TD Cowen held its Nvidia buy rating despite Google's rival AI chips

Despite a new chip challenge from Google and a billion-dollar contract loss hitting one of its key suppliers, Nvidia remains the dominant force in artificial intelligence hardware, with fresh deals in the UK, China, and the automotive sector reinforcing that position.

Wall Street research firm TD Cowen reaffirmed its buy rating on Nvidia this Thursday, brushing aside concerns raised by Google’s Wednesday announcement of new AI training and inference chips.

The firm said it continues to see Nvidia as “the market leader in terms of performance and breadth of software ecosystem.”

The endorsement came as Nvidia announced a string of new partnerships across multiple industries on the same day.

New deals span continents

In Britain, telecom company BT and cloud infrastructure firm Nscale announced a joint plan to build AI data centers on UK soil using Nvidia’s full-stack infrastructure.

The goal is to let organizations run AI systems securely and independently, without relying on foreign-controlled infrastructure.

Under the plan, Nscale will build up to 14 megawatts of AI data center capacity across three existing BT sites.

BT will provide the connectivity needed to handle rising compute demand. The project extends BT’s business platform to offer new AI services to both the private and public sectors.

Use cases include AI-powered analysis of sensitive healthcare data, as well as applications in energy, finance, and security.

On the automotive front, Nvidia and Chinese company Desay SV are set to jointly unveil a new intelligent driving solution at the Beijing Auto Show.

The system is built on Nvidia’s DRIVE AGX Thor computing platform and uses NVLink interconnect technology, which links two AGX Thor chips together.

The combined setup delivers a maximum computing power of 4,000 FP4 TFLOPS and is designed to tackle the technical challenges of building Level 3 and Level 4 autonomous vehicles, cars that can largely or fully drive themselves under specific conditions.

The system runs entirely on edge-side computing, meaning it does not rely on the cloud to function.

According to the companies, this approach improves real-time performance, data security, and overall reliability, making it suitable for both highway and urban driving.

Supply chain troubles mount

While Nvidia’s partnerships continue to grow, trouble is brewing in its supply chain. Shares of Super Micro Computer fell 10% on Thursday after reports surfaced that the company lost a major contract with Oracle for Nvidia’s GB300 NVL72 server racks.

A report from research firm Bluefin said Oracle canceled an order for between 300 and 400 racks, wiping out a contract worth between $1.1 billion and $1.4 billion for Super Micro.

Bluefin, citing industry sources, said the cancellation is believed to be connected to a lawsuit against Super Micro’s co-founder over the alleged smuggling of AI graphics processors to China.

Bluefin also reported that Wistron NeWeb is believed to have taken over the racking business that Super Micro lost.

At the same time, sources within the supply chain flagged concerns about a build-up of unsold B200 GPU inventory, describing the levels as “considerable.”

The accumulation is being linked to a shift in demand.

Buyers have moved away from B200 hardware toward the newer GB200 NVL72 racks, and the contracts for those were awarded to Dell and Hewlett-Packard Enterprise, not Super Micro.

The situation highlights how even the world’s most in-demand AI chips can run into complicated distribution problems.

As Nvidia pushes further into sovereign infrastructure, self-driving technology, and financial services, keeping its hardware moving through the right hands is becoming just as important as building it.

So Wall Street is betting on Nvidia’s software strength, but overlooking real cracks in its supply chain.

The buy rating assumes these problems will sort themselves out. That is not guaranteed. Unsold chips and contract shuffles signal growing pains.

The real test is whether Nvidia can get its own operations under control before rivals move in.

If you're reading this, you’re already ahead. Stay there with our newsletter.