Nvidia has told its largest customers to expect server price increases of more than 15%, driven by rising memory chip costs, according to Bloomberg. The increases will apply to systems shipped early next year and include configurations built around the flagship Vera Rubin and Grace Blackwell chips. Final pricing will vary by chip generation and memory configuration, with contract server builders already notifying major data center operators including Microsoft, Google and Oracle.
The pricing pressure stems from memory chipmakers Samsung, SK Hynix and Micron, which control most global DRAM production and have gained leverage as demand for AI infrastructure surges. Nvidia is particularly exposed because its AI accelerators rely heavily on DRAM capacity. The company currently holds a gross margin around 75% and charges tens of thousands of dollars per chip, while TSMC supply remains unable to keep up with demand. Nvidia has also raised prices on gaming-focused PC graphics cards, according to Tom’s Hardware.
In response, major customers continue developing in-house alternatives, although meaningful independence from Nvidia remains a long-term project. Amazon is expanding its Trainium chips, which power much of Anthropic’s AI training; Microsoft has its Maia chip; Google and Meta are developing TPU and MTIA chips respectively. Last week Google expanded its partnership with Marvell Technology to accelerate TPU production, while Cerebras, Etched and AMD are also scaling up AI chip production.
Ahead of Nvidia’s Q2 earnings this week, the stock dropped from $227 to around $214.75, retreating to the 50-period EMA and testing support at $214, the July 25 high. Wall Street expects revenue of about $92 billion, up 96% year-over-year, with Q3 guidance near $103 billion. Some analysts expect actual figures closer to $96 billion and $112 billion respectively, given Nvidia’s record of beating forecasts. Potential catalysts include a larger share buyback beyond the $80 billion already announced. Technical resistance sits at $227, while a break below $200 would invalidate the bullish outlook.
