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"Nvidia spends around $3,320 to manufacture a single H100 unit, which is then sold to end customers for a price ranging from $25,000 to $30,000." https://www.te

by mtmail 3y ago

"Nvidia spends around $3,320 to manufacture a single H100 unit, which is then sold to end customers for a price ranging from $25,000 to $30,000." https://www.techspot.com/news/99839-nvidia-garners-reported-1000-profit-each-h100-gpu.html https://www.techspot.com/news/99839-nvidia-garners-reported-... I'm sure a customer ordering 150.000 will get a discount, but how much? (150.000 x 25.000 = 3.75 billion)

marcus0x62 3y ago
Also consider that the $3,320 figure appears to be an estimate of the cost to manufacture an H100, which doesn’t encompass all of Nvidia’s COGS (R&D, warranty reserve, etc.)
freedomben 3y ago
agreed there probably is a bulk discount of some sort, but Nvidia has them by the balls because there aren't really other options, so they pressure to give good bulk discounts would be lessened a bit
- dotnet00 3y ago
  Not only are there no other options, but Nvidia can't make them fast enough, so even more reason to not really bother with significant bulk discounts.
samspenc 3y ago
This makes sense, let's say that R&D per unit is a similar amount, that would totally explain how Nvidia is able to generate insane 50%+ net profit margins (74% gross margin), higher than FAANG and unheard of for hardware companies [1][2] [1] https://nvidianews.nvidia.com/news/nvidia-announces-financial-results-for-third-quarter-fiscal-2024 [2] https://www.reddit.com/r/Infographics/comments/1825y3f/nvidias_q3_earnings_visualized/
fulafel 3y ago
It's seems fourth (at best) hand info, the source being a tweet by an analyst referencing another analyst. NV does not manufacture chips, wonder if charitably they meant that they pay this much to the manufacturer? In that case this would be their price, I guess in a way "manufacturing cost" but quite misleading since the chip manufacturer probably has big margins.

by mtmail 3y ago

marcus0x62 3y ago

Also consider that the $3,320 figure appears to be an estimate of the cost to manufacture an H100, which doesn’t encompass all of Nvidia’s COGS (R&D, warranty reserve, etc.)

freedomben 3y ago

agreed there probably is a bulk discount of some sort, but Nvidia has them by the balls because there aren't really other options, so they pressure to give good bulk discounts would be lessened a bit

dotnet00 3y ago
Not only are there no other options, but Nvidia can't make them fast enough, so even more reason to not really bother with significant bulk discounts.

samspenc 3y ago

This makes sense, let's say that R&D per unit is a similar amount, that would totally explain how Nvidia is able to generate insane 50%+ net profit margins (74% gross margin), higher than FAANG and unheard of for hardware companies [1][2] [1] https://nvidianews.nvidia.com/news/nvidia-announces-financial-results-for-third-quarter-fiscal-2024 [2] https://www.reddit.com/r/Infographics/comments/1825y3f/nvidias_q3_earnings_visualized/

fulafel 3y ago

It's seems fourth (at best) hand info, the source being a tweet by an analyst referencing another analyst. NV does not manufacture chips, wonder if charitably they meant that they pay this much to the manufacturer? In that case this would be their price, I guess in a way "manufacturing cost" but quite misleading since the chip manufacturer probably has big margins.