Nvidia's Blackwell AI Servers Are Back In Production After Key Supply Chain Partners Like Foxconn Fix Overheating Issues: Report

Nvidia Corp.'s NVDA long-awaited Blackwell AI servers are finally shipping after supply chain partners resolved critical technical issues that had delayed production.What Happened: Suppliers, including Foxconn, also known as Hon Hai Precision Industry Co. Ltd. HNHAF, Inventec Corp, Dell Technologies Inc. DELL and Wistron Corp., have resumed shipments of Nvidia's Blackwell-powered GB200 AI racks after months of troubleshooting hardware and software challenges, the Financial Times reported, citing several people familiar with the developments.The racks, each featuring 36 Grace CPUs and 72 Blackwell GPUs, faced setbacks due to overheating, liquid cooling system leaks and complex chip synchronization issues.An engineer at one of Nvidia's partners said, "Our internal tests showed connectivity problems… the supply chain collaborated with Nvidia to solve the issues, which happened two to three months ago."Production capacity is now scaling rapidly, and the first shipments began at the end of the first quarter, according to the suppliers. Speaking at Computex last week, Nvidia's Taiwanese partners confirmed the fixes are allowing them to meet rising demand.Why It's Important: The timing is crucial for Nvidia CEO Jensen Huang, who had promised the Blackwell system would deliver massive computing power for next-generation AI models.Nvidia previously said it aims to hit $43 billion in quarterly revenue for the quarter ended in April—a record—despite a $5.5 billion hit from U.S. export restrictions to China, the report added.In February, Huang acknowledged the challenges faced by the first Blackwell chips but praised the team for their recovery efforts. He also assured investors at the time that the Blackwell Ultra remains on track for the second half of 2025.Blackwell's recovery is also pivotal for Nvidia as it seeks to maintain momentum in the booming AI infrastructure market. Major customers, including Microsoft Corp. MSFT and Meta Platforms Inc. META, are expected to drive demand.Additionally, Saudi Arabia and the UAE have also announced plans to purchase thousands of Blackwell chips during President Donald Trump's Gulf tour.Analysts anticipate that Nvidia will post first-quarter revenue of $43.54 billion, a significant increase from $26.04 billion in the same quarter last year.Price Action: Nvidia shares edged up 0.074% in after-hours trading, reaching $135.60 at the time of writing, after rising 3.21% during regular trading hours on Monday, according to Benzinga Pro.Meanwhile, NVDA earned a growth score of 98.78% from Benzinga Edge Stock Rankings, reflecting strong market momentum. Click here to see how it stacks up against other stocks. Navitas Semiconductor Soars 146% On NVIDIA Partnership For AI Power Systems Photo courtesy: Jack Hong / Shutterstock.com