• Nvidia's new Blackwell AI chips are reportedly overheating in servers, causing concern among customers.
• Despite design alterations, the overheating issue persists, but Nvidia remains optimistic about resolving the problem.
• The Blackwell chip, a significant advancement in Nvidia's technology, is 30 times faster at tasks like generating chatbot responses.
• Despite the challenges, Nvidia's success in briefly overtaking Microsoft as the world's most valuable publicly traded company highlights its potential for continued growth.

Nvidia's new Blackwell AI chips are reportedly overheating in servers, causing concern among customers who fear they may not have enough time to get their new data centers up and running. The Blackwell graphics processing units, which have already faced delays, are said to overheat when connected together in server racks designed to hold up to 72 chips. This information comes from sources familiar with the issue, who have chosen to remain anonymous.

In response to these concerns, Nvidia has reportedly asked its suppliers to alter the design of their racks several times in an attempt to resolve the overheating problems. However, these efforts have so far been unsuccessful. The suppliers involved in these changes have not been named.

Despite these issues, Nvidia remains optimistic. A company spokesperson stated, Nvidia is working with leading cloud service providers as an integral part of our engineering team and process. The engineering iterations are normal and expected.

Nvidia's Technological Advancements and Challenges

The Blackwell chips were unveiled by Nvidia in March and were initially expected to ship in the second quarter. However, these plans were delayed, potentially affecting customers such as Meta Platforms, Alphabet's Google, and Microsoft.

The Blackwell chip is a significant advancement in Nvidia's technology. It combines two squares of silicon, each the size of the company's previous model, into a single component. This new component is 30 times faster at tasks such as generating responses from chatbots.

However, the overheating issue has raised serious concerns among customers. When the chips are integrated into Nvidia's customized server racks, they reportedly produce excessive heat that can result in operational inefficiencies or even hardware damage.

Nvidia's Position in the Tech Industry

In other news, Nvidia overtook Microsoft as the world's most valuable publicly traded company for one day in June 2024. This achievement highlights the company's significant growth and success in recent years.

In the broader tech industry, other companies have also faced challenges. For instance, Facebook owner Meta was recently fined over $840 million by the EU for breaching antitrust rules. The tech giant was accused of using abusive practices that benefited its online classified ads service, Facebook Marketplace.

Meanwhile, Intel won a major legal battle when the European Union 's top court ruled that EU antitrust regulators could not reinstate a €1.06bn fine against the company. This marked the end of a nearly two-decade-long case.