to launch in 2025 and 2026 respectively, will utilize CPO to enhance bandwidth and reduce operational costs in AI clusters [89][90] Market Context - Major companies like OpenAI and Meta are investing heavily in NVIDIA's technology, with OpenAI reportedly spending $100 billion on infrastructure that could house up to 400,000 NVIDIA AI chips [30] - Despite the technological advancements, NVIDIA's stock has faced volatility, with a notable decline following the GTC event, raising questions about the sustainability of its market dominance [31][32]

Core Viewpoint - Nvidia's stock has faced significant pressure following a disappointing quarterly forecast, leading to a decline of over 8% and raising concerns about the broader tech sector's performance, particularly among the "Magnificent Seven" stocks [2][3]. Financial Performance - Nvidia's first-quarter revenue forecast is better than market expectations, with an anticipated revenue increase of approximately 65%, although this is a slowdown compared to the previous year's triple-digit growth [3][4]. - The company's revenue for the previous quarter was reported at $39.33 billion, exceeding expectations by 3.4% and showing over 7% growth year-on-year [6]. - Nvidia's CEO highlighted that the demand for the new Blackwell chips is "astonishing," yet the overall growth is decelerating [3][7]. Market Sentiment - Analysts express a cautious outlook on Nvidia, with concerns that the company's performance and guidance are not sufficient to reignite investor confidence and drive stock prices higher [4][5]. - Despite the challenges, Nvidia is still viewed as a bellwether for AI spending health, with its stock price reflecting a lower price-to-earnings ratio of approximately 29 times expected earnings, down from over 80 times two years ago [8]. Product Development - Nvidia is on track to release the Blackwell Ultra GPU later this year, which is expected to provide significant performance improvements, with unofficial reports suggesting a performance boost of around 50% compared to the previous B200 series [10][11]. - The upcoming Rubin architecture is anticipated to enhance AI computing capabilities, with the first generation of Rubin GPUs expected to feature up to 288GB of HBM4E memory by 2026 [11][12]. - Nvidia plans to discuss the Rubin architecture and its subsequent products at the upcoming GPU Technology Conference (GTC) [11].