NVIDIA Could Account for 37% of 2027 HBM Capacity, Worth $279 Billion

NVIDIA’s supply commitments climbed to $279 billion in the quarter ended July 26, up from $119 billion the quarter before. The company says the increase is primarily related to memory procurement. Morgan Stanley estimates that NVIDIA has claimed about 37.3% of global high-bandwidth memory (HBM) supply for 2027, with Alphabet at 36% and AMD at 12.1%. That adds up to roughly 85%, leaving everyone else to split the rest. These are Morgan Stanley’s estimates, as reported by The Inference.

About $267 billion of the commitments come due by the end of fiscal 2029, according to the filing. NVIDIA reported record revenue of $96.2 billion for the quarter, but memory costs are weighing on margins. Gross margin was 75% and is guided to 74% this quarter, with a trough of 71% to 72% expected in the January quarter. CFO Colette Kress tied that pressure to memory pricing. Operating cash flow also fell to $24.1 billion from $50.3 billion the quarter before. Jensen Huang said on September 17 that he expects NVIDIA to sell twice as many chips next year, and the company’s formal guidance is about 70% revenue growth.

HBM reportedly takes three to four times the wafer area of DDR5 per gigabyte. Rising HBM demand leads to less production capacity for DDR5, the effects of which we have seen clearly. DDR5 prices have broken records, rising nearly 500% in the last 12 months. Acer’s Jason Chen expects PC prices to rise another 5% to 20% in the fourth quarter, and thinks they could peak around…