Nvidia, the dominant force in AI chip manufacturing, is reportedly facing production cuts for its next-generation Rubin graphics-processing units (GPUs), a development that could ripple through the cryptocurrency sector heavily invested in artificial intelligence. According to a note from KeyBanc analyst John Vinh, Nvidia may have lowered its 2026 production target for Rubin GPUs to approximately 1.5 million units, down from an originally planned 2 million.
The reduction is attributed to delays in securing adequate supplies of high-bandwidth memory (HBM4) from key suppliers SK Hynix and Micron Technology. "The ramp of Nvidia's Rubin GPU has been delayed due to issues related to the qualification of HBM4 at SK Hynix and to a lesser extent Micron," Vinh wrote. Despite this, the analyst maintained an Overweight rating and a $275 price target on Nvidia shares, expecting the company to ship over 60,000 of its NV72 AI server racks this year.
Geopolitical risks are compounding these supply chain concerns. Investor attention is focused on potential disruptions linked to energy access in Asia, where a significant portion of energy supply transits the effectively blocked Strait of Hormuz. Taiwan Semiconductor Manufacturing Company (TSMC), the world's largest chipmaker and a critical Nvidia supplier, is seen as particularly vulnerable. TSMC accounts for roughly 9% of Taiwan's total electricity consumption, with natural gas as the primary source. Taiwanese authorities have indicated existing liquefied natural gas reserves should last through May.
Nvidia's financial dominance in the AI space was highlighted in its fiscal 2026 results, with revenue reaching $215.9 billion—a 65% year-over-year jump—and net income of $120.1 billion. Its Data Center segment alone brought in $193.7 billion, representing about 90% of total revenue. In contrast, rival AMD reported $34.6 billion in full-year 2025 revenue, with a record $16.6 billion from its Data Center segment. Nvidia's data center revenue is more than eleven times larger than AMD's entire data center business.
Both companies face pressure from US export controls restricting chip sales to China. Nvidia has stated it is not counting on data center chip revenue from China in its fiscal Q1 2027 guidance, and AMD felt similar pressure on its MI308 data center GPUs during 2025.
Nvidia's shares have fallen nearly 20% from their October record high, trading at approximately 20 times expected earnings. The stock decline is partly attributed to geopolitical concerns and the prospect of sustained high oil prices stoking inflation, which could lead central banks to maintain or tighten monetary policy—a scenario that disproportionately weighs on high-growth tech stocks.
