According to a report by Mizuho, shipments of the GB200 NVL are on track to meet the late 2024 schedule, even though production volumes have initially been lower due to bottlenecks. Mizuho's predictions are grounded in the recent developments at King Yuan Electronics, which has announced an increase in capex in response to the growing demand for AI chips. It is anticipated that GB200 production will accelerate throughout 2024.
Mizuho's latest report indicates that recent consultations with ODMs confirm the GB200 NVL shipments are on schedule to be completed by the end of 2024. Nonetheless, the initial volume of shipments is expected to be less than projected just 2-3 months ago. This prediction stems from production data provided by KYEC, responsible for final testing services for the B200, and Amphenol, a crucial supplier of cable cartridges, which is currently experiencing a bottleneck in the mass production of the GB200 NVL.
Mizuho expects supply constraints to ease after the first quarter of 2025, with mass production of GB200 NVL36 and NVL72 accelerating sequentially in the second and third quarters of 2025. For the full year, the forecasted production volume for ODMs is approximately 25,000 NVL72 and 20,000-25,000 NVL36 server racks. This is roughly 5,000-10,000 units below the previous forecast of 40,000-45,000 NVL72 (equivalent) units for 2025. However, Mizuho anticipates that the shortfall will be compensated by GB300 NVL72 racks, expected to launch in late 2025.
With the anticipated acceleration of the GB200 shipment through 2025, KYEC is preparing for an unprecedented level of capex that year, driven by the rising demand for AI and high-performance computing chips. The company's board has allocated roughly NT$21.84 billion (approx. US$664.75 million) for the next year's capital expenses. This figure contributes to a total of NT$23.3 billion, factoring in expenditures by KYEC's subsidiaries, as reported to the Taiwan Stock Exchange.
Over 70% of KYEC's investment will focus on acquiring testing machines and related equipment, with the rest directed toward plant construction and facility upgrades. The increase in capital spending is driven by rising customer demand for AI and HPC chip testing, aiming to enhance production capacity for quick product launches.
Industry insiders note that KYEC is significantly boosting its 2025 capex to cater to the growing need for comprehensive AI product testing. The company has already seen a positive impact from the current demand for AI GPU and AI ASIC testing, involving key players like Nvidia. Sales of AI-related chips are expected to contribute 18% to company revenue in 2024.
Additionally, KYEC has secured a NT$14.0 billion syndicated loan from First Commercial Bank and other banking groups to refinance debt and support working capital. The company recorded revenue of NT$24.4 billion for the first 11 months of 2024, marking an 11.3% increase from the previous year.