NVIDIA is poised to unveil its third-quarter financial report this Wednesday, local time, marking its inaugural financial disclosure post-inclusion in the Dow. However, media reports reveal a snag in the rollout of NVIDIA's cutting-edge Blackwell AI chip due to overheating concerns. This setback not only disrupts regular product deployment but also sparks apprehension among key clients such as Google, Meta, and Microsoft.

The prominent AI frontrunner, NVIDIA (NVDA.US), is slated to present its third-quarter financial report this Wednesday (20th). Yet, as per last Sunday's media coverage, the latest iteration of the Blackwell artificial intelligence chip grapples with severe overheating issues in configurations intended for hosting up to 72 chips in high-capacity server racks, resulting in substantial delays in chip delivery.

This predicament disrupts the smooth deployment of products and raises alarms among critical clients like Google, Meta, and Microsoft, who find themselves pressed for time in deploying and launching new data centers. In response to this challenge, NVIDIA is collaborating with leading cloud service providers and implementing multiple revisions to rack designs. The company asserts that engineering iterations are standard and anticipated.

Nevertheless, this delay could potentially impact NVIDIA's third-quarter financial report. Analysts envisage NVIDIA to achieve a revenue of $33.08 billion in Q3, an 83% year-on-year surge; adjusted net profit of $18.46 billion, an 84% year-on-year increase; and earnings per share of $0.72, a 94% year-on-year rise. NVIDIA has consistently surpassed market projections over the past seven quarters, primarily driven by robust demand for AI chips.

Despite this, supply challenges with NVIDIA's Blackwell chip may influence the performance and forward guidance for the third quarter. Morgan Stanley analyst Joseph Moore forecasts Blackwell sales in Q1 next year to range between $5 billion and $6 billion, slightly lower than a few weeks ago. He underscores that even a one-week advancement or delay can have significant repercussions due to substantial month-over-month escalations.

NVIDIA's third-quarter financial report is slated for unveiling on November 20, representing its premier report since joining the Dow. Market sentiments suggest that this report could instigate significant fluctuations in the U.S. stock market, emerging as another pivotal indicator in the American financial landscape. Following the lull in the surge prompted by the elections, investor focus may pivot back to tech stocks and AI trading.

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