H100 Profit Margin 1000%! Is NVIDIA Comparable to a "Money Printing Machine"?
A single H100 graphics card can earn approximately 200,000 yuan, and the orders are scheduled until 2024. Old Huang is going to make a fortune!
Taking a ride on the AI bandwagon, Huang Renxun is likely to make a fortune!
On Friday, according to Tae Kim, a senior contributor to Barron's, NVIDIA can earn up to 1000% profit for each H100 GPU accelerator sold.
In terms of US dollars, the market price of each high-performance computing (HPC) accelerator from NVIDIA (the cheapest PCIe version) is about $25,000 to $30,000, which is roughly 10 times the cost of $3,320 for each chip and peripheral.
Tae Kim cited data from financial consulting firm Raymond James, stating that the cost of the H100 GPU is $3,320. It is not yet clear how in-depth the cost analysis is, but it may be purely a manufacturing cost issue (taking into account the average price of each wafer and other components considering yield), so NVIDIA still needs to pay a significant amount for profit.
In addition, product development requires time and resources. Considering the engineers and other personnel involved in the product development lifecycle of H100 and similar products, NVIDIA's R&D costs must also be taken into account before arriving at the final average product development cost.
According to Glassdoor, the average annual salary of NVIDIA electronic hardware engineers is about $202,000. This is only the salary of one engineer, and chip development like H100 likely requires multiple professionals spending thousands of hours, all of which must be taken into account.
However, based solely on the production cost/price ratio, NVIDIA's H100 GPU is already a "money-making machine."
What's more important is that NVIDIA GPUs are in high demand and have quickly been snapped up by major tech giants. Currently, it seems that product orders for NVIDIA GPUs have been sold out until 2024, and it is expected that the AI accelerator market will reach a scale of around $150 billion by 2027.
As mentioned in a previous article, the orders from just four giants like Microsoft and Meta are enough for NVIDIA to achieve its sales target for this quarter. Bernstein analysts pointed out that NVIDIA is likely to generate $75 billion to $90 billion in data center and AI chip revenue by 2024.