Long Term agreements, particularly the NCNR order is a relative newcomer this cycle. Let's see how they are holding up. The Industry Structure is showing that Fabs are in charge.
Hi Doug - quick question...when you say "Nvidia, in particular, chased supply agreements much harder than their competitors, and the temporary demand slump means they won’t fulfill their contracts.", are you saying Nvidia won't fullfil those supply agreements with fabs? What about NCNR?
yes - i believe that this is what this was on their prelim announcement .
Second quarter results are expected to include approximately $1.32 billion of charges, primarily for inventory and related reserves, based on revised expectations of future demand.
Pretty much they have too much inventory in gaming, and don't need more supply so they are moving orders down. NCNRs are volume based contracts, so they will be paying break fees to TSMC I believe.
Hi Doug - quick question...when you say "Nvidia, in particular, chased supply agreements much harder than their competitors, and the temporary demand slump means they won’t fulfill their contracts.", are you saying Nvidia won't fullfil those supply agreements with fabs? What about NCNR?
yes - i believe that this is what this was on their prelim announcement .
Second quarter results are expected to include approximately $1.32 billion of charges, primarily for inventory and related reserves, based on revised expectations of future demand.
Pretty much they have too much inventory in gaming, and don't need more supply so they are moving orders down. NCNRs are volume based contracts, so they will be paying break fees to TSMC I believe.
https://nvidianews.nvidia.com/news/nvidia-announces-preliminary-financial-resultsfor-second-quarter-fiscal-2023
Got it thank you! Great writeup!!!